"Semiconductors Too Expensive"... Smartphone Shipments Hit 14-Year Low

[Anchor]

As soaring memory semiconductor prices drive up smartphone costs, consumers are closing their wallets. Affected by this, global smartphone shipments have dropped to their lowest level in 14 years.

Reporter Park Jaehyeon has the story.

[Reporter]

Apple raised the prices across the board for its iPhone 18 series released last month.

The factory price for the iPhone duo has surpassed 3 million won.

The sales prices were increased due to cost pressures, with the surge in memory semiconductor prices having a major impact.

Prices of semiconductors used in PCs and smartphones have surged by up to nearly tenfold in a year.

This shortage occurred as semiconductor companies concentrated their production on high-value-added products like HBM.

[Sean Kim / Researcher, Morgan Stanley (June, Morgan Stanley Podcast) : AI companies were able to secure priority supplies by signing long-term contracts and paying upfront. On the other hand, PC and smartphone manufacturers have to compete for the remaining supply.]

As smartphone manufacturers raise prices due to cost burdens, consumers are now closing their wallets.

[Choo Jung-sook / Yangcheon-gu, Seoul : The prices are expensive, to begin with. I can't upgrade because it costs too much. It hasn't broken down yet, so I plan to keep using it until it completely breaks.]

As a result, global smartphone shipments in the third quarter of this year decreased by 20% compared to the previous year.

This is the lowest level in 14 years since 2012.

The rise in semiconductor prices has led to a decline in consumption and a drop in shipments.

Although Samsung Electronics recorded a record-high operating profit of 107 trillion won in the third quarter, its mobile and home appliance divisions are estimated to have posted deficits in the 1 trillion won range in the third quarter, following their first-ever deficits in the second quarter.

Recently, even semiconductor equipment and material suppliers have been rushing to raise prices, and cost burdens are expected to grow even heavier.

[Kim Yang-peng / Senior Researcher, Korea Institute for Industrial Economics and Trade : (Due to the increase in semiconductor demand), demand for manufacturing equipment and materials is also rising, causing a 'domino effect' where supplying companies are raising prices as well.]

With supply shortages and rising process costs, expectations are growing that inflation driven by semiconductors, or "chipflation," will accelerate further.

(Video Editor: Lee Sang-min, Design: Seo Seung-hyun, VJ: Lee Ji-hwan)
※ Please note: This article was translated by AI and may contain errors.