Reports from Korea indicate that Samsung is turning to OLED panels from Chinese manufacturer CSOT for its mid-range smartphones, aiming to cut production costs. This move doesn’t signal a decline in the quality of Chinese panel manufacturing, which boasts excellent producers, but rather directly impacts Samsung Display, Samsung’s internal subsidiary specialized in screen production for various devices.
These reports detail that Samsung will no longer exclusively rely on Samsung Display for certain mid-range and Fan Edition models. Instead, it has opted for OLED panels from CSOT, a Chinese company that is part of the TCL group.
Samsung Purchases 15 Million OLED Panels from Chinese Manufacturer CSOT
According to these reports, Samsung has already acquired 15 million OLED panels from CSOT. The Samsung Galaxy A57 is expected to be the first mid-range smartphone to incorporate these panels, a trend that will extend to future Fan Edition models. It’s important to note that a reduction in Samsung’s manufacturing costs doesn’t necessarily translate to a lower final price for consumers, but rather improves Samsung’s profit margins. Supply chain estimates suggest that CSOT’s panels are 20% cheaper than those produced by Samsung Display.
Considering the current context, this decision is logical. DRAM and NAND memory prices have escalated dramatically and are projected to continue rising until 2026. Compared to Q1 2025, the cost of memory for a smartphone with 8GB RAM and 256GB internal storage could have surged by nearly 200%. Historically representing 10-15% of a smartphone’s total manufacturing cost, memory now accounts for between 30% and 40%. RAM is expected to double in price during the second quarter of this year, while NAND could increase by up to 60%.
For a mid-range smartphone, this cost increase is highly impactful. Therefore, it is plausible that Samsung has been compelled to use CSOT panels to protect its profit margins and prevent an excessive price increase for its devices, driven by the surge in memory prices.
Memory Crisis Breaks Samsung Display’s Monopoly
In its 2025 financial results, Samsung had already indicated that its mobile division would face constant cost pressures in 2026. Recently, the CEO of Samsung Display added that rising raw material and energy prices, linked to oil price increases, further complicate hardware costs. Thus, Samsung is not only dealing with more expensive memory but also a less favorable industrial environment for in-house component manufacturing. Consequently, it has chosen to purchase OLED panels from CSOT, as it is more cost-effective to buy them than to produce them internally.
Furthermore, Chinese manufacturers surpassed 50% market share in OLED shipments during 2025, demonstrating their growing volume and cost competitiveness, especially in the crucial mid-range segment. This suggests that Samsung is prioritizing the competitiveness of its mobile division over safeguarding the interests of its display subsidiary. Reports indicate that Samsung Display reacted negatively and attempted to internally oppose this decision.
In essence, to maintain its leadership in the mobile sector, Samsung is choosing to reduce the revenue of its display division by sourcing OLED panels from competitors. The drastic increase in RAM and storage prices has compelled brands to optimize every euro in production costs. Simply passing these increases onto consumers would weaken demand and impact sales. This also opens a new perspective: rather than a technological defeat for Samsung Display, it signals that Chinese competition has reached a quality-price level capable of penetrating even Samsung’s internal operations.
