{"id":687651,"date":"2026-05-22T16:19:32","date_gmt":"2026-05-22T16:19:32","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/687651\/"},"modified":"2026-05-22T16:19:32","modified_gmt":"2026-05-22T16:19:32","slug":"ai-turned-samsung-into-a-1-trillion-company-its-workers-want-a-bigger-slice-of-the-pie","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/687651\/","title":{"rendered":"AI turned Samsung into a $1 trillion company. Its workers want a bigger slice of the pie"},"content":{"rendered":"

Hong Kong\/Seoul\u00a0\u2014\u00a0\n <\/p>\n

\n Samsung Electronics has become one of the leading beneficiaries of the global artificial intelligence boom. Surging demand for semiconductors has turned South Korea\u2019s largest corporation into a $1 trillion company this year, propelling Seoul\u2019s stock market to rank as the world\u2019s sixth-largest.\n <\/p>\n

\n But one segment of the country is unhappy with the result: Samsung workers. Tens of thousands of employees have threatened to strike, in an unprecedented walkout that would disrupt a crucial source of memory chips at a time when the AI industry is desperate for more.\n <\/p>\n

\n Hours before the strike was scheduled to start Thursday, the workers\u2019 unions announced they had reached a tentative deal with management. While the agreement still requires a vote by union members, it marks an early win for Samsung employees, who had been demanding higher pay in light of the company\u2019s record profits.\n <\/p>\n

\n The deal averted \u2013 for now \u2013 what would be the largest strike in the company\u2019s history, involving more than 48,000 employees, or nearly 40% of its Korean workforce, over 18 days. Most of the participating employees work in memory chips, critical components in AI hardware produced by tech giants Nvidia and AMD.\n <\/p>\n

\n The prospect of a halt in production rattled both the South Korean government and the global tech industry. Samsung\u2019s revenue accounted for more than 12% of South Korea\u2019s GDP last year. The company is also one of the world\u2019s three main memory chip makers at a time of acute shortages driven by the largest data center buildout in history.\n <\/p>\n

\n \u201cAny disruption to Samsung\u2019s semiconductor production would go far beyond losses for a single corporate group, leaving deep scars across the national economy,\u201d South Korea\u2019s Prime Minister Kim Min-seok said on Sunday.\n <\/p>\n

\n The preliminary victory for Samsung workers came as the rise of AI threatens to upend tech jobs around the world. On Wednesday, Meta laid off or reassigned nearly 15,000 employees<\/a> as part of its efforts to allocate more resources to AI. Other companies like LinkedIn, Amazon and Snap have also announced job cuts and restructuring around AI this year.\n <\/p>\n

\"Employees<\/p>\n

\n Last month, Samsung reported record quarterly profits, which surged more than 8.5 times higher than the same period one year ago and surpassed operating profit for the entirety of 2025.\n <\/p>\n

\n Now, its workers are seeking a larger share of the profits.\n <\/p>\n

\n The unions have demanded that Samsung remove its cap on bonuses at 50% of annual pay, allocate 15% of annual operating profit to bonuses, and extend these changes beyond this year.\n <\/p>\n

\n While Samsung\u2019s chip production employees receive some of the most competitive salaries in the country, workers have been galvanized by a bonus gap in comparison with rival chipmaker SK Hynix, South Korea\u2019s second-largest company.\n <\/p>\n

\n SK Hynix has also notched record profits this year. But its employees secured a new bonus structure in September that scrapped a cap limiting bonuses to 1,000% of base salary. SK Hynix now allocates 10% of annual operating profit to an employee bonuses pool.\n <\/p>\n

\n Under the new pay structure, some SK Hynix employees are entitled to bonuses equivalent to nearly 3,000% of their base salary in 2025, with the average annual bonus per employee reaching 700 million won ($465,000).\n <\/p>\n

