Samsung Prioritizes External Clients Amidst DRAM & NAND Price Surge, Potentially Impacting Galaxy S26
SEOUL, SOUTH KOREA - Samsung Electronics is reportedly limiting internal supply of its DRAM and NAND memory chips to prioritize higher-paying external customers, a strategic move capitalizing on current market scarcity even if it means potential headwinds for its own smartphone division.The decision signals a willingness to make arduous trade-offs to bolster overall profitability as the company anticipates margin improvements driven by advancements in 2nm production technology.
This shift comes as memory prices reach unprecedented levels, with some retailers comparing the cost of RAM to that of luxury goods like lobster.While the global market is feeling the pinch, Samsung’s internal prioritization demonstrates the acute challenges of navigating a constrained supply chain – and the company’s calculated bet that maximizing profit from component sales outweighs maintaining consistent smartphone margins. Analysts estimate Samsung could achieve an operating profit of $69 billion in 2026, fueled by rising memory values and improved yields from next-generation processes.A key goal is achieving profitability in the foundry business by 2027, necessitating stringent resource allocation.
The most immediate impact is expected to be felt with the launch of the Galaxy S26 range, slated for February 2026. Uncertain supply and “memory prices out of control” raise the likelihood of a price increase at launch, potentially complicating efforts to maintain sales volumes despite Samsung’s typical post-launch discounting strategy.
Samsung’s strategy reflects a broader industry trend of supply chain volatility, but highlights the unique position of vertically integrated companies like Samsung, which must balance internal needs with external market opportunities. The company is betting that short-term sacrifices in smartphone market share will pave the way for long-term gains in its more lucrative component businesses.
