Lotte Energy Materials has entered the market for ultra-thin copper foil used in artificial intelligence (AI) data centers and is considering a third capacity expansion based on binding customer agreements.

The company disclosed its third-phase expansion strategy on Aug. 6, centered on ultra-thin copper foil products. Ultra-thin copper foil, measuring between 1 and 3 micrometers in thickness, is a next-generation circuit material used in AI data center optical transceivers and semiconductor packaging applications. The product is significantly more difficult to manufacture than conventional circuit foil due to its extremely thin profile.

Lotte Energy Materials currently supplies reverse-treated foil (RTF) and high-voltage low-profile (HVLP) copper foil for AI data center optical transceivers. The materials are used in the inner and outer layers of transceiver substrates. RTF products range from 12 to 70 micrometers in thickness, while HVLP products range from 12 to 35 micrometers.

The company plans to expand its portfolio into the thinner ultra-thin copper foil segment to target the rapidly growing optical transceiver market.

The ultra-thin copper foil market is currently dominated by Japan’s Mitsui Chemicals. However, rising investment in AI data centers has created an opportunity for new entrants. Demand for ultra-thin copper foil has surged as optical networking transitions toward 800G and 1.6T architectures. At the same time, North American customers have increasingly sought non-Chinese supply chains. Lotte Energy Materials is currently the only company operating a circuit foil production base in South Korea.

The company emphasized that any third-phase expansion will depend on securing binding agreements with customers. Future investment decisions will be based on confirmed demand commitments rather than speculative capacity additions.

“Customer demand for additional expansion is strong, and we are reviewing a third expansion phase either at available space within our domestic facilities or at a new site,” the company said. “The project will proceed once binding customer contracts are signed and economic feasibility is secured.”

Lotte Energy Materials added that it plans to determine the timing and scale of investment through discussions with customers and is already conducting preliminary preparations, including concept design work, due to strong demand from key clients.

The broader circuit foil business is also shifting toward AI-related applications. Demand has expanded beyond traditional IT products into high-end copper foil for AI accelerators, network switches and optical transceivers.

High-value-added HVLP products currently account for roughly 20% of circuit foil sales. Following completion of the second expansion phase next year, the proportion is expected to exceed 50%. Some production lines dedicated to AI-focused HVLP products are already being operated exclusively for specific customers.

The company began mass production earlier this year of HVLP 1 and HVLP 2 products used in AI networking equipment supplied to Nvidia systems. Production yields have reached approximately 60%, and commercial shipments began in the second quarter after customer qualification procedures were completed.

Production capacity for HVLP 3 and HVLP 4 products designed for Nvidia’s next-generation Rubin platform was secured through the first expansion phase completed in May. Initial mass production began in the second quarter, and related revenue is expected to increase in the second half as Rubin shipments expand.

Lotte Energy Materials completed its first expansion phase in May, increasing annual circuit foil production capacity from 3,700 metric tons to 6,700 metric tons.

The second expansion phase, currently under construction, will add annual capacity of 16,000 metric tons. Major equipment contracts have been finalized and manufacturing has begun. The company plans to accelerate equipment delivery schedules and start operating part of the new production lines in the second quarter of 2027, ahead of the original timetable, with full operations beginning in the fourth quarter.

The company also reported second-quarter consolidated revenue of 286.4 billion won and an operating loss of 9.2 billion won. Despite higher copper foil sales volumes and increased revenue from AI-focused high-end products, earnings remained in the red due to initial expansion costs and production stabilization expenses.

“Both pricing and demand are entering a more stable phase,” Chief Executive Officer Kim Yeon-seop said. “We believe a turnaround is only a matter of time and can be achieved in the near future.”

CMTX said through its shareholder communication platform that it has no plans to issue convertible bonds (CBs) or bonds with warrants (BWs), dismissing concerns raised after its recent extraordinary general meeting.

The company said amendments approved at the extraordinary shareholders’ meeting held on July 22 included the introduction of an independent director system in line with revisions to Korea’s Commercial Act, as well as an increase in the issuance limits for CBs and BWs. “We currently have no plans to issue CBs or BWs,” CMTX said.

Following shareholder approval, CMTX increased the issuance limit for both CBs and BWs to 50 billion won each from 10 billion won previously. The company said the move was intended as a preparatory measure to provide flexibility for future mergers and acquisitions (M&A) and strategic investment opportunities. It added that it currently holds approximately 90 billion won in cash and cash equivalents and has secured 100 billion won in available credit facilities from financial institutions, making external fundraising unnecessary at this time.

CMTX said that if it had been planning a large-scale issuance of CBs or BWs in the near future, it would have raised the limits by a substantially larger amount. The company described the amendments as a minimum-level revision designed to address potential future needs. It also emphasized that any future financing decisions would be made with the goal of minimizing dilution for existing shareholders.

The company also revised its articles of incorporation to reflect changes to the Commercial Act, including replacing outside directors with independent directors and increasing the required proportion of independent directors from at least one-quarter of the board to at least one-third.

Through its recently launched shareholder communication forum, CMTX said it plans to continue sharing key management information, including earnings analysis, investment and capacity expansion progress, new customer acquisition, and shareholder return policies.

HanWool Semiconductor on Aug. 6 unveiled its strategy for AI-based multilayer ceramic capacitor (MLCC) back-end manufacturing equipment, highlighting an ultrasound inspection system and a second-generation mounter capable of conducting high-speed, full-scale inspection of internal defects.

The company aims to expand its presence in automotive electronics and AI server markets by transforming MLCC inspection methods. As demand grows for high-reliability MLCCs, inspection requirements are extending beyond external appearance to internal structures and evolving from sample-based checks to high-speed, 100% inspection.

