Samsung Electronics executives are increasingly tying their financial futures to the company’s performance, opting to receive a significant portion of their performance bonuses in company stock. The shift, implemented last year, aims to align executive interests with long-term shareholder value amid a surge in profits driven by the artificial intelligence boom and a global memory chip supercycle.
The stock-based compensation system varies by rank within Samsung. Senior vice presidents are required to take at least 50% of their bonus in stock, whereas executive vice presidents must allocate 70% or more. Presidents are mandated to take 80% or more in stock, and registered executives receive 100% of their bonus in Samsung shares.
TM Roh, head of Samsung’s mobile division, recently received 7,299 shares valued at 1.17 billion won (approximately $800,000) as part of his bonus, while Jeon Young-hyun, who leads Samsung’s chip unit, opted to receive his $1.2 million bonus entirely in stock. Other top leaders, including those in the corporate management office and senior advisory roles, have also chosen to receive their bonuses in shares, signaling confidence in the company’s future prospects.
The move comes as Samsung Electronics reports substantial profits, with chip sales contributing $4.9 billion to a net profit of $8.6 billion. This financial performance is part of a broader trend impacting the semiconductor industry, with SK Hynix also reporting a profit of $8.8 billion and labeling the current market a “supercycle,” having already sold out production capacity through 2026. Micron, another major player, posted a net profit of $3.2 billion, confirming a parallel surge in demand.
Industry analysts attribute the current boom to the growing demand for High Bandwidth Memory (HBM), a critical component for training large AI models. The need for standard DRAM is also increasing as data centers expand server purchases for AI inference, offering a more cost-effective alternative to maintaining extensive training clusters. Global DRAM revenue is projected to reach an estimated $231 billion by 2026, according to industry estimates.
