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HURCO COMPANIES INC

HURCO COMPANIES INCHURC财报

Nasdaq · 工业 · 工业测量、显示和控制仪器

Hurco Companies Inc is a global industrial technology firm that designs, manufactures and sells CNC machine tools, including machining centers, turning centers, and proprietary control software. It serves aerospace, automotive, energy, and general metalworking customers across North America, Europe and Asia Pacific.

What changed in HURCO COMPANIES INC's 10-K — 2024 vs 2025

Top changes in HURCO COMPANIES INC's 2025 10-K

206 paragraphs added · 192 removed · 171 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

64 edited+7 added−6 removed92 unchanged
We have sales, application engineering, and service subsidiaries in China, the Czech Republic, France, Germany, India, Italy, the Netherlands, Poland, Singapore, Taiwan, the United Kingdom, and the U.S. We have manufacturing and assembly operations in Taiwan, the U.S., Italy, and China, and distribution facilities in the U.S., the Netherlands, and Taiwan.
We have sales, application engineering, and service subsidiaries in China, the Czech Republic, France, Germany, India, Italy, the Netherlands, Poland, Singapore, Taiwan, the United Kingdom, and the U.S. We have manufacturing and assembly operations in Taiwan, the U.S. and Italy, and distribution facilities in the U.S., the Netherlands, and Taiwan.
The SW model utilizes the swivel head and a traditional machine table that can be then fitted with an A-axis rotary table to machine long five-axis parts. These models are available in 42-, 60-, or 84-inch X-axis travels.
The SW model utilizes the swivel head and a traditional machine table that can then be fitted with an A-axis rotary table to machine long five-axis parts. These models are available in 42-, 60-, or 84-inch X-axis travels.
These efforts collectively enhance software performance and efficiency, providing more dependable and responsive experience while using WinMax®. ​ Milltronics CNC Machine Tools ​ Our Milltronics line of CNC machine tools is designed for excellent value with more standard features for the price versus competitors. We manufacture and sell these machine tools with a fully integrated interactive computer control system.
These efforts collectively enhance software performance and efficiency, providing a more dependable and responsive experience while using WinMax®. ​ Milltronics CNC Machine Tools ​ Our Milltronics line of CNC machine tools is designed for excellent value with more standard features for the price versus competitors. We manufacture and sell these machine tools with a fully integrated interactive computer control system.
We welcome and celebrate our teams’ differences, experiences, and beliefs, and we are investing in a more engaged, diverse, and inclusive workforce. ​ Ethical Business Practices We also foster a strong corporate culture that promotes high standards of ethics and compliance for our businesses, including policies that set forth principles to guide employee, officer, director, and vendor conduct, such as our Code of Business Conduct and Ethics.
We welcome and celebrate our teams’ differences, experiences, and beliefs, and we are investing in a more engaged and diverse workforce. ​ Ethical Business Practices We also foster a strong corporate culture that promotes high standards of ethics and compliance for our businesses, including policies that set forth principles to guide employee, officer, director, and vendor conduct, such as our Code of Business Conduct and Ethics.
Most toolroom models feature box way construction for rigidity and are designed to absorb vibrations. ​ VM General Purpose (GP) Product Line The VM-GP product line consists of attractively-priced vertical machining centers designed for job shops, prototype, research and development, and other general machining applications. These belt-driven models have 40-taper spindles and are available in four different sizes.
Most toolroom models feature box way construction for rigidity and are designed to absorb vibrations. ​ VM General Purpose Product Line The VM product line consists of attractively-priced vertical machining centers designed for job shops, prototype, research and development, and other general machining applications. These belt-driven models have 40-taper spindles and are available in four different sizes.
Market segments that require such applications include die and mold, aerospace, medical, and energy, or any customer that needs to produce very high-accuracy parts quickly. Takumi machines are available with a variety of industry standard CNC controls, including Fanuc ® * , Siemens ® , Mitsubishi ® , or Heidenhain ® .
Market segments that require such applications, including die and mold, aerospace, medical, and energy, or any customer that needs to produce very high-accuracy parts quickly. Takumi machines are available with a variety of industry standard CNC controls, including Fanuc®*, Siemens®, Mitsubishi®, or Heidenhain®.
We currently market two models of our Autobend ® computer control systems for press brake machines, in combination with six different back gauges as retrofit units for installation on existing or new press brake machines. ​ Software Products In addition to our standard computer control features, we offer software option products for part programming.
We currently market two models of our Autobend® computer control systems for press brake machines, in combination with six different back gauges as retrofit units for installation on existing or new press brake machines. ​ ​ 12 ​ Software Products In addition to our standard computer control features, we offer software option products for part programming.
LCM’s direct drive spindle, swivel head, and rotary torque table are used in the Hurco SRT line of five-axis machining centers to achieve simultaneous five-axis machining. ​ CNC Rotary Tables LCM has introduced a new generation of trunnion tables that are common across various machine models.
LCM’s direct drive spindle, swivel head, and rotary torque table are used in the Hurco SRT line of five-axis machining centers to achieve simultaneous five-axis machining. ​ 14 ​ CNC Rotary Tables LCM has introduced a new generation of trunnion tables that are common across various machine models.
Hurco emphasizes a number of measures and objectives in managing its human capital assets, including, among others, employee safety and wellness, talent acquisition and retention, employee engagement, development, and training, diversity and inclusion, and compensation and pay equity. None of our employees are covered by a collective-bargaining agreement.
Hurco emphasizes a number of measures and objectives in managing its human capital assets, including, among others, employee safety and wellness, talent acquisition and retention, employee engagement, development and training, diversity, and compensation and pay equity. None of our employees are covered by a collective-bargaining agreement.
Major worldwide competitors include DMG Mori Seiki Co., Ltd., Mazak Corporation, Haas Automation, Inc., Smart Machine Tool, DN Solutions (formerly Doosan Corporation), Okuma Machinery Works, Ltd., Fryer Machine Systems Inc., ProtoTRAK CNC Machines, Quick Jet Machine, Co., Ltd., Gentiger Machinery Industrial, Co., Ltd., and Yeong Chin Machinery Industries, Co., Ltd. ​ Through our subsidiary LCM, we compete with manufacturers of machine tool components and accessories such as IBAG, Kessler, Peron Speed International, GSA Technology Co., Ltd., and Duplomatic Automation. ​ We strive to compete by developing patentable software and other proprietary features that offer enhanced productivity, technological capabilities, and ease of use.
Major worldwide competitors include DMG Mori Co., Ltd., Mazak Corporation, Haas Automation, Inc., Smart Machine Tool, DN Solutions (formerly Doosan Corporation), Okuma Corporation, Fryer Machine Systems Inc., ProtoTRAK CNC Machines, Quick Jet Machine, Co., Ltd., Gentiger Machinery Industrial, Co., Ltd., and Yeong Chin Machinery Industries, Co., Ltd. ​ Through our subsidiary LCM, we compete with manufacturers of machine tool components and accessories such as IBAG, Kessler, Peron Speed International, GSA Technology Co., Ltd., and Duplomatic Automation. ​ We strive to compete by developing patentable software and other proprietary features that offer enhanced productivity, technological capabilities, and ease of use.
ProCobots, LLC (“ProCobots”) is our wholly-owned subsidiary that provides practical automation solutions, such as feeders, machine tending systems, and collaborative robots (cobots). In addition, through our wholly-owned subsidiary LCM, we produce high-value machine tool components and accessories.
