Tens of thousands of Samsung Electronics workers rallied in South Korea on Thursday, demanding higher bonuses and threatening an 18-day strike next month as surging artificial intelligence demand drives record chip profits.

The Associated Press reported that around 40,000 employees gathered at the company’s semiconductor complex in Pyeongtaek, marking the largest demonstration to date by Samsung’s unionised workforce. Organisers warned that a strike planned from 21 May could disrupt chip production and delay shipments to global customers.

The dispute centres on compensation, with union leaders arguing that pay has failed to keep pace with profits and with rival SK Hynix. The union is calling for the removal of a cap on bonuses, currently set at 50 per cent of base salary, and wants 15 per cent of annual operating profit allocated to performance pay.

Workers say the pay gap with SK Hynix has widened as the competitor secured a leading position in supplying high-bandwidth memory chips for AI applications. “In reality, many employees are leaving for SK Hynix,” Song Yong-gi, a logistics worker at Samsung, told Reuters, adding that “the compensation gap has become so wide that it’s driving these moves”.

The rally took place hours after SK Hynix posted record quarterly revenue and operating profit for the January to March period, driven by strong demand for data centre and AI infrastructure. Samsung itself has forecast first-quarter operating profit of 57.2 trillion won, exceeding SK Hynix’s 37.6 trillion won, reflecting robust conditions in the memory chip market.

Union leaders argue that these gains justify higher payouts to employees, particularly as membership has surged to more than 90,000 workers, representing over 70 per cent of Samsung’s South Korean workforce. “We won’t stop this fight until our fair demands are met,” said Choi Seung-ho, a union leader, speaking at the rally.

Samsung has said it will continue efforts to reach an agreement in ongoing wage negotiations, while warning internally that even limited production stoppages could damage customer trust and take years to recover. Management has proposed allocating 10 per cent of operating profit to bonuses and offering additional incentives to memory division staff.

Analysts cited by Reuters noted that any prolonged strike could tighten global chip supply and push prices higher, although some expect automation and subcontracting to soften the impact. The broader outlook remains uncertain, with supply chains facing pressure from geopolitical tensions affecting key materials used in semiconductor manufacturing.

National Technology News has reached out to Samsung for comment.

---