It’s no surprise that Samsung is earning more money than ever thanks to its memory business. If this means the mobile division (Samsung MX) incurs losses, it’s a small price to pay. It’s worth remembering that Samsung’s own mobile division publicly complained about its parent company raising prices and cutting memory allocations. This also included making it harder and more time-consuming to purchase memory for their smartphones. Now, the company itself is warning that they might close their latest quarter with losses.
Specifically, Roh Tae-moon, the interim head of Samsung MX, has already conveyed his concerns to management about the possibility of an annual deficit in the mobile business. The issue isn’t a drop in sales of the Samsung Galaxy S26; instead, it’s the brutal increase in the cost of DRAM and NAND memory, particularly LPDDR5x, which is skyrocketing the manufacturing cost of their smartphones. Ironically, this is happening while Samsung is reporting record revenues as a memory manufacturer. However, their own mobile division is contributing to this success at the expense of its own profits.
Samsung, and Other Companies, Will Raise Smartphone Prices Again Due to DRAM Memory Costs to Avoid Losses
According to reports, the price of LPDDR5 memory practically doubled during the first quarter of 2026. Now, in the second quarter, it’s expected to nearly double again, with an increase of over 80%. Additionally, NAND memory, used for storage, is also rising in price. Consequently, smartphones, especially high-end models, have seen their manufacturing costs skyrocket in recent months. Analyst firm Counterpoint estimates that these premium devices will be $100 to $150 more expensive during the second quarter. Consumers are expected to face an additional cost of $150 to $200 for some flagship devices.
Evidently, the impact and losses won’t just affect Samsung’s mobile division. IDC had already warned that global smartphone shipments would fall in 2026 due to rising memory prices, with particular pressure on low- and mid-range Android devices. IDC also reported that the first quarter of 2026 already registered a 4.1% drop in global smartphone shipments, all within a context of limited memory supply and record prices. More recent analyses point to an even harsher scenario, with forecasts of much sharper declines for the entirety of 2026 if the RAM crisis persists.
The situation is particularly delicate for Samsung because the Galaxy S26 has performed well commercially, but this no longer guarantees sufficient profitability. The problem will emerge with the next generation of smartphones. Apple has so much memory that it can afford to keep the iPhone 18 at the same price as its predecessors. We’ve already seen with the MacBook Neo what happens when Apple offers a good product at a lower price than the competition: Apple will be the only one selling more laptops in 2026.
