Samsung Electronics’ shares are lagging behind those of SK Hynix, despite a global rally in chip stocks driven by optimism surrounding AI. According to analysts, rising tensions between Samsung and its workforce are a key factor in the difference in performance.
This is reported by Bloomberg. The tensions became clear on April 23, when the union organized a large-scale protest to demand a larger share of the profits from the chip division. Although it was a demonstration and not a full-scale strike, this is seen as an important signal that the conflict is escalating.
The situation could worsen further. The union has announced that employees intend to walk off the job for 18 days starting May 21 if no agreement is reached with management. This threat is causing uncertainty among investors, precisely at a time when demand for advanced memory for AI applications is growing rapidly.
Strike risk overshadows growth expectations
According to market experts, confidence in the structural growth of high-bandwidth memory remains intact, but the risk of a strike at Samsung weighs heavily on the stock’s valuation. Other chip companies, including MediaTek and ASE Technology Holding, are benefiting from the positive sentiment and showing stronger share price performance.
The conflict centers on profit sharing. The union is demanding that a larger portion of operating profits go to employees of the chip division. An earlier proposal from Samsung, which included bonuses and wage increases, was rejected.
Samsung states that it intends to continue discussions with the union and handle the situation in accordance with applicable procedures. At the same time, the company says it is prepared for a potential strike and is taking measures to limit disruptions to production.
Financially, Samsung is performing strongly. The semiconductor division recently posted exceptionally high profits, partly thanks to demand from AI data centers. Analysts warn, however, that additional costs from potential concessions to staff or bonus schemes could squeeze profitability.
At SK Hynix, the situation is more stable. The company had previously reached agreements with employees regarding profit-sharing, preventing a similar conflict from arising. According to analysts, this offers an advantage in the current market.
Research firms such as Citigroup have since lowered their expectations for Samsung, partly due to the potential impact of the labor dispute. At the same time, analysts see opportunities for SK Hynix, partly because any disruptions at Samsung could lead to more favorable market conditions for competitors.