The rising costs of the Snapdragon 8 Gen 4 chip could force Samsung to increase the price of the Galaxy S25 series or look for alternative solutions.
About a month ago, the well-known leaker Digital Chat Station on Weibo dropped some worrying news about the next one Galaxy S25suggesting it could be sold to a higher price than usual. The reason? The increase in production costs of the chip Qualcomm Snapdragon 8 Gen 4, and not a direct decision by Samsung. Now, a market analyst has offered a clearer view on what lies ahead.
Qualcomm reported that next Snapdragon 8 Gen 4 will go into production in second half of 2024. The chip will be an upgrade over the current Snapdragon 8 Gen 3 and is expected to improve significantly artificial intelligence processing. Samsung is one of Qualcomm’s major customers and will use this new SoC in the series Galaxy S25which is expected to debut at the beginning of 2025.
The problem is that the technological advances of the Snapdragon 8 Gen 4 could lead to a increase in costsreflected in the prices of Galaxy S25 devices. According to a forecast by the well-known analyst Ming-Chi KuoQualcomm could increase the cost of the Snapdragon 8 Gen 4 by 25-30% compared to Gen 3. The Snapdragon 8 Gen 4 will be produced with the process TSMC’s 3nm N3E, the same one used for Apple’s A18 Pro chip. This means that the new chip could cost approx $260compared to $190-200 for the Snapdragon 8 Gen 3.
L’expected price increase for the Snapdragon 8 Gen 4 is out of Samsung’s control, but the company has some options to address the issue. The least likely is that Samsung decides to absorb the additional costs without increasing the price. Alternatively, it could reduce costs in other areas, such as the battery, display or build quality. Another possibility for Samsung is to use a new internal Exynos chip for the entire Galaxy S25 series, thus avoiding Qualcomm’s costs. However, if the Exynos 2500 turns out to be just as expensive, this strategy could backfire, especially if customers aren’t yet ready to accept that the Exynos is better than it was a few years ago.
An earlier report suggested that Samsung may split the Galaxy S25 series between the Exynos 2500 and Snapdragon 8 Gen 4, making an all-Exynos lineup unlikely. There most probable solution appears to be a increase in the launch price of the Galaxy S25 to compensate for the higher production costs. While we can’t yet say for sure what will happen, it’s clear that the cost of the new Snapdragon chip will have an impact market for Samsung’s next flagships.
