When it comes to casino supply companies, International Game Technology (NYSE:IGT) is usually the first name to spring to mind. Walk into most any casino in North America, sit down at one of the many banks of slots that dominate the floor space, and on either side you are likely to find a machine stamped with the company's logo. As the industry leader with a two-thirds share of the domestic market, IGT deserves much of the credit for advancing the slot machine business -- but it does not have a monopoly on innovation.

Smaller rival WMSIndustries (NYSE:WMS) has steadily been making inroads, as seen in its impressive fourth-quarter results released yesterday. Net income increased to $7.7 million, or $0.22 per share, from just $900,000 a year ago. Strong top-line growth helped fuel the outsized gains, as revenues climbed 64% to $111.6 million. Not only did the company sell nearly 75% more machines than last year (6,200 vs. 3,600), but it was also able to raise the average price tag per unit by 14% to $10,800.

Product sales represent roughly three-fourths of the company's revenues, while the rest are primarily generated by a base of slots that earn a recurring stream of income every day, called participation revenues. So-called "wide-area progressive" machines -- the ones that often display eye-popping jackpots -- earn twice as much as their non-linked counterparts, and now constitute almost 15% of the company's installed base. During the year, WMS Industries increased this base by 2,300 slots to a total of 6,539, and it squeezed $51.27 (a 24% improvement) from each of them on a daily basis. As a result, participation revenues nearly doubled year over year to $28.6 million.

While WMS Industries may operate in the shadow of IGT, it has busily been cranking out new models that resonate with slot players. In a recent poll of slot enthusiasts conducted by Casino Player magazine, three of the top 10 favorite video slots (as opposed to the old-school spinning reel variety) were manufactured by WMS, including the ever-popular Jackpot Party, Monopoly, and Reel 'Em In. Though I seldom give in to the temptation to play slots, the last of those three nearly always coaxes a few coins from my pocket.

Of course, player tastes can change quickly, and manufacturers are more than happy to feed Harrah's (NYSE:HET), MGMMirage (NYSE:MGM), and other casino operators a steady diet of new and improved models. And the casinos are usually willing to give them a shot, knowing that the machines can quickly pay for themselves and recoup the cost. In another survey to determine the most popular new game to hit the market within the last 12 months, WMS Industries earned three of the top five spots, and its Men In Black game -- among the first to showcase its new ergonomically designed Bluebird cabinet style -- was crowned champion.

From multiline video penny slots to tiered bonus rounds to ticket in/ticket out technology to high-resolution plasma screens, slot machines are constantly evolving -- and developers are pumping millions more into research and development.

With shorter game life cycles fueling more replacement sales, and new gaming jurisdictions providing expansion opportunities, developers like WMS Industries -- which is expecting to achieve positive free cash flow this year -- should see plenty of coins in their corporate hoppers.

Fool contributor Nathan Slaughter hates ticket in/ticket out machines, and misses the unmistakable sound of falling coins. He owns shares of IGT. The Motley Fool has a disclosure policy.