Memory prices have surged to nearly four times year over year in the first quarter. This has affected the Redmi brand, which has prioritized extreme cost-effectiveness. For some models, we had no choice but to raise prices slightly or end promotions and revert to original prices. We ask for your broad understanding. (Lu Weibing, president of Xiaomi Group)
Due to changes in the international situation, the exchange rate and prices of key components such as memory semiconductors have risen together, making a price increase unavoidable. (Samsung Electronics)
While Apple, which boasts the No. 1 global smartphone market share, has withstood the sharp rise in prices of key components such as memory, latecomers have raised the white flag, saying they can't hold out. Smartphone makers, including No. 2 Samsung Electronics and No. 3 Xiaomi in global smartphone sales, are lining up to raise prices. Lu Weibing, president of Xiaomi Group, recently said, The increase in memory prices this time was much larger than expected. For the 12GB+512GB model, component prices rose by about 1,500 yuan (about 330,000 won), and for the 16GB+1TB model, the increase was even larger. Experts believe consumers' preference for No. 1 Apple will deepen further.
Hong In-gi, a professor in the Department of Electronic Engineering at Kyunghee University, said, There has been a perception that Apple was expensive, but a price freeze has formed an image that it has price competitiveness. Apple preference will deepen further, adding, In particular, some students had been unable to approach Apple because of price, but as such demand increases, it is clear that the gap between No. 1 Apple and the other brands will widen.
◇ No. 2 Samsung Electronics to latecomers Xiaomi, Vivo, Oppo all raise prices at once
According to Counterpoint Research, in the first quarter of this year (January–March), DRAM and NAND flash prices rose by more than 50% and 90%, respectively, compared with the previous quarter. As a result, Xiaomi is reportedly set to raise prices in China from the 11th for the Redmi K90 Pro Max, Redmi Turbo 5, and Redmi Turbo 5 Max. Although Lu Weibing did not disclose the exact increase for each product, the Xiaomi Redmi K90 Pro Max will rise by 200 yuan (about 40,000 won), and the Turbo 5 and Turbo 5 Max will end their spring promotions. Earlier, on the previous month, other Chinese smartphone makers, No. 4 Vivo and No. 5 Oppo in the world, also raised prices.
Samsung Electronics also unusually raised prices this month for models released a year ago. Samsung increased the factory price of the foldable smartphone Galaxy Z Flip 7, released in July last year, from 1,643,400 won to 1,738,000 won, and the Galaxy Z Fold 7 512GB model from 2,537,700 won to 2,632,300 won. Each saw a factory price hike of 94,600 won. The Fold 7 1TB model went from 2,933,700 won to 3,127,300 won, up 193,600 won. Along with this, the Galaxy S25 Edge 512GB model, released in May last year, was also raised from 1,639,000 won to 1,749,000 won, an increase of 110,000 won. A Samsung Electronics representative explained, Although we have maintained a domestic price freeze policy for several years to minimize the burden on customers despite adverse conditions such as exchange rate increases, a price increase was unavoidable.
◇ Samsung struggles, even changing components, while Apple freezes prices as if to show it off
But Apple, the No. 1, is taking a completely different path. Apple is said to be maintaining prices while preemptively securing available mobile DRAM supplies in the market at high prices. Apple expanded its lineup last month by adding the budget model iPhone 17e, and although it is not a premium model, it doubled the storage to 256GB from its predecessor while setting the price at 990,000 won. It is the same amount as the previous model. In the United States, the iPhone 17e is also priced at $599, the same as its predecessor. Apple appears to be prioritizing market expansion by holding prices in the mid- to low-end market as well.
Even though smartphone makers have raised prices, they have been unable to fully reflect the soaring memory prices and are troubled by Apple's moves. If a flagship model is launched $200 higher than a year ago, it inevitably affects sales volume. What troubles manufacturers more is that the more they equip the AI features consumers want, the more the cost of required components rises. Expanding on-device (embedded) AI raises specifications for memory, chips, and storage. On top of that, the Middle East war is leading to higher logistics costs.
In the end, manufacturers are striving to cut expense where possible. For example, Samsung is reportedly set to equip the soon-to-be-released Z Fold 8 and Z Flip 8 with M13 displays. These displays are excellent as well, but brightness, efficiency, and battery life are somewhat lower than the latest M14 panels. The Galaxy S26 Ultra will apply the latest commercialized M14. Of course, the M13 panel is not at all bad, as it has been used starting with the Galaxy S24 series in 2024, followed by the Galaxy Z Fold 6/Flip 6, the Galaxy S25 series, the Galaxy Z Fold 7/Flip 7, and the regular and Plus models of the Galaxy S26 series released in February.
In addition, Samsung is said to have decided to procure a significant volume of flexible organic light-emitting diode (OLED) panels from China Star (CSOT) in China, focusing on major mid- to low-priced models such as the A57 and FE produced starting this month. Considering that, aside from ultra-budget smartphones, Samsung Display had supplied a large share of OLED panels for the A series, this is a bold decision. To ensure stable quality and maintain the internal supply chain, while burdened by manufacturing costs under contract with Samsung Display, it sought to diversify its supply chain. Samsung Electronics is also said to be increasing the use of Chinese (Huanli) parts for the Z Flip 7 hinge, and for some S series smartphones, the Chinese supplier (Sunny Optical) has emerged as a major company for ultra-wide-angle camera modules.
Bang Hyo-chang, a professor in the Department of Smart IT at Doowon Technical University and policy committee chair at the Citizens' Coalition for Economic Justice, said, Apple, which had boasted higher margins than other brands, froze prices by absorbing the cost burden from DRAM increases internally, adding, However, if latecomers raise prices and even adjust components, savvy consumers of this era will inevitably recognize it, and the tilt toward Apple will become more pronounced.