How Samsung’s Own Chip Business Is Cushioning Its Phone Prices

Samsung Electronics is heading into this month’s Galaxy Unpacked event with a foldable price hike leaked at around $100, a modest number next to what Apple and Xiaomi are bracing for. Apple’s chief executive has already called his own company’s price increases “unavoidable.” Xiaomi, Oppo, Vivo and Meizu have quietly trimmed or scrapped budget phone launches. Samsung can move slower because it makes both the phones and the memory chips inside them, an overlap none of its rivals share as a historic memory shortage reshapes the entire industry.

The advantage looks bigger than it is built to last. Samsung’s phone division still pays market rates for that memory, and even people close to the arrangement admit nobody knows when the shortage ends.

Samsung’s Chip Arm Is Quietly Underwriting Its Phones

Samsung’s handset division buys memory chips at the same market rates as Apple, Xiaomi or anyone else building a phone. What it has that its rivals don’t is a sister division that makes those chips in the first place, and a long relationship between the two.

“It is understood that the two divisions have a long-term contract, allowing Samsung’s smartphone business to meet its shipment targets without facing the same memory supply risks,” a source familiar with the matter told the Korea JoongAng Daily. “That said, it’s unclear how long Samsung can keep this up, because nobody really knows when this memory crunch ends.”

That contract matters because of how concentrated memory production has become. Samsung and SK hynix, alongside Micron, control well over 90% of the global DRAM (dynamic random access memory) market, and all three are pouring cleanroom space into high bandwidth memory for AI servers instead of the ordinary chips that go into phones. IDC has described it as a zero-sum game for wafer capacity: every wafer dedicated to an NVIDIA-bound memory stack is one denied to the chip that would have gone into a mid-range Galaxy or a budget Redmi.

The Memory Math

The scale of the price move explains why nobody is exempt. Gartner projects DRAM and SSD prices combined will surge 130% by the end of 2026. Counterpoint Research says DRAM already eats up 23% of the total cost of a premium handset this quarter, up from 17% three months earlier, after DRAM prices jumped more than 50% quarter on quarter.

“Considering the massive memory price surge, standard cost-cutting measures may only result in limited returns. A rise in retail prices seems unavoidable in 2026. We expect low-end retail prices to increase by around $30, while the cost pressures on some premium flagships will likely be passed on to consumers, resulting in price hikes of $150 to $200.”

Shenghao Bai, a Counterpoint Research analyst, laid out that math in a note on 2026 pricing. Every major forecasting shop is describing a version of the same story, just with different numbers attached.

TrendForce, which tracks contract pricing directly with manufacturers, said as early as December that brands would be compelled to raise prices and cut specs at once, not later, and not one instead of the other.

Xiaomi, Oppo and Vivo Retreat From the Bottom of the Market

Xiaomi, Oppo, Vivo and Meizu have each trimmed shipment forecasts or scrapped planned budget releases this year, all tracing back to the same shortage squeezing their component costs. Nothing’s chief executive, Carl Pei, put a number on what’s coming for brands built on specs per dollar.

“Brands now face a simple choice: raise prices by 30% or more in some cases, or downgrade specs,” Pei said. “The ‘more specs for less money’ model that many value brands were built on is no longer sustainable in 2026.”

That retreat has opened a lane for Samsung in exactly the markets where it used to lose on price. In India, one of its biggest markets, the Galaxy M47 5G has drawn praise for beating Realme’s 16T on specs at a lower price, an unusual result for a brand long accused of charging a premium without delivering one. It’s a reversal of the dynamic that dogged Apple for years: cheaper rivals closed the value gap themselves, without Apple ever touching its own price tag.

IDC’s own analysts frame the bigger question as whether affordable phones survive at all, or whether the whole product mix simply resets upward for good.

Samsung Spreads the Fold 8 Price Increase Unevenly

Samsung’s own foldable lineup shows the same logic playing out at retail. Leaked pricing suggests the bulk of the increase is landing on the Z Fold 8 Ultra, the direct successor to last year’s Z Fold 7, while the new, wider Z Fold 8 sits at a lower starting price with no predecessor to be measured against.

• Z Fold 8 Ultra, base tier: around $2,100, roughly $100 above the Z Fold 7’s $1,999 launch price
• Z Fold 8 Ultra, 512GB: about $180 more than the equivalent Z Fold 7 tier
• Z Fold 8 Ultra, 1TB: about $280 more than the equivalent Z Fold 7 tier
• Z Fold 8 (Wide), base tier: leaked between $1,799 and $1,899, with no prior generation for comparison

A separate leak published two days before the announcement window put the Ultra’s increase closer to a 5% bump, a smaller jump than the industry had braced for. Samsung will make its case first, at Galaxy Unpacked on July 22 in London, its first time holding the event outside Seoul or San Francisco. Apple’s own foldable follows in September, giving Samsung roughly two months to set expectations before Cupertino says a word. An IDC estimate reported last week put that Apple device’s starting price as high as $2,500, well above where Samsung’s Fold 8 Ultra is expected to land.

