Samsung Electronics and Apple are increasingly relying on their high-end foldable smartphone lines to offset the margin pressure caused by an artificial intelligence-driven semiconductor shortage.
As memory chip costs surge due to data center demand, the traditional smartphone business faces significant headwinds, prompting a strategic shift toward devices that can command higher price points.
This follows Apple’s recent decision to hike Mac and iPad prices by up to 25% amid similar supply constraints.
Samsung president and CEO TM Roh highlighted this strategy during the launch of the Galaxy Z Fold8 and Flip8 series in London.
The new lineup carries a $100 price increase over the previous generation, reflecting the broader industry trend of passing elevated component costs to consumers.
This follows Apple’s recent decision to hike Mac and iPad prices by up to 25% amid similar supply constraints.
The semiconductor shortage, initially driven by the insatiable demand for AI training and inference chips, has rippled through the consumer electronics supply chain.
Memory manufacturers are prioritizing high-margin data center products, leaving fewer resources for consumer-grade components.
This dynamic has fueled a sell-off in Asia tech stocks, with investors reassessing the profitability outlook for hardware makers.
Foldable phones, despite their already premium pricing, offer a crucial avenue for maintaining gross margins.