HanWool is developing an “AI-based ultrasound full inspection system” capable of non-destructively detecting microscopic cracks, delamination and voids inside MLCCs. The system combines AI-driven judgment technology with ultrasound signal analysis to overcome the limitations of conventional sample inspections while improving both inspection speed and reliability.

A key element of the strategy is the company’s proprietary deep-learning inspection platform, HaWAIe. The platform is designed to detect defects such as microcracks, chipping, electrode failures and foreign materials that are difficult to identify through visual inspection or rule-based algorithms. HanWool plans to expand its use beyond visual inspection equipment to ultrasound inspection systems and process automation equipment.

The company is also developing a second-generation mounter designed for high-value-added MLCC production. HanWool said the new system will improve production yield and throughput by more than 30% compared with existing equipment while supporting ultra-small MLCC products.

“The MLCC inspection market is rapidly evolving from simple visual inspection toward high-speed full inspection capable of identifying internal defects,” a HanWool Semiconductor official said. “Through commercialization of our AI ultrasound inspection system and second-generation mounter, we aim to secure a leading position in the market for high-value MLCC manufacturing equipment.”

Simmtech reported a sharp increase in second-quarter earnings as sales of package substrates for artificial intelligence semiconductors continued to expand.

The company disclosed on Aug. 5 that it recorded consolidated revenue of 514.6 billion won and operating profit of 62.9 billion won for the second quarter.

Compared with the same period last year, revenue increased 51.0% while operating profit surged 1,034.4%, more than elevenfold. On a sequential basis, revenue rose 21.8% and operating profit increased 358.7%.

For the first half of 2026, Simmtech posted cumulative revenue of 936.9 billion won and operating profit of 76.6 billion won.

The company's operating margin reached 12.2% in the second quarter, up 10.6 percentage points from a year earlier and 9.0 percentage points from the previous quarter.

Net profit totaled 44.9 billion won, compared with a net loss in the year-earlier period, marking a return to profitability.

Simmtech expects growth to continue in the second half of the year.

In a separate disclosure, the company forecast second-half consolidated revenue of 1.0719 trillion won and operating profit of 163.1 billion won. The projected operating profit exceeds the company's first-half operating profit by more than two times.

The company said demand for system IC package substrates is expected to remain strong, while sales of products for SOCAMM are set to expand in earnest.

As a result, the proportion of high-value-added products used in AI applications is expected to increase further during the second half of the year.

Taiwan-based GlobalWafers has formally acknowledged growing supply shortages in the silicon wafer market, signaling a potential shift toward higher wafer prices as demand from artificial intelligence and advanced semiconductor applications accelerates.

During its second-quarter earnings conference call on Aug. 4, GlobalWafers said supply-demand imbalances are already emerging across the semiconductor wafer industry.

"The supply-demand imbalance in the wafer industry is already underway," the company said. "Our 12-inch (300mm), 8-inch (200mm) and 6-inch (150mm) production lines are effectively operating at full utilization, and supply constraints have already appeared for certain advanced 12-inch products."

The company attributed the tightening market to rapidly growing demand from AI semiconductors, high-bandwidth memory (HBM), silicon photonics and advanced packaging technologies.

GlobalWafers said both memory and logic chip manufacturers are increasingly seeking to secure long-term production capacity, turning potential shortages into a reality.

Similar trends are emerging across the broader wafer industry.

German wafer supplier Siltronic said during its earnings announcement on July 30 that inventory levels at memory and logic customers have normalized and customers have begun rebuilding safety stock inventories.

The company added that inventory replenishment is expected to further increase wafer demand and that requests for 300mm wafers are coming not only from existing customers but also from new ones.

Industry leader Shin-Etsu Chemical reported on July 24 that shipments of 300mm wafers increased by double-digit percentages both year over year and sequentially.

Japanese wafer manufacturer SUMCO also indicated in May that customer inventory adjustments were approaching completion.

South Korea's SK Siltron has been expanding production capacity through the phased startup of new facilities, but industry sources said demand growth is outpacing those additions.

The structure of long-term agreements (LTAs) is also changing.

Historically, LTAs were primarily designed to ensure stable wafer supplies for customers. Increasingly, however, they are being used as tools to secure future manufacturing capacity in anticipation of supply shortages.

Contract durations are also lengthening, with agreements increasingly extending from the traditional three-year range to five to eight years.

Last month, GlobalWafers signed a 10-year LTA with Micron, one of the longest agreements in the wafer industry's history. The contract, which begins next year, includes strategic financial support in the form of upfront payments.

The company said most of its revenue in the second half of this year and the first half of next year is expected to come from LTAs.

Shin-Etsu Chemical has stated that all of its 300mm wafer shipments are currently supplied under LTAs. Siltronic said roughly two-thirds of its shipments are sold through similar agreements.

Some memory customers are already requesting supply allocations for two to three years into the future.

Signs of pricing pressure are also emerging.

As supply tightens, prices in the spot market have started rising ahead of contract prices.

Siltronic said prices for non-LTA 300mm wafers have begun increasing, while GlobalWafers expects spot prices in the second half of 2026 to be higher than in the first half.

The industry expects price increases to eventually spread to long-term contracts as well.

GlobalWafers said it is discussing price increases with customers to reflect higher costs for raw materials, energy, logistics and labor.

"Existing LTAs will maintain their contracted prices, but future agreements will incorporate pricing mechanisms that reflect market conditions, product mix changes and industry developments," the company said.

Siltronic echoed the view, stating that prices must recover to levels that justify reinvestment as some LTAs come up for renegotiation in 2027 and 2028.

