Apple took a more than $40 billion hit today after reporting its second-quarter earnings — and it was bleak. Shares of Apple were down more than 8 percent in after-hours trading at one point today.

Things went about as poorly as you could expect: the company couldn’t hit revenue or earnings targets, iPhone sales fell off a cliff from the year-ago quarter, and its third-quarter guidance was pretty tepid. In short, it was not a good quarter for Apple, which blamed comparisons to a strong year-ago quarter and macroeconomic problems.

First, the scorecard:

• Revenue: $50.6 billion, compared to $58 billion a year ago and $52 billion that analysts were expecting
• Earnings: $1.90 per share, compared to analyst estimates of $2
• Guidance: Between $41 billion and $43 billion, compared to $49.6 billion in the same quarter a year ago and analyst estimates of $47.4 billion
• iPhone sales: 51.2 million, compared to analyst estimates of 50.7 million and down from 61.2 million in Q2 a year ago
• iPad sales: 10.3 million units, compared to analyst estimates of 9.4 million units and down from 12.6 million iPads in Q2 a year ago.
• Mac sales: 4 million units, compared to 4.4 million analyst expectations and 4.6 million in the same quarter a year ago
• Greater China (historically a strong growth area): $12.5 billion in revenue, compared to $16.8 billion in Q2 a year ago

There are a couple of bright spots against analyst expectations, but the miss on revenue and the very weak guidance really hit Apple very, very hard. So hard that its 8 percent drop in a single day is nearly unprecedented for the company — which has seen its shares decline 20 percent in the past year, but not really seen swings that dramatic. By Apple standards, they can sometimes be dramatic, but this was one for the books.

Here’s the rub. Investors tend to reward a couple of things: profitability is good, meeting expectations is good, beating them is even better. But for larger companies like Apple, Twitter, Facebook and Alphabet, growth is an absolutely massive part of the equation. And Apple today showed that not only did its sales fall year-on-year for the first time in 13 years, its next quarter is also looking equally bleak.

Take Twitter today, for example. Twitter managed to beat analyst estimates on earnings — and its user base actually grew! Twitter has 310 million monthly active users, compared to 305 million in the previous quarter. But the company also said it would record revenue between $590 million and $610 million, well below the $678 million that analysts were expecting for Q3. For a company that does a relatively good job of monetizing its very slowly growing (and sometimes declining) user base, that’s a bad thing to report.

Here’s another one: Alphabet. For a brief moment, Alphabet became even more valuable than Apple, because it beat in dramatic fashion what analysts were expecting from the company — and showed that it was growing, despite its cost-per-click (basically how valuable each click is to Alphabet) continuing to decline. Then the company completely whiffed on its revenue and earnings estimates that industry watchers were expecting, meaning it wasn’t growing as fast as what Wall Street sought.

And so we return to Apple. Last quarter, Apple fell just under what industry watchers were expecting — and everyone was curious if it would do it again, which it did. That’s the second straight quarter where it’s missed what Wall Street was seeking. Apple has historically been one of the strongest and most consistent growth stocks in not only the technology sector, but also the world. It’s basically a bellwether for the technology industry — if Apple is doing poorly, something must be wrong. But in the recent quarter, it becomes increasingly apparent that its growth engine — the iPhone — is stalling.

Being a publicly traded company means that it’s beholden to the whims of public investors, which have their own agenda. It means that Apple can be susceptible to individuals like Carl Icahn, who can buy up a lot of Apple stock and pressure the company to do things that it might not otherwise have in its playbook. Obviously Apple is much larger than most any other company out there, making it more difficult to do that, but it does mean that Apple can’t strictly play by Apple’s rules — it has to make sure it keeps Wall Street happy.

And for Wall Street, that means it wants the company to keep selling more iPhones and iPads, and find new lines of business. Apple’s trying to do that by releasing updates to the iPhone and iPad in the form of new devices like the iPad Pro and the iPhone SE. It’s expanding its services with things like Apple Music, which can generate new lines of revenue for the company if they hit enough scale. Apple, for example, said that Apple Music now has 13 million paying subscribers, and services revenue hit $6 billion this quarter. It’s still a blip, but it’s something that represents the potential for growth.

There’s another potential negative to shares dropping off a cliff: recruiting. When people join companies like Apple, often some of their compensation is locked up in stock. If that stock declines, it means their compensation was less valuable than when they started. Those employees are actually losing money for each point that Apple falls, which might make them more inclined to go to companies with steady growth like Facebook — or startups that offer the opportunity to cash out big if they are successful. If Apple is going to continue innovating, it still needs smart people, and it needs to be able to pay them well (and it doesn’t look like it’s using its massive cash pile any time soon).

Apple can please Wall Street in a couple of ways. It can pay back dividends or buy back shares, giving investors a chance to actualize a return on their investments. But in order for that to be valuable, Apple has to keep going up. Sometimes a dividend or a share repurchase program helps with that, but for the most part it has to keep convincing investors that it’s going to continue to grow. If that happens, Wall Street’s happy — and Apple can keep doing what Apple wants to do.

If not, Apple may have to reassess its strategy, or face off with investors that have punished the company’s stock in the past couple years.