Hurco Companies Inc 10-Q for FY2026 Q3

Hurco Companies Inc (HURC)

10-Q 2026-09-04 For: 2026-07-31

Added on September 05, 2026

About this 10-Q

Hurco Companies Inc filed this 10-Q on September 4, 2026, covering the quarter ended July 31, 2026 (FY2026 Q3).

Headline figures

Quarter ended July 31, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $47.29M; up 3.2% from $45.81M a year earlier
Net income: $2.31M; compared with a net loss of $3.69M a year earlier
Diluted EPS: $0.35; compared with -$0.58 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, 2026 and 2025	3

	Condensed Consolidated Statements of Comprehensive Income (Loss) Three and Nine Months Ended July 31, 2026 and 2025	4

	Condensed Consolidated Balance Sheets as of July 31, 2026 and October 31, 2025	5

	Condensed Consolidated Statements of Cash Flows Three and Nine Months Ended July 31, 2026 and 2025	6

	Condensed Consolidated Statements of Changes in Shareholders’ Equity Three and Nine Months Ended July 31, 2026 and 2025	7

	Notes to Condensed Consolidated Financial Statements	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	30

Item 4.	Controls and Procedures	31

Part II - Other Information

Item 1.	Legal Proceedings	32

Item 1A.	Risk Factors	32

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	32

Item 5.	Other Information	32

Item 6.	Exhibits	33

Signatures		34


	Three Months Ended				Nine Months Ended
	July 31,				July 31,
	2026		2025		2026		2025

		(unaudited)				(unaudited)
Sales and service fees	$	47,289	$	45,806	$	137,775	$	133,087

Cost of sales and service		34,106		36,694		106,323		107,856

Gross profit		13,183		9,112		31,452		25,231

Selling, general and administrative expenses		10,889		10,762		33,127		32,041

Operating income (loss)		2,294		(1,650)		(1,675)		(6,810)

Interest expense		25		4		61		66

Interest income		86		58		199		239

Investment income		95		13		204		186

Other income (expense), net		296		(1,543)		(525)		(2,499)

Income (loss) before taxes		2,746		(3,126)		(1,858)		(8,950)

Provision for income taxes		432		567		1,668		3,126

Net income (loss)	$	2,314	$	(3,693)	$	(3,526)	$	(12,076)

Income (loss) per common share

Basic	$	0.35	$	(0.58)	$	(0.55)	$	(1.87)
Diluted	$	0.35	$	(0.58)	$	(0.55)	$	(1.87)

Weighted average common shares outstanding

Basic		6,476		6,463		6,456		6,474
Diluted		6,497		6,463		6,456		6,474


	July 31,		October 31,
	2026		2025
ASSETS	(unaudited)
Current assets:
Cash and cash equivalents	$	52,087	$	48,713
Accounts receivable, net		26,845		27,928
Inventories		136,616		142,931
Derivative assets		251		263
Prepaid and other assets		6,905		5,243
Total current assets		222,704		225,078
Property and equipment:
Land		1,046		1,046
Building		7,381		7,381
Machinery and equipment		23,993		26,061
Leasehold improvements		4,273		4,569
		36,693		39,057
Less accumulated depreciation and amortization		(29,536)		(31,083)
Total property and equipment, net		7,157		7,974
Non–current assets:
Software development costs, less accumulated amortization		9,393		8,090
Intangible assets, net		346		627
Operating lease - right of use assets, net		9,455		11,560
Deferred income taxes		744		794
Investments		9,037		9,005
Other assets		1,184		1,170
Total non–current assets		30,159		31,246
Total assets	$	260,020	$	264,298
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	29,207	$	26,074
Customer deposits		7,537		4,788
Derivative liabilities		1,818		3,084
Operating lease liabilities		4,124		4,374
Accrued payroll and employee benefits		7,467		7,474
Accrued income taxes		989		1,472
Accrued expenses		3,774		3,790
Accrued warranty expenses		1,071		967
Total current liabilities		55,987		52,023
Non–current liabilities:
Deferred income taxes		37		38
Operating lease liabilities		5,716		7,560
Deferred credits and other		5,991		5,890
Total non–current liabilities		11,744		13,488
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; 6,675,629 and 6,569,224 shares issued and 6,476,322 and 6,402,396 shares outstanding, as of July 31, 2026 and October 31, 2025, respectively		648		640
Additional paid-in capital		62,213		60,850
Retained earnings		142,779		146,305
Accumulated other comprehensive loss		(13,351)		(9,008)
Total shareholders’ equity		192,289		198,787
Total liabilities and shareholders’ equity	$	260,020	$	264,298


