As Samsung Electronics' flagship smartphone Galaxy S26 series officially debuts, a game surrounding memory chip pricing is quietly influencing the profitability outlook of this product line.On February 25, South Korean media reported that Samsung's semiconductor division (DS) quoted Apple with a 100% price increase, which was unexpectedly accepted immediately. This result not only locked in an ultra-high price benchmark but also plunged Samsung's mobile business into a cost dilemma.The report cited insiders indicating that this illustrates the extent of competition among smartphone manufacturers for memory inventory. At the same time, a chain reaction occurred, leading Samsung's semiconductor division to abandon the long-term supply agreement (LTA) with the MX division, opting instead for quarterly contracts to maximize profits.Against the backdrop of global tight supply of general memory, Samsung Electronics' Mobile Experience (MX) division will ensure the shipment volume of the Galaxy S26 series by sourcing the LPDDR5X memory needed for initial mass production equally from its semiconductor (DS) division and Micron Technology, each accounting for 50%.According to reports, both Samsung's semiconductor division and Micron plan to significantly raise the LPDDR5X supply price in negotiations following the initial mass production, which will have a substantial impact on the profitability of Samsung Electronics' Mobile Experience division.On February 25 local time, Samsung launched the new Galaxy S series flagship models in San Francisco, with the base model S26 priced at $899 and the S26+ at $1,099, both of which are higher than the previous generation. Pre-sales in the South Korean market will start on the 27th, with the official sale date set for March 11.<img src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/2f0a0d04-01dc-4f97-aaf8-9cdc524c90cf.png?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="" original-src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/2f0a0d04-01dc-4f97-aaf8-9cdc524c90cf.png"/> (Screenshot from the S26 Ultra official website)<h2>Samsung Semiconductor Division's Sky-High Prices, Apple Accepts Without Hesitation</h2>In the current tight memory supply market, Samsung's semiconductor division has raised the price of LPDDR5X sold to Apple for the iPhone 17 series to double the original price.According to media reports citing semiconductor industry insiders, Samsung's semiconductor division initially aimed to raise the supply price to Apple by about 60%, starting with a 100% increase as the initial quote to leave room for negotiation. However, Apple accepted this quote on the spot, and the price was thus fixed.Recently, Apple also held an emergency meeting with Samsung's semiconductor division to negotiate supply volumes for the first half of this year.This outcome is costly for Samsung Electronics' Mobile Experience division. Samsung's semiconductor division confirmed the pricing power in the memory market based on this, subsequently adopting the same price increase stance for internal transactions.Although the price increase for supplies from the semiconductor division to Samsung Electronics' Mobile Experience division is lower than that for Apple, it still shows a significant increase compared to the previous period.Micron is also preparing to offer higher quotes to Samsung Electronics' Mobile Experience division. Due to relatively limited capacity, Micron is expected to be the most aggressive in raising mobile memory prices among the three memory manufacturers. Industry insiders analyze that even if Samsung Electronics' Mobile Experience division refuses to accept the price increase, Micron will have no worries due to strong demand from other customers<h2>Initial mass production of Micron reduced from &#34;full amount&#34; to a 50-50 split</h2>The memory supply structure of the Galaxy S26 series reflects the subtle interests and power struggles between Samsung's semiconductor and terminal product departments.According to reports citing insiders familiar with Samsung's internal affairs, Samsung Electronics' Mobile Experience Division engaged in intense negotiations with both the Samsung Semiconductor Division and Micron in the fourth quarter of last year, ultimately determining that initial mass production would be supplied 50% by each party. The insider stated:<blockquote>Currently, the subsequent production volume has not been determined, so there is no concept of a 'main supplier' at this stage.