Samsung Workers Rally, Call for Larger Share of AI Profits

Samsung’s labor unions have warned of a potential work stoppage, citing unmet wage demands. A prolonged halt at the world’s largest memory chipmaker could shake global semiconductor supply chains. On Thursday, nearly 40,000 employees from Samsung Electronics gathered in protest, urging the company to distribute its record-breaking AI-related earnings more equitably.

Strikes Threatened Over Bonus Caps

Unions stated they may initiate an 18-day strike if their conditions aren’t satisfied, potentially halting chip production critical for AI development. Despite Samsung’s robust financial performance, with shares rising over 300% in the last year due to AI chip demand, the unions argue the company hasn’t provided fair compensation.

“If talks fail, production could cost the firm more than 1 trillion won per day,” the unions emphasized.

The bonus ceiling for chip division workers remains at 50% of their annual base salary. For instance, an employee earning 76 million won annually would receive only 38 million won in 2025 bonuses. This is less than a third of what a comparable role at SK Hynix offers, which removed its bonus cap last September.

Competitive Landscape and Supply Chain Pressures

SK Hynix, Samsung’s direct competitor, has surpassed it in high-bandwidth memory (HBM) chip supply to Nvidia, especially after ChatGPT’s 2022 launch. Samsung claims it will allocate extra funds to ensure its memory division workers earn more than rivals this year, though it has not yet removed the bonus cap.

Amid the AI industry’s growth, global chipmakers face additional challenges. The Middle East conflict has tightened access to materials like helium and increased energy expenses. This backdrop adds urgency to the labor dispute, as Samsung’s first-ever strike in 2024 highlights its longstanding resistance to union pressures.