Samsung Electronics and Apple are scaling back orders for smartphone components as soaring memory prices squeeze margins, The Korea Herald reported on 26 October 2026, citing industry sources. The report says the cuts threaten fourth-quarter earnings at Samsung Display, which draws nearly two-thirds of its revenue from the two handset makers.
The Herald traces the strain to the memory market: chipmakers are directing production capacity toward server DRAM and high-bandwidth memory for AI data centers, making mobile memory far more expensive, it reported.
Short explainer · The memory squeeze
A vertical news Short narrated from the published text of this piece and related FourWeekMBA pieces.
Business Pill · The memory wall
An evergreen Business Engineer explainer on why memory, not only compute, limits AI performance. It explains the general idea and does not discuss Samsung Display or Apple.
The key insight: As we read it, the Herald’s report shows the AI memory boom reaching consumer hardware: the same server DRAM and HBM demand that lifts chipmakers is, by its account, pushing Apple and Samsung to cut smartphone part orders.
According to the Herald’s industry sources, Samsung’s mobile division has asked suppliers to trim fourth-quarter component deliveries by 20 to 30 percent from earlier plans.
Apple has reportedly cut October orders for certain iPhone 18 Pro and Pro Max parts by 15 to 20 percent, the Herald reported.
The Herald noted that Samsung generally reduces handset production ahead of its next Galaxy S launch, but said the latest reported cuts are steeper than expected. The pullback comes during a period when flagship launches typically lift orders for high-end OLED panels, it added.
Reported ranges of smartphone component order cuts, per The Korea Herald (26 Oct 2026, citing industry sources): Samsung’s mobile division asked suppliers to trim fourth-quarter deliveries by 20 to 30 percent from earlier plans; Apple reportedly cut October orders for certain iPhone 18 Pro and Pro Max parts by 15 to 20 percent. The scopes differ and are not added together.
Patently Apple relayed the Korean report on X on 27 October, under the headline that Samsung Display faces a profit squeeze as Apple cuts iPhone 18 Pro orders. Its article cites the same figures as The Korea Herald: Apple’s 15 to 20 percent cut to October orders for certain iPhone 18 Pro and Pro Max components, and Samsung Electronics’ 20 to 30 percent cut to fourth-quarter deliveries. This piece is sourced to the Herald’s own article.
Two Customers, Two-Thirds of Sales
Samsung Display’s 2025 revenue by customer group, per The Korea Herald: 40.4 percent from the group widely believed to be Apple, 22.4 percent from the group widely believed to be Samsung Electronics, and 37.2 percent from all others (our arithmetic). Both large customers are reportedly cutting component orders as memory prices rise.
Samsung Display’s 2025 audited accounts show that customer groups widely believed to be Apple and Samsung Electronics generated 40.4 percent and 22.4 percent of annual revenue, respectively, the Herald reported. Together they accounted for 18.66 trillion won ($14.1 billion), or 62.8 percent of sales.
The Herald wrote that a drop in premium OLED orders could hurt profits more than shipment volumes suggest, because weaker factory utilization would raise per-panel fixed costs while fewer high-margin screens would drag down the sales mix.
“The bigger concern isn’t necessarily how many fewer panels Samsung Display sells, but which panels it loses orders for,” an industry source told the Herald.
The Memory Squeeze Behind It
Samsung Display’s two biggest customer groups, as reported by The Korea Herald (26 Oct 2026) from its 2025 audited accounts: 18.66 trillion won ($14.1 billion, the Herald’s conversion) of revenue, or 62.8 percent of total sales, from the groups widely believed to be Apple and Samsung Electronics.
Market researcher TrendForce estimated that prices for LPDDR5X, the memory used in smartphones, jumped 78 to 83 percent in the second quarter from the previous three months, according to the Herald.
Global smartphone shipments fell 20 percent on-year in the third quarter, their lowest level for the period since 2012, according to Counterpoint Research as cited by the Herald.
The Herald also reported that Samsung’s mobile and networks business posted a 700 billion won operating loss in the second quarter despite higher revenue, and that Apple raised Korean starting prices for the iPhone 18 Pro and Pro Max by 200,000 won each.
The squeeze could extend to panel pricing, the Herald wrote. Display research firm UBI Research said this month that handset makers are pressing OLED suppliers for discounts to offset higher memory costs, the Herald reported.
