Huawei and Samsung Announce Price Hikes Amid Memory Semiconductor Surge
In a significant move reflecting ongoing market pressures, Huawei has publicly disclosed imminent price increases for its smartphones, attributing these adjustments to skyrocketing memory semiconductor costs.
Concurrently, Samsung Electronics has also reacted to similar challenges, raising the U.S. prices for its Galaxy S26 series by as much as $200.
On the 1st of the month (local time), Richard Yu, the CEO of Huawei Consumer Business, addressed reporters in Shenzhen regarding the company’s pricing strategy.
He stated, “We will need to raise prices going forward,” elucidating that “the magnitude of the increases will be measured.”
Yu emphasized that the surging costs associated with memory procurement have inflated the manufacturing expenses of smartphones by an average of $200 (approximately 270,000 won), although a specific baseline for this comparison was not provided.
Huawei’s premium device, the Mate 90 Pro Max Special Edition, was unveiled the same day, with a staggering price tag of 10,999 yuan (around $1,600).
By positioning the new model at a higher price point than its predecessor, the company has commenced the process of transferring increased costs to consumers.
In parallel, Samsung Electronics has revised the manufacturer’s suggested retail prices for the Galaxy S26 series on its official U.S. website.
The entry-level Galaxy S26 (256GB) has seen a price hike of $100, now listed at $999.99 (approximately 1.4 million won). The Galaxy S26 Plus (256GB) is priced at $1,199.99 (approximately 1.6 million won).
Further, the Galaxy S26 Ultra has similarly increased, with both the 256GB and 512GB models rising by $100 to $1,399.99 (approximately 1.9 million won) and $1,599.99 (approximately 2.2 million won), respectively.
The 1TB variant saw a substantial increase of $200, now priced at $1,999.99 (approximately 2.7 million won). Notably, the budget-centric Galaxy S26 FE and the foldable Galaxy Z Fold and Flip 8 have maintained their current pricing structures.
Underlying Factors and Market Implications
The impetus behind these price elevations is intricately linked to a meteoric rise in memory semiconductor demand, primarily driven by advancements in artificial intelligence (AI) infrastructure.
As costs associated with DRAM and other essential memory components surge, profit margins for global smartphone manufacturers—including tech giants like Apple and Xiaomi—have come under significant strain, prompting widespread price adjustments across their product lines last September.
Yu posited that the ongoing memory supply crunch could inadvertently offer a lucrative opportunity for Huawei.
He articulated the notion that budget smartphone manufacturers are particularly susceptible to these escalating costs, whereas Huawei’s forte lies in mid-to-high-end offerings.
“As demand for low-end products contracts further, all manufacturers will be compelled to transition to the mid-to-high-end segment,” Yu remarked. “This is precisely where Huawei excels.”
Market analysts from Counterpoint Research predict a stark reduction in the availability of approximately 230 million smartphones priced below $200 by the year 2030, primarily due to persistent memory supply shortages.
This trend underscores the potential for a dramatic contraction in the entry-level segment, which currently holds a considerable share of the global smartphone market.
In terms of consumer behavior, evidence suggests that demand within the Chinese market has shown notable fragility this year.
According to Counterpoint, weekly smartphone sales in China have reported double-digit year-over-year declines since July.
With the combined impact of rising memory costs and a contraction in consumer spending, manufacturers are increasingly prioritizing strategies to safeguard profitability.
“I am confident that we can navigate through this cycle and continue to deliver innovative products,” Yu asserted.
Huawei aims to sustain its dominance in the premium market segment by capitalizing on its proprietary chip design competencies and extensive software ecosystem, even amid the challenges posed by the memory supply shortage. However, specifics pertaining to the company’s overseas market expansion remain undisclosed.
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