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Samsung Offers $120M in Treasury Shares as Executive Bonuses Amid AI Push

Samsung Electronics plans to distribute treasury shares worth approximately $120 million to over a thousand executives under its excess profit incentive program. The shares will be provided without being sold on the market, aiming to promote responsible, long-term management. This move comes as Chairman Lee Jae-yong warned executives not to become complacent despite a record quarterly profit, calling this a "last chance" to restore competitiveness. He emphasized the need to rebuild Samsung's technological edge, particularly in areas like artificial intelligence.

Key Points: Samsung $120M Share Bonus for Executives, Chairman's "Last Chance" Warning

  • $120M treasury share bonus
  • 1,051 executives receive shares
  • Part of excess profit incentive system
  • Chairman warns against complacency
  • Focus on AI and long-term tech edge
2 min read

Samsung to offer treasury shares worth $120 million as bonuses

Samsung to distribute treasury shares worth $120M to 1,051 executives as part of an incentive program, while Chairman Lee Jae-yong warns against complacency.

Samsung to offer treasury shares worth $120 million as bonuses
"The incentive programme aims to enhance responsible management and create long-term performance. - Samsung Electronics"

Seoul, Jan 26

Samsung Electronics said on Monday it plans to provide treasury shares worth 175.2 billion won to its executives under its excess profit incentive system.

The South Korean tech giant said in a regulatory filing that it will distribute a total of 1.15 million treasury shares to 1,051 executives under the incentive program, without selling the shares on the market.

Under Samsung Electronics' OPI system, employees can receive up to 50 percent of their annual salary as bonuses when their business division meets earnings targets. Part of the incentive is provided in shares after a one-year period, reports Yonhap news agency.

"The incentive programme aims to enhance responsible management and create long-term performance," Samsung Electronics said, adding the latest distribution relates to incentives for 2024.

"The shares to be distributed account for 0.019 percent of the company's outstanding shares and are expected to have a limited impact on share value," it added.

Meanwhile, Lee Jae-yong, chairman of Samsung Electronics, has urged the company's executives not to become complacent despite a sharp rebound in earnings, stressing that the company faces a "last chance" to restore its competitiveness, industry sources said.

Lee delivered the message during a recent seminar for Samsung Group executives, following the company's announcement of a record operating profit of 20 trillion won (US$13.8 billion) for the fourth quarter amid a semiconductor industry upcycle.

His remarks were aimed at warning some 2,000 executives against settling for short-term performance gains and calling for stepped-up efforts to fundamentally rebuild Samsung's technological edge, according to the sources, who asked not to be identified.

During the seminar, Lee shared key remarks by his late father and Samsung Group Chairman Lee Kun-hee, along with the company's core business strategies, including those related to artificial intelligence (AI).

- IANS

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Reader Comments

A
Arjun K
While the incentive system seems good, Chairman Lee's warning is the real story. "Last chance to restore competitiveness" – that's a powerful statement. In the fast-moving semiconductor and AI race, even giants can't afford to be complacent. Hope Indian corporates are listening.
R
Rohit P
$120 million as bonuses for executives... meanwhile, what about the regular engineers and factory workers? The gap is staggering. The chairman's father's legacy is being invoked, but true leadership should also focus on equitable growth. Just my two paise.
S
Sarah B
Interesting to see the OPI system details. Providing part of the bonus as shares after a year encourages executives to think beyond quarterly results. With AI being a core strategy, this long-term thinking is crucial. Hope it translates into real innovation.
V
Vikram M
Record profits in Q4, yet the chairman says it's a "last chance." That's the kind of relentless drive that makes Korean companies global leaders. We need more of this urgency in our own manufacturing and tech sectors. Complacency is the biggest enemy.
K
Karthik V
The share distribution is a tiny percentage of outstanding shares, so it won't dilute value much. It's more of a symbolic gesture to promote ownership. Practical move. Now, let's see if this motivates them to truly innovate in AI and semiconductors, which is the real challenge.

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