Hurco Companies Inc 10-Q for FY2025 Q3

Hurco Companies Inc (HURC)

10-Q 2025-09-05 For: 2025-07-31

Added on April 09, 2026

About this 10-Q

Hurco Companies Inc filed this 10-Q on September 5, 2025, covering the quarter ended July 31, 2025 (FY2025 Q3).

Headline figures

Quarter ended July 31, 2025, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $45.81M; up 7.4% from $42.65M a year earlier
Net loss: $3.69M; compared with a net loss of $9.6M a year earlier
Diluted EPS: -$0.58; compared with -$1.47 a year earlier

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Indiana		35-1150732
(State or other jurisdiction of		(I.R.S. Employer Identification Number)
incorporation or organization)

One Technology Way
Indianapolis, Indiana		46268
(Address of principal executive offices)		(Zip code)

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, no par value	HURC	The Nasdaq Stock Market LLC

Large accelerated filer ◻	Accelerated filer ⌧
Non-accelerated filer ◻	Smaller reporting company ⌧
Emerging growth company ◻

Part I - Financial Information

Item 1.	Financial Statements

	Condensed Consolidated Statements of Operations Three and Nine Months Ended July 31, 2025 and 2024	3

	Condensed Consolidated Statements of Comprehensive Income (Loss) Three and Nine Months Ended July 31, 2025 and 2024	4

	Condensed Consolidated Balance Sheets as of July 31, 2025 and October 31, 2024	5

	Condensed Consolidated Statements of Cash Flows Three and Nine Months Ended July 31, 2025 and 2024	6

	Condensed Consolidated Statements of Changes in Shareholders’ Equity Three and Nine Months Ended July 31, 2025 and 2024	7

	Notes to Condensed Consolidated Financial Statements	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	29

Item 4.	Controls and Procedures	30

Part II - Other Information

Item 1.	Legal Proceedings	31

Item 1A.	Risk Factors	31

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	31

Item 5.	Other Information	32

Item 6.	Exhibits	32

Signatures		33


	Three Months Ended				Nine Months Ended
	July 31,				July 31,
	2025		2024		2025		2024

		(unaudited)				(unaudited)
Sales and service fees	$	45,806	$	42,651	$	133,087	$	132,882

Cost of sales and service		36,694		34,808		107,856		107,325

Gross profit		9,112		7,843		25,231		25,557

Selling, general and administrative expenses		10,762		10,376		32,041		33,352

Operating (loss) income		(1,650)		(2,533)		(6,810)		(7,795)

Interest expense		4		159		66		426

Interest income		58		172		239		492

Investment income, net		13		59		186		126

Other (expense) income, net		(1,543)		(136)		(2,499)		(1,125)

(Loss) income before income taxes		(3,126)		(2,597)		(8,950)		(8,728)

Provision (benefit) for income taxes		567		6,999		3,126		6,438

Net (loss) income	$	(3,693)	$	(9,596)	$	(12,076)	$	(15,166)

(Loss) income per common share

Basic	$	(0.58)	$	(1.47)	$	(1.87)	$	(2.33)
Diluted	$	(0.58)	$	(1.47)	$	(1.87)	$	(2.33)

Weighted average common shares outstanding

Basic		6,463		6,513		6,474		6,505
Diluted		6,463		6,513		6,474		6,505

Dividends paid per share	$	—	$	—	$	—	$	0.32


	July 31,		October 31,
	2025		2024
ASSETS	(unaudited)
Current assets:
Cash and cash equivalents	$	44,494	$	33,330
Accounts receivable, net		27,645		36,678
Inventories		147,538		153,037
Derivative assets		2,782		323
Prepaid and other assets		5,835		5,209
Total current assets		228,294		228,577
Property and equipment:
Land		1,046		1,046
Building		7,381		7,381
Machinery and equipment		26,919		28,106
Leasehold improvements		4,644		4,667
		39,990		41,200
Less accumulated depreciation and amortization		(31,671)		(32,404)
Total property and equipment, net		8,319		8,796
Non–current assets:
Software development costs, less accumulated amortization		7,684		7,044
Intangible assets, net		663		763
Operating lease - right of use assets, net		11,929		11,313
Deferred income taxes		641		1,349
Investments		8,821		8,216
Other assets		2,737		2,585
Total non–current assets		32,475		31,270
Total assets	$	269,088	$	268,643
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	27,343	$	24,951
Customer deposits		4,453		4,308
Derivative liabilities		2,038		705
Operating lease liabilities		4,190		3,829
Accrued payroll and employee benefits		6,819		7,786
Accrued income taxes		1,622		866
Accrued expenses		4,113		4,258
Accrued warranty expenses		961		1,086
Total current liabilities		51,539		47,789
Non–current liabilities:
Deferred income taxes		47		53
Accrued tax liability		29		537
Operating lease liabilities		8,116		7,852
Deferred credits and other		5,685		5,240
Total non–current liabilities		13,877		13,682
Commitment and contingencies		—		—
Shareholders’ equity:
Preferred stock: no par value per share, 1,000,000 shares authorized; no shares issued		—		—
Common stock: no par value, $.10 stated value per share, 12,500,000 shares authorized; 6,569,682 and 6,548,838 shares issued and 6,402,396 and 6,435,624 shares outstanding, as of July 31, 2025 and October 31, 2024, respectively		640		644
Additional paid-in capital		60,781		61,500
Retained earnings		149,346		161,422
Accumulated other comprehensive loss		(7,095)		(16,394)
Total shareholders’ equity		203,672		207,172
Total liabilities and shareholders’ equity	$	269,088	$	268,643


