Samsung cuts Q4 Galaxy A output plan by about 20%
Samsung Electronics told suppliers it will build roughly 10 million fewer Galaxy A units in Q4, shifting parts to Galaxy S and Galaxy Z.
Samsung Electronics has cut its fourth-quarter production plan for the Galaxy A series by about 20% compared with its plan at the start of the year, according to etnews.com. The company has passed the adjustment to its supply chain.
In component terms, the revised fourth-quarter order represents roughly a 10 million unit decrease on an annual basis. Samsung also plans to trim Galaxy A output by more than 10% next year.
The company is redirecting components and materials toward its higher-value Galaxy S flagships and Galaxy Z foldables instead of the lower-margin Galaxy A line. Memory prices have climbed far enough that memory can account for more than half the cost of a budget smartphone, and core parts such as PCBs and MLCCs are being prioritized for high-value AI chips, making smartphone supply harder to secure.
Samsung's mobile experience division is reported to be in an emergency situation after a loss this year.
Scale of the Galaxy A business
Samsung ships 230-240 million smartphones a year, and the Galaxy A series accounts for 70% of those shipments. In August, Counterpoint Research forecast that Samsung would edge out Apple by 0.1 percentage points to lead the global smartphone market this year.
Quick answers
How much is Samsung cutting Galaxy A production?
Samsung Electronics has reduced its fourth-quarter Galaxy A production plan by about 20% versus its early-year plan, a drop of roughly 10 million units on an annual basis, and plans a further cut of more than 10% next year.
Why is Samsung producing fewer Galaxy A phones?
Memory prices have risen so that memory can exceed half the cost of a budget smartphone, and components such as PCBs and MLCCs are being prioritized for high-value AI chips. Samsung is redirecting parts to the Galaxy S and Galaxy Z lines.