Samsung mobile posts first-ever loss of $544M on soaring memory prices

Samsung's Mobile eXperience (MX) division, responsible for smartphones, posted an operating loss of 800 billion won ($544 million) for the second quarter of 2026, its first-ever quarterly deficit, the company said on July 30, 2026.

Soaring component costs eroded profit margins, despite solid sales of premium phones such as the Galaxy S26 and Galaxy Z Fold 8. Memory prices jumped as demand from artificial intelligence applications surged.

Budget smartphones bore the brunt of the cost increases, with their already thin margins squeezed further. Samsung had warned in April 2026 that rising parts costs could weigh on earnings.

The company's overall revenue hit a record 171.5 trillion won ($119 billion), up 28 percent from a year earlier. Operating profit reached an all-time high of 89.5 trillion won ($62.2 billion). The Device Solutions (DS) division, which includes the memory business, saw sales jump 56 percent from the previous quarter and set new revenue and profit records.

Earnings per share for both common and preferred shares rose 52 percent, among the highest levels for global tech companies, Samsung said. The company plans to focus on "high-value-added products" to drive future mobile growth.

Consumers can expect higher smartphone prices across all categories, with the steepest percentage increases in the $200–$500 range, hitting low-income buyers hardest. Samsung's integrated supply chain, including in-house memory and storage manufacturing, provides a buffer, but the mobile division's turnaround hinges on managing component costs amid the ongoing AI-driven demand surge.