Samsung reportedly cuts phone production by up to 30% as memory costs soar

Samsung is reportedly reducing smartphone production by up to 30% in the fourth quarter as rising memory costs squeeze its profits.

The company recently asked suppliers to cut deliveries by 20% to 30%, Money Today reports, citing multiple industry sources. One unnamed source said higher memory and semiconductor prices were leaving Samsung with little or no profit on its smartphones, describing the reductions as an effort to protect the company’s overall earnings.

The report cites TrendForce figures showing that 12GB of LPDDR5X smartphone memory cost around $145 to $146 in the second quarter, up 175% from a year earlier. It also cites a forecast for prices to rise another roughly 20% in the third quarter, potentially reaching $180.

Samsung usually produces fewer phones toward the end of the year as customers wait for its next Galaxy S flagships, which typically arrive in January or February. This year’s planned reduction is reportedly larger than the market expected, with higher component costs adding to the seasonal slowdown.

The report puts potential annual production in the low 200-million range, compared with earlier expectations of as many as 270 million smartphones. Its sources attribute the pullback to the shrinking returns from producing and selling additional devices.

Samsung’s mobile and networks businesses posted an operating loss in the second quarter despite higher revenue from Galaxy S26 and Galaxy A sales. The company attributed the weaker earnings to rising component costs.