Samsung Biologics Posts Strong Q1 Growth, but Labor Dispute Emerges as Key Risk

Samsung Biologics Posts Strong Q1 Growth, but Labor Dispute Emerges as Key Risk: Reporter Kim Jisun / 기사승인 : 2026-04-23 06:33:26

Photo courtesy of Yonhap News

[Alpha Biz= Kim Jisun] Samsung Biologics delivered double-digit growth in both revenue and operating profit in the first quarter, underscoring its core competitiveness as a contract development and manufacturing organization (CDMO), though escalating labor tensions are emerging as a potential risk to future operations.

The company announced on April 22 that it recorded revenue of KRW 1.2571 trillion and operating profit of KRW 580.8 billion for the first quarter. Driven by full utilization across Plants 1 through 4, revenue rose by KRW 257.6 billion, or 26% year-on-year, while operating profit increased by KRW 150.6 billion, or 35%.

The results reflect continued improvement following the spinoff of Samsung Bioepis, positioning the company as a pure-play CDMO. Enhanced production efficiency and a growing share of high-value contracts have strengthened cash flow, fueling expectations of a re-rating in corporate valuation.

Samsung Biologics has also expanded its global footprint with the acquisition of a manufacturing facility in Rockville, U.S., while pursuing additional growth through increased orders from global pharmaceutical companies. Strategic partnerships have also been reinforced, including collaboration with Eli Lilly on the Lilly Gateway Labs (LGL) initiative and expanded cooperation with the Coalition for Epidemic Preparedness Innovations, broadening its capabilities beyond CDMO into public health response.

Despite the strong performance, labor tensions have intensified. The company’s labor union held a rally attended by around 2,000 members at its Songdo Bio Campus in Incheon on April 22, marking the first such protest since the company’s founding. While the event concluded without physical clashes, tensions between labor and management remain elevated.

The two sides have held 13 rounds of negotiations since late last year but have failed to reach an agreement, and mediation efforts have also broken down. The union is demanding a 14% wage increase, a KRW 30 million incentive per employee, and the distribution of 20% of operating profit as performance-based bonuses. Management, meanwhile, has proposed a 6.2% wage increase.

The union has indicated it will proceed with a general strike starting May 1 if no progress is made, having secured over 95% approval from members.

Industry observers note that the strong first-quarter performance largely reflects previously secured orders, raising concerns over potential risks ahead. A strike could disrupt production schedules, leading to contract penalties with global clients and reputational damage.

Given the nature of biopharmaceutical manufacturing, any disruption could result in the disposal of entire production batches, causing direct financial losses and undermining client trust. Prolonged labor disputes could weigh on the company’s growth trajectory.