TOPSHOT – Members of the Samsung Electronics labour union hold signs reading “Change it to be transparent!” as they stage a mass rally demanding the removal of a cap on performance bonuses, outside the company’s foundry and semiconductor factory in Pyeongtaek on April 23, 2026. (Photo by Jung Yeon-je / AFP via Getty Images)
Jung Yeon-je | Afp | Getty Images
South Korea’s largest company Samsung Electronics lost as much as 99.07 trillion won ($66.18 billion) in market value on Wednesday after failing to reach a wage agreement with its workers union.
This represented an intraday drop of as much as 6.09% in its share price from yesterday’s close of 279,000 won, and comes as its labor union threatened an 18-day strike from May 21 if its demands were not met.
More than 41,000 workers are expected to join the walkout, which was first announced at a rally on April 23.
“I would like to express some regret that none of the agenda items requested by the union have been addressed,” union representative Choi Seung-ho told reporters Wednesday, according to a report by Reuters.
The demands center on Samsung’s performance-based bonus system. The union is reportedly demanding that Samsung allocate 15% of its operating profit to workers as performance bonuses, scrap caps on bonus payouts, and formalize the bonus structure.
Samsung’s management offered to allocate 10% of operating profit to bonuses and provide a one-time special compensation package, according to South Korean news agency Yonhap.
The union said its rally on April 23, which drew 40,000 workers, caused a 58% drop in foundry production and an 18% fall in memory production for Samsung on that day.
It added that an 18-day strike could cost Samsung 30 trillion won, or about $20 billion.
In a post on X, South Korea’s Finance Minister Koo Yun Cheol said the government “deeply regrets” the failure to reach a resolution and warned that “strikes must never happen under any circumstances.”
“Samsung Electronics is an important company that the world is watching,” Koo wrote. “Considering the current management situation and its impact on the national economy, both labor and management sides must continue to strive to achieve principled negotiations.”
Shares of Samsung later reversed losses and turned positive after Koo’s post and remarks by Prime Minister Kim Min Seok, who instructed the government to “manage the situation closely” and provide “active assistance” to avert a strike.
Samsung Electronics reported an over eightfold increase in first-quarter operating profits in April, driven by the explosive growth of its chip business.
The company recorded a first-quarter operating profit of 57.2 trillion won, a whopping 750% increase compared with the same period last year.
— CNBC’s Blair Baek contributed to this report.
[/gpt3]