ProCobots, LLC (“ProCobots”) is our wholly-owned subsidiary that provides automation solutions, such as feeders, machine tending systems, and collaborative robots (cobots). In addition, through our wholly-owned subsidiary LCM, we produce high-value machine tool components and accessories.
ProCobots solutions are available for any Hurco, Milltronics, or Takumi machine. ​ ​ 14 ​ LCM Machine Tool Components and Accessories ​ Based in Italy, LCM designs, manufactures, and sells mechanical and electro-mechanical components and accessories for machine tools for a wide variety of machine tool OEMs.
ProCobots solutions are available for any Hurco, Milltronics, or Takumi machine. ​ LCM Machine Tool Components and Accessories ​ Based in Italy, LCM designs, manufactures, and sells mechanical and electro-mechanical components and accessories for machine tools for a wide variety of machine tool OEMs.
The TMX models have higher spindles and a more rigid frame, the TMX-MY models are equipped with an additional axis and motorized live tooling, and the TMX-MYS models also have an additional spindle.
The TMX models have higher speed spindles and a more rigid frame, the TMX-MY models are equipped with an additional axis and motorized live tooling, and the TMX-MYS models also have an additional spindle.
However, any prolonged interruption of operations or significant reduction in the capacity or performance capability at any of our manufacturing facilities, or at any of our key component suppliers, could have a material adverse effect on our operations. ​ Marketing and Distribution ​ We principally sell our products through approximately 180 independent agents and distributors throughout North and South America (the “Americas”), Europe, and Asia.
However, any prolonged interruption of operations or significant reduction in the capacity or performance capability at any of our manufacturing facilities, or at any of our key component suppliers, could have a material adverse effect on our operations. ​ Marketing and Distribution ​ We principally sell our products through approximately 160 independent agents and distributors throughout North and South America (the “Americas”), Europe, and Asia.
Typical applications for these machines include general machining, job shops, prototype, or maintenance and repair. Available with quill-head or rigid-head designs, there are six models in four sizes with X-axis travels of 30, 40, 60 and 78 inches. The 60-inch model is also available with a high-torque option.
Typical applications for these machines include general machining, job shops, prototype, or maintenance and repair. Available with quill-head or rigid-head designs, there are six models in four sizes with X-axis travels of 30, 40, 60 and 78 inches. The 60-inch and 78-inch models are also available with a high-torque option.
High-speed spindles (20,000rpm or 30,000rpm) are offered as an option. ​ SRTi/SWi Product Line The SRT Series of five-axis machines utilizes motor spindles and a swivel head with a C-axis rotary table embedded into and flush with the machine table, making them among the most flexible machines in the industry.
High-speed spindles (20,000rpm or 30,000rpm) are offered as an option. ​ SRTi/SWi Product Line The SRT Series of five-axis machines utilizes motorized spindles and a swivel head with a C-axis rotary table embedded into and flush with the machine table, making them among the most flexible machines in the industry.
Customers can transfer part designs, receive event notifications via email for text, access diagnostic data, monitor the machine via webcam, and communicate with the machine operator. ​ UltiPocket with Helical Ramp Entry and Insert Pockets automatically calculates the tool path around islands, eliminating the arduous task of plotting these shapes.
Customers can transfer part designs, receive event notifications via email or text, access diagnostic data, monitor the machine via webcam, and communicate with the machine operator. ​ UltiPocket with Helical Ramp Entry and Insert Pockets automatically calculates the tool path around islands, eliminating the arduous task of plotting these shapes.
Other factors affecting demand include: ​ ● the need to continuously improve productivity and shorten cycle time; ● an aging machine tool installed base that will require replacement with more advanced technology; ● the industrial development of emerging markets in Latin America, Asia, and Eastern Europe; and ● the declining supply of skilled machinists. ​ Demand for our products is also highly dependent upon economic conditions and the general level of business confidence, as well as factors such as production capacity utilization and changes in governmental policies regarding tariffs, corporate taxation, fluctuations in foreign currencies, and other investment incentives. ​ Competition ​ We compete with many other machine tool producers in the United States and foreign countries.
Other factors affecting demand include: • the need to continuously improve productivity and shorten cycle time; • an aging machine tool installed base that will require replacement with more advanced technology; • the industrial development of emerging markets in Latin America, Asia, and Eastern Europe; and • the declining supply of skilled machinists. ​ Demand for our products is also highly dependent upon economic conditions and the general level of business confidence, as well as factors such as production capacity utilization and changes in governmental policies regarding tariffs, corporate taxation, fluctuations in foreign currencies, and other investment incentives. ​ Competition ​ We compete with many other machine tool producers in the U.S. and foreign countries.
It is important to note that data for foreign countries are based on government reports that may lag six to 12 months behind real-time and, therefore, are unreliable for forecasting purposes. ​ 4 ​ Demand for capital equipment can fluctuate significantly during periods of changing economic conditions.
It is important to note that data for foreign countries are based on government reports that may lag six to 12 months behind real-time and, therefore, are unreliable for forecasting purposes. ​ 4 ​ Demand for capital equipment can fluctuate significantly during periods of changing market conditions.
The familiar Windows ® operating system coupled with our intuitive conversational style of program creation allows our customers’ operators to create and edit part-making programs without incurring the incremental overhead of specialized computer aided design (“CAD”) and computer aided manufacturing (“CAM”) programmers.
The familiar Windows® operating system coupled with our intuitive conversational style of program creation allows our customers’ operators to create and edit part-making programs without incurring the incremental overhead of specialized computer aided design (“CAD”) and computer aided manufacturing (“CAM”) software.
As a global industrial technology company, a large number of our employees are engineers, trained trade, or technical workers focusing on advanced manufacturing, and many of them hold masters’, doctorate, or equivalent advanced degrees, or are veterans of the armed services.
As a global industrial technology company, a large number of our employees are engineers, trained trade, or technical workers focusing on advanced manufacturing, and many of them hold master’s, doctorate, or equivalent advanced degrees, or are veterans of the armed services.
High speed motor spindle (20,000rpm) is offered as option for high performance models. ​ BXi Product Line The BX product line is for customers that require higher accuracy parts, as they are built with an extremely rigid double column design that offers superior vibration dampening and excellent thermal characteristics.
A high speed motor spindle (20,000rpm) is offered as an option for high-performance models. ​ BXi Product Line The BX product line is for customers that require higher accuracy parts, as they are built with an extremely rigid double column design that offers superior vibration damping and excellent thermal characteristics.
The 3- and 4-meter models are available as five-axis machines equipped with two different types of articulating head for either high-speed cutting or high-torque cutting.
The 3- and 4-meter models are available as five-axis machines equipped with two different types of articulating heads for either high-speed cutting or high-torque cutting.
The new control console leverages patented Hurco intellectual property to enhance cutting precision and surface finish on Milltronics machine tools. Features like rapid retract and leadscrew and squareness compensations enable customers to maximize their Milltronics machine tool's performance. Additionally, Milltronics introduced two new product lines, the TRL toolroom flatbed lathes and the X5 five-axis integrated machines.
The new control console leverages patented Hurco intellectual property to enhance cutting precision and surface finish on Milltronics machine tools. Features like rapid retract and leadscrew and squareness compensations enable customers to maximize their Milltronics machine tool's performance. Additionally, in fiscal year 2024, Milltronics introduced two new product lines, the TRL toolroom flatbed lathes and the X5 five-axis integrated machines.