	Three Months Ended July 31, 2025 and 2024
	(unaudited)
								Accumulated
	Common Stock			Additional				Other
	Shares			Paid–in		Retained		Comprehensive
(unaudited)	Outstanding	Amount		Capital		Earnings		Income (Loss)		Total
Balances, April 30, 2024	6,523,259	$	652	$	62,155	$	172,461	$	(19,691)	$	215,577
Net income (loss)	—		—		—		(9,596)		—		(9,596)
Other comprehensive income (loss)	—		—		—		—		1,210		1,210
Deferred income tax valuation allowances	—		—		—		—		(327)		(327)
Stock–based compensation expense, net of taxes withheld for vested restricted shares	—		—		269		—		—		269
Stock repurchases	(29,413)		(3)		(505)		—		—		(508)
Balances, July 31, 2024	6,493,846	$	649	$	61,919	$	162,865	$	(18,808)	$	206,625

Balances, April 30, 2025	6,506,868	$	651	$	62,192	$	153,039	$	(13,602)	$	202,280
Net income (loss)	—	0	—	0	—	0	(3,693)		—		(3,693)
Other comprehensive income (loss)	—	0	—	0	—	0	—		6,310		6,310
Deferred income tax valuation allowances	—	0	—	0	—	0	—		197		197
Stock–based compensation expense, net of taxes withheld for vested restricted shares	—	0	—	0	578	0	—		—		578
Stock repurchases	(104,472)	0	(11)	0	(1,989)	0	—		—		(2,000)
Balances, July 31, 2025	6,402,396	$	640	$	60,781	$	149,346	$	(7,095)	$	203,672


	Nine Months Ended July 31, 2025 and 2024
	(unaudited)
								Accumulated
	Common Stock			Additional				Other
	Shares			Paid–in		Retained		Comprehensive
	Outstanding	Amount		Capital		Earnings		Income (Loss)		Total
Balances, October 31, 2023	6,462,138	$	646	$	61,665	$	180,124	$	(20,204)	$	222,231
Net income (loss)	—		—		—		(15,166)		—		(15,166)
Other comprehensive income (loss)	—		—		—		—		1,723		1,723
Deferred income tax valuation allowances	—		—		—		—		(327)		(327)
Stock–based compensation expense, net of taxes withheld for vested restricted shares	61,121		6		759		—		—		765
Stock repurchases	(29,413)		(3)		(505)		—		—		(508)
Dividends paid	—		—		—		(2,093)		—		(2,093)
Balances, July 31, 2024	6,493,846	$	649	$	61,919	$	162,865	$	(18,808)	$	206,625

Balances, October 31, 2024	6,435,624	$	644	$	61,500	$	161,422	$	(16,394)	$	207,172
Net income (loss)	—		—		—		(12,076)		—		(12,076)
Other comprehensive income (loss)	—		—		—		—		9,277		9,277
Deferred income tax valuation allowances	—		—		—		—		22		22
Stock–based compensation expense, net of taxes withheld for vested restricted shares	71,244		7		1,270		—		—		1,277
Stock repurchases	(104,472)		(11)		(1,989)		—		—		(2,000)
Balances, July 31, 2025	6,402,396	$	640	$	60,781	$	149,346	$	(7,095)	$	203,672


	July 31, 2025			October 31, 2024
	Balance Sheet	Fair		Balance Sheet	Fair
Derivatives	Location	Value		Location	Value
Designated as Hedging Instruments:
Foreign exchange forward contracts	Derivative assets	$	612	Derivative assets	$	165
Foreign exchange forward contracts	Derivative liabilities	$	669	Derivative liabilities	$	430

