Samsung posted worse-than-expected guidance for the third quarter

South Korean tech giant Samsung Electronics said this Expect worse-than-expected profits for the third quarter.

In guidance released Tuesday, the world's top memory chip maker said operating profit for the quarter ended September is estimated to be about 9.10 trillion won, up 274% from 2.43 trillion Korean won last year.

Samsung's memory business performance declined as a result of “one-time costs and negative impacts,” including inventory adjustments by mobile customers and increased supply of legacy products by Chinese memory companies,” Samsung wrote in a statement.

Samsung is a leading manufacturer of memory chips, which are used in devices such as laptops and servers. It is the world's second largest player in the smartphone market.

Shipments of HBM3E chips to major customers were also delayed, the company added.

Analysts polled by LSEG had expected an operating profit of 11.456 trillion Korean won ($7.7 billion) for the quarter ended Sept. 30. Samsung's revenue for the quarter was expected to hit 81.96 trillion won ($61 billion), according to LSEG estimates.

“The company needs to remain flexible about its memory supply controls, as the decline in conventional DRAM will likely hurt Samsung more than its smaller rivals,” Macquarie Equity Research analysts said in a recent note. DRAM refers to dynamic random access memory chips that are often used in laptops, workstations, and PCs.

Samsung has ordered its subsidiaries around the world to cut 30% of their workforce in some divisions, Reuters reported in September, citing two sources with knowledge of the matter.

Shares of Samsung Electronics, listed on South Korea's stock exchange, fell 22% year-on-year, LSEG data showed. The company is set to release detailed third-quarter results later this month.

Shares of Samsung fell 0.98% after the guidance was released.