Why International Game Technology (IGT) Stock Is Plummeting

NEW YORK (TheStreet) -- International Game Technology (IGT) is plummeting in post-market trading Tuesday after cutting its previously-issued guidance and warning of layoffs.

After the bell, shares had slid 8.8% to $13.55.

The company, which specializes in the design and manufacture of casino gaming machines, said in a statement that it was "taking actions to realign its cost structure for long-earnings growth."

IGT said one of its cost-cutting measures included reducing its 5,000-strong workforce by 7%, enabling cost savings of $30 million over fiscal 2014 and $50 million on an annual run-rate basis.

The Las Vegas-based business also cut its fiscal 2014 earnings guidance to between $1 and $1.10 a share from previous guidance of $1.28 to $1.38 a share. Analysts surveyed by Thomson Reuters had forecast net income of $1.20 a share.

For its March-ending second quarter, management provided earnings guidance of 17 cents to 19 cents a share. Analysts expected 29 cents a share.

"As we reach the halfway point in our fiscal year, you can see this is a challenging time for the industry and IGT. We knew that our success in 2013 would be difficult to replicate," said IGT CEO Patti Hart in a statement. "However, we did not expect such a sharp decline in North American gross gaming revenues, or further degradation in the international currency, compliance, and importation environment."

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