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This happened because they were facing a storm of injuries to the core squad and even if it wasn't wrong they had lost almost 8 core players to injury at that time thus affecting the team's performance. Alexander Isak has had some good moments this season and he has been one of Newcastle's goal machines. Many clubs are starting to see his abilities, especially since he is still young enough to develop a career at a club that has far more potential to win titles because staying at Newcastle doesn't necessarily mean he can become champions.
His desire to stay until his contract ends there is still a chance for other clubs who are interested in signing him because even though he says so. If the club intends to sell because they need some additional players that will be another matter and maybe he will get a place as one of the players to be sold.
Newcastle still needs to improve the squad instead of letting some of its best players leave at the end of the season. Alexander Isak is one of the important players in Newcastle's squad this season, so they need to keep him instead of selling him. It is true that it is difficult for Newcastle players to hope for a title, but it is not impossible for this team to follow in the footsteps of Manchester City because of its good financial strength.
This season Newcastle's performance is very different compared to last season, even though they have improved their squad. Of course player injuries have had a significant impact on the team's performance, but that should not be the main reason why they have dropped so much so far.