How Samsung’s latest RAM decision will hurt budget Android phones

The RAM crisis sweeping the tech markets shows no signs of abating – and in some cases, it may be getting worse. Demand from AI datacenters isn’t slowing down, and Samsung Electronics has just taken it on Last orders for budget smartphone memory: LPDDR4 and 4X RAM chips, which, despite their age, still underpin a large portion of affordable devices. As one of the few major players in the memory sector, Samsung’s decision to push LPDDR4 toward end-of-life to free up capacity for new, higher-margin memory is a double-edged sword.

For context, most – but certainly not all – smartphones have moved to LPDDR5 and 5X, including relatively affordable models like Samsung’s Galaxy A37. But there are still plenty of exceptions. The low-cost Nothing Phone 4a is a recent example of a device clinging to older memory, and some budget chipsets – including Samsung’s own Exynos line – continue to support it.

LPDDR4 may not be state-of-the-art, but it is widely used, especially at the lowest prices. And this is where the current crisis hits hardest now. Budget devices are more exposed than flagships, simply because they have less room to absorb rising component costs.

according to competitionThe share of DRAM in bill-of-materials (BOM) costs in affordable (sub-$200) and mid-tier ($400-$600) smartphones has increased over the past year. At the low end, phones using LPDDR4X – the same memory that Samsung is phasing out – have seen BOM share rise from about 13% to 26% between Q1 2025 and Q1 2026, with estimates that will reach 35% in Q2. A major supplier taking the last order will only tighten supplies further and drive costs even higher.

This leaves budget handset makers with few good options. Raising prices is the obvious move, but it weakens the overall value proposition and risks pushing these devices into direct competition with better-equipped mid-range phones.

Cutting across specifics is not very attractive. There’s little slack left to trim: weaker processors, lower-end cameras, or even tighter memory configurations may be on the table in some cases, but each comes at the cost of an extremely poor user experience. For consumers shopping on a budget, that means paying more for less — or settling for devices that feel increasingly compromised. There is no easy victory here.

At first glance, the shift in production to LPDDR5 may seem like good news for high-end devices. There is some truth in this. By turning off older memory, Samsung can redirect capacity to newer, more profitable DRAM and NAND storage, which is also under pressure. But there’s no guarantee Samsung will dedicate additional capacity to mobile chips when data-center high-bandwidth memory (HBM) is currently far more profitable.

Even if this happens, it is not a quick solution. Demand at higher levels is arguably even more intense, and the cost impact is already visible. DRAM is expected to contribute 20-23% of phone BOM cost in mid-tier and premium smartphones in Q2 2026 – significantly down from 7% a year ago for LPDDR5X. That’s a dramatic increase, and one that will force manufacturers to either make cuts elsewhere or pass the cost on to consumers.

Any relief from shifting production will also take time. Samsung has just taken the final orders for LPDDR4, which means those chips will continue to roll off production lines for a while yet. Retooling manufacturing plants is neither quick nor easy – it could take several months for additional LPDDR5 capacity to come online. And even then, pent-up demand may absorb any gains without a significant drop in prices.

Of course, Samsung isn’t working in a vacuum, and the size of the RAM supply depends exactly on how Micron and SK Hynix handle production priorities. But based on current trends, meaningful relief for high-end consumer tech may not come until 2027 at the earliest. The situation is going to be even more difficult for budget handsets.