Samsung’s mobile division has reported its first-ever quarterly loss, despite strong smartphone sales, as rising memory and component prices linked to the AI boom eroded profits. The result highlights how higher hardware costs are squeezing phone makers, particularly in lower-priced models with already narrow margins, and may lead to higher handset prices for consumers.

Samsung’s DX division, which includes mobile, TVs and appliances, recorded an operating loss of 800 billion won (£544 million) in its second fiscal quarter; the mobile business was the main cause. Sales of Galaxy S26, Galaxy S26 Ultra and Galaxy Z Fold 8 devices remained solid, but budget phones struggled, while Samsung’s chip division benefited: memory sales rose 56 per cent quarter-on-quarter and the company posted record quarterly revenue of 171.5 trillion won and operating profit of 89.5 trillion won.