Samsung unveils Galaxy S26; lifts prices in key markets amid chip price surge

By Heekyong Yang

SEOUL, Feb 26 (Reuters) - Samsung Electronics 005930.KS on Thursday launched its flagship Galaxy S26 smartphones with higher prices for some models in the United States and South Korea, testing demand as soaring memory chip costs pressure margins.

The rollout, which integrates Perplexity's AI features along with Google's GOOGL.O Gemini and an upgraded Bixby, follows Samsung's loss of smartphone leadership last year to Apple AAPL.O, which benefited from strong iPhone demand in China and India.

The company last month warned of a worsening chip shortage driven by the AI boom, with strong memory demand supporting its core chip business but pressuring smartphones and display units.

A global push by firms such as Meta, Google and Microsoft to build AI infrastructure has absorbed much of memory supply, lifting prices as chipmakers prioritise higher-margin data centre components such as high-bandwidth memory chips over consumer devices.

Samsung priced the base Galaxy S26 at $899 in the United States, up 4.7% from the previous model, and the S26 Plus at $1,099, up 10%. Prices for the Ultra were unchanged.

In South Korea, it raised the base model price by 8.6%.

The company also equipped some S26 models with in-house Exynos processors after using Qualcomm’s QCOM.O Snapdragon chips for the S25, a shift analysts said could support its chip design business and mobile margins.

Samsung said the S26 Ultra includes what it calls the industry's first built-in mobile privacy display, limiting side viewing angles.

The company said it will begin rolling out the S26 series on March 11.

Market tracker TrendForce expected conventional DRAM contract prices to surge by 90% to 95% in the January to March period of this year, from the final three months of 2025.

Apple's Tim Cook said in a post-earnings conference call in January he expected memory chip prices to increase sharply, but declined to answer analysts' questions about whether Apple would raise prices in response.