[Alpha Biz= Kim Jisun] The labor union at Kakao has entered formal mediation with the labor authorities, demanding an expansion of performance-based bonuses, in a move that could escalate into a strike if negotiations fail.

According to industry sources on May 10, the Kakao chapter of the Korea Chemical & Textile Industry Workers' Union filed for mediation with the Gyeonggi Regional Labor Relations Commission after failing to reach an agreement with management in the 2026 wage negotiations. Labor unions from several Kakao affiliates are also reported to have joined the mediation request.

The central issue in the negotiations is the scale of performance bonuses. While the union has not explicitly demanded a fixed percentage, the proposed amount is estimated to correspond to approximately 13–15% of operating profit. Market observers note that this stance may have been influenced by a precedent set by SK Hynix, which allocates 10% of its operating profit toward employee bonuses.

Industry estimates place Kakao’s operating profit for the previous year at around KRW 440 billion, with a workforce of approximately 4,000 employees. If the union’s proposal is accepted, the average performance bonus per employee could reach roughly KRW 15 million.

A Kakao official stated, “The company has been engaging in good-faith discussions with the labor union regarding the 2026 wage negotiations, but has been unable to reach a final agreement on the detailed compensation structure, leading to the initiation of mediation procedures.” The official added, “We remain committed to maintaining open communication with the union and will continue efforts to reach an amicable resolution.”

If mediation by the labor commission fails, the union may proceed with industrial action. However, filing for mediation does not automatically indicate a strike, as any such decision will depend on the outcome of the mediation process and internal union procedures.

Meanwhile, Kakao’s stock has remained in the KRW 40,000 range despite broader market strength. Analysts attribute the subdued investor sentiment to the lack of clear monetization from its artificial intelligence services. The stock, which once traded above KRW 70,000 last year, closed at KRW 46,000 on May 8.

Brokerages have generally maintained a “buy” recommendation while lowering target prices. Hanwha Investment & Securities analyst Kim So-hye stated, “We have lowered our target price to KRW 70,000 while maintaining a ‘buy’ rating. Although the company’s stock has underperformed the market, we believe it is entering a phase where upside factors could be more strongly reflected.”

 

 

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