Japanese passive component giant Murata Manufacturing is considering further investment to expand its production capacity for multilayer ceramic capacitors (MLCCs) in response to the surging demand driven by AI servers.
According to a Bloomberg report, Murata President Norio Nakajima stated in an interview on the 13th that the company is actively securing material supplies and engaging in discussions with suppliers and other relevant industry partners. He noted that Murata plans to announce specific figures for additional investment when it releases its financial results on October 30.
“Demand related to AI continues to climb; the market demand is truly very strong,” Nakajima said. “We must verify whether all our suppliers can keep pace with this rate of growth.”
In April of this year, Murata announced an 80 billion yen (approximately $505 million) investment over the next two years to increase its MLCC production capacity by 10% to 15%. This investment is in addition to the company’s typical annual capital expenditure increase of about 10%, and the new round of investment currently under consideration would be even larger in scale.
While Nakajima had expressed reservations in late July regarding the sustainability of investments in AI data centers, he noted that market demand has since climbed even further—to the point where the company is now sometimes forced to decline customer orders.
Capacitors are essential components in all electronic products, primarily used to maintain a stable power supply. Murata’s MLCCs are highly favored in the market for their exceptional reliability.
Nakajima indicated that Murata’s existing expansion plans are far from sufficient to meet current market demand.
He pointed out that while additional investment is something the company “must do,” its actual implementation is another matter—with the adequacy of material supplies serving as a key factor.
Nakajima noted that Murata’s book-to-bill ratio—the ratio of orders received to the value of goods shipped—has remained at a high level, near 1.5. As of the end of June, this ratio reached 1.47, marking an all-time high for the company.