Not Designated as Hedging Instruments:
Foreign exchange forward contracts	Derivative assets	$	2,170	Derivative assets	$	158
Foreign exchange forward contracts	Derivative liabilities	$	1,369	Derivative liabilities	$	275


					Location of Gain	Amount of Gain
	Amount of Gain (Loss)				(Loss) Reclassified	(Loss) Reclassified
	Recognized in Other				from Other	from Other
	Comprehensive				Comprehensive	Comprehensive
Derivatives	Income (Loss)				Income (Loss)	Income (Loss)
	Three Months Ended					Three Months Ended
	July 31,					July 31,
	2025		2024			2025		2024
Designated as Hedging Instruments:
(Effective portion)
Foreign exchange forward contracts – Intercompany sales/purchases	$	544	$	(248)	Cost of sales and service	$	(304)	$	(373)
Foreign exchange forward contract – Net investment	$	(5)	$	(20)


	Location of Gain
	(Loss) Recognized	Amount of Gain (Loss)
Derivatives	in Operations	Recognized in Operations
		Three Months Ended
		July 31,
		2025		2024
Not Designated as Hedging Instruments:
Foreign exchange forward contracts	Other (expense) income, net	$	2,395	$	(632)


	Foreign Currency		Cash Flow
	Translation		Hedges		Total
Balance, April 30, 2025	$	(11,844)	$	(1,758)	$	(13,602)
Other comprehensive income (loss) before reclassifications		5,462		544		6,006
Reclassifications		—		304		304
Deferred income tax valuation allowances		—		197		197
Balance, July 31, 2025	$	(6,382)	$	(713)	$	(7,095)


	Foreign		Cash
	Currency		Flow
	Translation		Hedges		Total
Balance, October 31, 2024	$	(14,511)	$	(1,883)	$	(16,394)
Other comprehensive income (loss) before reclassifications		8,129		37		8,166
Reclassifications		—		1,111		1,111
Deferred income tax valuation allowances		—		22		22
Balance, July 31, 2025	$	(6,382)	$	(713)	$	(7,095)


		Weighted Average Grant
	Number of Shares	Date Fair Value
Unvested at October 31, 2024	378,092	$	24.97
Shares or units granted	210,325		19.41
Shares or units vested	(71,244)		25.80
Shares or units cancelled	(42,472)		31.06
Shares withheld	(17,748)		28.51
Unvested at July 31, 2025	456,953	$	21.58


		Three Months Ended July 31,				Nine Months Ended July 31,
		2025		2024		2025		2024
Operating cash flow information:
Cash paid for amounts included in the measurement of lease liabilities	$	1,298	$	1,202	$	3,831	$	3,500
Non-cash information:
Right-of-use assets obtained in exchange for new operating lease liabilities	$	1,621	$	1,676	$	3,903	$	4,278


	Three Months Ended				Nine Months Ended
	July 31,				July 31,
	2025		2024		2025		2024

		(unaudited)			(unaudited)
Cash flows from operating activities:
Net (loss) income	$	(3,693)	$	(9,596)	$	(12,076)	$	(15,166)
Adjustments to reconcile net income to net cash provided by (used for) operating activities:
Provision for doubtful accounts		(125)		20		(134)		(40)
Deferred income taxes		(1,623)		(3,395)		(4,000)		(3,536)
Deferred income tax valuation allowances		1,639		8,158		5,294		8,158
Equity in loss (income) of affiliates		179		(181)		48		(268)
Foreign currency (gain) loss		3,099		(571)		2,552		(1,177)
Unrealized (gain) loss on derivatives		(813)		(418)		(914)		821
Depreciation and amortization		642		888		2,000		2,678
Stock–based compensation		578		269		1,629		1,080
Change in assets and liabilities:
(Increase) decrease in accounts receivable		(1,638)		2,141		9,754		15,377
(Increase) decrease in inventories		1,467		1,386		11,099		(2,357)
(Increase) decrease in prepaid expenses		185		1,344		(1,182)		(1,068)
Increase (decrease) in accounts payable		2,489		(524)		1,104		(2,860)
Increase (decrease) in customer deposits		820		1,049		80		1,442
Increase (decrease) in accrued expenses		(288)		(484)		(461)		(3)
Increase (decrease) in accrued payroll and employee benefits		(145)		393		(967)		(1,865)
Increase (decrease) in accrued income tax		(244)		(365)		726		(909)
Increase (decrease) in accrued tax liability		—		4		(508)		(591)
Net change in deferred tax assets and liabilities		47		(46)		172		(57)
Net change in derivative assets and liabilities		171		(527)		(63)		(633)
Other		(209)		(167)		(281)		(338)
Net cash provided by (used for) operating activities		2,538		(622)		13,872		(1,312)