Most models are equipped with a belted spindle up to 12,000rpm, one model is equipped with an inline (direct drive) spindle, and one model includes motor spindle speeds up to 30,000rpm. ​ VMXi Product Line The VMX product line is our flagship series of machining centers and consists of higher performing vertical machining centers aimed at manufacturers that require faster speeds and greater part accuracy.
Most models are equipped with a belted spindle up to 12,000rpm, one model is equipped with an inline (direct drive) spindle, and one model includes motor spindle speeds up to 30,000rpm. ​ VMXi Product Line The VMX product line is our flagship series of machining centers and consists of high-performance vertical machining centers aimed at manufacturers that require faster speeds and greater part accuracy.
This technology differentiates us in the marketplace and is incorporated into our control. ​ Our offering of Hurco machining centers, currently equipped with either a dual touch-screen console or a single touch-screen console, consists of the following product lines: ​ ​ ​ ​ ___________________ † Windows ® is a registered trademark of Microsoft Corporation in the United States and other countries. 6 ​ VMi Product Line The VM product line consists of moderately priced vertical machining centers for the entry-level market, and offer the advantage of our advanced control and motion systems.
This technology differentiates us in the marketplace and is incorporated into our control. ​ Our offering of Hurco machining centers, currently equipped with either a dual touch-screen console or a single touch-screen console, consists of the following product lines: ​ ​ ​ ​ ​ ___________________ † Windows ® is a registered trademark of Microsoft Corporation in the United States and other countries. 6 ​ VMi Product Line The VM product line consists of moderately priced vertical machining centers for the entry-level market while still offering the advantages of our advanced control and motion systems.
In addition to saving time, the Tool and Material Library eliminates the need to enter information repeatedly and can prevent common tool crash conditions. ​ NC/Conversational Merge lets the user incorporate conversational features, such as tool probing, pattern operations, and scaling, into existing G-Code programs. ​ Job List provides an intuitive way to group files together and run them sequentially without operator intervention, which promotes automation, lights-out machining, program stitching, file bundling, and adaptive processes. ​ Automation Job Manager is a software feature designed specifically for seamless integration of the Hurco control to our automation package called Job Shop Automation, which promotes intuitive programming of collaborative robots for machine tending applications. ​ Stream Load allows the user to run very large NC files without the need to upload the entire file into the control’s memory to avoid exceeding memory limits. ​ Active Thermal Compensation is a feature that uses sensors to measure head casting temperature growth and software that automatically compensates for that growth, improving part accuracy. ​ Thread Repair is a feature for turning applications that provides an efficient way to repair existing threads, which is especially beneficial for large pipes and other parts manufactured for the oil/energy sector. ​ Simultaneous Five-Axis Contouring software enables a five-axis machine to command motion concurrently on all axes.
In addition to saving time, the Tool and Material Library eliminates the need to enter information repeatedly and can prevent common tool crash conditions. ​ ​ ________________________ * AutoCAD® is a registered trademark of Autodesk, Inc., and/or its subsidiaries/ affiliates in the U.S. and/or other countries. 13 ​ NC/Conversational Merge lets the user incorporate conversational features, such as tool probing, pattern operations, and scaling, into existing G-Code programs. ​ Job List provides an intuitive way to group files together and run them sequentially without operator intervention, which promotes automation, lights-out machining, program stitching, file bundling, and adaptive processes. ​ Automation Job Manager is a software feature designed specifically for seamless integration of the Hurco control to our automation package called Job Shop Automation, which promotes intuitive programming of collaborative robots for machine tending applications. ​ Stream Load allows the user to run very large NC files without the need to upload the entire file into the control’s memory to avoid exceeding memory limits. ​ Active Thermal Compensation is a feature that uses sensors to measure head casting temperature growth and software that automatically compensates for that growth, improving part accuracy. ​ Thread Repair is a feature for turning applications that provides an efficient way to repair existing threads, which is especially beneficial for large pipes and other parts manufactured for the oil/energy sector. ​ Simultaneous Five-Axis Contouring software enables a five-axis machine to command motion concurrently on all axes.
These compact machines are available with chuck sizes of six, eight, and ten inches and support an optional conversational high-efficiency cutting cycle on the control called Bi-Directional Turning, a cutting strategy typically available only with high-end CAD/CAM systems. ​ Product Development In fiscal year 2024, Milltronics introduced the new INSPIRE+ control console, with a modern look, increased display size, and ergonomic input.
These compact machines are available with chuck sizes of six, eight, and ten inches and support an optional conversational high-efficiency cutting cycle on the control called Bi-Directional Turning, a cutting strategy typically available only with high-end CAD/CAM systems. ​ Product Development Milltronics recently introduced the new INSPIRE+ control console, with a modern look, increased display size, and ergonomic input.
We pride ourselves on policies and programs designed for the development and fair treatment of our global workforce, including generous healthcare and benefit programs for our employees, equal employment hiring practices and policies, anti-harassment, workforce safety, and anti-retaliation policies, and implementation of affirmative action programs.
We pride ourselves on policies and programs designed for the development and fair treatment of our global workforce, including generous healthcare and benefit programs for our employees, equal employment hiring practices and policies, and anti-harassment, workforce safety, and anti-retaliation policies.
While the Hurco-branded computer control systems have been, and continue to be, our premium flagship product line, we have added other products to our portfolio that provide product diversity and market penetration opportunity priced from entry-level to high performance serving a variety of different industries.
While the Hurco-branded computer control systems have been, and continue to be, our premium flagship product line, we have added other products to our portfolio that provide product diversity and market penetration opportunity priced from value-tier to high-performance serving a variety of different industries.
Due to leverage of shared resources and cross-utilization of proven engineering designs, we achieve manufacturing cost reductions from economies of scale and manufacturing efficiencies. ​ Hurco CNC Machine Tools ​ Hurco computerized machine tools are equipped with a fully integrated interactive computer control system that features our proprietary WinMax ® software.
Due to leverage of shared resources and cross-utilization of proven engineering designs, we achieve manufacturing efficiency from economies of scale. ​ Hurco CNC Machine Tools ​ Hurco computerized machine tools are equipped with a fully integrated interactive computer control system that features our proprietary WinMax® software.
We pioneered the application of microprocessor technology and conversational programming software for use in machine tools. Our Hurco brand computer control systems can be operated by both skilled and unskilled machine tool operators, and yet are capable of instructing a machine to perform complex tasks.
We pioneered the application of microprocessor technology and conversational programming software for use in machine tools. Our Hurco brand computer control systems can be operated by both skilled and unskilled machine tool operators, and yet can instruct a machine to perform complex tasks.
Finally, Takumi developed three intelligent thermal compensation levels, iSPIN-TC, which, depending on the application, greatly reduces spindle thermal deviation. ​ Other Computer Control Systems and Software Products ​ The following machine tool computer control systems and software products are sold directly to end-users and/or to other original equipment manufacturers (“OEMs”). ​ 12 ​ Autobend ® Our Autobend ® computer control systems are applied to metal bending press brake machines that form parts from sheet metal and steel plate.
Finally, Takumi developed three intelligent thermal compensation levels, iSPIN-TC, which, depending on the application, greatly reduces spindle thermal deviation. ​ Other Computer Control Systems and Software Products ​ The following machine tool computer control systems and software products are sold directly to end-users and/or to other OEMs. ​ Autobend® Our Autobend® computer control systems are applied to metal bending press brake machines that form parts from sheet metal and steel plate.
