Samsung Electronics shares plunge 9% as record shareholder return plan disappoints 8 million retail investors

"I thought it would bounce back — instead it fell even further." — a Samsung Electronics retail investor

The fear became reality. Samsung Electronics shares tumbled more than 8% in a single session after the company unveiled its shareholder return plan, and the selloff deepened in after-hours trading despite hopes for a rebound.

Samsung Electronics shares closed Monday down 8.70% at 257,000 won ($186). The stock slid even further in the after-hours market — where investors had anticipated a recovery — falling an additional percentage point to 256,000 won, a decline of roughly 9%.

The drop was nearly three times steeper than the roughly 3% decline posted by SK hynix on the same day.

Even the headline figure of up to 110 trillion won in total shareholder returns — a record — failed to meet the elevated expectations investors had built up. Analysts pointed particularly to the company's decision to defer its share buyback and cancellation plan as a key factor behind the sharp selloff.

By contrast, when SK hynix announced a 40 trillion won share buyback and cancellation plan, its share price soared 12.73% in a single session.

The shareholder return package Samsung Electronics announced Friday was worth up to 110 trillion won — roughly five times the previous record of 20.3 trillion won set in 2020. The plan did not include a share buyback and cancellation program beyond what is reserved for employee compensation.

"The market had already priced in expectations that this year's shareholder return would expand to around 140 trillion won, but the actual figure came in below that threshold," said Choi Bo-young, an analyst at Kyobo Securities. "Given that the aggressive expansion of share buybacks and cancellations fell short of expectations, it is hard to call this a 'surprise return.'"

Earlier, Samsung Electronics closed the regular session Friday up 3.87% at 281,500 won, with the share price rising as high as 285,000 won during trading — putting the long-awaited "300,000-won Samsung" back within reach. After the market closed and the shareholder return plan was made public, however, the stock fell 4% from the regular-session closing price in after-hours trading, ending the session lower.

Among Samsung Electronics investors, the after-hours drop sparked widespread anxiety about Monday's open. That fear ultimately proved well-founded. Despite the record shareholder return announcement, some analysts warned that Samsung Electronics could continue to underperform SK hynix in terms of returns for now.

The number of Samsung Electronics retail shareholders approached 8 million in the first half of this year, the highest level on record. South Korea's adult population stands at about 43 million, which means roughly one in five adults holds Samsung Electronics shares.