👩🍳 How we use AI at Tech in Asia, thoughtfully and responsibly.
🧔♂️ A friendly human may check it before it goes live. More news here
🧔♂️ A friendly human may check it before it goes live. More news here
Samsung Electro-Mechanics bets $1.2b on Vietnam AI chips
Samsung Electro-Mechanics to invest 1.8 trillion won (US$1.21 billion), in Vietnam to expand output of FC-BGA semiconductor substrates used in AI servers and other high-performance chips.
FC-BGA connects chips to substrates and helps improve data transfer and heat control, and the company has produced the product in Vietnam since 2024.
The new investment matches the US$1.2 billion Samsung Electro-Mechanics put into its Vietnam unit when it was set up in 2013.
Samsung Electro-Mechanics said demand for server and data center FC-BGA is more than 50% above current production capacity and that the company is adding investment and expanding some factories.
🔗 Source: Chosun Daily
🧠 Food for thought
Implications, context, and why it matters.
Vietnam investment is one piece of a global strategy to capitalize on a component shortage
- Samsung Electro-Mechanics’ president said demand for FC-BGA substrates used in AI servers and data centers runs more than 50% above current production capacity 1.
- Tight supply lets the company lift prices on some FC-BGA products. Mirae Asset Securities, a South Korean financial services firm, raised its FC-BGA price estimates by about 10% 1.
- The new spending targets Vietnam. Samsung Electro-Mechanics is also expanding plants in Busan and Sejong, South Korea 1.
- Kyobo Securities, a South Korean brokerage, raised its target stock price and expects operating profit to double within two years 1.
Today’s substrate profits are funding tomorrow’s next-generation chip packaging
- While it grows FC-BGA output, Samsung Electro-Mechanics is developing glass substrates that can improve performance for larger AI chips 2.
- Industry sources say Samsung Electro-Mechanics is supplying early glass substrate samples to potential customers including Apple and Broadcom, a US chip designer 2.
- Mass production of glass substrates is targeted for after 2027. Strong demand for current products helps pay for the shift and could shape product plans at large tech companies 2.