Apple’s iPhone 18 Runs Into a Different Ceiling

Apple’s pricing problem for this fall is straightforward: pay more for phones with the same 12GB of RAM as this year’s models, on top of the increases it already applied to Mac and iPad lines. The more interesting fight is happening one generation out, with the iPhone 18.

Analyst Ming-Chi Kuo says the standard iPhone 18 and 18e will carry 9GB of RAM when they arrive around spring 2027, up from 8GB in the iPhone 17 but still short of the 12GB threshold Apple set for its most advanced on-device AI models at WWDC 2026. Two iOS 27 features, the ability to customize Siri’s voice expressiveness and pace, and a major accuracy upgrade for speech-to-text dictation, stay locked to the Pro line and the foldable iPhone, which keep 12GB.

Tim Cook told the Wall Street Journal in an interview published in June that the company’s price increases were “unavoidable” and called the underlying memory situation “unsustainable.” “The world is being disrupted by AI and, at the same time, even before we start reaping the benefits of AI in our devices, we are already paying the bill,” said Francisco Jeronimo, an IDC analyst.

Apple is reportedly exploring cheaper alternatives too. It is said to be considering memory from ChangXin Memory Technologies, a Chinese chipmaker known as CXMT that is still years behind Korean and US chipmakers on its most advanced nodes but has become an option for buyers priced out of the big three’s allocation queues.

When Does the Memory Crunch Actually End?

Estimates range from one year to well past 2030. SK hynix’s chief executive calls 2027 the worst supply year on record, UBS expects DRAM to stay undersupplied into 2028, and a former Samsung chip chief thinks prices could fall within a year. No forecaster agrees on a date, only that relief isn’t arriving in 2026.

• SK hynix CEO Kwak Noh-jung says 2027 will be the worst supply year in the industry’s history, with demand possibly outstripping capacity beyond 2030.
• UBS forecasts the global DRAM industry stays undersupplied until at least the second quarter of 2028.
• NVIDIA CEO Jensen Huang predicts the shortage persists for “quite a few years” without naming an end date.
• Kye-hyun Kyung, a former head of Samsung’s own semiconductor business, believes prices could start falling within a year.

Kwak made his comments to Reuters on July 10, the day SK hynix began trading on the Nasdaq, a listing that has already made its bet on high bandwidth memory look prescient. Samsung shows its hand on July 22. Apple waits until September to answer, and by then the industry will know whether the memory math left room for anyone to surprise anyone else.

Frequently Asked Questions

What is causing the global memory chip shortage?

The shortage traces to AI data centers buying up high bandwidth memory capacity that used to make ordinary DRAM for phones and laptops. Each gigabyte of high bandwidth memory consumes roughly three times the wafer space of standard DDR5, so every AI server chip built pulls capacity away from consumer electronics. Samsung, SK hynix and Micron, which together produce nearly all the world’s DRAM, have prioritized that higher-margin business.

When will phone memory prices go back to normal?

No forecaster gives the same date. TrendForce expects the steepest quarterly increases to ease slightly by the third quarter of 2026 even as prices keep climbing, while SK hynix’s chief executive has called 2027 the worst supply year on record and UBS doesn’t expect the DRAM market to balance until at least mid-2028.

Why is Samsung still raising Galaxy Z Fold 8 prices if it makes its own memory?

Samsung’s phone division buys memory from its own chip division at market prices, not a discount, so it still absorbs part of the increase. Leaks suggest the company is spreading that cost by raising storage-tier prices more than the base model, while rising application-processor and camera costs add to the bill on top of memory.

Will the standard iPhone 18 get more RAM than the iPhone 17?

Yes, but only by 1GB. Analyst Ming-Chi Kuo expects the iPhone 18 and 18e to ship with 9GB of RAM, up from 8GB, while the Pro models and Apple’s first foldable keep 12GB and unlock two extra iOS 27 Apple Intelligence features the base models won’t run.

Is Apple really buying memory chips from a Chinese company?

Apple is reportedly evaluating ChangXin Memory Technologies, known as CXMT, as a supplier while it looks for ways around the shortage. CXMT trails Samsung, SK hynix and Micron on the most advanced manufacturing nodes, but it has become an option for buyers who can’t get allocation from the top three.