"We need broad and meaningful price increases," the company said.

The wafer industry has spent the past two years coping with shipment declines and pricing pressure after customer inventories surged beginning in 2023.

That trend began to reverse in late 2025 as inventories of 300mm wafers declined and inventory coverage levels fell further during the first quarter of this year, signaling the end of the industry's inventory correction cycle.

Many suppliers now view the second quarter of 2026 as the beginning of a new upcycle.

Industry participants expect supply shortages and price increases to become more pronounced from the second half of 2027.

Current shipment growth is being supported by higher utilization rates at existing semiconductor fabs. However, once new memory facilities being built by Samsung Electronics, SK hynix and Micron begin production, wafer demand could roughly double from current levels.

Daeduck Electronics reported record quarterly results as demand for semiconductor substrates used in artificial intelligence (AI) servers and data centers continued to expand. Operating profit surged 3,599% from a year earlier.

The company said on July 31 that it posted consolidated revenue of 401.0 billion won and operating profit of 70.3 billion won for the second quarter of 2026. Revenue increased 63% year over year, while operating profit jumped 3,599%. Compared with the previous quarter, revenue rose 16% and operating profit increased 37%.

Operating margin reached 17.5%, up 2.7 percentage points from 14.8% in the first quarter.

Growth was driven by higher sales of high-value semiconductor substrates for AI and data center applications.

"Performance continued to improve on the back of growing demand for high-performance semiconductors in AI and data center markets and strengthened business competitiveness," the company said.

Revenue from the company's core package substrate (PKG) business reached 343.5 billion won, up 65% from a year earlier and 18% from the previous quarter. Demand increased for controllers, optical modules and networking products used in AI data centers. Sales of automotive radar and advanced driver assistance system (ADAS) products also expanded. Improved product mix, higher productivity and favorable foreign exchange rates contributed to profitability.

Revenue from the multilayer board (MLB) business totaled 57.5 billion won, rising 53% year over year and 4% sequentially. The company began mass production of next-generation AI products and saw increased sales for semiconductor inspection equipment and electronic design automation (EDA) applications. Demand for high-margin products in aerospace and defense markets also remained stable.

The company's revenue mix continued to shift toward AI-related products. Flip-chip ball grid array (FC-BGA) substrates accounted for 26% of revenue, up from 23% in the previous quarter. Flip-chip chip-scale package (FC-CSP) products represented 48% of revenue, compared with 46% in the prior quarter, reflecting stronger sales of high-value products for AI servers and data centers.

By contrast, the share of memory-related chip-scale package (CSP) products—including NAND flash, low-power DRAM (LPDDR5), SOCAMM and Compute Express Link (CXL) products—declined to 23% from 25%.

Daeduck Electronics expects growth to continue in the third quarter. The company plans to expand mass production of large-area substrates for AI data centers and accelerate new product development. It also aims to address growing demand for high-performance networking products and physical AI-related applications.

SK hynix said it was unable to disclose additional shareholder return plans because of restrictions related to its American depositary receipt (ADR) offering and US securities regulations. The company expects to provide more specific details after the ADR process is completed in early August.

During the company's second-quarter earnings conference call on July 29, Song Hyun-jong, president of SK hynix's Corporate Center, said regulatory requirements tied to the ADR offering limited the company's ability to disclose new material information.

"Due to regulations and procedures related to the ADR offering, there are restrictions on providing additional material information that was not disclosed during the offering process," Song said. "We are reviewing various shareholder return options and will share specific plans with the market once they are finalized."

The restrictions are understood to stem from communication rules under Section 5 of the US Securities Act of 1933, which limit communications that could be interpreted as an offer to investors during a registered securities offering.

The US Securities and Exchange Commission (SEC) broadly interprets communications that could stimulate public interest in an issuer or its securities as potential offers. Violations of these restrictions are commonly referred to as "gun jumping."

The term originates from track-and-field competitions, where an athlete starts running before the starting gun is fired. In securities markets, it refers to the disclosure of new material information not included in an offering prospectus before the registration process is completed, potentially influencing investor decisions or market sentiment.

Because shareholder return measures such as share buybacks or special dividends could affect investment decisions, SK hynix was limited in what it could disclose while the registered offering remained in progress.

The company is expected to provide more detailed shareholder return plans after the ADR-related procedures conclude in early August.

Under Rule 174 of US securities regulations, prospectus delivery requirements remain in effect for up to 25 days after a newly registered public offering. During that period, investors must continue to receive offering-related information while post-offering procedures are completed.

An SK hynix spokesperson said the company expects to announce more specific shareholder return measures once the ADR process is finalized. The remaining post-offering procedures are expected to be completed on August 4.

SK hynix reported record quarterly results in the second quarter, posting revenue of 79.3187 trillion won and operating profit of 60.5426 trillion won. Despite the strong earnings, the company's share price fell nearly 10% on the day of the announcement, as investors were disappointed by the absence of additional shareholder return plans.

At the company's annual shareholders meeting earlier this year, Kwak Noh-jung, president of SK hynix, said the company aims to strengthen its financial position by building net cash to 100 trillion won over the long term while continuing to consider dividends and share repurchases.

As of the end of June, SK hynix held 69.37 trillion won in net cash, up from 35.01 trillion won at the end of March. The company is expected to reach 100 trillion won in net cash by the end of the third quarter.

SK Group Chairman Chey Tae-won has made his first-ever direct open-market purchase of SK hynix shares, a move interpreted as a display of his commitment to responsible management following the company's record quarterly earnings.

According to a regulatory filing on DART, the Financial Supervisory Service's electronic disclosure system, Chey purchased 3,620 common shares of SK hynix on the open market on July 30. Based on the stock's closing price of 1,322,000 won that day, the purchase was valued at approximately 4.79 billion won.

