Samsung's Phone Division May Post Its First-Ever Annual Loss
RAM and storage shortages are hammering Samsung's mobile unit hard enough to threaten historic financial losses.
Samsung's mobile division is staring down a milestone nobody wants. Co-CEO TM Roh reportedly warned company leadership that the MX division could post its first annual loss ever, driven by crippling RAM and storage shortages.
The culprit? AI's insatiable appetite is devouring the market's RAM supply, sending component costs through the roof. Smartphones are caught in the crossfire as manufacturers scramble for memory chips that are increasingly being redirected toward AI infrastructure.
Storage shortages are compounding the pain, squeezing margins from multiple directions simultaneously. The cost spiral shows no signs of slowing down.
For Samsung — the world's largest smartphone maker — an annual loss in its flagship mobile business would be unprecedented. The division has weathered plenty of storms before, but the AI-driven component crunch represents a fundamentally different kind of threat to the economics of building phones.