</blockquote>This pattern is significantly different from the previous generation. In the first three months after the launch of the Galaxy S25 series, all memory was supplied by Micron.At that time, Micron's products were considered superior to those of Samsung's semiconductor division in terms of performance and yield. Subsequently, Samsung's semiconductor division continuously improved product quality, rapidly enhancing its mobile memory competitiveness, leading the Mobile Experience Division to adjust the procurement ratio, with the Galaxy S25 series ultimately concluding with a split of 60% from Samsung's semiconductor division and 40% from Micron.An industry insider pointed out that Samsung's semiconductor division had experienced intermittent recall issues with consumer-grade memory about two years ago, but recently, through optimizing design redundancy, quality has significantly improved.Currently, both Samsung's semiconductor division and Micron supply LPDDR5X based on the 1b process to the MX division. Notably, Micron has submitted LPDDR5X samples based on the 1gamma (i.e., 1c process) to Samsung Electronics' Mobile Experience Division, but industry assessments suggest that it does not yet meet the conditions for mass production and has been postponed.As an alternative, the products supplied by Micron for this initial mass production are an improved version of the LPDDR5X used in the Galaxy S25 series, with production efficiency increased by about 15% through optimized wiring width, which helps Micron improve its profit margins.<h2>Galaxy S26 price increase, but cost pressure still difficult to fully transfer</h2>In the face of rising memory costs, Samsung Electronics' Mobile Experience Division is seeking multiple means to hedge against pressure.The release prices of the Galaxy S26 series have increased compared to the previous generation: the base model S26 is priced at $899, and the S26+ at $1099, both higher than the corresponding versions of the Galaxy S25 series.At the same time, Samsung Electronics' Mobile Experience Division plans to incorporate approximately 30% of its self-developed application processor Exynos 2600 in the S26 series to reduce reliance on externally sourced chips.According to media reports, the S26 and S26+ sold in the European market will use the Exynos 2600, which is said to be the world's first mobile processor based on 2nm process technology; the versions for the U.S. market will be equipped with Snapdragon 8 Elite Gen 5 for Galaxy.However, the industry generally believes that the above measures are insufficient to completely alleviate the profit pressure caused by rising memory prices. The rapid increase in memory prices means that even if Samsung Electronics' Mobile Experience Division raises terminal prices and introduces self-developed chips, it will still be difficult to fully offset the cost increase.From the product itself, the Galaxy S26 series continues the main architecture of the previous generation in design and functionality. All models are equipped with 12GB of memory and a minimum storage of 256GB.The base model S26 has a screen size that slightly increases from 6.2 inches to 6.3 inches, and the battery capacity is upgraded from 4000mAh to 4300mAh; the camera specifications are basically on par with the S25, featuring a main camera of 50 million pixels, an ultra-wide angle of 12 million pixels, and a 3x optical zoom telephoto lens, but it introduces ProScaler image enhancement technology and MDNIe color processing chip.On the software side, the 360-degree horizontal lock ultra-stable video mode, AI auto framing, and audio eraser function extended to mainstream platforms such as Netflix, Instagram, and YouTube are the more prominent new features this time

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Samsung's semiconductor division quoted Apple with a 100% price increase, which was accepted on the spot, thereby establishing pricing power and synchronously raising prices for its internal mobile business unit. To ensure supply, the mobile division introduced Micron, with the LPDDR5X memory required for the initial mass production of the Galaxy S26 being supplied 50% by Samsung Semiconductor and 50% by Micron. In the face of cost pressures, Samsung raised the base price of the S26 to $899 and introduced its self-developed Exynos 2600 chip, but the industry believes it will still be difficult to fully offset the impact of rising memory prices

- Samsung's flagship Galaxy S26 series launched amid rising memory chip prices, affecting profitability prospects.  
- The semiconductor division raised prices for Apple’s LPDDR5X chips dramatically, impacting Samsung's mobile experience department, which must share initial production with Micron at a 50% ratio.  
- Despite a price increase for the Galaxy S26 series, these cost pressures challenge Samsung's ability to fully transfer expenses to consumers, as internal and external supply negotiations unfold.

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Samsung's storage division is charging exorbitant prices, and Apple is accepting them all—Samsung's mobile division is forced to use 50% Micron storage chips