Samsung's recent profit-sharing arrangement has sparked significant unrest within the company, particularly affecting its capacity to produce essential AI memory products. While the tech giant managed to avert a potentially disruptive strike with its largest labor union, the agreement has instead led to widespread discontent across various divisions, causing severe operational disruptions.
Reports suggest that decision-making processes in Samsung's non-memory and shared business units have ground to a halt. Meetings are being canceled as frustration grows over the stark differences in bonus distributions. Workers in the memory division stand to receive substantial bonuses of approximately 600 million won (around $400,000), while employees in the Device eXperience (DX) division, which includes smartphones and home appliances, are set to receive only about 6 million won (approximately $4,000). This disparity has created a rift that has stalled critical operations in the foundry and Test & Package (TSP) divisions, which are important for producing high-bandwidth memory (HBM).
The situation is particularly precarious as Samsung ramps up production for NVIDIA’s next-generation Rubin AI accelerators. The TSP division is key to the chip supply chain, and any slowdown in its operations could severely impact HBM output. Competitors are also racing to fulfill hyperscaler orders, increasing pressure on Samsung to stick to its production schedule. If the internal conflict persists, it could jeopardize client relationships and threaten the company's ability to meet delivery commitments.
The backlash against the profit-sharing scheme has been considerable. A smaller union representing DX employees has filed a court injunction to prevent the larger union from overseeing collective bargaining, citing concerns that their interests will be overlooked. Membership in the smaller union has surged from 3,000 to nearly 13,000 since the agreement was announced, underscoring the growing dissatisfaction among workers.
In a further complication, the Korea Shareholder Action Headquarters has indicated it may pursue legal action against the bonus structure, claiming it requires shareholder approval under Korean law. As the internal vote on the profit-sharing deal progresses—with participation from over 43,000 non-memory division workers potentially influencing the outcome—tensions remain high. Internal communications have revealed strong resistance among employees who view the deal as blatant favoritism toward the memory unit at the expense of others.
To address the unrest, Samsung’s semiconductor CEO, Jun Young-hyun, has urged employees to move past the conflict. However, the company is at a critical juncture as it navigates this turmoil while aiming for a record year, with operating profits for 2026 projected at 330 trillion won (approximately $218 billion). The stakes are high, and as the situation develops, all eyes will be on Samsung’s ability to reconcile internal divisions while fulfilling commitments to clients like NVIDIA.
