Samsung's semiconductor-consumer divide deepens from pay dispute to labor talks

Samsung Electronics faces a widening gap between its semiconductor-focused Device Solutions (DS) and finished-products-focused Device eXperience (DX) divisions, which is now affecting upcoming labor negotiations. The dispute stems from a disagreement over performance pay, highlighting the differing fates of the two units.

The DS unit, which manufactures memory chips and other semiconductors, has reaped rewards from a surge in memory prices. Meanwhile, the DX unit, which sells smartphones, televisions, and appliances, has encountered higher component costs and declining profitability.

The Samsung Electronics Company Union, primarily made up of employees in the DX division, is preparing for a rally near the company's office in Seoul's Gangnam District. The union anticipates around 3,000 participants and is demanding additional compensation equivalent to 1,000 Samsung Electronics shares per DX employee. They argue that the pay gap between DS and DX workers has become excessive.

Meeting this demand would reportedly cost Samsung Electronics over 12 trillion won ($8.68 billion). This pay dispute adds to the strain on relations between the two divisions, which operate largely as separate businesses within the company.