Scientific Games Corp Earnings: Misses Analysts’ Estimates with Widening Loss

Scientific Games Corp (NASDAQ:SGMS) reported its results for the third quarter. Scientific Games is a supplier of technology-based products, systems and services to gaming markets worldwide.

Earnings season is back and more important than ever. Get our newest CHEAT SHEET stock picks now

Scientific Games Corp Earnings Cheat Sheet

Results: Loss widened to $27.1 million (30 cents per diluted share) from $4.1 million (loss of 4 cents per share) in the same quarter a year earlier.

Revenue: Rose 2.1% to $227.5 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Scientific Games Corp fell short of the mean analyst estimate of 7 cents per share. Analysts were expecting revenue of $228.1 million.

Quoting Management: “We were very pleased with the continued strong retail sales in the U.S. and U.K., which helped to offset weakness in our Italy and China businesses and the unfavorable impact of foreign currency fluctuations on our results,” Chairman and Chief Executive Officer A. Lorne Weil commented. “We are encouraged by signs of stabilization in Italy, based on a number of recent weeks of improved performance. While our China business remains soft as we move into the fourth quarter, we are taking a series of actions designed to revitalize our business there.”Mr. Weil continued, “We remain focused on our longer term pipeline of growth opportunities. Our plans are ambitious for the U.S., where we believe the lottery industry is at the beginning of a new phase of growth with the ability to offer games to players via the internet. As the leader in internet-based player loyalty programs for U.S. lotteries, we believe we are uniquely positioned to help lotteries transition to offering pay-for-play products to their customers. We also see additional opportunities both in the U.S. and internationally to implement our industry-leading instant game management and optimization programs as well as our integrated lottery solutions that have proven successful in maximizing lottery performance in many jurisdictions globally.”

Key Stats:

The company has now missed analyst estimates for the last four quarters. It fell short by 22 cents in the second quarter, by one cent in the first quarter, and by 13 cents in the fourth quarter of the last fiscal year.

Revenue has increased for four quarters in a row. Revenue increased 4.1% to $229.3 million in the second quarter. The figure rose 19.3% in the first quarter from the year earlier and climbed 12.7% in the fourth quarter of the last fiscal year from the year-ago quarter.

Looking Forward: The outlook for the company’s results in the upcoming quarter is unfavorable. The average estimate for the fourth quarter is 8 cents per share, down from 9 cents ninety days ago. The average estimate for the fiscal year is 4 cents per share, down from 12 cents ninety days ago.

Stocks with improving earnings metrics are worthy of your extra attention. In fact, “E = Earnings Are Increasing Quarter-Over-Quarter” is a core component of our CHEAT SHEET investing framework for this very reason. Don’t waste another minute — click here and get our CHEAT SHEET stock picks now.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

Don’t Miss These Additional Hot Stories:

Is Netflix Losing Its Edge?

Who is Apple Trying to Please With the iPad Mini?

Is the U.K. a Tech Company Tax Haven?