No annual bonuses for Samsung chip unit due to loss

The company instead offers more bonuses to smartphone, TV, home appliances, medical devices employees

Samsung Electronics semiconductor production lines in South Korea (Courtesy of Samsung)

Jeong-Soo Hwang 2

2024-01-30 11:34:47 hjs@hankyung.com

Korean chipmakers

Samsung Electronics Co., the world’s top memory chipmaker, decided not to pay annual bonuses to staff of its semiconductor business due to the division’s sluggish 2023 performance while offering higher incentives to other business units.

Samsung on Monday released overall performance incentives (OPIs) for its business units, according to industry sources. The South Korean tech giant provides yearly bonuses of up to 50% of annual salaries based on divisional performances the previous year within 20% of its excess profits. The OPIs are set to be paid on Jan. 31.

The company plans not to offer any bonuses to the staff of the device solutions division, which handles its semiconductor business as the unit logged an operating loss in 2023.

The division’s workers received 50% of their salaries for the incentives last year.

Staff of other divisions are set to enjoy more bonuses than in 2023, however.

50% FOR SMARTPHONE BUSINESS

Samsung, the world-second largest smartphone maker, is set to reward hefty incentives to staff of its mobile business thanks to strong sales of premium products.

The OPIs for the mobile experience division, which handles its smartphone business, topped the bonuses by division with 50% of the annual pay, given healthy sales of premium models such as the Galaxy S23 and Galaxy Z Fold 5. The division’s staff received 37% of their salaries last year.

The staff of the visual display division, which oversees its TV business, is set to enjoy 43% of their annual salaries as OPIs, nearly double the 24% in 2023, as strong sales of premium models including Neo QLED (quantum dot display) lineup bolstered profitability despite the slowing global TV demand.

The workers of the company’s home appliances and medical device units are poised to receive 12% for the bonuses, up from the 7% last year.

Separately, LG Electronics Inc., the world’s top home appliances maker, plans to offer generous bonuses to staff as it posted record annual sales in 2023 for the third year in a row.

The South Korean company decided to pay up to 665% of basic salaries, or 33.3% of annual pay, to the home appliance and air solution division’s employees.

Write to Jeong-Soo Hwang at hjs@hankyung.com

Jongwoo Cheon edited this article.