The SL Series includes four models: the SL200 and SL250, both available with ten-inch chucks; the SL300, which has a 12-inch chuck; and the SL450, which has an 18-inch chuck. ​ Product Development In fiscal year 2024, Takumi introduced a new UVC600 five-axis machine with a 600-millimeter cantilever table.
The SL Series includes four models: the SL200 and SL250, both available with ten-inch chucks; the SL300, which has a 12-inch chuck; and the SL450, which has an 18-inch chuck. ​ Product Development Takumi recently introduced a new UVC600 five-axis machine with a 600-millimeter cantilever table.
An operator with little or no machine tool programming experience can successfully create a program with minimal training and begin machining the part in a short period of time. The control features an operator console with a touch-screen and incorporates an upgradeable personal computer (“PC”) platform using a high-speed processor with solid rendering graphical programming.
An operator with little or no machine tool programming experience can easily create a program with minimal training and successfully machine the part in a short period of time. The control features a touchscreen operator console and incorporates an upgradeable personal computer (“PC”) platform using a high-speed processor with solid rendering graphical programming.
Our selling divisions in the United States have responsibility for the Americas, which includes Canada, Mexico, Central America, South America, and the U.S. ​ Approximately 84% of the worldwide demand for computerized machine tools and computer control systems is outside of the U.S. In fiscal year 2024, approximately 61% of our revenues were derived from customers outside of the Americas.
Our selling divisions in the United States have responsibility for the Americas, which includes Canada, Mexico, Central America, South America, and the U.S. ​ Approximately 85% of the worldwide demand for computerized machine tools and computer control systems is outside of the U.S. In fiscal year 2025, approximately 62% of our revenues were derived from customers outside of the Americas.
We also own additional patents covering new technologies that we have acquired or developed, and that we are planning to incorporate into our control systems or products in the future. ​ 17 ​ Human Capital Resources ​ Hurco is committed to attracting and retaining the brightest and best talent.
We also own additional patents covering new technologies that we have acquired or developed, and that we are planning to incorporate into our control systems or products in the future. 17 ​ Human Capital Resources ​ Hurco is committed to attracting and retaining the brightest and best talent. Therefore, investing, developing, and maintaining human capital is critical to our success.
Our industry has continued to face global headwinds due to changing economic conditions.
Our industry has continued to face global headwinds due to changing economic and regulatory conditions.
Product Portfolio by Brand ​ We have three brands of CNC machine tools in our product portfolio. Hurco is the technology and innovation brand for customers who want to increase productivity and profitability by selecting a brand with the latest software and motion technology. Milltronics is the value-based brand for shops that want easy-to-use machines at competitive prices.
Product Portfolio by Brand ​ We have three CNC machine tool brands in our product portfolio. Hurco is the technology and innovation brand for customers who seek to increase productivity and profitability by selecting a brand with the latest software and motion control technology. Milltronics is the value-tier brand for shops that want easy-to-use machines at competitive prices.
In addition, we routinely invest in seminar, conference, and other training or continuing education events for our employees. ​ Diversity and Inclusion We are committed to fostering work environments that value and promote diversity and inclusion.
In addition, we routinely invest in seminars, conferences, and other training or continuing education events for our employees. ​ Diversity We are committed to fostering work environments that value and promote diversity.
These non-Hurco branded products are sold by our wholly-owned distributors and are comprised primarily of other general-purpose vertical machining centers and lathes, laser cutting machines, waterjet cutting machines, CNC grinders, compact horizontal machining centers, metal cutting saws, and CNC Swiss lathes.
These non-Hurco branded products are sold by our wholly-owned distributors and are comprised primarily of other general-purpose vertical machining centers and lathes, laser cutting machines, CNC grinders, compact horizontal machining centers, metal cutting saws, CNC Swiss lathes, and related parts, consumables, and installation and repair services.
The design premise of the machining center with a large work cube and a small footprint optimizes the use of available floor space. The VM line consists of six models in four sizes with X-axis (horizontal) travels of 26 (three models), 30, 40, and 50 inches.
The design premise of the machining center with a large work volume with a small footprint is to optimize floor space. The VM line consists of six models in four sizes with X-axis (horizontal) travels of 26 (three models), 30, 40, and 50 inches.
The following table sets forth the contribution of each of our product groups and services to our total revenues during each of the past three fiscal years (in thousands): ​ Net Sales and Service Fees by Product Category ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended October 31, ​ ​ ​ 2024 ​ 2023 ​ 2022 ​ Computerized Machine Tools $ 147,561 79 % $ 188,335 83 % $ 211,804 85 % Computer Control Systems and Software † ​ 2,447 1 % 2,805 1 % 2,634 1 % Service Parts ​ 27,628 15 % 28,439 12 % 28,219 11 % Service Fees ​ 8,948 5 % 8,228 4 % 8,157 3 % Total ​ $ 186,584 100 % $ 227,807 100 % $ 250,814 100 % † Amounts shown do not include computer control systems and software sold as an integrated component of computerized machine tools.
The following table sets forth the contribution of each of our product groups and services to our total revenues during each of the past three fiscal years (in thousands): Net Sales and Service Fees by Product Category ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended October 31, ​ ​ ​ 2025 ​ 2024 ​ 2023 ​ Computerized Machine Tools ​ ​ ​ $ 142,259 ​ ​ ​ 80 % $ 147,561 ​ ​ ​ 79 % $ 188,335 ​ ​ ​ 83 % Computer Control Systems and Software † ​ 2,416 1 % 2,447 1 % 2,805 1 % Service Parts ​ 25,095 14 % 27,628 15 % 28,439 12 % Service Fees ​ 8,784 5 % 8,948 5 % 8,228 4 % Total ​ $ 178,554 100 % $ 186,584 100 % $ 227,807 100 % † Amounts shown do not include computer control systems and software sold as an integrated component of computerized machine tools.
During fiscal year 2024, our sales and service fees were $186.6 million, a decrease of $41.2 million, or 18%, compared to fiscal year 2023 and included a favorable currency impact of $1.8 million, or less than 1%, when translating foreign sales to U.S. dollars for financial reporting purposes.
During fiscal year 2025, our sales and service fees were $178.6 million, a decrease of $8.0 million, or 4%, compared to fiscal year 2024 and included a favorable currency impact of $2.0 million, or 1%, when translating foreign sales to U.S. dollars for financial reporting purposes.
Companies using computer-controlled machine tools are better able to: ​ ● maximize the efficiency of their human resources; ● make more advanced and complex parts from a wide range of materials using multiple processes; ● incorporate fast moving changes in technology into their operations to keep their competitive edge; ● integrate their business into the global supply chain of their customers by supporting small to medium lot sizes for “just in time” initiatives; and ● connect equipment to intranet and extranets to facilitate collaboration, communication and monitoring. ​ Our Windows ® based Hurco control facilitates our ability to meet these customer needs.
Companies using computer-controlled machine tools are better able to: • maximize the efficiency of their human resources; • make more advanced and complex parts from a wide range of materials using multiple processes; • incorporate rapidly evolving changes in technology into their operations to maintain their competitive edge; • integrate their business into the global supply chain of their customers; and • connect equipment to intranet external networks to facilitate collaboration, communication and monitoring. ​ Our Windows® based Hurco control facilitates our ability to meet these customer needs.
