Samsung has posted strong smartphone shipment numbers in recent quarters and even returned to the top of the global market in Q2 2026, according to Counterpoint Research.
However, strong sales are reportedly not translating into profits.
A new report claims Samsung’s smartphone business is struggling to make money as sharply higher RAM and storage prices increase the cost of producing phones.
Major Production Cut
According to Money Today, citing industry sources, Samsung has asked suppliers to prepare for a 20% to 30% reduction in smartphone production during Q4 2026.
Before the reported cut, Samsung was expected to manufacture around 270 million smartphones this year.
That figure could now fall to roughly 200 million units. The biggest problem appears to be memory pricing.
Samsung reportedly paid around $145 for a 12GB LPDDR5X memory chip this year, representing an increase of about 175% compared with a year earlier.
Higher Phone Prices Did Not Help
Samsung has already responded to rising costs by increasing smartphone prices.
The Galaxy S26 series and Galaxy Z8 foldables launched at higher prices, while some recent flagship models have received increases of up to $100.
Older flagship devices and mid-range phones have also become more expensive.
Despite those increases, Samsung’s mobile business is reportedly still struggling to generate a profit.
The situation could become even more difficult if memory prices continue rising.
DRAM prices are expected to climb another 20%, with the cost of some components potentially reaching around $180.
Samsung Mobile’s First Quarterly Loss
Samsung’s mobile division reportedly recorded its first quarterly loss in Q2 2026.
The company’s Device eXperience division posted a loss of around $544 million, with the mobile business accounting for approximately $476 million.
Current market conditions could put even more pressure on the division during Q3 and Q4.
Memory Business Making Record Profits
The situation is very different on Samsung’s semiconductor side.
Its Device Solutions division, which includes memory chips and semiconductors, has benefited heavily from soaring memory prices.
The division reportedly generated an operating profit of KRW 53.7 trillion in Q1 2026.
That figure rose to KRW 89.2 trillion in Q2, while estimates suggest operating profit may have exceeded KRW 100 trillion in Q3.
This creates an unusual situation for Samsung: the same memory price increases hurting its smartphone business are helping generate record profits for its semiconductor division.
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