The AI boom has opened a deep rift within South Korea’s Samsung Electronics. Employees in the semiconductor division are expected to receive bonuses of up to ₩600 million (approximately ¥65 million), while those in other divisions, such as digital appliances and displays, will see bonuses of just ₩6 million (approximately ¥650,000) — a staggering 100-fold gap. This “super disparity” has triggered a protest rally of 3,000 employees. The labor union has effectively split into semiconductor and non-semiconductor factions, creating an abnormal situation where the slogan “One Samsung” rings hollow.

Bonus Cap Removal Creates ‘Instant Millionaires’

The turmoil traces back to May 2026. Accelerating AI development sent demand for DRAM and High Bandwidth Memory (HBM) soaring. Samsung Electronics posted April-June 2026 revenue of ₩171 trillion (approximately $116.7 billion), up 2.3 times year-on-year, and operating profit of ₩89.4 trillion (approximately $61.0 billion), a 19.1-fold increase — both record quarterly highs.

The semiconductor division drove this explosive growth. Against a backdrop of tight AI memory supply, DRAM prices surged sixfold over the past year. In response, the semiconductor division’s union fiercely clashed with management, demanding the removal of bonus caps, and came to the brink of a strike. With the South Korean government intervening due to the gravity of the situation, Samsung Electronics accepted the union’s demands and removed the bonus ceiling. As a result, some employees in the semiconductor business are expected to receive bonuses of up to ₩600 million (approximately ¥65 million), including stock grants. Some young employees have even drawn attention as “instant millionaires” after receiving massive amounts of company stock.

“Non-Semiconductor Units Are as Good as Abandoned”

Meanwhile, non-semiconductor divisions — including smartphones, home appliances, displays, and automotive-related businesses (Harman brand) — saw lackluster earnings due to intensifying competition from Chinese companies. Despite this, company-wide budget allocation diverted earnings from non-semiconductor divisions toward the cash-cow semiconductor unit and high-growth-potential areas as investment capital. Consequently, bonuses for non-semiconductor employees are expected to be around ₩6 million (approximately ¥650,000), just one-hundredth of what the semiconductor division receives.

Frustration among non-semiconductor employees has exploded. On July 16, the non-semiconductor labor union “Together Union” held a protest rally under the “One Samsung” banner in front of Samsung Electronics’ Suwon headquarters. The crowd swelled to 3,000 participants. Reports indicate union membership has surged from around 2,000 to nearly 29,000 in the wake of this issue. Some union members even set up a memorial altar in front of their offices, claiming that business units unable to pay high bonuses were “as good as abandoned.”

Compensation Gap with SK Hynix Adds Fuel to the Fire

Further complicating this internal conflict is the presence of rival SK Hynix. The company is also reaping the benefits of the AI boom, with stellar performance. Market forecasts project SK Hynix’s April-June 2026 operating profit to reach approximately ₩64.09 trillion (approximately $43.8 billion), up roughly 600% year-on-year. Combined with Samsung Electronics, their quarterly operating profit is on track to surpass ₩150 trillion (approximately $102.4 billion).

Last year, SK Hynix responded to union demands by removing bonus caps and paid all employees a uniform performance bonus equivalent to 2,964% of base salary. For an employee with an annual salary of ₩100 million (approximately ¥11.2 million), the bonus would have reached about ₩48.2 million (approximately ¥5.4 million). With this year’s operating profit forecast expanding further to ₩266 trillion (approximately $181.6 billion), reports suggest a simple average bonus of around ¥70 million (approximately $427,794) per employee could be paid.

Amid this compensation gap, defections from Samsung Electronics’ semiconductor division to SK Hynix have increased, particularly among younger workers. The sense of crisis over talent outflow is seen as one factor that pushed management to approve the hefty bonuses.

The Enron Nightmare — Lack of a ‘Fair’ Evaluation System

History offers examples of internal conflict over bonuses leading to corporate collapse. The most famous is U.S. energy giant Enron, which went bankrupt in 2001. Enron paid massive bonuses to high-earning employees in its energy trading division while regularly firing the bottom 15-20% of performers. As a result, employees prioritized self-interest above all else, which is believed to have contributed to accounting fraud.

Samsung Electronics’ current situation is reminiscent of the Enron case. The semiconductor division’s rapid growth is supported by a historic, AI-driven demand surge, with no guarantee of permanence. Like the IT bubble of the late 1990s, market conditions are constantly changing. Experts point out that Samsung Electronics’ management failed to adequately explain the performance-based bonus system in advance, and made opaque decisions influenced by union demands and personal connections with management, deepening internal friction.

To unify the organization and achieve sustainable growth, establishing a “fair” personnel evaluation system and compensation structure that all employees can accept is essential. Precisely now, when the stock price is rising on the benefits of AI concentration and record profits are being posted, Samsung Electronics’ management is being tested on its ability to run the organization from a long-term perspective, rather than focusing on short-term profit distribution.