Opening
TSMC Chairman and President Wei Che-jia held an employee communication meeting on May 27, 2025, addressing concerns over a reported 15% bonus reduction despite the company's surging revenue and profits, according to Taiwanese media reports. Wei stated during the meeting that if employee performance evaluations remain consistent with the previous year, he has confidence that full-year bonuses will still increase by more than 30%. The communication came as the integrated circuit foundry giant faces internal dissatisfaction following news of potential bonus cuts, even as artificial intelligence demand drives the company to record-breaking financial performance in its first quarter of 2026 (fiscal year), with net profit reaching NT$572.5 billion (approximately RMB 123.6 billion), representing a 58% year-over-year increase.
Wei's Three-Pillar Profit Distribution Framework
Wei explained to employees that TSMC's profit distribution focuses on three areas: employees, shareholders, and society. According to the communication, employees prioritize work value, compensation benefits, and development opportunities; shareholders expect steady corporate growth and reasonable returns; and the company bears responsibility for social environment and public resource stewardship. TSMC reviews profit distribution annually to balance these three demands and implement sustainable business operations policies.
Wei emphasized that care for employees will not change. He noted that as operations have expanded and profitability has grown in recent years, employee bonus growth rates have been no less than 30% annually from 2023 to present, thanking employees for their contributions to the company. Wei stated that TSMC's goal is for base-level employee salary growth rates to exceed those of management.
TSMC's Compensation Data
According to TSMC's 2024 Annual Sustainability Report, the company's global workforce exceeded 84,500 employees, with overall compensation maintained at the top 25% industry level. From 2020 to 2024, total annual employee salary and benefit expenses increased from approximately NT$140.8 billion (approximately RMB 30.4 billion) to approximately NT$301.8 billion (approximately RMB 65.2 billion). In 2024, the approved total cash bonuses and remuneration for Taiwan facilities exceeded NT$140.5 billion.
Taiwan facility incentive programs are implemented over two years: "employee cash bonuses" are distributed quarterly during the current year, while "employee cash remuneration" is paid the following year, encouraging long-term service and continued contributions.
First Quarter Financial Performance
TSMC's first quarter 2026 (fiscal year) results exceeded market expectations across all metrics. Net profit reached NT$572.5 billion (approximately RMB 123.6 billion), up 58% year-over-year. Revenue totaled NT$1.134 trillion (approximately RMB 244.8 billion), up 35% year-over-year. Operating profit reached NT$659 billion (approximately RMB 142.3 billion). All three indicators surpassed external estimates.
The quarter's most notable highlight was gross margin reaching a new high of 66.2%, expanding nearly 4 percentage points from the previous quarter's 62.3% and significantly exceeding the market estimate of 64.5%. TSMC forecasts total revenue growth this year will exceed 30%, higher than its previous expectation of below 30% and the market consensus of 25%-28%.
Samsung Electronics Labor Agreement Context
On May 27, 2025, Samsung Electronics' labor and management reached a temporary wage negotiation agreement that passed in union voting, allowing the company to avoid production capacity interruptions from a full-scale strike. Employees in Samsung Electronics' semiconductor Device Solutions (DS) division are expected to receive performance bonuses of up to approximately 600 million Korean won (approximately RMB 2.723 million) this year.
Prior to this agreement, Samsung Electronics semiconductor employees had threatened to strike over dissatisfaction with bonus distribution plans amid the company's profit surge from rising memory chip prices. Multiple rounds of labor-management negotiations resulted in the temporary agreement that averted the strike threat.
