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International Game Technology

(IGT) - Get International Game Technology PLC Report

surged Monday morning, after it reported last week that its quarterly profit nearly tripled. But analysts warn it might be too soon to get excited.

The slot-machine maker also surprised Wall Street by raising its full-year guidance after its

two main rivals trimmed their forecasts for the remainder of the year.

During the quarter, IGT earned $69.6 million, or 23 cents a share, compared with $26 million, or 8 cents a share, in the year prior. Analysts were looking for a profit of 20 cents a share.

Revenue grew 1% to $492 million, also ahead of estimates of $479.2 million.

IGT attributed its strength to significant cost cutting measures, with operating expenses falling 22.5% to $161 million during the three-month period.

Looking ahead, management upped its 20011 earnings outlook to 84 cents to 90 cents a share, from prior estimates of 79 cents to 87 cents. Wall Street is calling for a profit of 87 cents.

Earlier in the month, both

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lowered their outlooks citing weak demand.

But despite IGT's impressive results and revised forecast, Wells Fargo analyst Carlo Santarelli warns that the near-term will continue to be a challenge for the space. He believes the replacement cycle will remain dormant and that with IGT's cost cutting initiatives behind it, competition in product sales will most likely weigh on margins for the foreseeable future.

"While we think regional gaming/slot revenue can grow later this calendar year, we see the mix and profitability of the IGT participation business ad being fundamentally changed," Santarelli wrote in a note.

Sterne Agee analyst David Bain echoed this sentiment. "Given the volatile nature of content momentum, combined with IGT's peer-high valuation and bundling initiatives on the game sales side to induce sales in a difficult macro environment, we believe making a significant stock call to the upside is premature."

Investors, however, are hardly not heeding these warnings Mondayh, with shares of IGT up 9.7% to $17.92 in morning trading.

--Written by Jeanine Poggi in New York.

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