Top European technology stocks shed nearly $6 billion of market value on Wednesday, with suppliers for Apple the top fallers after the tech giant’s revenue forecasts fell short of expectations.

While the worst hit were the handful with 20-70 percent direct exposure, the whole sector suffered as investors cautioned against frothy valuations, with the STOXX Europe 600 tech index .SX8P trading well above its historical average.

The European technology index lost 5.7 billion dollars of market capitalization, led lower by a 6.5 percent slump in Germany’s Dialog Semiconductors and a 5.1 percent fall in British-listed ARM Holdings (ARM.L).

Apple orders accounted for around 70-75 percent of Dialog’s total revenue, industry experts said, while Apple accounted for 20-25 percent of ARM’s processor royalties last year.

While Apple’s biggest suppliers, such as Intel (INTC.O) and Qualcomm (QCOM.O), are American, Apple is a large customer of many smaller European companies.

Dialog, which makes chips for Apple, lost $287 million, while ARM, which licenses chip designs for use in Apple products, saw $1.7 billion knocked off its value.

Dialog remains up 67 percent so far this year, and trades at valuations over 15 percent higher than its historical averages.

“We have nothing against Apple, but expectations on that side of the market are a little bit too high and that the reason we now don’t have any Apple-related stocks,” said Anko Beldsnijder, managing director of MainFirst Asset Management.

Austria’s Ams AG fell 2.9 percent. Its technology is used in the Apple watch, though in June a Swiss newspaper reported it would miss out on a valuable new Apple contract.

Shares in European companies with smaller direct exposure to Apple such as Infineon (IFXGn.DE) and STMicro (STM.PA) also fell by around 5 percent, with investors saying sentiment around technology stocks in general had turned negative.

The STOXX Europe tech index trades at a price of 18.7 times its 12-month forward earnings, against a 10-year average of 16.2 times, according to Thomson Reuters Datastream. It trades at a premium to every other sector apart from telecoms and healthcare stocks.

Tech consultancy Gartner said in April it forecast a 4 percent rise in semiconductor sales worldwide in 2015 but warned that stronger dollar, excess inventories and end of PC upgrade cycle were seeing “mounting concerns”.

ARM’s drop came as the chip-designer’s reported results that were broadly in line with expectations, saying that Apple’s outlook would not change its view of second half trading.

Veronika Pechlaner, fund manager at Ashburton, said the resilience of royalties from Apple last quarter was a good sign, and that ARM had enough other diverse streams of revenue to withstand a slight Apple slowdown.

“Looking at the share price now, we could be nearing a buying opportunity. We still like ARM in the longer term, even in the context of weaker Apple earnings, as there are lots of opportunities outside handheld devices,” Pechlaner said.

She added that Dialog would be more sensitive to Apple sales, and that after today’s fall investors would reconsider their position in the stock in the coming days.

“We still own it, it’s a question of whether we still want to continue to own it, whether we add to it here, or if the Apple concentration is a problem in the longer term. It’s definitely a stock to revisit after this.”

(Reporting by Alistair Smout and Atul Prakash; Editing by Alison Williams)

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