Electronics giant Philips on Tuesday issued a profit warning, saying adverse market conditions and delayed start-up of its factory in the US city of Cleveland hurt its performance in the fourth quarter.

Philips is now expecting its operating earnings to be €255m in the fourth quarter rather than the €884m originally forecast, the company said in a statement.

The problems at the medical equipment factory in Cleveland are bigger than expected. The delayed start will depress operating earnings by €225m, up from the previously expected €180m.