Samsung’s Dilemma With An Ambitious Galaxy S26 Sales Target

Rohail Saleem
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Nov 4, 2025 at 08:33am EST
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Samsung Galaxy S23 Ultra phones on display stand.

Samsung is currently having to contend with two opposing forces, which have created a dilemma of sorts for the South Korean behemoth. Price pressures lie at one end of this spectrum, driven by higher component costs, and an ambitious sales target for the upcoming Galaxy S26 series constitutes the other end, necessitating a competitive pricing regime and a higher marketing spend.

Samsung expects to sell 35 million units of the Galaxy S26 series next year

A new report from the South Korean publication MK has now disclosed that Samsung is targeting 130 trillion won ($90.3 billion) in annual sales for its smartphone-centric MX division in 2026, divided between smartphone sales of 240 million units and tablet sales of around 27 million units.

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The report goes on to note:

  1. Samsung's MX division is targeting sales of 35 million units for the upcoming Galaxy S26 lineup, with 24 million units targeted for the first half of 2026 vs. the Galaxy S25 lineup's 22 million units that the South Korean behemoth managed to sell in H1 2025.
  2. Samsung also expects to sell 5 million units of the Fold and Flip phones that will be released in July.
  3. Samsung's MX division posted all-time record sales of 133 trillion won back in 2013.
  4. The division has been stuck in the proverbial doldrums ever since.
  5. Samsung's ambitious sales target for 2026 suggests that it is trying to stage a comeback by regaining the market share it lost to other OEMs in recent years.

This lofty goal, however, clashes with the emerging industry dynamics, which are all about component cost inflation.

Samsung Galaxy S26 lineup's price increase is "inevitable"

As per a separate report from Taiwan's Electronic Times, a price hike for the upcoming Galaxy S26 series is now "inevitable" due to the soaring cost of key components:

  1. Samsung launched the Galaxy S25 series (256 GB) in South Korea at the same price that it charged for the S24 series.
  2. Price stability for the upcoming Galaxy S26 lineup will not be possible, however.
  3. Costs of key smartphone components, including Application Processors (APs), continue to inflate.
  4. As per Samsung's semiannual report in August, the cost for mobile APs has risen 12 percent year-over-year, while camera modules have experienced a cost inflation of 8 percent.
  5. The soaring demand for HBM for AI workloads is increasingly cornering the global DRAM capacity, leading to supply bottlenecks and price hikes for mobile-centric LPDDR5.
  6. The cost of a 96Gb LPDDR5 has increased by 16 percent relative to the first quarter of 2025.
  7. Xiaomi has already raised the retail price of its Redmi K90 model released in October.
  8. Chinese OEMs such as Oppo and Vivo are also pursuing price hikes.

Goldman Sachs: Smartphone gross margins under pressure

Meanwhile, Goldman Sachs has now penned a pertinent note on this topic, noting that smartphone gross margins will remain under pressure for the next 12 to 18 months. This industry paradigm does not bode well for Samsung's ambitions for the Galaxy S26 series.

The report points out:

  1. Due to the increased diversion of global DRAM capacity towards HBM and the concurrent rise in smartphone DRAM content, the cost of low-power DRAM continues to increase.
  2. TrendForce has revised its outlook for conventional DRAM pricing in Q4 2025 upwards, from an earlier forecast of 8 – 13 percent growth to 18 – 23 percent, with a strong likelihood of further upward revision.
  3. According to CMF, recent LPDDR4X DRAM prices (6GB/8GB/12GB) are up 7 – 12 percent relative to the end of September alone, or up a whopping 76 – 158 percent year-over-year vs. Q4 2024.
  4. The supply-demand imbalance for DRAM and NAND in 2026 will only aggravate, leading to a DRAM/NAND price upcycle throughout 2026.
  5. For the Redmi Note 14, which retails for $299, CMF indicates that the price of the 8GB+256GB uMCP (LPDDR4X + UFS 2.2) configuration has risen to $49, making up about 16 percent of the smartphone's retail price. Just a year back, the configuration constituted only 10 percent of the retail price.
  6. For the cheaper Redmi 15C, which retails for $119, the cost for the 4GB+128GB configuration is estimated to have increased from $18 in Q2 2025 (when it made up 15 percent of the original price) to $27 (now making up 23 percent of the original price).

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