--- title: "Wafer Foundry Output Down 58%, Memory Production Slides 18%: Samsung Labor Crisis Escalates as 18-Day Strike Enters Countdown" type: "News" locale: "en" url: "https://longbridge.com/en/news/283983860.md" description: "With Samsung's first-quarter profit expected to surge by 700%, the union is demanding 15% of operating profits be distributed as bonuses, potentially exceeding $400,000 per employee. Following recent rally-induced disruptions, wafer foundry output plummeted approximately 58%, while memory chip production fell about 18%. The union has warned that if negotiations fail, an ultra-long 18-day strike will commence on May 21" datetime: "2026-04-24T10:45:50.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/283983860.md) - [en](https://longbridge.com/en/news/283983860.md) - [zh-HK](https://longbridge.com/zh-HK/news/283983860.md) --- # Wafer Foundry Output Down 58%, Memory Production Slides 18%: Samsung Labor Crisis Escalates as 18-Day Strike Enters Countdown Samsung Electronics is facing an increasingly intense labor dispute. The artificial intelligence boom has driven the company's profits to record highs, and the union is leveraging this momentum to pressure management for a larger share of AI gains, using large-scale strikes as leverage, which has already caused tangible disruption to core chip production lines. The Samsung union stated that during the night shift on April 23, **due to workers attending a rally, the company's wafer foundry output dropped sharply by approximately 58%, and memory chip production also declined by about 18%.** Samsung declined to comment on the capacity losses. The union simultaneously warned that **if negotiations break down, it will launch a large-scale 18-day strike starting May 21.** Reports indicate that approximately 30,000 to 40,000 people gathered outside Samsung's Pyeongtaek semiconductor base for the rally. **The union is demanding that 15% of the company's annual operating profits be distributed as bonuses to employees in the chip division,** totaling over 40 trillion won (approximately $27 billion), which translates to more than $400,000 per person. A Samsung spokesperson stated that the company will continue efforts to reach an agreement on salary negotiations as soon as possible. The deep background to this risk of work stoppage is Samsung's explosive performance expansion— **the company expects its operating profit for the first quarter of 2026 to grow year-over-year by approximately 700%;** analysts further predict it could surpass Nvidia in 2027 to become the world's most profitable enterprise. The gap between profits and compensation has become the core tension in this labor standoff. ## Union Demands vs. Management Stance Samsung's largest union demands that the company allocate 15% of its annual operating profits to a bonus pool for distribution to chip division employees. Reports suggest this proportion corresponds to an amount exceeding 40 trillion won (approximately $27 billion), averaging over $400,000 per worker after conversion. The union is also demanding a 7% wage increase. Samsung management's current proposal is: **allocate 10% of operating profits for bonuses, coupled with a 6.2% wage increase, along with a package of benefits including preferential mortgage support.** This proposal has been rejected by the union. Choi Seung-ho, head of Samsung's largest union, stated at the rally: > "The company talks about crisis every year, but among those crises, what supports Samsung Electronics is not management, but the workers—it is union members who manufacture products, improve processes, fight through the night, and enhance yield rates, making the company a leading global semiconductor producer." The union is using SK Hynix's allocation plan as a benchmark. Reports indicate that **SK Hynix agreed last year to allocate 10% of its annual operating profits to a performance bonus pool.** The production halt effect generated by this rally clearly foreshadows the potential scale of a full-scale strike impact. A single rally caused a single-shift output drop of approximately 58% for the wafer foundry line and 18% for memory chips—where the wafer foundry line, being more labor-intensive, suffered particularly severe disruption. In contrast, the previous work stoppage initiated by the Samsung union in 2025 lasted only three days, with relatively controllable impacts on production. **The 18-day strike threatened by the union this time—running from May 21 to June 7—if implemented, would far exceed previous scales and durations, making the impact on Samsung's supply chain difficult to estimate.** ## Surging Performance Empowers Union Negotiations A key background to the intensification of labor contradictions is Samsung's explosive growth. In recent years, Samsung, alongside SK Hynix and Micron, has accelerated the shift toward producing high-bandwidth memory (HBM) for Nvidia AI accelerators, becoming the first to commercially ship next-generation HBM4 to customers this year. The company expects total sales in the first quarter of 2026 to reach 133 trillion won (approximately $88.2 billion), significantly higher than the market consensus estimate of 116.81 trillion won; operating profit is expected to be around 57.2 trillion won (approximately $37.8 billion), representing a year-over-year increase of approximately 700%, **a sequential increase of about 184% compared to the 20.1 trillion won recorded in the fourth quarter of 2025.** KB Securities analysts project that Samsung's operating profit for the full year of 2026 will reach 327 trillion won, rising further to 488 trillion won in 2027, at which point it may narrowly surpass Nvidia to become the world's most profitable listed company. This conflict reflects deeper shifts in Samsung's internal power structure. For decades, Samsung was able to maintain distance from unions; however, in recent years, organized labor groups have established a firmer foothold within the company, giving employees greater confidence to voice their demands publicly. **The next critical milestone for negotiations is May 21.** If management and the union still fail to reach an agreement by then, Samsung's core position in the global AI supply chain will face a direct test. ### Related Stocks - [SSNGY.US](https://longbridge.com/en/quote/SSNGY.US.md) - [SMSN.UK](https://longbridge.com/en/quote/SMSN.UK.md) - [SMH.US](https://longbridge.com/en/quote/SMH.US.md) - [07747.HK](https://longbridge.com/en/quote/07747.HK.md) - [09747.HK](https://longbridge.com/en/quote/09747.HK.md) - [XSD.US](https://longbridge.com/en/quote/XSD.US.md) - [SOXL.US](https://longbridge.com/en/quote/SOXL.US.md) - [SOXX.US](https://longbridge.com/en/quote/SOXX.US.md) - [NVDA.US](https://longbridge.com/en/quote/NVDA.US.md) - [MU.US](https://longbridge.com/en/quote/MU.US.md) - [NVD.DE](https://longbridge.com/en/quote/NVD.DE.md) ## Related News & Research - [Unionised Samsung workers to hold rally in South Korea as labour unrest grows](https://longbridge.com/en/news/283729186.md) - [Samsung's chip output dropped amid workers' rally, union says](https://longbridge.com/en/news/283978816.md) - [CSconnected supporting £436m for Welsh economy and 3140 jobs](https://longbridge.com/en/news/283479811.md) - [Omdia Raises 2026 Semiconductor Forecast to 62.7% as AI Drives Global Memory Crunch](https://longbridge.com/en/news/283862662.md) - [BUZZ-Street View: AI demand boosts Intel, but capacity limits loom](https://longbridge.com/en/news/283982891.md)