Taiwan's stock market tumbled 1,655 points in a single session — the sixth-largest point drop on record — but TSMC delivered a record profit at its earnings call, keeping the picture relatively positive for long-term investors.

• Higher-than-expected U.S. inflation data for September, combined with concerns over AI financing, pushed the Taiwan index below 47,000, while TSMC briefly fell under NT$2,420 during the session.
• TSMC's third-quarter profit hit an all-time high, with a gross margin of 66.4%, and the company raised its forecast for 2026 U.S. dollar revenue growth to 44%.
• Sun Ching-lung, director of Investor Daily, identified two warning signs that would turn him from bullish to bearish: a gross margin falling below 55%, or an inability to keep raising the cash dividend year after year.
• TSMC has close to 20 new plants under construction worldwide and is adding another 3-nanometre fab. It confirmed it is evaluating expansion in Texas and has not ruled out cooperation with Terafab, a company under Elon Musk, but insists that it must operate its wafer fabs itself.
• Costs at the U.S. plants are expected to eat up about 4 percentage points of gross margin, the main source of pressure on future profitability.

Outlook: Taiwan stocks may see further sharp swings in the near term, but with AI demand providing momentum, TSMC's orders and capacity expansion plans are still accelerating.