UPDATE 2-International Game Tech profit falls 42 percent

* Q1 shr $0.22 vs $0.36 yr earlier

* IGT expects fiscal 2009 EPS of $1.00 or higher

* Shares down 2.7 pct in early trade

(Adds outlook, stock price, byline)

By Deena Beasley

LOS ANGELES, Jan 22 (Reuters) - Slot-machine maker International Game Technology (IGT.N) posted a 42 percent drop in quarterly profit on Thursday as the financial crisis took a toll on its casino customers.

The company also reined in its fiscal 2009 earnings outlook and shares fell nearly 3 percent in early trading.

"This is the worst economy in decades and clearly affects our slot customers ... We have tight credit markets that have constrained gaming operators and their future growth budgets," Chief Executive T.J. Matthews said during a conference call with analysts and investors.

He forecast that IGT would earn $1.00 per share or higher for its fiscal year ending in September, compared with the $1.17 forecast by Wall Street analysts, as compiled by Reuters Estimates.

For its fiscal first quarter ended Dec. 31, net income fell to $65.7 million, or 22 cents a share, compared with $113.7 million, or 36 cents a share, a year earlier.

The results included 7 cents a share in one-time items, including restructuring charges and share-based compensation.

Oppenheimer analyst David Katz said IGT's adjusted profit was 26 cents a share, short of his estimate of 28 cents a share.

"Overall, results were modestly below our expectations, with revenue slightly ahead, offset by lower-than-expected profitability," he said in a research note.

Revenue fell nearly 7 percent to $601.6 million, beating the average Wall Street forecast of $590 million.

Shares of Reno, Nevada-based IGT, which have fallen about 77 percent from highs set last February, were down 2.7 percent at $11.26 on the New York Stock Exchange. (Reporting by Deena Beasley; editing by John Wallace and Derek Caney)