We introduced the TM8MY and TM10MY multi-axis live tooling lathes models. Additionally, we made background enhancements to our WinMax® software, focusing on bolstering reliability and optimizing resource management. These improvements are designed to ensure smoother user experience without interrupting workflow.
Additionally, we made background enhancements to our WinMax® software, focusing on bolstering reliability and optimizing resource management. These improvements are designed to ensure smoother user experience without interrupting workflow.
Sales decreased year-over-year due primarily to a decreased volume of shipments of higher-performance Hurco, Takumi, and Milltronics machines in the Americas, Germany, the United Kingdom, Italy and China, as well as decreased shipments of electro-mechanical components and accessories manufactured by our wholly-owned subsidiary, LCM Precision Technology S.r.l. (“LCM”).
Sales decreased year-over-year due primarily to a decreased volume of shipments of Hurco 5-axis vertical machines and entry-level 3-axis Hurco and Milltronics machines in the Americas, Germany and France, as well as decreased shipments of electro-mechanical components and accessories manufactured by our wholly-owned subsidiary, LCM Precision Technology S.r.l. (“LCM”).
PV machines are available in two sizes with X-axis travels of either 26 or 41 inches. They are designed for general purpose and job shop applications. ​ VC Series The VC Series vertical machining centers are fast, three-axis linear guide machining centers designed for customers doing a variety of different parts, including die and mold, medical, automotive, and job shops.
They are designed for general purpose and job shop applications. ​ VC Series The VC Series vertical machining centers are fast, three-axis linear guide machining centers designed for customers doing a variety of different parts, including die and mold, medical, automotive, and job shops.
This “on-machine” technique improves the throughput of the measurement process when compared to traditional “off-machine” approaches. ​ ________________________ * AutoCAD® is a registered trademark of Autodesk, Inc., and/or its subsidiaries/ affiliates in the U.S. and/or other countries. 13 ​ The Tool and Material Library option stores the tool and material information with the machine instead of storing it with each individual part program.
This “on-machine” technique improves the throughput of the measurement process when compared to traditional “off-machine” approaches. ​ The Tool and Material Library option stores the tool and material information with the machine instead of storing it with each individual part program.
UltiMotion ® , our patented motion control system, provides significant cycle time reductions and increases the quality of a part’s surface finish.
We continually add technology to our controls and machines to enhance performance, productivity, and precision. UltiMotion®, our patented motion control system, provides significant cycle time reductions and increases the quality of a part’s surface finish.
The UR1000 has a two-axis head and a 39-inch rotary table integrated into a double-column machine, designed for large and heavy five-axis parts, such as those found in die and mold, aerospace, and energy applications. ​ G Series Designed specifically for the machining of graphite or copper electrodes used in electrical discharge machining (EDM), G Series machines offer the same extremely rigid and thermally stable double-column design of the H Series with high-speed, direct-drive spindles, or built-in HSK spindles, that have up to 20,000rpm, but are also equipped with a graphite dust extraction system.
JOHANNES HEIDENHAIN GmbH. 11 ​ G Series Designed specifically for the machining of graphite or copper electrodes used in electrical discharge machining (EDM), G Series machines offer the same extremely rigid and thermally stable double-column design of the H Series with high-speed, direct-drive spindles, or built-in HSK spindles, that have up to 20,000rpm, but are also equipped with a graphite dust extraction system.
The Takumi brand is for customers that need precision and very high speed, high efficiency performance, such as that required in the die and mold, aerospace, and medical industries. Takumi machines are equipped with industry standard controls instead of the proprietary controls found on Hurco and Milltronics machines.
The Takumi brand is for customers looking for top-tier precision and performance typically sought by the die and mold, aerospace, and medical industries. Takumi machines are equipped with industry standard controls instead of the proprietary controls found on Hurco and Milltronics machines.
The net loss for fiscal year 2024 included a non-cash tax valuation allowance of $8.6 million recorded in provision for income taxes. ​ Industry ​ Machine tool products are capital goods, which makes them part of an industry that has historically been highly cyclical. ​ Industry association data for the U.S. machine tool market is available, and that market accounts for approximately 16% of worldwide consumption.
For fiscal year 2025, we reported a net loss of $15.1 million, or $2.34 per diluted share, compared to net loss of $16.6 million, or $2.56 per diluted share, for fiscal year 2024. ​ Industry ​ Machine tool products are capital goods, which makes them part of an industry that has historically been highly cyclical. ​ Industry association data for the U.S. machine tool market is available, and that market accounts for approximately 15% of worldwide consumption.
Models include three-axis vertical machining centers with linear guides; three-axis vertical machining centers with box ways; high-speed, double column vertical machining centers; heavy-duty, double-column machining centers; five-axis machining centers and high-speed horizontal machining centers.
Models include three-axis vertical machining centers with linear guides; three-axis vertical machining centers with box ways; high-speed, double column vertical machining centers; heavy-duty, double-column machining centers; five-axis machining centers and high-speed horizontal machining centers. Takumi machines are built and fitted to exacting standards to produce high accuracies and superior surface finishes.
The INSPIRE+ control console, launched in 2024, is an upgrade from the previous system, Milltronics 9000 Series DGI CNC, with enhanced hardware and graphics features.
The INSPIRE+ control console, launched in 2024, was an upgrade from the previous system, Milltronics 9000 Series DGI CNC, with enhanced hardware and graphics features. The control is compatible with G & M Code programs (generated from CAD/CAM software) and features onboard conversational visual aid programming.
Heidenhain® is a registered trademark of HEIDENHAIN CORPORATION, a wholly-owned subsidiary of the German company DR. JOHANNES HEIDENHAIN GmbH. 11 ​ U Series Designed with trunnion tables or swivel heads, these five-axis simultaneous machining centers provide versatility, as well as reduced setup time and process time. Most models are offered with a double-column structure for superior stability and performance.
These machines are specifically targeted for die and mold and aerospace customers. ​ U Series Designed with trunnion tables or swivel heads, these five-axis simultaneous machining centers provide versatility, as well as reduced setup time and process time. Most models are offered with a double-column structure for superior stability and performance.
Therefore, investing, developing, and maintaining human capital is critical to our success. As of October 31, 2024, Hurco had approximately 688 full-time employees, of which approximately 30% were in the Americas and 70% were in other global regions.
As of October 31, 2025, Hurco had approximately 651 full-time employees, of which approximately 30% were in the Americas and 70% were in other global regions.
Customers can choose from three different models with X-axis travels of 50, 60, or 84 inches. ​ BR Product Line The BR product line consists of high-speed bridge mills that are used in pattern shops and the aerospace industry, in addition to job shops, due to the large table and travels that support a wide range of part sizes.
The 200mm machine is offered with a belted spindle and the 250mm machine comes with an inline configuration. ​ BR Product Line The BR product line consists of high-speed bridge mills that are used in pattern shops and the aerospace industry, in addition to job shops, due to the large table and travels that support a wide range of part sizes.
Takumi machines are hand built and fitted to exacting standards to produce high accuracies and superior surface finishes. ​ The Takumi portfolio consists of the following product lines: ​ PV Series The PV Series are entry-level vertical machining centers yet feature high-performance direct drive spindles and robust roller way technology.
The Takumi portfolio consists of the following product lines: ​ PV Series The PV Series are entry-level vertical machining centers yet feature high-performance direct drive spindles and robust roller way technology. PV machines are available in two sizes with X-axis travels of either 26 or 41 inches.