	Three Months Ended July 31, 2026 and 2025
	(unaudited)
								Accumulated
	Common Stock			Additional				Other
	Shares			Paid–in		Retained		Comprehensive
(unaudited)	Outstanding	Amount		Capital		Earnings		Income (Loss)		Total
Balances, April 30, 2025	6,506,868	$	651	$	62,192	$	153,039	$	(13,602)	$	202,280
Net income (loss)	—		—		—		(3,693)		—		(3,693)
Other comprehensive income (loss)	—		—		—		—		6,310		6,310
Deferred income tax valuation allowances	—		—		—		—		197		197
Stock–based compensation expense, net of taxes withheld for vested restricted shares	—		—		578		—		—		578
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

Balances, April 30, 2026	6,484,478	$	648	$	61,637	$	140,465	$	(10,331)	$	192,419
Net income (loss)	—		—		—		2,314		—		2,314
Other comprehensive income (loss)	—		—		—		—		(2,996)		(2,996)
Deferred income tax valuation allowances	—		—		—		—		(24)		(24)
Stock–based compensation expense, net of taxes withheld for vested restricted shares	(8,156)		—		576		—		—		576
Balances, July 31, 2026	6,476,322	$	648	$	62,213	$	142,779	$	(13,351)	$	192,289


	Nine Months Ended July 31, 2026 and 2025
	(unaudited)
								Accumulated
	Common Stock			Additional				Other
	Shares			Paid–in		Retained		Comprehensive
	Outstanding	Amount		Capital		Earnings		Income (Loss)		Total
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

Balances, October 31, 2025	6,402,396	$	640	$	60,850	$	146,305	$	(9,008)	$	198,787
Net income (loss)	—		—		—		(3,526)		—		(3,526)
Other comprehensive income (loss)	—		—		—		—		(4,135)		(4,135)
Deferred income tax valuation allowances	—		—		—		—		(208)		(208)
Stock–based compensation expense, net of taxes withheld for vested restricted shares	73,926		8		1,363		—		—		1,371
Balances, July 31, 2026	6,476,322	$	648	$	62,213	$	142,779	$	(13,351)	$	192,289


	July 31, 2026			October 31, 2025
	Balance Sheet	Fair		Balance Sheet	Fair
Derivatives	Location	Value		Location	Value
Designated as Hedging Instruments:
Foreign exchange forward contracts	Derivative assets	$	167	Derivative assets	$	215
Foreign exchange forward contracts	Derivative liabilities	$	895	Derivative liabilities	$	945

Not Designated as Hedging Instruments:
Foreign exchange forward contracts	Derivative assets	$	84	Derivative assets	$	48
Foreign exchange forward contracts	Derivative liabilities	$	923	Derivative liabilities	$	2,139


	Location of Gain
	(Loss) Recognized	Amount of Gain (Loss)
Derivatives	in Operations	Recognized in Operations
		Three Months Ended
		July 31,
		2026		2025
Not Designated as Hedging Instruments:
Foreign exchange forward contracts	Other income (expense), net	$	27	$	2,395


	Foreign Currency		Cash Flow
	Translation		Hedges		Total
Balance, April 30, 2026	$	(8,781)	$	(1,550)	$	(10,331)
Other comprehensive income (loss) before reclassifications		(2,901)		(129)		(3,030)
Reclassifications		—		34		34
Deferred income tax valuation allowances		—		(24)		(24)
Balance, July 31, 2026	$	(11,682)	$	(1,669)	$	(13,351)


	Foreign		Cash
	Currency		Flow
	Translation		Hedges		Total
Balance, October 31, 2025	$	(8,234)	$	(774)	$	(9,008)
Other comprehensive income (loss) before reclassifications		(3,448)		(1,049)		(4,497)
Reclassifications		—		362		362
Deferred income tax valuation allowances		—		(208)		(208)
Balance, July 31, 2026	$	(11,682)	$	(1,669)	$	(13,351)


		Weighted Average Grant
	Number of Shares	Date Fair Value
Unvested at October 31, 2025	456,496	$	21.58
Shares or units granted	206,042		16.04
Shares or units vested	(73,926)		19.39
Shares or units cancelled	(89,983)		26.24
Shares withheld	(16,516)		21.70
Unvested at July 31, 2026	482,113	$	18.67


		Three Months Ended July 31,				Nine Months Ended July 31,
		2026		2025		2026		2025
Operating cash flow information:
Cash paid for amounts included in the measurement of lease liabilities	$	1,192	$	1,298	$	3,693	$	3,831
Non-cash information:
Right-of-use assets obtained in exchange for new operating lease liabilities	$	417	$	1,621	$	1,814	$	3,903


Remainder of 2026	$	1,193
2027		4,166
2028		3,057
2029		959
2030		473
2031 and thereafter		551
Total		10,399
Less: Imputed interest		(559)
Present value of operating lease liabilities	$	9,840


