Samsung Electronics has posted the most profitable quarter any South Korean company has ever reported, and almost all of it came from the memory chips that artificial intelligence servers cannot get enough of. The same shortage is now reaching the other half of Samsung, the one that sells phones and appliances. Its flagship Galaxy phone now costs a hundred dollars more in the United States and South Korea, and the company passing on the memory bill is the one that makes the memory.

Memory is among the most expensive parts inside a phone, a laptop or a games console, and chipmakers are steering limited output toward the high-bandwidth memory used in AI data centers, where margins are far richer. Shoppers end up bidding against cloud companies for the same silicon, and so far the cloud companies are winning.

Samsung’s preliminary filing put operating profit at 107.4 trillion won, more than $75 billion, on revenue of about 195 trillion won. Profit rose roughly 783% from a year earlier, when it was 12.17 trillion won, and 20% from the previous quarter’s 89.4 trillion won, itself a record. The operating margin reached 55.1%, meaning Samsung kept more than half of every won of sales as operating profit, a ratio more typical of a software firm than of a television maker. By the Seoul Economic Daily’s conversion, the quarter beat Nvidia‘s latest quarterly operating profit of $63.7 billion by about a fifth.

The preliminary release carries no divisional breakdown, but the shape is clear. The Chosun Ilbo estimated, as relayed by market tracker TrendForce, that the chip division alone earned about 110 trillion won, more than the whole company. Industry estimates cited by the Seoul Economic Daily put the phone and appliance division at an operating loss of about 2 trillion won, squeezed by memory costs and by weaker demand as high oil prices weigh on households. The mobile and networks business had already slipped to a 700 billion won loss the quarter before, The Korea Herald reported.

The price rise covers the Galaxy S26, S26+ and S26 Ultra. In the US the cheapest S26 now starts at $999.99, and the 1TB Ultra climbs $200 to $1,999.99. In South Korea the 256GB S26 rose 149,600 won to 1,403,600 won. The S26 FE and the foldables were spared, and the reported increases so far cover only those two markets. Samsung issued no statement explaining the move. Apple and Google have each raised prices by about $100 on their latest phones, so switching brands offers little shelter.

Investors were not celebrating either. Samsung shares edged lower in Seoul after the release, as they did after the previous record, when they fell almost 7% on fears that the chip cycle had peaked. “Samsung has delivered a record profit and still fallen short of expectations, which tells you just how demanding the AI trade has become,” said Josh Gilbert, a market analyst at eToro. Revenue also came in below the FnGuide consensus of about 200 trillion won, a hint that higher prices, more than higher volumes, are doing much of the work. Memory has always been a boom-and-bust business, and profit built on scarcity lasts only as long as the scarcity. Samsung is trying to blunt that risk with supply contracts of three to five years, according to the Seoul Economic Daily.

For buyers, the squeeze is not over. TrendForce, cited by The Korea Herald, expects conventional DRAM contract prices to rise another 10% to 15% in the fourth quarter and NAND flash storage 15% to 20%, costs that feed straight into next year’s phones and laptops. Samsung publishes its full third-quarter results, with the first official split between chips and devices, on October 29. Until then the clearest consumer number sits on Samsung’s own website, where the cheapest Galaxy S26 now stops one cent short of $1,000.

Tags: AI infrastructure, DRAM, memory chips, Samsung Electronics, Galaxy S26, smartphone prices