The news of Intel’s poor first-quarter forecast caused a sell-off in chip stocks on Friday, with shares of the company dropping by 10% in premarket trading. This surprised analysts and raised concerns about Intel’s financial stability during a downturn in the semiconductor industry. Additionally, the company’s revenue forecast fell short of expectations by $3 billion.

The poor forecast from Intel has led to a decline in shares of chipmaking companies, including KLA Corp, which fell over 5%. Other companies, such as Advanced Micro Devices, Nvidia, Applied Materials and Qualcomm, also saw losses ranging from 0.8% to 3.2%.

These projections suggest that Intel is facing some of its worst results in history and highlights the difficulties facing CEO Pat Gelsinger as the PC market struggles and growth in the data center industry slows down. Analyst Hans Mosesmann of Rosenblatt Securities, who is one of the 16 analysts who lowered their price targets for Intel, stated, “No words can portray or explain the historic collapse of Intel.”

Intel, once a dominant player in the PC and data center markets, has been losing market share to competitors such as AMD. The chipmaker has been using contract chipmakers like Taiwan-based TSMC to produce chips that surpass Intel’s technology.

Due to this, some analysts believe that even when the data center market recovers, Intel will have lost even more market share by then. As Matt Wegner, analyst at YipitData states, “AMD’s Genoa and Bergamo chips have a strong price-performance advantage compared to Intel’s Sapphire Rapids processors, which should drive further AMD share gains.”

Intel’s first-quarter outlook has caused a significant drop in shares of chipmakers, including a 10% decrease in premarket trading for Intel’s own shares. The company’s forecast for a surprise loss and revenue below estimates by $3 billion has raised concerns about Intel’s cash position in the current semiconductor downturn.

Other companies, including KLA Corp and Advanced Micro Devices, Nvidia, Applied Materials, and Qualcom, also saw decreases in shares. The projections highlight the challenges facing Intel’s CEO Pat Gelsinger due to a decrease in PC demand and slowing growth in the data center business. It also puts Intel at a disadvantage when the data center market bottoms out, as it is expected to have lost even more market share by then. The results are also expected to decrease the cash flow available to the company, as it tries to revive the business by expanding contract manufacturing and building new factories.