Samsung workers launch 18-day strike over bonus caps as chip profits surge

Nearly 48,000 Samsung Electronics workers are set to launch an 18-day strike Thursday, the largest labor action in the South Korean chipmaker's history, demanding the removal of a 50 percent cap on annual salary bonuses as artificial intelligence-driven chip profits reach record highs.

The walkout threatens to disrupt global memory chip supplies at a moment when demand from AI data centers is pushing the industry toward record profits — a dispute that Orange County's Korean-American community, with deep ties to South Korea's technology-driven export economy, is watching closely.

Samsung's union has demanded the company abolish the cap limiting bonuses to 50 percent of annual salaries and allocate 15 percent of annual operating profit to a worker bonus pool, according to The Korea Times. Samsung rejected both demands, instead offering one-time bonuses of between 50 and 100 percent of salary for this year while declining to permanently restructure the cap, The Korea Times reported.

The dispute has sharpened around comparisons with rival SK Hynix, which abolished its own bonus cap roughly a decade ago. Some SK Hynix staff now receive bonuses estimated at 607 percent of annual salary — more than 12 times what Samsung's current structure allows. Union leaders say the compensation gap has accelerated the departure of experienced engineers to competitors.

Approximately 38 percent of Samsung's domestic workforce signed up for the walkout, dwarfing the roughly 6,000 workers who participated in a 2024 strike. A South Korean court partially granted Samsung's injunction request, ordering 7,087 employees to remain at the company's round-the-clock chip factories in Pyeongtaek and Hwaseong as essential workers.

"An 18-day strike could disrupt global supplies of DRAM memory by 3 percent to 4 percent and NAND memory by 2 percent to 3 percent, which would likely fuel further price increases," said Jeff Kim, an analyst at KB Securities. Samsung commands 36 percent of the global DRAM market as of late 2025, according to research firm TrendForce — making the company a critical node in the supply chains that power AI data centers and consumer electronics worldwide.

The broader economic stakes are substantial. Samsung accounts for nearly 25 percent of South Korea's exports, and the country's central bank has warned that a worst-case scenario could shave 0.5 percentage points from South Korea's 2.0 percent GDP growth forecast. Analysts estimate the 18-day stoppage could cost approximately 30 trillion won, or roughly $19.9 billion, in lost chip production.

For Korean-Americans in Orange County — many of whom have family, investment or career ties to South Korea's technology sector — the strike is a reminder that the AI infrastructure boom reshaping global supply chains is also rewriting compensation norms at the foundries that power it.