Our proprietary controls with WinMax ® software and high-speed processors efficiently handle the large amounts of data these complex part-making programs require and enable our customers to create parts with higher accuracy at faster speeds. We continue to add technology to our control design as it becomes available.
With the ability to transfer most CAD data directly into a Hurco program, part programming time can be significantly reduced. ​ Our proprietary controls with WinMax® software and high-speed processors efficiently handle the large amounts of data that complex part-making programs require and enable our customers to create parts with higher accuracy at faster speeds.
There are 17 models available in a variety of thru hole sizes and in the following six swing-over bed diameters: 17, 19, 23, 27, 36, and 40 inches. ​ SL Product Line The SL product line of slant-bed lathes (horizontal turning centers) is designed for entry-level job shops and contract manufacturers seeking efficient processing of small to medium lot sizes.
Chuck size is chosen during the purchasing process. ​ SL Product Line The SL product line of slant-bed lathes (horizontal turning centers) is designed for entry-level job shops and contract manufacturers seeking efficient processing of small to medium lot sizes.
It offers the easy table access of a conventional knee mill, with the power and flexibility of the 9000 DGI CNC control and motion system.
The Milltronics portfolio consists of the following product lines: ​ VK Series The VK is our CNC knee mill designed for prototype, research and development, maintenance, and other general-purpose applications. It offers the easy table access of a conventional knee mill, with the power and flexibility of the 9000 DGI CNC control and motion system.
The LCM line of electro-mechanical components and accessories for machine tools is designed and manufactured in Italy.
HML conducts final assembly operations and is supported by a network of contract suppliers of components and sub-assemblies that manufacture components for our products. The LCM line of electro-mechanical components and accessories for machine tools is designed and manufactured in Italy.
BR machines have inline spindles and are available with 150 inches in X-axis travel and 60 inches in Y-axis travel. ​ ML Product Line The ML product line consists of combination lathes that the customer can configure for either toolroom or production applications with the option to add live tooling.
BR machines have inline spindles and are available with 150 inches in X-axis travel and 60 inches in Y-axis travel. ​ TRL Product Line The TRL product line is Milltronics’ newest line of tool room lathes.
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For fiscal year 2024, we reported a net loss of $16.6 million, or $(2.56) per diluted share, compared to net income of $4.4 million, or $0.66 per diluted share, for fiscal year 2023.
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One example of a product enhancement completed in fiscal year 2025 was a next generation VC 500 5-axis to better fit market needs. Improved automation integration and ergonomics are among some of the considerations engineered into the design. The next generation VC 500 is expected to launch in early 2026.
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With the ability to transfer most CAD data directly into a Hurco program, part programming time can be significantly reduced. ​ Machine tool products must be designed to meet customer demand to machine complex parts with greater part accuracies.
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Further building on our well-positioned 5-axis lineup, we also completed the design of the BM 500U in fiscal year 2025. This new model features a rigid dual column bridge design to compete with general purpose 5-axis machines from other original equipment manufacturers (“OEMs”).
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Examples of product enhancements completed in fiscal year 2024 include a new and higher speed 20,000rpm motorized spindle for the HSi and Ui product lines. We also refreshed the design of the TM-Mi and TMXi product lines to take advantage of higher performance live turret with options of either BMT or VDI tooling.
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As the market becomes more comfortable with multi-axis machines, opportunities with a growing number of job shops arise. To appeal to the job shop market, we have included the following in the design of the BM 500U: a smaller footprint, a 500mm table, a 15,000rpm spindle and faster axes.
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The control is compatible with G & M Code programs (generated from CAD/CAM software) and also features onboard conversational visual aid programming. ​ The Milltronics portfolio consists of the following product lines: ​ VK Series The VK is our CNC knee mill designed for prototype, research and development, maintenance, and other general-purpose applications.
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Customers can choose from three different models with X-axis travels of 50, 60, or 84 inches. ​ VM (5X) Product Line The VM-5X product line features five-axis trunnion tables integrated onto C-frame style machines and is available with either a 200 or 250mm plater.
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These machines are specifically targeted for die and mold and aerospace customers. ​ ​ ​ ​ ​ ​ ________________________ * Fanuc® is a registered trademark of G E Fanuc Automation Americas, Inc. Siemens® is a registered trademark of Siemens AG. Mitsubishi® is a registered trademark of Mitsubishi Electric Corporation.
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These turning centers feature a gap bed, a swing that ranges from 16.7 to 27 inches, and a Z-axis travel that ranges from 66.5 to 84.6 inches.
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HML conducts final assembly operations and is supported by a network of contract suppliers of components and sub-assemblies that manufacture components for our products. Our facility in Ningbo, China (Ningbo Hurco Machine Tool Co. Ltd (“NHML”)) focuses on the machining of castings to support HML’s production in Taiwan.
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The UR1000 has a two-axis head and a 39-inch rotary table integrated into a double-column machine, designed for large and heavy five-axis parts, such as those found in die and mold, aerospace, and energy applications. ________________________ * Fanuc® is a registered trademark of G E Fanuc Automation Americas, Inc. Siemens® is a registered trademark of Siemens AG.
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Mitsubishi® is a registered trademark of Mitsubishi Electric Corporation. Heidenhain® is a registered trademark of HEIDENHAIN CORPORATION, a wholly-owned subsidiary of DR.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Our international operations are subject to a number of risks, including: ​ • trade barriers; • regional economic uncertainty and nationalistic trade strategies; • differing labor regulation; • governmental expropriation; • domestic and foreign customs and tariffs; • current and changing regulatory environments affecting the importation and exportation of products and raw materials; • difficulty in obtaining distribution support; • difficulty in staffing and managing widespread operations; • differences in the availability and terms of financing; • political instability and unrest; • negative or unforeseen consequences resulting from the introduction, termination, modification, or renegotiation of international trade agreements or treaties or the imposition of countervailing measures or anti-dumping duties or similar tariffs; • foreign exchange controls that make it difficult to repatriate earnings and cash; • changes in tax regulations and rates in foreign countries; and • changes in the geopolitical environment, wars, conflicts, or trade barriers or blockades in the European Union and Asia, which may adversely affect business activity and economic conditions globally and could continue to contribute to instability in global financial and foreign exchange markets, as well as disrupt the free movement of goods, services, and people between countries. ​ 20 ​ Quotas, tariffs, taxes, or other trade barriers could require us to attempt to change manufacturing sources, reduce prices, increase spending on marketing or product development, withdraw from or not enter certain markets, or otherwise take actions that could be adverse to us and/or that we might not be able to accomplish in a timely manner or at all.
Our international operations are subject to a number of risks, including: • trade barriers; • regional economic uncertainty and nationalistic trade strategies; • differing labor regulation; • governmental expropriation; • domestic and foreign customs and tariffs; • current and changing regulatory environments affecting the importation and exportation of products and raw materials; • difficulty in obtaining distribution support; 20 ​ • difficulty in staffing and managing widespread operations; • differences in the availability and terms of financing; • political instability and unrest; • negative or unforeseen consequences resulting from the introduction, termination, modification, or renegotiation of international trade agreements or treaties or the imposition of countervailing measures or anti-dumping duties or similar tariffs; • foreign exchange controls that make it difficult to repatriate earnings and cash; • changes in tax regulations and rates in foreign countries; and • changes in the geopolitical environment, wars, conflicts, or trade barriers or blockades in the European Union and Asia, which may adversely affect business activity and economic conditions globally and could continue to contribute to instability in global financial and foreign exchange markets, as well as disrupt the free movement of goods, services, and people between countries. ​ Quotas, tariffs, taxes, or other trade barriers could require us to attempt to change manufacturing sources, reduce prices, increase spending on marketing or product development, withdraw from or not enter certain markets, or otherwise take actions that could be adverse to us and/or that we might not be able to accomplish in a timely manner or at all.
