A leading maker of the computer servers and software behind the Intern

Harshgmat , sure!

I will start with the issue that is most obvious to me, but I think that the issue may be obscure.
This question tests the idiom:
• cite X as Y
• X is cited as Y

"Cite" in this instance means "to give a reason for"

We have a 4-1 split. Every answer choice except B construes the idiom incorrectly.

We want "citing X as Y" or "X is cited as Y"

The verb "being" is both unnecessary and unidiomatic.

Citing surprisingly low demand [X] as [one reason for the change in its expectations] [Y]. Perfect.

"Citing X to be Y" is not idiomatic.

Same as C.

Same as A.

***
Do not panic if you have never seen or heard of this idiom before.
We are not expected to know every idiom.
I caught the idiom because I am a native speaker, a writer, and an editor.

We could replace "citing" with more familiar words and then assess the sentences.

Words we could use instead of "citing" (be careful NOT to use a participle that requires anything else such as "to"):

naming
identifying
specifying
referencing

Try replacing one of those words in order to see that you do not need to know the idiom "citing X as Y."

Almost always, other errors exist in the sentences with idioms.
If such other issues exist, I hope others will tease them out.

I have two requests:

1) workout - you assert that in options C and E, the word "that" incorrectly modifies Europe

Did you rely on the "touch" rule about essential modifiers and their nouns?
Have you considered the exceptions to the "touch" rule?

I think Manhattan Prep calls such exceptions "mission-critical" modifiers.
Might "in Europe" be a vital modifier?

2) sudarshan22 , would you please elaborate on those parts of sentences that you marked in red?

Why do you think that those portions of the sentences are incorrect?
Please offer analysis, reasoning, explanation, and the like.

Harshgmat , I hope that helps.

By the way, one mention of the idiom "cite X as Y" is here.