	Three Months Ended				Nine Months Ended
	July 31,				July 31,
	2026		2025		2026		2025

		(unaudited)			(unaudited)
Cash flows from operating activities:
Net income (loss)	$	2,314	$	(3,693)	$	(3,526)	$	(12,076)
Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities:
Provision for doubtful accounts		(9)		(125)		10		(134)
Deferred income taxes		(226)		(1,623)		(2,412)		(4,000)
Deferred income tax valuation allowance		161		1,639		2,283		5,294
Equity in (income) loss of affiliates		(35)		179		(165)		48
Foreign currency (gain) loss		(1,009)		3,099		(2,601)		2,552
Unrealized (gain) loss on derivatives		(654)		(813)		(1,258)		(914)
Depreciation and amortization		484		642		1,570		2,000
Stock–based compensation		576		578		1,642		1,629
Change in assets and liabilities:
(Increase) decrease in accounts receivable		463		(1,638)		184		9,754
(Increase) decrease in inventories		(1,373)		1,467		4,821		11,099
(Increase) decrease in prepaid and other assets		(702)		185		(2,187)		(1,182)
Increase (decrease) in accounts payable		3,062		2,489		3,991		1,104
Increase (decrease) in customer deposits		(181)		820		2,900		80
Increase (decrease) in accrued expenses		237		(288)		35		(461)
Increase (decrease) in accrued payroll and employee benefits		157		(145)		(3)		(967)
Increase (decrease) in accrued income tax		(37)		(244)		(458)		726
Net change in deferred tax assets and liabilities		365		47		631		172
Net change in derivative assets and liabilities		78		171		(202)		(63)
Other		134		(209)		72		(789)
Net cash provided by (used for) operating activities		3,805		2,538		5,327		13,872

Cash flows from investing activities:
Proceeds from sale of property and equipment		—		69		151		245
Purchase of property and equipment		(331)		(470)		(580)		(871)
Software development costs		(703)		(462)		(1,792)		(1,417)
Cash received from sale of a business		—		—		1,165		—
Other investments		—		118		—		118
Net cash provided by (used for) investing activities		(1,034)		(745)		(1,056)		(1,925)

Cash flows from financing activities:


	July 31,		October 31,
	2026		2025
Purchased parts and sub–assemblies	$	36,209	$	35,346
Work–in–process		10,598		11,172
Finished goods		89,809		96,413
Inventories	$	136,616	$	142,931


	Three Months Ended July 31,				Nine Months Ended July 31,
	2026		2025		2026		2025
Computerized Machine Tools	$	38,008	$	36,889	$	110,094	$	106,347
Computer Control Systems and Software ^†		523		530		1,491		1,843
Service Parts		6,706		6,309		19,815		18,404
Service Fees		2,052		2,078		6,375		6,493
Total	$	47,289	$	45,806	$	137,775	$	133,087


	Nine Months Ended
	July 31,
	2026		2025
Balance, beginning of period	$	967	$	1,086
Provision for warranties during the period		1,700		1,747
Charges to the estimated liability		(1,593)		(1,890)
Impact of foreign currency translation		(3)		18
Balance, end of period	$	1,071	$	961


	Assets				Liabilities
	July 31, 2026		October 31, 2025		July 31, 2026		October 31, 2025
Level 1
Mutual Funds	$	3,529	$	3,489	$	—	$	—

Level 2
Derivatives	$	251	$	263	$	1,818	$	3,084


		Three Months Ended
		July 31,
		2026					2025					$ Change			% Change
Americas		$	18,778		40	%	$	16,901		37	%	$	1,877		11	%
Europe			21,336		45	%		24,166		53	%		(2,830)		(12)	%
Asia Pacific			7,175		15	%		4,739		10	%		2,436		51	%
Total		$	47,289		100	%	$	45,806		100	%	$	1,483		3	%


				Contract Amount at
	Notional	Weighted		Forward Rates in
	Amount	Avg.		U.S. Dollars
Forward	in Foreign	Forward		Contract	July 31,
Contracts	Currency	Rate		Date	2026	Maturity Dates
Sale Contracts:
Euro	6,900	1.1723		8,089	7,996	August 2026 - July 2027
Sterling	5,500	1.3349		7,342	7,403	August 2026 - July 2027

Purchase Contracts:
New Taiwan Dollar	670,000	31.0898	*	21,550	20,742	August 2026 - July 2027



		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		2026		Date
Sale Contracts:
Euro		3,000		1.1723		3,517		3,468		Nov 2026

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, 2026, 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 4, 2026

Arch
/s/ Gregory Volovic
Gregory Volovic
Chief Executive Officer
September 4, 2026