Samsung Mobile is facing its gravest crisis right now, ironically brought about by Samsung's memory division refusing to grant any special price-related concessions amid a historic increase in DRAM and NAND prices.
This means that while Samsung's semiconductor-focused DS division will report more profit this year than what it cumulatively earned over the past 40 years, Samsung Mobile is about to report its first operating loss.
Samsung's Mobile (MX) and Network Business division is all set to report an operating loss of 5.84 trillion won or ~$4 billion for FY 2026
Earlier this week, Samsung released key guidance for its Q2 2026 earnings disclosure, notifying of a slight miss on revenue expectations but a hefty beat on consensus expectations related to its total operating profit, which is expected to amount to 89.4 trillion won ($58.43 billion) vs. a consensus estimate of $55.6 billion, and constitutes a new record.
The prevailing trend also aligns with the recent shocking statement from Kim Yong-kwan, the President and Head of Business Strategy at Samsung Electronics’ Device Solutions (DS) division, who now expects Samsung's semiconductor business to print more profit this year than what it earned over the past 40 years combined.
Under the hood, however, the situation is downright morose for Samsung's other business units, especially the Mobile division. Faced with astronomical memory-related costs, the unit is now preparing to disclose the first operating loss in its history, which is something that Samsung Mobile evaded even when buffeted by the Note 7 saga and the resultant hit to the demand for its cellphones. In other words, the current crisis is far more debilitating than what Samsung faced when its cellphones were being banned from airplanes altogether!
As per the estimates from Samsung Securities, the Mobile unit, in conjunction with the Network Business division, will report an operating loss 5.84 trillion won or nearly $4 billion for the entire 2026.
Samsung's dilemma is simple: it needs to raise prices to balance the books, but each dollar of increase hands Chinese OEMs additional demand. In fact, Samsung Mobile and the Network Business division might report an even steeper ~$10 billion loss in 2027, with cumulative losses from 2026 to 2028 reaching a staggering $16 billion!
About the author: Writing is my one incontrovertible passion. Over the past six years, he has authored over 2,200 distinct articles on financial and tech-related topics, spanning nearly 1 million words. And he has been a member of Wcctech mobile team since 2025. As an alumnus of the University of Toronto, Rotman Commerce Program, I bring nuance, in-depth knowledge, and a unique perspective to every topic that I cover. When I'm not writing, I'm traveling the world, exploring hidden confectionaries and restaurants as an aspiring food connoisseur.
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