The world’s largest chipmaker, Taiwan Semiconductor Manufacturing Company, released quarterly results that almost any company would envy: a 40% jump in revenue to $40.2 billion, and a 77% jump in profit to $22.3 billion. Investors, though, decided those gaudy numbers weren’t enough. The next day, TSMC shares dropped 7.3%—and dragged Taiwan’s benchmark TAIEX index down in the biggest single-day point decline on record.
TSMC’s outsize role poses a challenge for Sherman Lin, the chair of the Taiwan Stock Exchange Corporation, which runs the island’s main stock exchange. According to Bloomberg calculations, Taiwan overtook India to become the world’s fifth-largest stock market—behind only the U.S., mainland China, Japan, and Hong Kong—in May. And yet two-fifths of that value comes from TSMC.
