Demand for tantalum capacitors has slowly recovered since the end of the Covid-19 pandemic, supported by fresh demand from artificial intelligence (AI) data centres, autonomous vehicles and developments in ultra-portable technology.
Argus spoke with Dr Philip Lessner, industry veteran and former chief technology officer at Taiwanese capacitor maker Yageo, to discuss these advances and challenges facing the industry. Edited highlights follow:
How has the tantalum capacitor industry developed since the pandemic?
The biggest market for tantalum-polymer capacitors is notebook computers, and working from home has spiked demand for that, as well as other electronics.
Then from summer of 2022 through to the start of 2024, demand was depressed. There was a lot of product in the channel because companies always overbuy when demand goes up.
Then from the second quarter of 2024, the AI boom hit. Now business is pretty healthy and back to the sort of levels that we saw during Covid.
How is the AI boom driving demand?
Mostly through data centre buildout. Demand for notebook computers will probably go up a little with the transition to Windows 11 and people buying AI PCs. But data centres using tantalum capacitors for power management is the real demand driver.
Aluminium-polymer capacitors dominate the microprocessor or the GPU itself, but there are still a lot of tantalum capacitors on the GPU card. Looking at the Nvidia H 100 card, you can see around 25 tantalum capacitors on the front, back and side of that card. And they're building millions of these things.
Where else are you seeing demand?
Vehicles with advanced driver assist systems and ultimately autonomous vehicles.
Lots of processing power is needed for those functions and the processors need capacitors for voltage regulation.
They can use aluminium polymer capacitors and tantalum-polymer capacitors, but where space is more of a constraint, they tend to favour tantalum. So if you look at the boards built by Tesla or Nvidia that are used in those in those systems, there's a lot of tantalum capacitors.
What are some of the challenges facing the tantalum capacitor industry today?
Ore sourcing is always a challenge for the industry. Most of the ore is sourced in central Africa, in countries where there are conflicts, which is a concern for OEMs.
Then the other challenge comes from competing technology. Tantalum competes with multi-layer ceramic capacitors (MLCCs) on the low end of capacitance and aluminium electrolytics and aluminium-polymer on the high end of capacitance. Those technologies are always making advances in size, capacitance and other characteristics.
Are the problems with raw material sourcing in central Africa driving OEMs to switch to MLCCs and aluminium-based capacitors?
Yes, for OEMs, tantalum is problematic, and they'll replace it with MLCCs or aluminium where they can because those don't have the same supply chain problems.
There's also a push to use as much recycled tantalum as possible to get around the ore issue, but there's just not enough recycled tantalum to meet the capacitor demand. A lot of tantalum capacitor manufacturers recycle pretty much all the scrap they generate internally. But recycling for end products such as notebook computers is not as prevalent and a lot of tantalum will end up in landfill.
How is the need for miniaturisation affecting the tantalum capacitor industry?
There's a drive now for more ultra-portable devices, such as the Apple watch or augmented reality glasses, which could drive demand for more tantalum capacitors.
Tantalum has a higher dielectric constant than aluminium, which makes it easier to miniaturise. Tantalum also has better audio quality, and it has a potential cost advantage over MLCCs. Tantalum is an expensive material but at higher capacitance the MLCC manufacturer has to stack lots of layers on top of each other, which is an expensive process.
A few years ago, Apple replaced 22 ceramic capacitors in its series 7 Apple watch with a single tantalum capacitor, because of the audio quality and size advantages compared with ceramics.
But the challenge is not just making the capacitors smaller, but making them thinner without the tantalum elements warping. The capacitor used in the Apple watch is the thinnest available and it is 0.8mm thick but they want capacitors that are even 0.65mm thick. Look at the new iPhone 17 air, for example — everything is getting thinner.
What are some potential trends that we should look out for in the future?
Tantalum capacitors are also being used more in defence and aerospace. Drones are an expanding application with a limited amount of space, so you can't use large aluminium capacitors.
And in space, components in satellites are exposed to extreme temperatures depending on whether they're facing towards or away from the sun, but they've got to be reliable because they can't be replaced if they fail. There was a study at Nasa several years ago that showed tantalum-polymer capacitors have good characteristics at liquid nitrogen temperatures, and on the upper range, there's now a tantalum-polymer series qualified to 150°C.
