Samsung Electronics (SSNLF) stock dropped about 3% on the Korea Exchange on Wednesday after wage negotiations with its union broke down, setting the stage for a large-scale walkout.
Samsung Electronics Co., Ltd., SMSN.L
More than 47,000 workers are scheduled to begin an 18-day strike on Thursday, May 21. It is the largest labor action in the company’s history.
SAMSUNG UNION SAYS IT WILL GO ON STRIKE TOMORROW: YONHAP
— Wall St Engine (@wallstengine) May 20, 2026
The collapse came after Samsung rejected a mediation proposal from South Korea’s National Labor Relations Commission. The union had already agreed to the proposal. Samsung asked for more time to consider, then said “no decision has been made,” according to union spokesperson Choi Seung-ho.
“We express deep regret that the post-mediation process was terminated due to the delay in management’s decision-making,” Choi said.
Samsung responded by saying it could not accept the union’s demands as written, stating they “could undermine the fundamental principles of company management.” The company added it would not give up on dialogue.
The core dispute is over Samsung’s performance bonus system. Workers want bonuses set at 15% of Samsung’s annual operating profit. They also want the removal of the current bonus cap, which limits payouts to 50% of an employee’s annual salary.
Workers are also pushing for a formalized bonus structure and guaranteed payouts for employees in business units that post a loss.
Kamil Dimmich of North of South Capital told CNBC that removing the bonus cap permanently would be a drag on Samsung’s profitability. He noted the union’s 15% demand is higher than the 10% agreed to by workers at rival SK Hynix.
The dispute is playing out against the backdrop of a chip boom, with Samsung posting strong profits driven by demand for AI hardware.
South Korean President Lee Jae Myung and Prime Minister Kim Min-seok both urged the two sides to reach a deal before the deadline. Kim warned the government could use emergency measures if the strike threatened the national economy.
Under South Korean law, the labor minister can invoke an “emergency adjustment” order to suspend industrial action for up to 30 days.
A South Korean court has also ordered that any strike cannot interfere with safety operations or damage semiconductor manufacturing equipment, which limits how much the walkout can disrupt production.
Samsung accounts for roughly one-quarter of South Korea’s total exports and is the world’s largest memory chip maker.
Wall Street currently has a Moderate Buy consensus rating on SSNLF. The average price target of $149.40 implies about 6.71% upside from current levels. The stock has gained around 115% year-to-date.
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