Cash flows from investing activities:
Proceeds from sale of property and equipment		69		1		245		26
Purchase of property and equipment		(470)		(219)		(871)		(793)
Software development costs		(462)		(516)		(1,417)		(1,253)
Other investments		118		—		118		117
Net cash provided by (used for) investing activities		(745)		(734)		(1,925)		(1,903)

Cash flows from financing activities:


	July 31,		October 31,
	2025		2024
Purchased parts and sub–assemblies	$	37,122	$	35,385
Work–in–process		11,476		13,428
Finished goods		98,940		104,224
Inventories	$	147,538	$	153,037


Remainder of 2025	$	1,228
2026		4,360
2027		3,517
2028		2,303
2029		772
2030 and thereafter		926
Total		13,106
Less: Imputed interest		(800)
Present value of operating lease liabilities	$	12,306


	Three Months Ended July 31,				Nine Months Ended July 31,
	2025		2024		2025		2024
Computerized Machine Tools	$	36,889	$	33,191	$	106,347	$	104,176
Computer Control Systems and Software ^†		530		697		1,843		1,866
Service Parts		6,309		6,535		18,404		20,389
Service Fees		2,078		2,228		6,493		6,451
Total	$	45,806	$	42,651	$	133,087	$	132,882



	Assets				Liabilities
	July 31, 2025		October 31, 2024		July 31, 2025		October 31, 2024
Level 1
Mutual Funds	$	3,282	$	2,942	$	—	$	—

Level 2
Derivatives	$	2,782	$	323	$	2,038	$	705


				Contract Amount at
	Notional	Weighted		Forward Rates in
	Amount	Avg.		U.S. Dollars
Forward	in Foreign	Forward		Contract	July 31,
Contracts	Currency	Rate		Date	2025	Maturity Dates
Sale Contracts:
Euro	5,000	1.1071		5,535	5,763	Aug 2025 - Jul 2026
Sterling	2,950	1.2883		3,801	3,908	Aug 2025 - Jul 2026

Purchase Contracts:
New Taiwan Dollar	485,000	30.0091	*	16,162	16,587	Aug 2025 - Jul 2026



	Notional	Weighted	Contract Amount at Forward Rates in
	Amount	Avg.	U.S. Dollars
Forward	in Foreign	Forward	Contract	July 31,	Maturity
Contracts	Currency	Rate	Date	2025	Date
Sale Contracts:
Euro	3,000	1.1005	3,302	3,448	Nov 2025


							Approximate
					Total Number of		Dollar Value of
					Shares		Shares that
					Purchased as		May Yet Be
					Part of Publicly		Purchased
	Total Number		Average Price		Announced		Under Plans or
	of Shares		Paid per		Plans or		Programs
	Purchased		Share		Programs⁽¹⁾		($ in thousands)
May 1-31, 2025	—	$	—		—	$	21,688
June 1-30, 2025	36,275	$	18.16	⁽¹⁾	36,275	$	21,029
July 1-31, 2025	68,197	$	19.74	⁽¹⁾	68,197	$	19,682
Total	104,472				104,472

3.1		Amended and Restated Articles of Incorporation of the Registrant, as amended effective March 15, 2024, incorporated by reference to Exhibit 3.1 to the Registrant’s Quarterly Report on Form 10 Q for the quarter ended April 30, 2024.

3.2		Amended and Restated By-Laws of the Registrant, as amended through March 15, 2024, incorporated by reference to Exhibit 3.2 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended April 30, 2024.

31.1		Certification by the Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.

31.2		Certification by the Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.

32.1		Certification by the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification by the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101		The following information from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended July 31, 2025, formatted in Inline XBRL: (i) Condensed Consolidated Statements of Operations; (ii) Condensed Consolidated Statements of Comprehensive Income (Loss); (iii) Condensed Consolidated Balance Sheets; (iv) Condensed Consolidated Statements of Cash Flows; (v) Condensed Consolidated Statements of Changes in Shareholders’ Equity; (vi) Notes to Condensed Consolidated Financial Statements; and (vii) information regarding trading arrangements set forth in Part II, Item 5.

104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

	HURCO COMPANIES, INC.


	By:	/s/ Sonja K. McClelland
		Sonja K. McClelland
		Executive Vice President, Treasurer & Chief Financial Officer
		September 5, 2025

Arch
/s/ Gregory Volovic
Gregory Volovic
Chief Executive Officer
September 5, 2025