Reaching Out to South Korean Chip Giants: SK Hynix and Samsung's "Excess Profits" May Need to Be Shared with the US

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While promoting Korean chip companies to build factories in the U.S., the United States has quietly put forward a more direct demand—profit sharing.

According to The Korea Times, citing informed sources, Rick Switzer, Deputy U.S. Trade Representative, explicitly stated in a meeting last month with South Korean Trade Minister Bang-kyu Ryoo that the U.S. side has the right to share the huge profits of SK Hynix and Samsung Electronics. Although this statement has not yet been officially confirmed by the U.S., it has already drawn attention within South Korea’s industry and government. At the same time, South Korea’s semiconductor exports to the U.S. in the first half of this year surged by over 90% year-on-year, providing direct context for the U.S. demand.

This development means that the semiconductor game between the U.S. and South Korea is extending from manufacturing localization to issues of profit distribution, creating new policy pressure for the two Korean chip giants.

U.S. Logic: Contribution by Procurement, Justified Profit Sharing

According to The Korea Times, citing an industry insider familiar with the matter, Rick Switzer stated during last month’s meeting with Bang-kyu Ryoo that American companies purchase large amounts of Korean semiconductors, directly boosting the profitability of Korean chip firms, and therefore the U.S. has the right to share these profits.

"The U.S. logic is that if domestic partners in Korea have the right to a share of profits because of their contribution, then U.S. companies should also enjoy the same rights," the source said.

A senior South Korean government official also confirmed to The Korea Times that the U.S. did propose such a claim, but did not elaborate further. The Korea Times repeatedly contacted the Office of the United States Trade Representative, the Department of Commerce, and the Department of the Treasury for comment, but received no response.

Officials from South Korea’s Ministry of Trade, Industry and Energy said they were unaware of the matter and reiterated South Korea’s basic stance that "industry-related affairs should be promoted based on commercial rationality." The official added that Korean companies have already announced their investment plans through roundtable meetings, in line with last year’s tariff agreements, and have been making large-scale investments for years.

Korean Chip Exports to the U.S. Surge, Providing a Basis for U.S. Claims

The U.S. demand for profit sharing is backed by specific trade data.

According to South Korean government figures, South Korea’s total semiconductor exports in the first half of this year reached a record 192.43 billion USD, up 162.5% year-on-year; U.S.-bound exports rose 91.3% to 26.4 billion USD.

Monthly data is even more striking. In June, South Korea’s semiconductor exports grew 199.2% year-on-year to 44.82 billion USD, a new record; exports to the U.S. surged 377.2% year-on-year to 6.49 billion USD.

The sustained boom in global AI chip demand is the main driving force behind this growth, with SK Hynix and Samsung Electronics, as major global suppliers of memory chips, benefiting significantly.

Beyond Factory Pressure, Profit Sharing Becomes a New Battleground

Previously, Washington’s public pressure on Korean chipmakers mainly focused on urging them to set up factories in the U.S. Last week, U.S. Commerce Secretary Howard Lutnick publicly called on Samsung Electronics and SK Hynix to build memory chip manufacturing plants in the U.S., continuing the Trump administration’s push for localization of semiconductor production.

Both companies have announced major investment plans in the U.S., but currently have no concrete plans to build advanced DRAM or NAND wafer fabs in the U.S.

The emergence of the profit sharing demand means the logic of U.S. pressure is expanding. If factory construction requirements point to future capacity layout, profit sharing directly targets already realized returns, with a more immediate impact on the companies’ short-term finances.

How Should Excess Profits Be Distributed

It is worth noting that as the U.S. puts forward the profit sharing claim, debate in South Korea over "excess profits" had already been brewing.

In recent months, there has been ongoing controversy in South Korea over whether Samsung Electronics and SK Hynix should redistribute some excess profits to subcontractors and suppliers in their supply chains—who to some extent have also contributed to those profits; some even argue that the public should benefit, as taxpayer funds were used to support infrastructure construction.

U.S. intervention adds an external variable to what was originally a domestic dispute over distribution in South Korea and makes the situation more complex for the Korean government and companies to handle.

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