Samsung May Cut Smartphone Production by Up to 30%

Jakarta (ANTARA) – South Korean technology company Samsung may cut smartphone production in the fourth quarter of 2026 by around 20–30% from its original target because component costs continue to surge.

A Gizmochina report on Friday (9 October), local time, said that although smartphone sales had strengthened over the past few quarters, they had not translated into profits.

Samsung’s smartphone business is reportedly not making a significant contribution, while component costs—particularly for RAM and storage memory—continue to climb.

Samsung is not alone: this is an industry-wide problem, and smartphone manufacturers are struggling to maintain profitability.

The costs represent a 175% increase for similar components compared with last year.

If Samsung goes ahead with the production cuts, its original target of producing 270 million smartphones in 2026 could fall to around 200 million.

Prices for both components have risen significantly. Even after launch prices increased, they rose again soon afterwards by as much as US$100 (around Rp1.7 million).

The price increases have affected not only newly released models but also older phones, including mid-range devices.

The difficulties are not expected to end soon. Globally, memory-component prices in the third quarter of 2026 are forecast to rise by a further 20%, reaching US$180 (around Rp3.2 million) per unit.

On the positive side, Samsung’s other business lines are delivering record profits from memory chips. Its DS division, which is responsible for memory chips and semiconductors, posted its largest-ever quarterly operating profit of 53.7 trillion South Korean won in the first quarter of 2026.

For the third quarter, Samsung’s DS division is expected to have exceeded 100 trillion won in operating profit.