Samsung launched the Galaxy S26 series a few weeks back. According to the company, its new high-end phones have broken previous pre-order records as well as achieved double-digit growth in many markets.
Nevertheless, the success is likely not enough to prevent a financial crisis for Samsung’s mobile business. The Galaxy S26’s record-breaking performance may not be able to save Samsung’s mobile division from its first-ever loss.
A report from FNNews reveals that Samsung Electronics has placed its mobile division, Samsung MX, in emergency mode. Samsung’s home appliance and TV divisions were already operating under similar measures. This implies that the company’s Device Experience (DX) business, (which includes home appliances, mobile, and TV businesses), is now under emergency management.
Reports have it that the company is facing profitability challenges due to sharply rising memory chip prices. Memory chip prices have increased by about 8.5 times (850%) over the past year. This, no doubt, contributed to the reduction of Samsung MX’s profitability.
An operating profit of KRW 12.9 trillion (around $8.62 billion) was reported by Samsung MX in 2025. The figure is likely to fall to around KRW 5 trillion (around $3.34 billion) this year. This implies that its profit margin, which rose to 11% in the first quarter of 2025, is likely to reduce to just 3%. According to some insiders, it will even be difficult to maintain a 1% profit margin this year. This being the case has raised concerns that the division could record its first-ever loss.
Apart from Samsung, other smartphone brands like, Honor, OPPO, Vivo, and Xiaomi, will likely experience this condition.
Samsung Electronics’ Digital Appliances division, which handles home appliances, and its Visual Display division, which covers TVs and monitors, are also expected to struggle. These divisions could record a combined loss of about KRW 200 billion (around 133 million) this year. This is similar to the performance in 2025.
In the efforts to minimise costs, there’s the possibility some employees will be reassigned, and some senior staff members will be encouraged to take early retirement. Samsung has ordered a 30% reduction in expenses across all its divisions. This is also part of its emergency measures.
Then again, Samsung has introduced stricter travel policies. As a result of this development, Samsung DX executives below the vice president level aren’t allowed to fly business class. Rather, they must travel in economy class instead for flights shorter than 10 hours.
