Samsung may cut smartphone output to shield profits from memory costs
Samsung is reportedly preparing to reduce smartphone production by 20–30% in the fourth quarter to limit losses in its mobile business. The move follows sharp increases in DRAM and storage prices that have raised device costs and pressured profitability. The company's planned annual output could fall from roughly 270 million units to about 200 million.
Samsung has reportedly told parts suppliers it will lower Q4 smartphone output by 20–30%. Before that reduction, its 2026 manufacturing target was about 270 million units; the revised estimate is near 200 million. The trigger is higher DRAM and storage pricing, which has made phones, tablets, and other electronics costlier.
Even with premium demand strong—Galaxy S26 and Z Fold 8 reportedly outselling predecessors—Samsung’s mobile unit lost money. Its Q2 2026 mobile loss was about $476 million within a $544 million DX division loss. Meanwhile, Samsung’s memory-chip arm posted huge gains, with Q2 profit up 1,810% and Q3 operating profit forecast near $80.17 billion.
Consumers could see fewer Samsung models, less aggressive promotions, or higher prices if production is trimmed while memory costs stay elevated. Component suppliers and manufacturing workers may feel reduced orders, though Samsung’s memory business could remain insulated. Rival phone makers may gain some shelf space, but they also face the same rising input costs, so any relief for buyers may be limited. The broader effect may be a slower, pricier upgrade cycle across consumer gadgets.