Seoul, Oct. 8 -- Samsung Electronics faces an unusual operational paradox where its record-breaking memory chip sales are directly squeezing profits at its flagship Galaxy smartphone division, according to a news report by The Korea Herald.

While surging memory prices propelled the South Korean tech giant towards a projected record third-quarter operating profit of 107.4 trillion won (~USD 78.8 billion), brokerages estimate that its mobile and networks businesses lost between 900 billion won (~USD 660.4 million) and 1.9 trillion won (~USD 1.39 billion) during the same period.

The deepening deficit comes despite steady shipments and strong consumer interest. The company previously recorded a 700 billion won (~USD 513.6 million) operating...