Dutch medical device maker Philips lowered Monday its full year sales target, blaming drop in demand from Chinese hospitals as it released third quarter results.

Markets reacted negatively to the announcement with Philips's share price dropping by more than 11 percent in morning trading on the Amsterdam stock exchange's blue-chip AEX index.

A "significant deterioration" in Chinese demand forced Philips to adjust its expected growth in sales to 0.5 to one percent for 2024, the Amsterdam-based company said.

Philips had previously anticipated three to five percent sales growth.

"In the quarter, demand from hospitals and consumers in China further deteriorated, while we continue to see solid growth in other regions," chief executive Roy Jakobs said.

"We have adjusted our full-year sales outlook to reflect the continued impact from China," Jakobs said.

Third quarter sales came in at 4.37 billion euros ($4.7 billion), a drop of two percent from the same period last year.

When stripped of exceptional items sales were flat.

The company saw net profit double from the same period last year to 181 million euros, with Jakobs pointing to "productivity measures and the improved margins of our AI-driven, industry-leading innovations".

Philips earlier this year reached a $1.1 billion deal to settle lawsuits in the United States over faulty sleep machines.

The crisis erupted in 2021, with millions of devices recalled over concerns that users were at risk of inhaling pieces of noise-cancelling foam and fears it could potentially cause cancer.

Starting off as a lighting company more than 130 years ago, Philips has undergone major changes in recent years, selling off assets to focus on making high-end electronic healthcare products.