Acquisitions involve numerous risks, including the following: ​ • difficulties integrating the operations, technologies, products, and personnel of an acquired company or being subjected to liability for the target’s pre-acquisition activities or operations as a successor in interest; • diversion of management’s attention from normal daily operations of the business; • potential difficulties completing projects associated with in-process research and development; • difficulties entering markets in which we have no or limited prior experience, especially when competitors in such markets have stronger market positions; • initial dependence on unfamiliar supply chains or relatively small supply partners; • insufficient revenues to offset increased expenses associated with acquisitions; and • the potential loss of key employees of the acquired companies. ​ Acquisitions may also cause us to: ​ • issue common stock that would dilute our current shareholders’ percentage ownership; • borrow and subject us to increasing interest rates; • assume or otherwise be subject to liabilities of an acquired company; • record goodwill and non-amortizable intangible assets that will be subject to impairment testing on a regular basis and potential periodic impairment charges; • incur amortization expenses related to certain intangible assets; • incur large acquisition and integration costs, immediate write-offs, and restructuring and other related expenses; and • become subject to litigation. ​ Mergers and acquisitions are inherently risky.
Acquisitions involve numerous risks, including the following: • difficulties integrating the operations, technologies, products, and personnel of an acquired company or being subjected to liability for the target’s pre-acquisition activities or operations as a successor in interest; • diversion of management’s attention from normal daily operations of the business; • potential difficulties completing projects associated with in-process research and development; • difficulties entering markets in which we have no or limited prior experience, especially when competitors in such markets have stronger market positions; • initial dependence on unfamiliar supply chains or relatively small supply partners; • insufficient revenues to offset increased expenses associated with acquisitions; and 24 ​ • the potential loss of key employees of the acquired companies. ​ Acquisitions may also cause us to: • issue common stock that would dilute our current shareholders’ percentage ownership; • borrow and subject us to increasing interest rates; • assume or otherwise be subject to liabilities of an acquired company; • record goodwill and non-amortizable intangible assets that will be subject to impairment testing on a regular basis and potential periodic impairment charges; • incur amortization expenses related to certain intangible assets; • incur large acquisition and integration costs, immediate write-offs, and restructuring and other related expenses; and • become subject to litigation. ​ Mergers and acquisitions are inherently risky.
The full extent to which a global health crisis will impact our business and operating results will depend on future developments that are highly uncertain and cannot be accurately predicted, including new medical and other information that may emerge as a result and the actions by governmental entities or others to contain it or treat its impact. ​ The impacts of a severe global health crisis could pose the risk that we or our employees, suppliers, customers and others may be restricted or prevented from conducting business activities for indefinite or intermittent periods of time, including as a result of employee health and safety concerns, shutdowns, shelter in place orders, travel restrictions and other actions and restrictions that may be prudent or required by governmental authorities. ​ 26 ​ Global health crisis could disrupt our ability to deliver and/or install machines, our procurement of supplies for our operations, and our customers’ purchasing behavior or decisions, including reduced demand for our products that could continue for an extended period of time.
The full extent to which a global health crisis will impact our business and operating results will depend on future developments that are highly uncertain and cannot be accurately predicted, including new medical and other information that may emerge as a result and the actions by governmental entities or others to contain it or treat its impact. ​ The impacts of a severe global health crisis could pose the risk that we or our employees, suppliers, customers and others may be restricted or prevented from conducting business activities for indefinite or intermittent periods of time, including as a result of employee health and safety concerns, shutdowns, shelter in place orders, travel restrictions and other actions and restrictions that may be prudent or required by governmental authorities. ​ Global health crisis could disrupt our ability to deliver and/or install machines, our procurement of supplies for our operations, and our customers’ purchasing behavior or decisions, including reduced demand for our products that could continue for an extended period of time.
In such a case, we may be forced to relocate and/or shift production facilities to other geographic territories to mitigate the risks associated with consolidating our manufacturing operations in such territories, which would likely result in disruptions to our production plans and/or our ability to meet forecasted customer demand in the near and medium term, all of which could have a material adverse effect on our business, financial results, future operations, and/or financial position. ​ 21 ​ Fluctuations in the exchange rates between the U.S. dollar and any of several foreign currencies can increase our costs and decrease our revenues.
In such a case, we may be forced to relocate and/or shift production facilities to other geographic territories to mitigate the risks associated with consolidating our manufacturing operations in such territories, which would likely result in disruptions to our production plans and/or our ability to meet forecasted customer demand in the near and medium term, all of which could have a material adverse effect on our business, financial results, future operations, and/or financial position. ​ Fluctuations in the exchange rates between the U.S. dollar and any of several foreign currencies can increase our costs and decrease our revenues.
Failure to comply with U.S. and international data protection laws and regulations could result in government enforcement actions (which could include substantial civil and/or criminal penalties), private litigation and/or adverse publicity, and could negatively affect our operating results and business. ​ 25 ​ If our network and system security measures are breached and unauthorized access is obtained to our data, to our employees’, customers’, or vendors’ data, or to our critical information technology systems, we may incur legal and financial exposure and liabilities.
Failure to comply with U.S. and international data protection laws and regulations could result in government enforcement actions (which could include substantial civil and/or criminal penalties), private litigation and/or adverse publicity, and could negatively affect our operating results and business. ​ If our network and system security measures are breached and unauthorized access is obtained to our data, to our employees’, customers’, or vendors’ data, or to our critical information technology systems, we may incur legal and financial exposure and liabilities.
Although we have implemented policies, procedures, and training designed to ensure compliance with these laws and regulations, there can be no assurance that our employees, contractors, or agents will not violate our policies. ​ Finally, a significant portion of our manufacturing, production, and assembly operations are located in certain limited geographic territories, including the People’s Republic of China (“China”) and the Republic of China (“Taiwan”).
Although we have implemented policies, procedures, and training designed to ensure compliance with these laws and regulations, there can be no assurance that our employees, contractors, or agents will not violate our policies. ​ 21 ​ Finally, a significant portion of our manufacturing, production, and assembly operations are located in certain limited geographic territories, including the People’s Republic of China (“China”) and the Republic of China (“Taiwan”).
If we are unable to secure access and/or rights to any such inputs, components, code, or similar items, our ability to continue to produce our products without interruption could be challenged, which could materially and adversely impact our business, financial condition, results of operation, and demand for our products. ​ Disruptions in our manufacturing operations or the supply of materials and components could adversely affect our business, results of operations and financial condition.
If we are unable to secure access and/or rights to any such inputs, components, code, or similar items, our ability to continue to produce our products without interruption could be challenged, which could materially and adversely impact our business, financial condition, results of operation, and demand for our products. ​ 23 ​ Disruptions in our manufacturing operations or the supply of materials and components could adversely affect our business, results of operations and financial condition.
Our financial resources are limited compared to those of many of our competitors, making it challenging to remain competitive. ​ Operational and Strategic Risks ​ Our competitive position and prospects for growth may be diminished if we are unable to develop and introduce new and enhanced products on a timely basis that are accepted in the market.