The transaction increased Chey's direct ownership of SK hynix shares from zero to 3,620 shares. Total holdings by the company's largest shareholder and related parties increased from 146,124,531 shares to 146,128,151 shares, while the ownership stake remained unchanged at 20.00%.

The purchase marks the first time Chey has directly acquired SK hynix shares in the open market. The move is seen as a display of responsible management, reflecting confidence in the company's mid- to long-term growth potential and corporate value amid the recent decline in the share price.

SK hynix reported record quarterly results on July 29, posting revenue of 79.3187 trillion won and operating profit of 60.5426 trillion won for the second quarter, both all-time highs on a quarterly basis. After the announcement, however, the shares weakened as profit-taking coincided with a correction in the South Korean stock market.

The purchase has also drawn attention because it came after the Seoul High Court, in a remanded case on July 24, ordered Chey to pay 944 billion won in property division to Roh Soh-yeong, director of Art Center Nabi. Analysts said the move demonstrates Chey's willingness to invest in a key group affiliate despite the substantial financial burden from the ruling.

SK Group Chairman Chey Tae-won must pay 944 billion won in property division to Roh Soh-yeong, director of Art Center Nabi, a South Korean court ruled in a remanded divorce case. The ruling included Chey's holdings in SK Inc. as part of the assets subject to division. The amount was about 400 billion won less than the 1.3808 trillion won awarded by the appellate court, but far higher than the 66.5 billion won ordered by the first-instance court.

The Seoul High Court's Family Division 1, presided over by Judge Lee Sang-joo, ruled on July 24 that Chey must pay Roh 944 billion won in property division, along with annual default interest of 5% from the date the judgment becomes final until payment is completed. The court ordered each party to bear its own litigation costs.

The court recognized Chey's holdings in SK Inc. as assets subject to division, concluding that a substantial portion of the couple's joint assets had been formed or acquired during their marriage. It set April 16, 2024, the date when oral arguments concluded in the divorce proceedings, as the valuation date for the assets. SK Inc. shares were trading at around 160,000 won at that time.

The court did, however, take into account the subsequent sharp increase in the value of Chey's SK Inc. shares when determining the amount of the property division. SK Inc. shares that Chey had gifted to relatives to maintain control of the group were excluded from the assets subject to division.

The court recognized Roh's contribution to the formation of the assets at 33.3%, or one-third. It found that Roh contributed to Chey's business activities and to the appreciation of SK Inc. shares by handling household affairs and child-rearing and through her external activities during the marriage. The contribution ratio was slightly lower than the 35% recognized by the appellate court.

The court did not take into account the 30 billion won in slush funds linked to former President Roh Tae-woo in calculating the property division ratio.

For the method of division, the court chose compensatory division, under which Chey will continue to hold the shares and pay Roh the shortfall in her portion in cash. The decision took into account the defense of management control and the stability of the group's governance structure.

The divorce proceedings began in 2015, when Chey publicly disclosed his intention to divorce and the existence of a child born outside the marriage. The legal dispute escalated when he filed for divorce mediation in July 2017.

In December 2022, the first-instance court ruled that Chey's SK Inc. shares were his separate property and excluded them from the assets subject to division, awarding Roh 66.5 billion won in property division and 100 million won in alimony. In May 2024, the appellate court determined that the shares were the couple's joint assets, recognized Roh's contribution at 35%, and ordered Chey to pay 1.3808 trillion won in property division and 2 billion won in alimony.

In October 2025, the Supreme Court found that the 30 billion won from the side of former President Roh Tae-woo appeared to be illicit funds raised during his presidency, and that it could not be taken into account as Roh Soh-yeong's contribution to the formation of the assets even if the money had flowed into SK Group. The court overturned the property division portion and sent the case back to the Seoul High Court. The divorce itself and the 2 billion won alimony payment were confirmed.

The business community is watching the impact the ruling will have on SK Group's governance structure. With Chey required to raise close to 1 trillion won for the property division payment, attention is turning to how he will secure the funds. Some observers have raised the possibility that he could use his SK Inc. stake as collateral or sell some assets, with SK Siltron cited as a prime example.

Immediately after the ruling, Chey's legal counsel issued a statement saying, "The divorce was confirmed by last year's Supreme Court ruling in a process of dissolving a marriage spanning nearly 20 years, and today's remanded ruling on property division followed. We feel apologetic for causing concern to many people." The statement added, "We respect the court's judgment, but we will closely review the details of the ruling before deciding our future response, including whether to appeal to the Supreme Court."

OCI Holdings posted its third consecutive quarter of operating profit, as its Malaysian solar-grade polysilicon subsidiary and Vietnamese wafer subsidiary sold out their currently available production through long-term supply agreements (LTAs).

The company reported second-quarter revenue of 1.0231 trillion won and operating profit of 108 billion won on July 23. Revenue rose 31.8% from a year earlier, while the company returned to an operating profit. The latest results mark its third straight quarter of operating profitability since the fourth quarter of 2025.

OCI TerraSus, OCI Holdings' Malaysia-based polysilicon manufacturing subsidiary, recently signed a long-term agreement with a new US customer for solar-grade polysilicon, fully committing its annual production capacity of 35,000 metric tons. To meet growing solar demand driven by the expansion of AI infrastructure in the US, the company plans to add another 35,000 tons of annual capacity, bringing total production capacity to 70,000 tons by 2029.

Its Vietnam-based wafer subsidiary, NEOSILICON Technologies, has also secured contracts covering its planned 11.5-gigawatt (GW) production capacity through 2029. The company currently operates a 2.7GW production line and has begun supplying products. Shipments to a new US customer are scheduled to begin next year.

