Summary of Key Points
In the second quarter of 2026, the global MLCC (Multilayer Ceramic Capacitor) industry, which consists of small components used for storing electricity in electronic devices, showed a significant recovery in momentum: all six leading manufacturers experienced year-on-year growth in revenue, with profit growth outpacing revenue growth. The increase was mainly driven by demand from AI servers and the automotive sector, although the sources of growth varied among companies. Indicators such as orders and delivery times indicate strong demand, but the demand for consumer electronics has not fully recovered yet. Whether the current market trend can continue depends on several key factors.
Q2 Performance: Both Revenue and Profit Increased, with Profit Growth Outpacing Revenue
The six leading MLCC manufacturers (Murata, Samsung Electro-Mechanics, NGK, TDK, Kyocera, and Taiyo Yuden) all saw revenue growth in the second quarter. TDK and NGK had the highest increases (over 30%), while Samsung and Murata grew by around 20%, and Taiyo Yuden and Kyocera grew by about 10%.
Profit figures were even more impressive: the growth rate of operating profit (the main source of earnings) exceeded 50%, significantly higher than revenue growth (for example, Kyocera's operating profit increased by 164.7%). Net profit attributable to shareholders also increased for all companies, with Samsung Electro-Mechanics seeing a rise of 143%, and Taiyo Yuden even turning from loss to profit.
Why did profit grow faster than revenue? The main reasons include higher capacity utilization (factories operating at full capacity to reduce costs), the depreciation of the Japanese yen (increasing earnings from exports when converted into local currency), and an optimization of the product portfolio (focusing on high-profit AI-related products).
Different Growth Drivers for Each Company
Although all companies experienced growth, the drivers varied:
- Murata and Taiyo Yuden: Directly Benefiting from MLCC Demand
These two companies have a large proportion of their business in MLCCs (51% and 70%, respectively), so strong sales of MLCCs directly contributed to their performance. For instance, Murata's MLCC revenue increased by 30% due to high demand from AI servers and the automotive sector. Taiyo Yuden also raised its annual forecast for MLCC sales, as AI servers require more of these components.
- Samsung Electro-Mechanics: Dual Drivers from MLCCs and Packaging
MLCCs were a major contributor (with revenue growth of 29%), and the packaging business (which provides substrates for AI chips) also grew by 37% due to the increased demand for substrates in AI accelerators and server CPUs.
- TDK and Kyocera: Not Fully Relying on MLCCs
TDK's energy products (such as batteries) accounted for 54% of its revenue, which was the main source of growth; the passive components business (including MLCCs) only grew by 28%. Kyocera's electronic components business grew by 23.6% due to demand for MLCCs and tantalum capacitors in AI applications. Profit improvement was also aided by real estate sales and reduced losses from the previous year.
- NGK: A Balanced Approach with Multiple Drivers
AI-related businesses accounted for 16% of NGK's revenue, with tantalum capacitor sales increasing by 44%. MLCCs and resistors also performed well. Demand in industrial, automotive, and consumer markets was strong, resulting in a gross margin of 38.5%, the highest in the industry.
Key Indicators Reveal Market Trends
Revenue and profit figures alone are not sufficient to predict future trends; these additional indicators provide insights:
- B/B Ratio (Orders/Shipments): All companies have a ratio above 1, indicating more orders than shipments
Murata's B/B ratio increased from 1.24 to 1.34, and NGK's even reached 2.2 (meaning orders are more than twice the amount shipped). Taiyo Yuden's capacitor B/B ratio was 1.72. However, it's important to note that some customers may be stocking up in anticipation of shortages, so these figures do not necessarily reflect actual demand.
- Extended Delivery Times
Delivery times for certain high-capacity MLCCs have increased to 20-52 weeks (4-12 months). For example, the 0805 specification 10μF capacitors used to be available in a few weeks but now require more than half a year, indicating a real shortage of these products.
- Inventory Levels
Manufacturers from Japan and South Korea have shifted production capacity from consumer-grade to high-end MLCCs for AI applications, leading to inventory levels of less than 30 days for consumer-grade medium and high-capacity MLCCs (the normal range is 1-3 months). As a result, spot market prices have risen significantly. However, Murata has increased its inventory for the peak mobile phone season, indicating that overall demand in the consumer electronics sector remains weak.
The Future of the Market
The Q2 data confirms strengthening demand, but the future is uncertain:
1. Can the B/B Ratio Be Maintained?
If orders decrease in the coming period and the B/B ratio falls, it may indicate a slowdown in demand.
2. Will Long-Term Contracts Be Fulfilled?
Some customers have signed long-term supply agreements, but whether they will actually place orders is still uncertain.
3. Can Consumer Electronics Recover?
The market is currently supported by AI and the automotive sector. If consumer electronics (such as phones and computers) see a demand surge, the market trend will be more stable; otherwise, growth may be limited.
In summary, the MLCC industry is experiencing localized growth driven by high-end products in AI and automotive applications, but consumer electronics have not fully recovered. The future direction depends on the balance between these two sectors. For those interested in this industry, monitoring changes in the B/B ratios of leading manufacturers and sales data for consumer electronics can be helpful.