Intel reported better-than-expected second-quarter earnings Thursday, but one analyst on Wall Street is not convinced it is a sign of better things to come.

Jefferies reiterated its underperform rating for Intel, saying new products from its competitors will take market share away from the company.

“Intel beat and raised on better top line and operational execution, but the low quality of earnings, and accelerated pace of acquisitions are consistent with our Tectonic Shift in Computing Thesis,” analyst Mark Lipacis wrote in a note to clients Thursday. “We continue to believe that Intel’s DCG [data center group] revs will decelerate further in 2018 as AMD and CAVM ramp competitive offerings in servers.”

Intel shares have fallen 3.6 percent this year through Thursday compared with the S&P 500’s 10.6 percent return.

Lipacis increased his Intel price target to $30 from $29, still representing 14 percent downside from Thursday’s close.

The analyst cited how in the previous four quarters Intel’s data center server business sales grew 8 percent year over year versus the double-digit growth during the last decade. He said new server chip products from AMD, Cavium and Qualcomm will be released in the second half of this year.

Lipacis also mentioned Intel’s recent sales upside may have benefited from retailers replenishing inventories versus true customer demand.

“INTC noted that PC inventories in the supply chain have increased to ‘healthy’ levels from ‘lean’ levels over the past several quarters,” he wrote.

Intel did not immediately respond to a request for comment. The shares traded up 0.7 percent midday Friday.