Samsung Electronics said on its October 29 earnings call that demand for AI-related memory will keep outrunning supply through 2027 and that supply limits are expected to continue into 2028, according to summaries of the call. The warning matters beyond data centers because phone and PC makers buy from the same memory suppliers. It arrived alongside record quarterly profit at Samsung, a reported 21% drop in global PC shipments in the third quarter, and an admission from Intel that it has run out of some chips for budget laptops. Samsung’s own filings were not opened for this article, so its figures are as reported by the outlets cited.

What Samsung said

Memory executive Jaejune Kim said on the call that the move to newer high-bandwidth memory, or HBM, will act as a physical constraint on supply, according to Wccftech’s report. Larger and more complex HBM4E and HBM5 chips, with bigger dies and more metal layers, limit how much can be made. Samsung also said its higher capital spending will not translate into faster growth in memory output, Wccftech reports, and a summary of the call carried by BigGo Finance quotes chief financial officer Sooncheol Park saying new capacity is unlikely to raise bit production in the short term.

Supply for next year is already spoken for. Wccftech reports that Samsung’s 2027 HBM4 output is fully committed, and BigGo’s summary says the volume is sold out at an agreed target price. HBM4 sales more than tripled from the previous quarter and reached 60% of HBM revenue, according to BigGo, and Samsung plans to start mass production of HBM4E in the first half of 2027.

Long-term contracts are spreading. Wccftech reports Samsung has signed long-term agreements with 10 major customers that will cover roughly 60% to 70% of its production capacity, and that demand for such deals now reaches mobile, automotive and networking customers rather than only cloud providers. BigGo’s summary says 10 contracts are concluded and 10 more are under negotiation. Android Headlines, summarizing the same call, reports the company expects memory supply to stay constrained through 2028.

Samsung’s message has been consistent and has grown stronger over the year. In January, Reuters reported that Kim expected supply growth to stay constrained through 2027, and that co-CEO TM Roh did not rule out raising device prices. At the April 30 first-quarter call, the Korea Herald reported, Kim said advance customer orders alone implied that next year’s supply-demand gap would be wider than this year’s. The October call extends the horizon to 2028.

Samsung’s own results

The quarter itself was a record. A summary of the call carried by BigGo Finance puts third-quarter revenue at 195.3 trillion won, up 127% from a year earlier, and operating profit at 107.4 trillion won, up 783%, or about $80 billion at the exchange rate Reuters used in October. Samsung had pre-announced the operating profit figure on October 8, when Reuters said it was slightly above the LSEG SmartEstimate of 106.1 trillion won.

The chip business supplied almost all of it. Both Bloomberg Línea and BigGo’s summary put the device solutions division’s operating profit at 106.5 trillion won. Bloomberg Línea says that was about 2 trillion won short of the 108.5 trillion won analysts had expected, which it said dampened enthusiasm for AI infrastructure and raised questions about whether Samsung can turn industry-wide shortages into higher margins when rivals hold lucrative long-term HBM contracts. Expansión attributes a share-price fall of as much as 6.2% to investor concern over how long AI-driven growth will last and what returns the company will give shareholders. A separate secondary summary put the drop at more than 4% in Seoul trading.

Samsung’s consumer business is on the other side of the trade. BigGo’s summary shows the device experience division, which includes phones, posted an operating loss of 0.8 trillion won against a profit of 3.5 trillion won a year earlier. Mobile executive Daniel Araujo said memory price increases have pressured mobile profitability since the fourth quarter of last year and that the company expects unit volumes to decline while market value grows. Reuters reported on October 8 a mobile division loss of more than $1 billion, larger than expected, so the figures differ and should be checked against Samsung’s filing.

The payout was in line with the plan Samsung announced in August, which Bloomberg Línea describes as about 30 trillion won in cash dividends for the third quarter. BigGo’s summary puts it at 4,601 won per share. BigGo adds that a board meeting in January 2027 will finalize buyback details. Bloomberg Línea reports that SK Hynix, which plans to return about $45 billion to shareholders, expects the memory shortage to last at least until 2030, a longer horizon than Samsung’s.

