IGT reports strong sales in second quarter

Gaming equipment manufacturer International Game Technology saw a strong second quarter thanks in part to an increase in gaming product sales.

The company’s global gaming machine unit shipments were up 46 percent.

“I think that compared probably to the beginning of the year, we’re doing obviously a little bit better in terms of product sales,” said CEO Marco Sala in a conference call with investors Thursday morning. “With North American gaming, it is better.” 

IGT, a London-based company with vast holdings in Reno and Las Vegas, attributed part of its sales growth to robust replacement demand in North America.

The company shipped 4,661 units in the second quarter — 4,223 of which were replacement units — compared to 4,550 in the second quarter of 2018. Revenue in the North American gaming segment jumped 8 percent year over year, with operating income up 27 percent.

IGT also reported higher systems revenue from placements at properties like Encore Boston Harbor in Massachusetts and MGM Northfield in Ohio.

“We have a good portfolio of performing titles and cabinets,” Sala said. “We feel like we have a line up of new games that are, in the time being, appear to be very promising.”

Global lottery revenue also saw growth this quarter, with a 4 percent increase in lotto wages in Italy and stable revenue in North America.

On a per-share basis, IGT said it had net income of 2 cents. Earnings, adjusted for non-recurring costs, were 44 cents per share. 

The results surpassed Wall Street expectations. The average estimate of three analysts surveyed by Zacks Investment Research was for earnings of 31 cents per share.

The slot machine maker posted revenue of $1.23 billion in the period, which also topped Wall Street forecasts. Seven analysts surveyed by Zacks expected $1.17 billion.

IGT shares have dropped 8.5 percent since the beginning of the year, while the Standard & Poor’s 500 index has increased 19 percent. The stock has dropped 47 percent in the last 12 months.

Despite concerns that mergers and acquisitions among casino operators will cut back the install base of gaming units, Sala was confident in the company’s momentum this quarter.

“It’s always been a challenge, but we are in a much better place than some quarters ago,” he said.

IGT stock closed up 5.45 percent, or $073, to $14.12 per share Thursday.

Contact Bailey Schulz at bschulz@reviewjournal.com or 702-383-0233. Follow @bailey_schulz on Twitter. The Associated Press contributed to this report.