Samsung Electronics is set to award substantial bonuses to approximately 78,000 employees in its semiconductor division following a surge in profits driven by rising demand for artificial intelligence (AI) chips. The bonuses, which amount to roughly 10.5 percent of the division’s profits, could reach up to 600 million Korean won (around £300,000) per employee, nearly four times the average annual salary at the company last year.

The semiconductor unit, a critical supplier of memory chips essential for AI data centers, has experienced significant revenue growth amid the expanding AI market. The bonus agreement was approved by 74 percent of the 62,616 unionized workers who participated in a vote, ending a five-month pay dispute. Had the workers rejected the deal, an 18-day strike involving 48,000 employees may have proceeded, potentially disrupting global chip supplies.

The bonuses will be awarded to unionized technical staff within the memory division, with subcontractors excluded from the payout. For example, an employee working directly in the memory unit could receive between 500 million and 600 million Korean won, based on profit forecasts.

However, the arrangement has raised concerns about potential internal tensions at Samsung, as employees in other divisions—such as consumer electronics—are expected to receive significantly smaller bonuses. This disparity could prompt other labor unions within the company to push for comparable profit-sharing arrangements.

Business professor Seo Ji-yong noted that the deal might reduce funds available to shareholders and suggested it could face legal challenges. Nonetheless, the current agreement averts the risk of a prolonged strike and secures the semiconductor division’s critical role in supplying chips for the global AI industry.