In Q4 2025, Samsung’s Mobile eXperience (MX) division reported revenue of 29.3 trillion won (USD 20.1 billion) and an operating profit of 1.9 trillion won - a 9.5% year-over-year decline. Its operating margin also shrank from 8.1% to 6.5%.

The sharp jump in DRAM and NAND chip prices - fueled by a global race to build AI infrastructure - is the key culprit. “Rising memory prices are an industry-wide challenge,” admitted Cho Seong-hyuk, Chief Strategy Officer of Samsung’s MX unit. Mobile chief Roh Tae-moon had already hinted at CES 2026 that “price adjustments may be necessary” for upcoming smartphones.

Industry analyst Lee Min-hee noted, “Even if the Galaxy S26 launches in March, cost escalation will weigh on the division’s margins.”

Apple, in contrast, is enjoying record-breaking financials. The company recently reported USD 143.8 billion in revenue, with a stellar 35.4% operating margin. iPhone sales reached USD 85.3 billion, marking a 23% year-on-year increase.

CEO Tim Cook downplayed memory costs, saying they had only a minimal impact on last quarter’s margins. Analyst Ming-Chi Kuo predicts Apple is likely to retain the iPhone 18’s starting price at USD 799, even if that means accepting narrower hardware margins to protect the ecosystem’s long-term growth.

The difference lies in each company’s profit structure. Samsung relies heavily on hardware sales, whereas Apple benefits from its fast-growing Services segment, which generated USD 30 billion last quarter at a gross margin of 76.5%. This revenue buffer allows Apple to better absorb component cost spikes without passing them on to consumers.

Samsung’s strategy moving forward will focus on ramping up Galaxy S26 sales and reinforcing its position as a leader in AI smartphones. The company plans to deliver “Agentic AI” experiences that showcase its innovation in intelligent device interactions.

Whether Samsung can balance pricing, profitability, and innovation will be a key storyline as the Galaxy S26 approaches its anticipated March debut - especially in a market increasingly defined by ecosystem strength, not just hardware specs.

Du Lam