\n \u201cThe semiconductor industry is now facing a war to secure global talent,\u201d Samsung\u2019s largest union said in a statement last month. \u201cSK Hynix has already revised its compensation structure to retain talent, while foreign companies are luring our engineers with exceptional offers.\u201d\n <\/p>\n

\n As part of the tentative deal reached with Samsung\u2019s union on Wednesday, the company agreed to scrap the existing bonus cap and allocate 10.5% of business performance profits for bonuses for the company\u2019s semiconductor division.\n <\/p>\n

\n \u201cThe agreement came later than expected,\u201d Samsung said in a Wednesday statement. \u201cWe will work to build a more mature and constructive labor management relationship so that such a situation does not happen again.\u201d\n <\/p>\n

\n The dispute has sparked nationwide debate over wealth distribution because of the enormous profits Samsung and SK Hynix are generating.\n <\/p>\n

\n Jo Geun-jun, head of a South Korean labor research and advocacy group Anyoneunion, said the AI boom has created \u201can extreme form of hyper-polarization.\u201d\n <\/p>\n

\n \u201cOn one side of society, the number of workers without job security or labor protections continues to grow,\u201d he said. \u201cOn the other, permanently employed workers at major conglomerates are enjoying unprecedented bonus payouts driven by booming corporate profits.\u201d\n <\/p>\n

\"A<\/p>\n

\n The threats to strike came just as the semiconductor supply chain has come under exceptional stress. Global tech giants from Google to Amazon are scrambling for more cutting-edge AI processors to expand data centers and train next-generation AI models.\n <\/p>\n

\n Once considered a low-margin commodity, memory chips<\/a> have become indispensable in AI processors, facilitating speedy data transfers and storage, said Simon Woo, Asia Pacific tech research coordinator at Bank of America. The resulting shortage could persist into 2028, he added.\n <\/p>\n

\n Research firm SemiAnalysis expects memory chip prices to more than double by the end of this year compared with 2025.\n <\/p>\n

\n This puts Samsung in a critical position within the global supply chain as one of the world\u2019s three dominant memory chip makers, alongside SK Hynix and US Micron Technology.\n <\/p>\n

\n A long-established player in semiconductors, Samsung was initially slow to capitalize on the AI boom<\/a> and lagged SK Hynix last year as profits fell. But it has since staged a recovery, driven partially by unending demand for memory chips.\n <\/p>\n

\n In the AI memory sector, SK Hynix leads with a 57% market share, followed by Samsung\u2019s 22% and Micron\u2019s 21%, according to Counterpoint research data from the fourth quarter of last year.\n <\/p>\n

\n For now, the tentative deal has lifted Samsung\u2019s shares, though a strike could still take place if members of the union vote against the temporary agreement.\n <\/p>\n

\n \u201c\u2060In an already supply constrained environment for memory, a disruption in one major memory supplier will certainly only have downside impact for the AI industry,\u201d said Ray Wang, a Seoul-based analyst at SemiAnalysis. \u201cThis could further worsen the shortage and potentially sustain the price hike momentum in the near term.\u201d\n <\/p>\n

\n Still, a strike is not expected to bring production to a complete halt. Samsung won a minor victory on Monday, when a court granted an injunction ruling that workers involved in safety operations for chip production must maintain a normal level of staffing.\n <\/p>\n","protected":false},"excerpt":{"rendered":"Hong Kong\/Seoul\u00a0\u2014\u00a0 Samsung Electronics has become one of the leading beneficiaries of the global artificial intelligence boom. Surging…\n","protected":false},"author":2,"featured_media":687652,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[256,254,255,64,63,105],"class_list":["post-687651","post","type-post","status-publish","format-standard","has-post-thumbnail","category-artificial-intelligence","tag-ai","tag-artificial-intelligence","tag-artificialintelligence","tag-au","tag-australia","tag-technology"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/687651","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=687651"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/687651\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/687652"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=687651"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=687651"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=687651"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}