Samsung reportedly fears its first-ever operating loss in Q1 2026 due to rising memory and semiconductor costs for mobile devices. This concern has prompted the tech giant to implement cost-cutting measures, including reducing overseas travel expenses for executives. The memory cost surge reflects broader industry challenges affecting smartphone manufacturers globally.

Despite these concerns, Samsung's Galaxy S26 Ultra leads strong pre-order performance, capturing 80% of total S26 series orders. Pre-orders jumped 25% in the U.S. after smashing records in South Korea. This consumer enthusiasm contrasts with Samsung's internal worries about profitability as component costs continue climbing.

Memory prices are projected to increase an additional 20% in 2026 following a 30% jump expected by late 2025. This roughly 50% total increase in component costs threatens to squeeze profit margins across the industry. Samsung faces significant pressure to maintain competitive pricing while absorbing these escalating expenses.