[U: Statement] Samsung Faces Internal Stand-Off as Chip Division Prioritizes Profit Over Galaxy S26

UPDATE 12/03 1:45 PM EST: A spokesperson from Samsung reached out to SammyGuru with clarification, refuting the Korean media claims: “Recent reports that Samsung’s DS division has rejected certain customer requests are baseless and not true. We are in close communication with global customers to address industry needs.”

Samsung is on its way to make solid profits in its memory business next year. The recent price and demand outlook for high-performance memory chips is boosting confidence in the company’s DS (Device Solutions) Division. As a result, the division has reportedly refused to strike a long-term supply deal with the in-house Mobile Experience (MX) unit. This comes ahead of the launch of the Galaxy S26 series, putting MX’s profitability at risk.

Samsung’s smartphone division failed to secure a long-term memory contract

According to a report from Sedaily (via Jukan), the DS division recently rejected MX’s request for a contract of more than a year to secure mobile DRAM. Instead, DS offered a three-month agreement on a quarterly basis. Even after senior MX executives engaged in extended supply terms, the smartphone unit secured DRAM supply only through the fourth quarter of this year.

The prices of low-power DRAM, mainly the 12GB LPDDR5X modules used in Galaxy flagships, have risen dramatically. The chip cost about $33 at the beginning of the year, but is now around $70 as of late November — more than double in under a year. Now that DS has refused to lock in longer-term supply at current prices, MX may see continued volatility as Galaxy S26 production moves forward.

“With AI accelerators absorbing not only HBM but also LPDDR volume, the DS division has no choice but to restructure its portfolio around profitability,” said an industry insider to the outlet. “Samsung has a robust division-specific management structure, giving priority to market logic”.

Meanwhile, the MX division remains worried about increasing prices for mobile application processors (APs). Samsung’s Device Experience (DX) division reportedly spent around KRW 10.93 trillion on AP purchases in the third quarter. This is about 25% up from around KRW 8.7 trillion during the same period last year. With both AP and DRAM prices increasing, the Galaxy S26 series may also see a price hike.