Samsung is quietly making fewer of the phones most people actually buy. A report out of Korea on October 26 says the company will cut Galaxy A production in the fourth quarter of 2026 by about 20 percent compared to its original plans, and component orders for the quarter are already down by that amount. One industry source puts the full-year shortfall at around 10 million fewer units, and another says Samsung aims to make at least 10 percent fewer Galaxy A devices next year too.
The reason is memory. Memory prices have been climbing for months, and memory now makes up over half the cost of some budget phones, according to the report. Samsung’s mobile division is reportedly facing its first-ever annual loss, and the company is responding by shifting scarce parts and materials toward its more profitable Galaxy S and Galaxy Z flagships.
Why a cut to budget phones matters so much
The Galaxy A series is not a side business. It accounts for about 70 percent of Samsung’s smartphone shipments, including models like the Galaxy A57, Galaxy A37, and Galaxy A17 5G. Samsung ships 230 to 240 million smartphones a year, and it has been trading the global top spot with Apple, which came out on top in 2025.
The timing is awkward. Back in August, Counterpoint predicted Samsung would beat Apple this year by a margin of just 0.1 percentage points. Losing volume on its biggest-selling lineup could easily hand Apple the crown, especially in a quarter when Apple’s first foldable is selling out. The iPhone Duo sold out in a minute at Korea’s carriers, Samsung’s home market, which shows how tight the race is.
Memory is now the most expensive part of a cheap phone
The deeper cause is a components squeeze. Materials for key parts such as PCBs and MLCCs are being prioritized for AI chips, which are far more lucrative than phone components. Samsung had kept Galaxy A production steady so far, partly because it makes its own memory and has easier access to raw materials than Chinese brands. With no end to the shortages in sight, that advantage has run out.
Samsung initially tried modest retail price adjustments to absorb the component costs, but that proved insufficient to protect baseline profitability. Cutting production is the next lever, and it is a telling one: the company would rather sell fewer budget phones than sell them at a loss.
What buyers should expect: higher prices, thinner specs
An industry insider warns that lower production may lead to higher prices, and that new phones could launch with downgraded displays or cameras while still costing more than their predecessors. That matches what Counterpoint warned about back in March, when the memory crunch first started biting.
For buyers, the practical advice is straightforward. If you were planning to buy a current Galaxy A model, especially the A57 or A37, do not assume it will be easy to find at today’s price in a few months. Stock already in stores and warehouses is unaffected, so the best deals are likely the ones available now, not the ones coming later. If you can wait, watch for clearance pricing on current models rather than assuming the next A-series launch will match last year’s specs at last year’s price.
It is also worth cross-shopping. Samsung’s move protects its flagships, which means previous-generation Galaxy S models may see sharper discounts as the company steers buyers upward. And if your budget is fixed, rival brands that held their production steady could offer better value on paper, though they face the same memory costs and may follow Samsung’s lead.
Apple is not the only winner here
The obvious beneficiary is Apple, which gains volume share without lifting a finger. But the subtler winner is Samsung’s own flagship business: every buyer pushed from a Galaxy A to a Galaxy S is a more profitable sale. The loser is the budget segment itself, which has driven smartphone adoption in India, Southeast Asia, and Latin America for a decade. If the cheapest good phones get worse or pricier, the upgrade cycle for hundreds of millions of users slows down.
Samsung has not confirmed the report, and production plans can change if memory prices ease. But the direction is clear, and it echoes across the industry: AI hardware is eating the component supply, and the phones at the bottom of the price ladder are paying for it first. If you are shopping in that range, the phone you can buy today may be a better deal than the one launching next year, and that is a sentence budget buyers rarely heard before 2026.
