Samsung Electro-Mechanics has entered into a strategic partnership with global artificial intelligence (AI) semiconductor company NVIDIA, signing a long-term supply agreement for semiconductor package substrates starting this year.
On October 21, Samsung Electro-Mechanics announced in a statement that it has formed a strategic business partnership with NVIDIA to strengthen the global AI semiconductor supply chain and accelerate the expansion of next-generation AI infrastructure. According to the announcement, the two companies will jointly invest to expand new factories for the production of AI semiconductor package substrates. Samsung Electro-Mechanics plans to supply NVIDIA with these substrates for AI semiconductors over several years starting in 2026.
This partnership will enable NVIDIA to secure a stable supply chain for cutting-edge substrates essential for mass production of AI semiconductors, addressing bottlenecks in the global AI infrastructure supply chain. Meanwhile, Samsung Electro-Mechanics aims to solidify its dominance in the high-value AI semiconductor package substrate market, which has the highest technological entry barriers.
Jensen Huang, CEO of NVIDIA, stated, "We are undertaking the largest infrastructure build-out in human history. The demand is enormous, but production capacity is a limiting factor." He emphasized the significance of this collaboration, noting, "Our supply chain partners are the world's top manufacturers."
To ensure timely supply of semiconductor package substrates, Samsung Electro-Mechanics will establish dedicated production lines at its key manufacturing sites in Sejong and Busan. The supply will include substrates for NVIDIA's computing chipsets and package substrates for networks (switches) responsible for ultra-fast connections between chips in data centers, with deliveries commencing in 2026.
As a result, starting this year, the volume of package substrates supplied to NVIDIA from Samsung Electro-Mechanics is expected to grow at an average double-digit rate annually. By 2028, this is projected to account for a significant portion of Samsung Electro-Mechanics' total annual production capacity for package substrates.
As the area of package substrates increases and the number of layers rises, maintaining flatness to prevent warpage due to thermal deformation and implementing ultra-fine circuits to minimize signal loss become critical for yield assurance.
In particular, to control the massive power noise generated during ultra-fast processing and maximize power efficiency, advanced manufacturing processes will be applied, including embedding passive components such as MLCCs (multi-layer ceramic capacitors) and silicon capacitors directly within the substrates. Samsung Electro-Mechanics possesses unique micro-processing technology that meets the stringent specifications of next-generation substrates, along with world-class capabilities in MLCC and silicon capacitor technology.
Jang Deok-hyun, President of Samsung Electro-Mechanics, expressed, "We are honored to join NVIDIA as a key infrastructure partner driving global AI innovation. By combining our advanced FC-BGA manufacturing competitiveness with our unique high-reliability MLCC technology, we will fulfill our role as a total solution provider to ensure NVIDIA's AI platform is delivered to the market with the highest performance and quality."
Deborah Shoquist, NVIDIA's Vice President of Operations, stated, "To respond to the speed of AI infrastructure development, we need to expand production capacity on a global scale. Our collaboration with Samsung Electro-Mechanics has broadened our substrate supply partner network and secured additional production capacity. This will allow us to scale up production and supply the accelerated computing platforms that our customers need."
* This article has been translated by AI.
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