The stock plummeted 26% to $21.48 at the close. It was the second worst day ever for the shares, behind only a 31% drop in July 1974, which was three years after Intel’s IPO. The company’s market cap is now below $100 billion.

The dramatic selloff contributed to a 2.4% drop in the Nasdaq and pulled down global semiconductor stocks. Taiwan Semiconductor Manufacturing Co. — known as TSMC — closed 4.6% lower in Taiwan, and Samsung was down more than 4% at the end of the session in South Korea. TSMC is the world’s biggest manufacturer of chips, while Samsung is the largest memory semiconductor firm globally .

Intel’s numbers were bad across the board.

The company swung to a $1.61 billion net loss after reporting net income of $1.48 billion in the year-earlier period. Adjusted earnings per share of 2 cents fell way short of the average analyst estimate of 10 cents, according to LSEG. Revenue also missed expectations.

Intel said it won’t pay its dividend in the fiscal fourth quarter of 2024 and lowered its forecast for full-year capital expenditures by over 20%. The company said it would lay off more than 15% of its employees as part of a $10 billion cost-reduction plan.

“This is the most substantial restructuring of Intel since the memory microprocessor transition four decades ago,” Intel CEO Pat Gelsinger told CNBC’s Jon Fortt in an interview that aired on Friday. “We have laid out an audacious journey of rebuilding this company, and we’re going to get that done.”

A decision to more rapidly produce Core Ultra PC chips that can handle artificial intelligence workloads contributed to the loss, Gelsinger said on a conference call with analysts. The company said pricing was more competitive than planned during the quarter, as AMD , Qualcomm and other companies have been working to take market share from Intel, which has fallen way behind its rivals in the AI battle.

The job cuts will mainly take place this year, Gelsinger wrote in a memo . It’s the largest of any single job cut listed on Layoffs.fyi, an industry tracker that’s been operating since March 2020.

Competing on merit

Adding pressure to the chip sector is a report from The Information that AI chipmaker Nvidia is the subject of a U.S. Department of Justice antitrust investigation.

The DOJ is looking at complaints that the company allegedly abused its market dominance in AI, The Information reported.

In response, a spokesperson for Nvidia said that the company “wins on merit.”

“We compete based on decades of investment and innovation, scrupulously adhering to all laws, making NVIDIA openly available in every cloud and on-prem for every enterprise, and ensuring that customers can choose whatever solution is best for them,” the spokesperson said.

The spokesperson added that Nvidia is “happy to provide any information regulators need.”

CNBC has also reached out to the DOJ on the report.

Samsung rival SK Hynix, which supplies U.S. giant Nvidia, also fell sharply to close more than 10% lower. The sell-off continued in Europe. Shares of ASML , which sells key tools required to make cutting-edge chips, declined along with STMicroelectronics and Infineon .

The VanEck Semiconductor ETF, which includes major names in the sector, fell 5.5% on Friday after plummeting 6.5% a day earlier.

WATCH: Why Intel faces a challenging road ahead