The Foldable Cushion
The Herald pointed to one possible cushion: Apple’s first foldable, the iPhone Duo, which went on sale on Friday with OLED panels supplied exclusively by Samsung Display.
Omdia expects Samsung Display to account for 66 percent of global foldable display shipments this year, as the market expands 44 percent to 29 million units, according to the Herald.
“An exclusive deal for Apple’s foldable phone is a major win, but it doesn’t automatically make up for weaker orders from the regular iPhone lineup,” another industry source told the Herald.
As we read it, the cost runs down the chain: the Herald reports LPDDR5X prices up 78 to 83 percent in a quarter, handset makers cutting component orders, and display suppliers pressed for discounts.
As we read it, Samsung Display’s exposure is concentration: by the Herald’s figures, two customer groups make up 62.8 percent of its sales, and both are reported to be cutting.
As we read it, the mix matters more than the count: the Herald’s source says the concern is which panels are lost, with premium iPhone screens among the higher-margin ones.
An industry source, to The Korea Herald, 26 October 2026
“If the cuts fall heavily on premium iPhone models, the damage to operating profit could be disproportionately large, especially if factory utilization also starts to decline”
Three Implications
FOR PANEL MAKERS UBI Research says handset makers are pressing OLED suppliers for discounts to offset higher memory costs, the Herald reported.
FOR APPLE AND SAMSUNG The Herald reports Apple raised Korean starting prices for the iPhone 18 Pro and Pro Max by 200,000 won each, while Samsung’s mobile business posted a second-quarter operating loss.
FOR FOLDABLES Omdia expects Samsung Display to hold 66 percent of foldable display shipments this year, the cushion the Herald points to.
The framework puts it this way: “Memory is becoming the new compute. HBM growth is outpacing accelerator demand, making memory the rate-limiting factor in the AI scaling equation.”
As we read it, the Herald’s report shows the other side of that constraint: memory makers directing capacity to AI data centers leaves smartphone memory scarcer and dearer. The framework was written in December 2025 about HBM supply and does not discuss Samsung Display or the iPhone 18 Pro.
What Is Not Established
The cuts rest on unnamed industry sources, and the Herald describes Apple’s cut as reported. The report does not carry comment from Apple, Samsung Electronics or Samsung Display, and it does not say which components or suppliers are affected beyond OLED panels.
Samsung Display’s accounts do not name its customers; the Herald says the two groups are widely believed to be Apple and Samsung Electronics. The share for all other customers, 37.2 percent, is our arithmetic.
This Week In The AI Supercycle
Execution Fault Lines, Concentrated Demand, and Geopolitical Firewalls
This week’s issue: the AI build is not short of demand for its parts. It is short of cheap money, and its end revenue rests on a narrow base of large, often venture-funded buyers.
The Korea Herald reports that Apple and Samsung Electronics are cutting smartphone component orders as AI-driven memory prices rise, putting fourth-quarter profit at Samsung Display, which relies on the two for 62.8 percent of its sales, under pressure.
A note on sourcing. The order cuts are as reported by The Korea Herald on 26 October 2026, citing industry sources; we read the Herald’s article in full. Figures from TrendForce, Counterpoint Research, UBI Research and Omdia are as cited by the Herald. We found the story through Patently Apple’s post on X. Figures labelled our arithmetic are ours. This is not investment advice.
Gennaro Cuofano is a CRO and tech executive who has worked in AI since late 2015, starting with bringing NLP, natural-language generation, voice and chatbot products to the marketing industry. His background is in law and finance: he holds a Master's degree in Law and an International MBA with an emphasis on corporate finance (LUISS Business School and the University of San Diego, 2012), and worked as a financial analyst at a real-estate investment firm in San Diego and as an assistant controller. His work focuses on business model strategy, business engineering and, more broadly, structural analysis: how companies make money, read from their own filings. He created FourWeekMBA and leads research there and at The Business Engineer, his newsletter on AI and business strategy, with over 95,000 subscribers and more than 1,000 published analyses. His writing has also appeared on Entrepreneur (for example, How to Digitize a Family Business in Europe) and HackerNoon. Find him on LinkedIn and Substack. See how we source.