OCI Holdings said it has established a non-China (Non-PFE) solar supply chain through its Malaysian polysilicon and Vietnamese wafer operations to respond to changes in US trade policy. The company expects deliveries under newly signed contracts to accelerate once uncertainty surrounding Section 232 of the US Trade Expansion Act is resolved.

The company is also expanding its US solar power generation business. OCI Energy recently generated returns by selling the 500-megawatt (MW) La Salle project. It is also negotiating a power purchase agreement (PPA) with a major US technology company for another project targeted to begin construction by the end of this year. OCI Energy is currently developing 29 projects centered in Texas with a combined capacity of 6.5GW, including 3.4GW of solar generation and 3.1GW of energy storage systems (ESS).

"The expansion of AI data centers is driving higher electricity demand in the US, further strengthening growth momentum in the solar market," said Lee Woo-hyun, chairman of OCI Holdings. "We will expand investment across the solar value chain based on our differentiated Non-PFE competitiveness while proactively responding to changes in the global supply chain."

TEMC CNS has resumed shipments of titanium tetrachloride (TiCl₄), a semiconductor precursor used in thin-film deposition, to SK hynix, about 10 months after a fire halted production at its Anseong plant. The company has officially declared a return to normal operations with the first commercial shipment from its new production base in Boeun, North Chungcheong Province.

TEMC CNS held a ceremony on July 23 to mark the first commercial shipment of TiCl₄ from its Boeun Plant 2. About 40 employees, including CEO Lee Dong-jun, Ko Sung-jong, head of Manufacturing Technology, and Koo Ja-kwon, director of Manufacturing Technology, attended the event, which featured a ribbon-cutting ceremony and the departure of the first delivery truck. The products shipped that day will be supplied to SK hynix's D램 production lines.

"Following the fire at our Anseong plant in September 2025, we have established a new production system and resumed supplying products to our customer," Lee said. "This marks a meaningful new beginning for the company's growth, built on our new manufacturing foundation."

Ko said, "When the fire occurred in 2025, the future looked uncertain, but every employee came together to make this resumption possible. It is a meaningful moment that demonstrates the company's resilience in overcoming adversity."

TEMC CNS completed installation of TiCl₄ production equipment and obtained regulatory approvals for Boeun Plant 2 in December 2025. It began trial operations in January and spent approximately six months completing customer qualification and production line validation. Sample shipments began in June, while the first commercial shipment on July 23 marked the start of full-scale production.

The company plans to restore TiCl₄ shipments to pre-fire levels by the end of this year. Before the fire, TEMC CNS supplied approximately 10 billion won worth of TiCl₄ annually to SK hynix. Demand for TiCl₄ and other semiconductor precursors is expected to increase as SK hynix ramps up new D램 production lines, including M15X in Cheongju and the first fab at its Yongin semiconductor cluster. Additional demand exceeding previous supply volumes is expected beginning next year.

TEMC CNS has also restored production of hexachlorodisilane (HCDS), another precursor whose production was halted by the same fire, after relocating the production line to Boeun Plant 2. Shipments to overseas customers, including those in China, began in May, while major customers are currently conducting final production line qualification. The company expects to complete the evaluation process and resume mass production of HCDS later this year.

The resumption of production came about two months earlier than initially expected after the company accelerated consolidation of manufacturing operations at its Boeun facility. Prior to the fire, TEMC CNS had planned to relocate precursor production from Anseong to Boeun Plant 2 by the second half of 2027 to improve manufacturing efficiency and prepare for customers' new production lines. Boeun Plant 2 had previously manufactured products including bis(diethylamino)silane (BDEAS) and disilane (Si₂H₆).

Following the fire, the company converted its long-term investment plan into an accelerated production recovery project by establishing new TiCl₄ and HCDS production lines at Boeun. It also relocated its headquarters from Anseong to Boeun in March, completing consolidation of its manufacturing base. The damaged Anseong Plant 1 is now being considered for future new business operations.

The relocation has nearly doubled the company's TiCl₄ production capacity compared with its previous facility. The new production line incorporates smart factory technologies, automating purification and filling processes while introducing real-time production data management to improve manufacturing efficiency and product consistency. The proximity of parent company TEMC's manufacturing facilities is also expected to generate logistics synergies.

A fire on September 6, 2025, destroyed the TiCl₄ and HCDS production facilities at TEMC CNS's Anseong Plant 1 in Gyeonggi Province. Because the finished goods warehouse was not damaged, the company continued supplying customers through November 2025 using approximately two months of inventory. During the subsequent supply interruption, Merck and Soulbrain, which were already approved suppliers to the same customers, filled the supply gap.

TiCl₄ is a precursor used to form titanium nitride (TiN) thin films during semiconductor deposition processes. A precursor is a chemical material used before a reaction takes place. TiN is used in D램 capacitor electrodes and as a protective barrier for metal interconnects, reducing leakage current and preventing copper diffusion into surrounding dielectric layers to improve semiconductor reliability.

HCDS is a precursor used to deposit silicon nitride (SiN) and silicon oxide (SiO) films. These materials are widely used as insulating and protective layers in D램 and NAND flash devices.

Samsung Electro-Mechanics has signed a multilayer ceramic capacitor (MLCC) supply agreement worth approximately 300 billion won with a major global company for artificial intelligence (AI) servers. To date, the company has secured cumulative long-term agreements (LTAs) worth about 2.3 trillion won in this segment.

