Samsung's 40k workers strike to demand bonuses, AI chip profits spark conflicts over profit sharing

Author: Claude, Deep Tide TechFlow

Deep Tide Guide: A Samsung Electronics union representing 40,000 workers held the largest gathering in the company’s history at the Pyeongtaek plant, demanding that 15% of operating profit be distributed as bonuses—about 580 million won per person (approximately $400,000). Management responded with a 10% proposal, which was rejected. The union announced it would strike for 18 days starting May 21. On the other side, SK Hynix has just delivered what is described as its strongest-ever quarterly report, and employees are expecting an annual bonus of about 670 million won per person. The pay gap among Samsung chip workers has become a spark for a talent battle.

The AI chip boom has let Korea’s two major memory giants reap enormous profits, but the dispute over how those profits should be shared is now erupting inside Samsung Electronics.

On April 23, more than 30,000 members of the Samsung Electronics union flooded into the company’s main chip factory campus in Pyeongtaek, South Korea, holding the largest labor rally in the company’s history. The union said participation was about 40,000 people. According to reports from Reuters and TechCrunch, the union’s core demands are: to distribute 15% of operating profit as a performance bonus pool to employees in the chip division, to scrap the current 50% bonus cap, and to raise base wages by 7%. If the 15% allocation ratio is calculated based on analysts’ forecast that Samsung’s full-year 2026 operating profit will be about 300 trillion won, that 15% would translate into a total bonus pool of roughly 45 trillion won. With about 77,000 employees in the chip division, the estimated bonus would be about 580 million won per person (approximately $400,000).

Samsung management has not completely refused dialogue. According to media outlets in Korea such as ZDNet, the company proposed a 10% operating profit distribution plan, a 6.2% increase in base wages, and additional benefits such as preferential housing loans, and promised that the total compensation for employees in the semiconductor division would exceed that of competitors. The union rejected the proposal.

An 18-day stoppage could disrupt global memory chip supply

If the two sides fail to reach an agreement, the union has announced it will launch a full-scale strike starting May 21 for 18 days, continuing through June 7. Euronews reports that the union estimates the strike would cause the company to lose more than 1 trillion won (about $720 million) per day.

At the rally site, union chairman Choi Seungho shouted through loudspeakers mounted above a crane: “Make pay transparent—cancel the bonus cap!”

This is Samsung Electronics’ strike action on an unprecedented scale in its history. In 2024, Samsung workers launched the company’s first strike in its 55-year history, but it lasted only about three days and had limited impact on production.

This time, the union has made its position clear: it will apply even greater pressure. Samsung has already filed an application with the court last week seeking to prohibit the union from carrying out so-called “illegal activities” during the strike.

According to Reuters, Park Joon-geun, head of the Korean corporate analysis firm Leaders Index, predicts that a compromise may ultimately be reached, because once a prolonged strike triggers public backlash, it would work against the union. On the day of the rally, Samsung’s stock price rose instead of falling, closing up 3% to a record high, indicating that the market is not panicking—at least for now. But on the road across from the factory, some shareholders gathered to protest, accusing the union of “holding the company back” at key moments.

SK Hynix’s “lottery bonus” stings Samsung workers

Much of the anger within the Samsung union comes from a direct comparison with SK Hynix.

On the same day as the rally, SK Hynix released what it described as its strongest-ever quarterly report: revenue of 52.58 trillion won, operating profit of 37.61 trillion won, and an operating margin as high as 72%, with all figures setting records. According to Seoul Economic Daily on April 24, based solely on first-quarter performance, each SK Hynix employee has already effectively locked in a bonus of about 1.09 billion won. Based on analysts’ forecast of the company’s full-year operating profit of 230 trillion won, plus its policy of “using 10% of operating profit as a bonus pool, with no cap,” the expected annual bonus per employee is estimated to reach 670 million won (about $490,000). Korean media has already dubbed it a “lottery bonus.”

SK Hynix canceled the bonus cap in September 2025 and tied 10% of operating profit directly to employee performance. The company’s actual average bonus paid per employee in 2025 was about 140 million won, while it was 70 million won in 2024. In contrast, Samsung did not pay any performance bonuses in 2024 because the chip division recorded losses throughout the year.

According to Korea Herald, Samsung union chairman Choi Seungho said that over the past four months, around 200 employees have already moved to SK Hynix. The union’s own calculations show that, under the same compensation system, bonuses for employees in Samsung’s chip division are less than one-third of those at SK Hynix. This disparity has already produced an intuitive effect at SK Hynix recruitment briefings: according to Seoul Economic Daily, SK Hynix’s recent recruitment events at 11 universities attracted about 400 attendees, twice the number of pre-registrants. Even some four-year college graduates who do not meet the criteria have been inquiring about production roles.

AI chip supercycle—workers say, “The money isn’t ours”

The root of the conflict is that Samsung is in a historic profit surge, but the benefits chip workers feel do not match.

Samsung Electronics’ Q1 2026 performance guidance released on April 7 shows quarterly operating profit of 57.2 trillion won (about $3.89 billion), a year-over-year surge of 755%, and revenue of 133 trillion won. The profit for this single quarter already exceeds Samsung’s full-year 2025 profit (43.6 trillion won). According to SamMobile citing analysts’ estimates, the semiconductor division contributed about 95% of the profit, with HBM high-bandwidth memory, server DDR5, and enterprise-class SSDs as the core drivers.

SK Hynix’s performance is equally astonishing: Q1 revenue grew 198% year over year, and operating profit doubled. During the earnings call, the company’s CFO Kim Woohyun said that customer demand for HBM over the next three years has far exceeded supply, and that customers are prioritizing securing supply rather than pushing for lower prices. “The strong pricing trend will continue.”

AI data centers currently consume about 70% of the world’s high-end memory chip production capacity. DRAM contract prices have been rising for 11 consecutive months, and the average price of standard PC DRAM reached $13 in March 2026. Samsung and SK Hynix together control about 70% of the global DRAM market. The two companies are substantially shifting capacity toward AI memory products with higher profit margins, further tightening supply of traditional consumer-grade storage.