Delta Electronics has reportedly signed a long-term supply agreement, or LTA, with Germany-based Infineon worth $2 billion, about NT$65 billion, covering silicon carbide, or SiC, and other key power semiconductor materials. ABMedia, citing Economic Daily News, said the deal would mark Delta’s first long-term raw-material contract since the COVID-19 pandemic. The report said the market viewed the move as a strategic step tied to NVIDIA’s 800VDC architecture.
A supply deal that pushed back on delay talk
Delta’s shares had recently faced pressure from market chatter that shipments related to NVIDIA’s 800VDC architecture could be pushed back, which in turn raised concerns about Delta’s near-term earnings visibility. Economic Daily News said the newly reported long-term contract with Infineon, described as a deal worth tens of billions of New Taiwan dollars, helped weaken that bearish narrative.
The report added that institutional investors see a long-term supply agreement as a form of validation for future order visibility. If Delta has indeed completed the LTA, it would suggest the company has a relatively firm internal view on the shipment timeline ahead, and that progress on 800VDC may not be as weak as some market rumors had suggested.
Why SiC is central to higher-voltage AI infrastructure
ABMedia placed the deal in the context of what it called NVIDIA’s “AI power revolution.” The idea is to move data-center power systems away from traditional alternating current, or AC, and toward 400VDC and eventually 800VDC direct-current architectures, as AI servers demand much higher power density. In that shift, silicon carbide is described as a critical material.
According to the report, a single data-center rack consumed about 20kW in 2022. As AI computing demand climbs, that power draw is rising by orders of magnitude. From the end of this year into next year, the report said, power consumption for a single server rack built on NVIDIA’s latest Vera Rubin platform is expected to exceed 500kW and could approach 1MW.
Under that kind of high-voltage, high-heat operating environment, conventional silicon-based power components run into efficiency ceilings and thermal constraints. SiC, by contrast, offers higher voltage tolerance, lower conduction loss, and better heat resistance, which is why the report described it as a necessary upgrade path in the 800VDC era.
SST demand seen breaking out by 2027
Delta President and COO Chang Hsun recently outlined the company’s technical roadmap in public remarks cited by the report. He said Delta had planned for 800VDC early, and that the next major wave would be the replacement of traditional silicon-based transformers with solid-state transformers, or SSTs. SiC is identified as a key material there as well.
Chang said the weakness of conventional AC transformer systems is that they are “not adjustable and not controllable.” In AI data centers, where load demand can swing sharply, those systems rely on large amounts of capacitors and batteries for buffering and backup, which reduces overall efficiency. SSTs, combining SiC with high-frequency power electronics, can make medium- and high-voltage conversion adjustable and controllable in real time, better matching changing loads, improving end-to-end efficiency, and cutting the need for backup equipment.
He said demand for SSTs would fully break out by 2027 at the latest. The report linked Delta’s large-scale materials preparation to that expected wave of component demand.
The contract goes beyond SiC, with July 30 as the next checkpoint
ABMedia said the long-term contract with Infineon is not limited to silicon carbide alone. Its primary purpose is to secure stable supply for multiple critical components, while also showing that Delta’s global capacity expansion strategy has moved into a concrete execution stage.
As AI data centers accelerate adoption of 400VDC and 800VDC power architectures, the report said demand for SiC is increasingly clear. It added that Delta’s July 30 investor conference is now seen as the next key checkpoint, with institutional investors expected to focus on earnings figures, the timeline for 800VDC deployment, and more detailed terms of the new LTA.