Key Takeaways:
Samsung Electronics Co. union members voted 73.7% in favor of a ten-year profit-sharing agreement that will distribute about 40 trillion won ($26.6 billion) in bonuses to semiconductor employees, deepening internal divisions over how the artificial intelligence boom's spoils are shared.
"The agreement secures our members' share in the company's AI-driven success," SELU spokesperson Kim Min-ho said in a statement. The Samsung Electronics Labor Union, which led negotiations, represents about 57,000 workers, with an estimated 80% to 90% drawn from the chip division.
Under the deal, roughly 78,000 semiconductor employees will receive 10.5% of annual operating profit as stock bonuses plus 1.5% in cash, contingent on the chip division achieving at least 200 trillion won in annual operating profit between 2026 and 2028. Memory chip workers stand to receive about 600 million won ($400,000) each on average this year, while employees in the foundry and logic chip design units will get about 150 million to 200 million won. Workers in the digital experience division, which oversees smartphones, televisions and home appliances, will receive roughly 6 million won ($4,000) — a gap of nearly 100 times.
The agreement ends months of tense negotiations and averted an 18-day strike threat, but it has exposed fractures within South Korea's largest company. The Samsung Electronics Co. Union, representing about 13,000 mostly digital-experience workers, filed an injunction to block the vote, arguing it was unfairly excluded from the process. A Seoul court rejected the challenge Tuesday, clearing the way for ratification. A separate union, the National Samsung Electronics Union, which has about 20,000 members across both chip and non-chip divisions, also opposed the deal and boycotted the vote.
Internal divisions spill into production
The bonus disparity has already affected operations. Samsung's chip packaging unit has experienced deliberate production slowdowns that are disrupting delivery of high-bandwidth memory chips critical for AI data centers, according to people familiar with the matter. Chief Executive Officer Jun Young-hyun issued an internal memo urging employees to set aside disputes and refocus on operations.
A group of individual shareholders calling themselves Korea Shareholder Action Headquarters has threatened to sue, arguing the profit-linked bonus plan constitutes a distribution of company funds that requires shareholder approval under South Korean commercial law. The group held a protest last week near the residence of Samsung Chairman Lee Jae-yong.
Samsung shares rose 6% on the day the deal was announced, bringing gains since the agreement to about 9%. The stock's advance has lagged behind rival SK Hynix Inc., which has surged 19% over the same period. SK Hynix reached a similar profit-sharing deal with its workers last year, granting 10% of operating profit as dividends for a decade.
The agreement locks in Samsung's semiconductor workforce at a critical moment, as the company competes with SK Hynix and Micron Technology Inc. for dominance in the high-bandwidth memory market. For holders, the deal removes near-term strike risk but introduces compensation-driven cost pressure that could weigh on margins. Investors will watch the Q3 earnings call for any revision to chip division margin guidance and for updates on the shareholder lawsuit.
This article is for informational purposes only and does not constitute investment advice.