Samsung Electro-Mechanics announced on July 23, 2026, that it signed a supply contract valued at approximately 295.1 billion won with a major global client. The contract value accounts for 2.6% of the company’s consolidated revenue from last year. The contract period runs for one year, from Jan. 1, 2027, to Dec. 31, 2027. The client's identity was not disclosed due to confidentiality terms.

Under the agreement, Samsung Electro-Mechanics will supply high-performance MLCCs for AI servers and data center systems. The company stated that the deal reflects market recognition of its MLCC design capabilities, high reliability under extreme temperature and voltage conditions, and robust production quality management.

Samsung Electro-Mechanics has been steadily expanding LTAs with global clients, focusing on components for AI servers. In May, the company signed an LTA worth about 1.5 trillion won for silicon capacitors (Si-Cap). In June, it secured another AI server MLCC supply contract worth approximately 450 billion won with a global cloud service provider (CSP).

Industry analysts note that securing consecutive, large-scale long-term MLCC supply contracts is unusual, as MLCCs are increasingly viewed as strategic components determining the stability and performance of AI infrastructure.

Samsung Electro-Mechanics currently holds more than 40% of the global AI server MLCC market, sharing the lead with Japan's Murata Manufacturing. The company is actively discussing mid- to long-term supply plans with multiple global customers to secure stable demand and accelerate its portfolio shift toward high-value-added products.

AI server MLCCs are high-value components requiring up to ten times the volume of general servers, with as many as 600,000 units installed per server rack. They must deliver ultra-small form factors, high capacity, and operational stability in high-temperature and high-voltage environments, presenting high technical entry barriers.

"Based on customer trust, we will lead the AI component market by developing next-generation advanced products and building a stable supply system," said Chang Duck-hyun, CEO of Samsung Electro-Mechanics.

SK hynix is accelerating investment in its P&T7 advanced packaging facility in Cheongju by bringing forward the project's execution schedule. The company has increased the amount approved by its board of directors to support an earlier cleanroom rollout, although the total planned investment for the project remains unchanged.

SK hynix announced on July 22 that its board approved an approximately 7.09 trillion won facility investment for construction of the P&T7 plant. The investment represents 5.88% of the company's equity. In its regulatory filing, SK hynix said the investment is intended to "secure production capacity in Cheongju to meet growing global demand for AI memory." The investment period extends through December 31, 2032.

The revised approval reflects the company's decision to accelerate the opening of cleanroom space in response to rising demand. Rather than increasing the overall project budget, SK hynix is adjusting the timing of capital expenditures under its existing investment plan. "The total investment for P&T7 remains unchanged at approximately 19 trillion won," the company said. "As the investment schedule has been brought forward, the amount requiring board approval increased, making a new board resolution necessary."

P&T7 will be SK hynix's seventh packaging and test facility and will manufacture advanced packaging products for AI memory, including high-bandwidth memory (HBM). Construction of the plant began in April. The company plans to begin installing the wafer test (WT) line in October 2027, followed by the phased construction of wafer-level packaging (WLP) lines through February 2028.

Daeduck Electronics is negotiating long-term supply agreements (LTAs) with multiple global technology companies as customer demand for additional semiconductor substrate capacity continues to rise. The company expects the agreements to be finalized by the end of the year.

Daeduck Electronics said on July 22 that it is in discussions with several global technology companies on LTAs covering flip chip ball grid array (FC-BGA), flip chip chip scale package (FC-CSP) and memory substrates.

"We are in negotiations to conclude LTAs, and discussions are largely in the final stages," a Daeduck Electronics official said. "Customers are requesting both long-term supply agreements and capacity expansion backed by advance payments. We are reviewing the production volumes we can support based on our manufacturing capacity and investment plans." The company added that it is discussing multiple product categories simultaneously with some customers but is being selective because demand exceeds its available production capacity.

An LTA is a multi-year agreement under which customers commit to purchasing specified volumes over several years. The contracts typically establish purchase quantities and supply terms in advance through memorandums of understanding or definitive agreements. Such arrangements allow customers to secure stable supplies while enabling substrate manufacturers to expand production with greater demand visibility.

The use of customer advance payments to finance facility investments is also becoming more common. Under this model, customers provide a portion of future purchase payments upfront to help suppliers accelerate capacity expansion. Substrate manufacturers invest the funds in new production lines and gradually offset the advance payments through product shipments, reducing the financial burden associated with large-scale capital expenditures.

Daeduck Electronics is pursuing a major capacity expansion using both customer advance payments and its own financial resources. On July 20, the company announced a 497 billion won investment in manufacturing facilities. It also agreed to acquire Newflex's Ansan plant for 52.8 billion won to secure additional production space for future expansion. Including a previously announced 213 billion won investment in a new FC-CSP plant in May and the revival of a previously postponed 90 billion won to 100 billion won FC-BGA investment announced in 2022, Daeduck Electronics' total investment plan exceeds 850 billion won. The company expects to complete the investments by the end of 2027.

The newly announced 497 billion won investment will be directed toward high-value semiconductor substrate production, including FC-BGA, FC-CSP and memory substrates, excluding conventional multilayer boards (MLBs). At its B2 Center in Ansan, Daeduck Electronics will install additional FC-BGA production equipment. The facility currently houses four FC-BGA production buildings, and the company plans to utilize approximately 70% of the available space in one newly constructed building while continuing maintenance of existing production lines. At its B1 Center in Siheung, Daeduck Electronics is adding a third FC-CSP production building to its existing two-building complex. Part of the new investment will be allocated to equipment installation at the facility. The new FC-BGA production line is scheduled to begin operations in the second quarter of 2027, followed by the FC-CSP line in the third quarter.