How the shortage reaches PCs and phones

The PC market is already showing the effect. Counterpoint Research said on October 22 that preliminary data show global PC shipments fell 21% from a year earlier in the third quarter to 57 million units, and 13.8% from the second quarter. Gartner’s preliminary figure, reported on October 12, was lower still: a 22.4% decline to 55.4 million units. The figures differ slightly, but they point the same way.

Counterpoint blames high storage and other component costs, which are lifting PC prices and weakening demand, particularly among consumers. HP fell the most among the top vendors, down 31% to 10.3 million units, while Lenovo shipped 15.0 million units, down 23%, Dell 7.6 million, down 25%, Apple 5.6 million, down 11%, and ASUS 5.2 million, down 7%. Counterpoint says the year-ago base was inflated by purchases before Windows 10 support ended and by tariff-related stock adjustments, while business refresh cycles and Windows migration supported demand only partly.

Gartner’s analyst Namrata Banerjee said, in a statement relayed by t2ONLINE, that the decline reflects higher prices rather than excess inventory, a contrast with the 2023 slump. Gartner also says scarce components are being redirected toward higher-priced configurations, which reduces the supply of cheaper devices. Counterpoint forecasts a 27% annual drop in shipments in the fourth quarter and roughly flat volumes in 2027, which its analyst David Naranjo said means stabilization, not recovery.

Memory contract prices explain part of this. Exame, citing a TrendForce analysis dated September 30, reports that conventional DRAM contract prices are projected to rise 10% to 15% in the fourth quarter compared with the third, and NAND flash prices 15% to 20%, with suppliers prioritizing server capacity and PC makers trimming SSD storage in mainstream models. Exame stresses that these are contract-price projections and not equivalent retail price rises.

Intel’s warning

Intel’s results on October 29 show the same strain from the chipmaker’s side. According to Intel’s release, third-quarter revenue was $16.5 billion, up 21%. Revenue from the Client Computing and Physical AI Group, its PC business, fell 5% to $8.1 billion, while Data Center and AI revenue rose 78% to $7.3 billion. Chief financial officer David Zinsner said in the release that the company sees the PC slowdown continuing at least through the first half of next year.

Expansión adds detail from the earnings presentation. Chief executive Lip-Bu Tan acknowledged that demand for certain budget processors exceeds Intel’s ability to supply them, and Zinsner said stock of the low-cost Wildcat Lake chip, part of the Core Series 3 family aimed at entry-level machines, has sold out, according to Expansión, which attributes the remark to The Verge. Expansión says Zinsner was pessimistic that supply would improve in 2027 and that Intel’s quarterly report expects shortages of memory, substrates and other components to persist through that year. Intel’s own release refers to current industry-wide substrate and memory shortages in its risk section but does not quantify the effect.

Expansión notes that a shortage does not automatically mean every model costs more. PC makers may delay production, change usual configurations or use alternative components, and Intel had not announced broad price increases for Wildcat Lake at the time of publication.

What it means for buyers and what to watch

Expansión’s reading of the Samsung call is that phones and computers could become more expensive during 2027, with the final cost depending on each manufacturer’s decisions, supply contracts and willingness to absorb the increase. Android Headlines also expects higher prices and cites rumors and analyst expectations for several devices, but gives no figures, so those items rest on expectation rather than announcement.

Lens analysis: the sources describe a supply chain in which the largest memory buyers have secured volume years ahead, with Samsung saying long-term agreements will lock up the majority of its capacity. That arrangement may leave device makers without long-term contracts competing for what is left. The reports reviewed do not show whether that is happening.

Several checkpoints are visible. Samsung’s full third-quarter filing should confirm the figures that differ between summaries, including net profit, which appears as 75.1 trillion won in BigGo’s summary and 75.21 trillion won in Bloomberg’s report. Counterpoint’s fourth-quarter forecast of a 27% decline in PC shipments will show whether the price effect deepens. And Intel’s statement that the PC slowdown will run through the first half of next year gives a date against which both chipmakers’ and PC makers’ guidance can be judged.

Sources

Image: Samsung Headquarters - Silicon Valley (cropped).jpg by Cristiano Tomás, CC BY-SA 4.0, via Wikimedia Commons. Illustrative photo; it does not show the events described.