Samsung Shares Slide as Labor Talks Intensify Ahead of Planned Strike

Samsung Electronics shares dropped more than 2% on Tuesday as investors monitored critical negotiations between the tech giant and its labor union over a potential strike that could impact the global semiconductor industry. The stock fell to 279,500 won during Seoul trading, lagging behind the broader South Korean market amid growing concerns over supply chain disruptions.

The ongoing talks between Samsung management and labor representatives entered a second day under government-led mediation after more than 11 hours of discussions on Monday failed to produce an agreement. The labor union, which represents tens of thousands of Samsung workers, is pushing for higher performance bonuses, demanding payouts equal to 15% of the company’s operating profit. Union leaders are also calling for the removal of bonus caps and stronger guarantees regarding employee compensation policies.

If negotiations fail, the union has threatened to launch an 18-day strike beginning May 21, raising fears of disruptions to Samsung’s semiconductor production. The possibility of a large-scale strike comes at a crucial time for the company, as demand for advanced memory chips used in artificial intelligence technologies continues to surge worldwide.

Samsung recently reported a significant increase in first-quarter operating profit, driven largely by strong sales of high-performance AI memory chips. Industry analysts warn that any interruption in production could affect the global semiconductor supply chain and increase market volatility.

Samsung’s board chairman has urged both sides to reach an agreement through dialogue, emphasizing that prolonged industrial action could weaken the company’s competitiveness and negatively impact South Korea’s economy. Investors are expected to remain cautious as labor negotiations continue and uncertainty surrounding Samsung’s chip operations grows.