Samsung’s AI glasses push meets memory squeeze

Samsung Electronics has signalled plans to expand its wearable device ambitions into AI glasses, even as it warned that a deepening global memory shortage could intensify through 2027 and raise costs across consumer electronics, servers and mobile devices.

The remarks came during the company’s first-quarter 2026 earnings call, where executives linked the squeeze in RAM and storage supply to the rapid build-out of artificial intelligence data centres. Demand for high-bandwidth memory, DRAM and NAND products has risen sharply as cloud providers and chip designers race to secure capacity for AI workloads. Samsung said available supply remained far below customer requirements and that demand already booked for 2027 pointed to a wider supply-demand gap than this year.

The warning underscores how the AI investment cycle is reshaping the semiconductor industry. Memory chips that were once exposed to boom-and-bust swings tied to smartphones, PCs and servers are now being pulled into longer-term supply contracts by companies building AI infrastructure. Samsung, the world’s largest memory chipmaker by sales, has benefited from higher prices and stronger margins, but its comments also suggest that downstream manufacturers may face sustained component inflation.

Samsung reported a record quarterly operating profit of 57.2 trillion won for the January-March period, compared with 6.69 trillion won a year earlier. Its semiconductor division generated 53.7 trillion won, up from 1.1 trillion won in the same quarter last year, accounting for most of group earnings. Revenue rose 69 per cent to 133.9 trillion won, reflecting the scale of the AI-led recovery in memory demand after the industry’s downturn in 2022 and 2023.

The company said the lead time required for new fabrication capacity meant supply could not be lifted quickly enough to match demand. Advanced memory production also competes for cleanroom space, equipment and engineering resources with conventional chips used in smartphones, laptops, displays, vehicles and gaming devices. As manufacturers allocate more capacity to high-margin AI products, standard DRAM and storage products risk becoming tighter.

The cost pressure is already visible inside Samsung’s own business. Its mobile and network division posted operating profit of 2.8 trillion won in the quarter, down 35 per cent from a year earlier, while its display division reported a 20 per cent fall in operating profit to 400 billion won. Higher memory and component prices are expected to weigh on profitability in smartphones and connected devices, even as Samsung leans on premium models, foldables and Galaxy AI features to protect margins.

Against that backdrop, Samsung’s reference to AI glasses signals a strategic push beyond handsets and watches into ambient computing. Executives said the mobile business planned to deliver “immersive multimodal AI experiences” through form factors including AI glasses, while also expanding its Galaxy Buds range and strengthening foldable devices. The company did not provide specifications, pricing, launch timing or details on whether the glasses would include a display, camera, voice assistant, on-device AI processing or cloud-based features.

The move would place Samsung in a developing market that has drawn renewed attention after earlier smart-glasses efforts struggled with cost, battery life, privacy concerns and limited consumer demand. The new wave is being shaped by generative AI, lightweight sensors, voice interaction and contextual assistants. Samsung already moved deeper into extended reality with Galaxy XR, developed around Google’s Android XR platform, and AI glasses could become a more accessible companion device if the company can balance design, battery performance and privacy safeguards.

Competition is likely to be intense. Meta has gained traction with camera-enabled smart glasses developed with EssilorLuxottica’s Ray-Ban brand, while Apple, Google and several Chinese manufacturers are examining lighter AI wearables after mixed market response to bulkier headsets. For Samsung, the advantage lies in its Galaxy ecosystem, semiconductor expertise, display capability and distribution scale. The challenge is that AI wearables depend on the same memory and processor supply chains now under strain.

The memory shortage could have wider effects on device pricing through 2027. Smartphones may see higher bills of materials, PC makers could face tighter RAM availability, and AI server suppliers are likely to continue signing long-term supply agreements to secure priority access. Smaller device makers, with less purchasing power than global technology groups, could face tougher negotiations and narrower margins.