GT expects US casinos to hold off on buying new machines until new technology, such as server-based gaming, becomes available. The dour outlook helped send its shares more than 5 percent.
"The demand for domestic replacement (slot and video poker machines) is likely to remain soft throughout fiscal ’08," CEO TJ Matthews said on a conference call. The slot machine maker said net income rose to us$ 122.6 million, in the fiscal fourth quarter ended September 30, from us$ 114.9 million, a year earlier.
The earnings matched Wall Street’s average forecast, according to Reuters Estimates.
Revenue rose 4 percent to us$ 662.9 million. Analysts had expected us$ 697.8 million.
Revenue from sales of new slot and video poker machines in North America fell 11 percent to us$ 186.1 million as the number of units shipped dropped 29 percent to 8,300.
Soft North American product sales were offset by higher sales in Japan and Australia, but those sales are less profitable. Looking ahead, IGT said it expects earnings for its fiscal first and second quarters of 35 cents to 40 cents per share.
Wall Street analysts, on average, had expected 38 cents for the first quarter and 39 cents for the second quarter, according to Reuters Estimates.
IGT hopes new gaming facilities will boost its earnings prospects later in the year. "We believe there is a good likelihood that our earnings per share will break out of this range in the second half of ’08," said Matthews.