Chip stocks are tumbling. But why?

Shares of Dutch chipmaker ASML Holding plunged more than 17% Tuesday after the semiconductor equipment maker missed third-quarter earnings estimates and forecast lower sales for next year.

The earnings results were accidentally published a day earlier than expected, which ASML said was due to a technical error that posted part of its Q3 results on its website.

The Netherlands-based chipmaker downgraded 2025 sales forecasts to between 30 billion euros and 35 billion euros ($32.7 billion and $38.1 billion) on the lower half of its guidance.

“While there continue to be strong developments and upside potential in AI, other market segments are taking longer to recover,” said CEO Christophe Fouquet in the company earnings release. “It now appears the recovery is more gradual than previously expected. This is expected to continue in 2025, which is leading to customer cautiousness.”

The firm is facing a hard time ahead in China, which is expected to bring in about 20% of the company’s total revenue in the next year, due to Dutch and American export restrictions on shipments to the country, according to CNBC.

The earnings results for the chip firm, which is a critical supplier for the broader semiconductor industry, triggered a sell-off of other chip stocks, with reverberations across the market, causing the Dow to close down 300 points.

Shares of current Wall Street darling Nvidia (NVDA) fell 5% midday after a recent all-time-high closing, and ended down 4.5% at the market close.

Taiwan Semiconductor Manufacturing Company (TSMC), which produces some 90% of the world’s super-advanced semiconductor chips, fell more than 2.6%.

Also at market close: Intel (INTC) was down 3.3%, Broadcom (AVGO) was down 3.47%, and Advanced Micro Devices (AMD) was down a whopping 5.22%.