The company's product portfolio has also shifted toward higher-value AI-related applications. Since the fourth quarter of 2025, FC-BGA products have expanded beyond automotive applications to include AI server controllers, networking equipment and optical modules. FC-CSP products are also becoming increasingly focused on controllers and automotive applications rather than smartphones. Its multilayer boards are primarily supplied for satellite communications and aerospace applications.

The trend toward customer-backed investment through LTAs is spreading beyond large corporations to mid-sized substrate manufacturers. Samsung Electro-Mechanics is expanding FC-BGA production at its Sejong facility and investing 1.8 trillion won in Vietnam at the request of North American technology customers. LG Innotek is also in discussions with multiple customers regarding FC-BGA capacity expansion at its Gumi and Vietnam facilities.

"As AI demand continues to drive shortages in semiconductor substrates, capacity expansion based on long-term supply agreements is becoming increasingly common," an industry official said. "In the past, substrate makers expanded capacity based on their own demand forecasts. Now, customers are initiating the investment requests. This represents a significant shift for an industry that has traditionally operated on a build-to-order basis."

Duksan Nepcores, a subsidiary of Duksan Hi-Metal, has received preliminary approval for a Kosdaq listing, becoming the first company to qualify for an exception under the Korea Exchange's tightened policy restricting parent-subsidiary dual listings.

The company announced on July 21 that the Korea Exchange (KRX) had approved its preliminary listing review, about eight months after it submitted its application on Nov. 11, 2025. Duksan Nepcores will now proceed with its initial public offering and listing process.

The company said it plans to use the proceeds from the IPO to expand production facilities and research and development, strengthen satellite navigation infrastructure and broaden its portfolio of dual-use products serving both civilian and defense markets.

Earlier, Duksan Nepcores received A/A ratings in Korea's technology evaluation process for a technology-special listing, demonstrating its technological capabilities and growth potential. The listing will also support the Duksan Group's efforts to diversify beyond semiconductor materials and components into the defense and aerospace sectors.

The listing review was delayed after the Korea Exchange strengthened its policy last year to generally prohibit separate listings of subsidiaries. In response, Duksan Nepcores introduced measures to obtain the consent of minority shareholders at its parent company and adopted shareholder return initiatives. The exchange has made the protection of parent company minority shareholders a key consideration in reviewing subsidiary listings.

To address those concerns, Duksan Hi-Metal amended its articles of incorporation to require shareholder approval before listing a subsidiary. The company also introduced shareholder return measures, including in-kind dividends for minority shareholders and a higher dividend payout ratio.

At an extraordinary shareholders' meeting in May, the proposal to pursue Duksan Nepcores' listing was approved with 92.7% support based on shares voted and 72.8% support based on total outstanding shares.

Duksan Hi-Metal emphasized that Duksan Nepcores operates independently, with separate business operations, customers, supply chains, manufacturing facilities and R&D organizations. Transactions between the two companies account for only 0.03% of the subsidiary's revenue, indicating virtually no operational dependence, the company said.

Founded in 2012, Duksan Nepcores provides end-to-end solutions covering the design, development, manufacturing and testing of navigation and anti-jamming technologies. The company serves the defense, aerospace and navigation infrastructure sectors and works with customers including Hanwha Aerospace, LIG Nex1, and Hyundai Rotem.

"This approval provides an opportunity to demonstrate more transparently the competitiveness of our navigation and anti-jamming technologies and our growth potential to the market," said Hwang Tae-ho, chief executive officer of Duksan Nepcores. "We will continue to do our best throughout the remaining listing process."

The rapid expansion of artificial intelligence data center investment, combined with surging semiconductor prices, is breathing new life into the hard disk drive (HDD) industry, prompting Japanese component manufacturers to launch major capacity expansion projects as demand shifts toward ultra-high-capacity enterprise storage.

According to industry sources, Japanese suppliers including TDK, JX Advanced Metals, Resonac, Nitto Denko, and HOYA are expanding production of key HDD components. Once the dominant storage medium for data centers, HDDs had gradually lost ground to solid-state drives (SSDs) as NAND flash prices fell and performance improved. The explosive growth of AI infrastructure, however, is reversing that trend.

Market research firm TrendForce forecasts that nearline HDD shipments for data centers will grow at a compound annual growth rate (CAGR) of 23% between 2025 and 2030. Nearline HDDs are enterprise-class drives designed to store large volumes of data that are accessed less frequently in data centers.

Race toward 100TB HDDs gains momentum

HDDs store data by magnetically recording information onto spinning disks known as platters. Although slower than SSDs, they offer significantly higher storage capacity and lower cost per terabyte, making them well suited for hyperscale AI data centers.

The emerging architecture for AI infrastructure typically relies on SSDs for high-speed data processing while using HDDs for large-scale storage and backup.

The global HDD market is dominated by three companies: Western Digital, Seagate Technology, and Toshiba. Western Digital and Seagate each hold more than 40% of the market, while Toshiba accounts for roughly 17%. All three are now competing to commercialize enterprise HDDs exceeding 40TB, with long-term roadmaps targeting 100TB products.

Western Digital is currently qualifying its 40TB-class HDDs with customers and plans to begin mass production in the second half of this year. The company is also conducting customer qualification with two hyperscale cloud providers for heat-assisted magnetic recording (HAMR) drives and has unveiled a roadmap to scale HDD capacity to 100TB by 2029.

Seagate is already shipping HAMR-based HDDs with capacities of up to 44TB to cloud service providers. The company aims to increase storage density from roughly 4TB per platter today to 10TB per platter, ultimately enabling 100TB HDDs. To strengthen production of HAMR recording media, Seagate acquired sputtering equipment manufacturer Intevac in 2025.

Toshiba is advancing its microwave-assisted magnetic recording (MAMR) technology and recently introduced 30TB to 34TB HDDs using the industry's first 12-platter architecture, exceeding the previous limit of ten platters. The company plans to launch 40TB-class drives in 2027, expand to 55TB and beyond, and eventually adopt HAMR technology.

Japanese component suppliers expand production

Rising demand for ultra-high-capacity HDDs is driving investment throughout the supply chain, including magnetic heads, recording media, glass substrates, sputtering targets and flexible printed circuits.

In May 2026, TDK announced plans to expand production of HDD heads and suspensions in response to growing demand for nearline HDDs used in AI data centers. The company is also investing in research and development as well as manufacturing capacity for next-generation HAMR heads.

The HDD head performs data read and write operations on the platter, while the suspension supports the head and precisely maintains its position just nanometers above the disk surface.

TDK is placing particular emphasis on expanding production of Tri-SA (Triple Stage Actuator) suspensions for ultra-high-capacity HDDs. By adding an extra actuator stage, the technology enables more precise head positioning, improving recording density and reliability. The company expects HDD head production to increase by about 50% this year, while suspension output is projected to rise by 22%.

Resonac announced in May 2026 that it would expand production of magnetic recording media, or platters, which are among the most critical HDD components. The company is the world's largest supplier of recording media to the three leading HDD manufacturers.

Recording media consists of aluminum or glass substrates coated with magnetic thin films and serves as the foundation for higher recording densities in next-generation HAMR and MAMR technologies.

Resonac is strengthening its Singapore subsidiary, Resonac HD Singapore (RHDS), as its primary production hub. Annual production capacity will increase from 160 million to 210 million disks, representing approximately 31% growth. The company will install additional manufacturing equipment in unused factory space while relocating idle equipment from its closed Taiwan facility. The expanded capacity is scheduled to begin operations in 2027.

HOYA announced in April 2026 that it would invest approximately 50 billion yen (approximately 450 billion won) to build a new HDD glass substrate plant in Vietnam. The company is the world's dominant supplier of glass substrates for HDDs.

Glass substrates offer superior flatness and rigidity compared with aluminum, making them increasingly important for ultra-high-capacity HDDs. As storage capacities continue to rise, adoption of glass substrates is expected to increase.

HOYA currently operates two HDD glass substrate plants in Vietnam and one in Laos. The new facility, targeted to begin operations in 2028, will increase its manufacturing footprint to four plants, with capacity expansion phased in according to market demand.

JX Advanced Metals has also announced plans to expand production of sputtering targets, a key material used to deposit magnetic thin films during HDD recording media manufacturing. Demand is expected to rise as HAMR technology increases recording density. New production lines at the company's Isohara plant in Japan will begin operating progressively in the second half of this year.

Meanwhile, Nitto Denko is expanding its business in flexible printed circuits for HDD suspensions. The company supplies CISFLEX, a thin-film metal substrate that integrates the suspension with electrical circuitry. CISFLEX transmits read and write signals to the magnetic head while supporting it at a flying height of approximately 10 nanometers above the platter surface.

Nitto Denko plans to invest 43 billion yen (approximately 390 billion won) in CISFLEX and other high-precision circuit technologies by 2028.

Although SSDs have rapidly displaced HDDs in PCs and notebooks, industry observers expect HDD demand to continue growing in data centers, where massive volumes of information must be stored economically over long periods. As adoption of ultra-high-capacity drives accelerates, demand for advanced HDD components is expected to expand alongside it.

Daeduck Electronics will invest an additional 497 billion won to expand production facilities and supporting infrastructure, just two months after announcing a 213 billion won investment in May. The latest commitment brings the company's cumulative investment in semiconductor substrate production since 2020 to approximately 1.3 trillion won.

The company disclosed on July 20 that it will invest 497 billion won in manufacturing facilities and related infrastructure for semiconductor products. The investment will run through December 31, 2027, and is equivalent to 55.39% of shareholders' equity. Daeduck Electronics said the investment is intended to expand production capacity and supporting facilities in response to growing demand in the semiconductor market. Funding will come from internal cash and external borrowings.

Including the latest investment, Daeduck Electronics will have committed about 1.3 trillion won to its semiconductor substrate business since 2020. Between 2020 and 2022, the company invested approximately 270 billion won to establish production capacity for flip-chip ball grid array (FC-BGA) substrates. It subsequently approved another 270 billion won investment in FC-BGA production in 2022, with that expansion project currently scheduled for completion in 2027.

In 2025, the company invested approximately 50 billion won to expand production capacity for multilayer boards (MLBs) at its Ansan facility. In May this year, it announced a 213 billion won investment to build a new flip-chip chip-scale package (FC-CSP) manufacturing plant at its B1 Center in Siheung, Gyeonggi Province. That project is also scheduled for completion by the end of 2027.

Industry sources said Daeduck Electronics is accelerating long-term capacity expansion as demand for high-value semiconductor substrates continues to rise, driven by increasing investment in AI servers and data centers. FC-BGA substrates are used in high-performance packages for AI accelerators, central processing units (CPUs) and graphics processing units (GPUs). FC-CSP substrates are primarily used in mobile application processors (APs), communications chips and power semiconductors. MLBs are key components for AI servers and networking equipment.

Daeduck Electronics reported 346.3 billion won in consolidated revenue and 51.3 billion won in operating profit for the first quarter, with revenue increasing 60.8% from a year earlier. According to FnGuide, market consensus forecasts second-quarter consolidated revenue of 370 billion won and operating profit of 58.7 billion won. The company is expected to sustain its growth on the back of higher sales of AI server substrates and an improved product mix.