Our financial resources are limited compared to those of many of our competitors, making it challenging to remain competitive. ​ 22 ​ Operational and Strategic Risks ​ Our competitive position and prospects for growth may be diminished if we are unable to develop and introduce new and enhanced products on a timely basis that are accepted in the market.
For additional information, please see the risk factor entitled, “Due to future changes in technology, changes in market demand, or changes in market expectations, portions of our inventory may become obsolete or excessive.” ​ 24 ​ Failure to comply with data privacy and security laws and regulations could adversely affect our operating results and business .
For additional information, please see the risk factor entitled, “Due to future changes in technology, changes in market demand, or changes in market expectations, portions of our inventory may become obsolete or excessive.” ​ Failure to comply with data privacy and security laws and regulations could adversely affect our operating results and business .
Our inability to protect our proprietary information and enforce our intellectual property rights through infringement proceedings could have a material adverse effect on our business, financial condition, and results of operations. ​ ​ ​ 22 ​ We are also subject to claims that we may be infringing certain patent or other intellectual property rights of third parties.
Our inability to protect our proprietary information and enforce our intellectual property rights through infringement proceedings could have a material adverse effect on our business, financial condition, and results of operations. ​ We are also subject to claims that we may be infringing certain patent or other intellectual property rights of third parties.
We will continue to monitor and assess the impact of these state laws, which may impose substantial penalties for violations, impose significant costs for investigations and compliance, allow private class-action litigation, and carry significant potential liability for our business. ​ Outside of the U.S., data protection laws, including the U.K. and E.U.
We will continue to monitor and assess the impact of these state laws, which may impose substantial penalties for violations, impose significant costs for investigations and compliance, allow private class-action litigation, and carry significant potential liability for our business. ​ 25 ​ Outside of the U.S., data protection laws, including the U.K. and E.U.
In addition, the cost and operational consequences of implementing further data protection or data restoration measures could be significant. ​ Public health emergencies or outbreaks of epidemics, pandemics, or contagious diseases have disrupted, and could continue to disrupt, our operations and materially and adversely affect our business, financial condition, and results of operations.
In addition, the cost and operational consequences of implementing further data protection or data restoration measures could be significant. ​ ​ 26 ​ Public health emergencies or outbreaks of epidemics, pandemics, or contagious diseases have disrupted, and could continue to disrupt, our operations and materially and adversely affect our business, financial condition, and results of operations.
The loss of senior management or other key personnel may adversely affect our operating results as we incur costs to replace the departed personnel and potentially lose opportunities in the transition of important job functions. ​ 23 ​ Acquisitions could disrupt our operations and harm our operating results.
The loss of senior management or other key personnel may adversely affect our operating results as we incur costs to replace the departed personnel and potentially lose opportunities in the transition of important job functions. ​ Acquisitions could disrupt our operations and harm our operating results.
We also earn a significant amount of our operating income from outside the U.S., and any repatriation of funds representing earnings of foreign subsidiaries may significantly impact our effective tax rates. ​ We are subject to taxes in the U.S. and numerous foreign jurisdictions.
We also earn a significant amount of our operating income from outside the U.S., and any repatriation of funds representing earnings of foreign subsidiaries may significantly impact our effective tax rates. 28 ​ We are subject to taxes in the U.S. and numerous foreign jurisdictions.
A change in a statutory tax rate may result in the revaluation of our deferred tax assets and liabilities related to the relevant jurisdiction in which the new tax law is enacted, potentially resulting in a material expense or benefit recorded in our Consolidated Statements of Income for that period. ​ 27 ​ Changes in the tax laws of the jurisdictions where we do business, including an increase in tax rates or an adverse change in the treatment of an item of income or expense, could result in a material increase in our tax expense.
A change in a statutory tax rate may result in the revaluation of our deferred tax assets and liabilities related to the relevant jurisdiction in which the new tax law is enacted, potentially resulting in a material expense or benefit recorded in our Consolidated Statements of Operations for that period. ​ Changes in the tax laws of the jurisdictions where we do business, including an increase in tax rates or an adverse change in the treatment of an item of income or expense, could result in a material increase in our tax expense.
During fiscal year 2024, approximately 61% of our revenues were derived from sales to customers located outside of the Americas. In addition, our main manufacturing facilities are located outside of the U.S.
During fiscal year 2025, approximately 62% of our revenues were derived from sales to customers located outside of the Americas. In addition, our main manufacturing facilities are located outside of the U.S.
Our sales to customers located outside of the Americas, which generated approximately 61% of our revenues in fiscal year 2024, are invoiced and received in several foreign currencies, primarily the Euro, Pound Sterling and Chinese Yuan.
Our sales to customers located outside of the Americas, which generated approximately 62% of our revenues in fiscal year 2025, are invoiced and received in several foreign currencies, primarily the Euro, Pound Sterling, Chinese Yuan and Indian Rupee.
Other state laws include the California Consumer Privacy Act (“CCPA”), which gives California residents certain privacy rights in the collection and disclosure of their personal information and requires businesses to make certain disclosures and take certain other acts in furtherance of those rights.
Other state laws include the California Consumer Privacy Act (“CCPA”), which gives California residents certain privacy rights in the collection and disclosure of their personal information and requires businesses to make certain disclosures and take certain other acts in furtherance of those rights. Additionally, the California Privacy Rights Act (the “CPRA”) revised and significantly expanded the scope of the CCPA.
As global economic conditions experience stress and negative volatility, or if there is an escalation in regional or global conflicts, or terrorism, we will likely experience reductions in the number of available customers and in capital expenditures by our remaining customers, longer sales cycles, deferral, or delay of purchase commitments for our products and increased price competition, any of which may adversely affect our business, results of operations and liquidity. ​ Our international operations pose additional risks that may adversely impact sales and earnings.
As global economic conditions experience stress and negative volatility, or if there is an escalation in regional or global conflicts, or terrorism, we will likely experience reductions in the number of available customers and in capital expenditures by our remaining customers, longer sales cycles, deferral, or delay of purchase commitments for our products and increased price competition, any of which may adversely affect our business, results of operations and liquidity. ​ Changes in U.S. trade policy, including the imposition of tariffs and the resulting consequences, may have a material adverse impact on our business, financial condition, and results of operations.
We also depend on our 35% owned affiliate, HAL, and other key third-party suppliers to produce our computer control systems and key components, such as motors and drives, for our machine tools.
We depend on our wholly owned subsidiaries, HML and LCM, to produce our machine tools and electro-mechanical components and accessories in Taiwan, the U.S., and Italy, respectively. We also depend on our 35% owned affiliate, HAL, and other key third-party suppliers to produce our computer control systems and key components, such as motors and drives, for our machine tools.
Additionally, effective starting January 1, 2023, the California Privacy Rights Act (the “CPRA”) revised and significantly expanded the scope of the CCPA. The CPRA also created a new California data protection agency authorized to implement and enforce the CCPA and the CPRA, which could result in increased privacy and information security regulatory actions.
The CPRA also created a new California data protection agency authorized to implement and enforce the CCPA and the CPRA, which could result in increased privacy and information security regulatory actions. Other states have considered and/or enacted similar privacy laws.
In addition, fluctuations in demand and other implications associated with a global health crisis, such as COVID-19, have resulted in, and could continue resulting in, certain supply chain constraints and challenges. ​ Financial, Credit, and Liquidity Risks ​ Due to future changes in technology, changes in market demand, or changes in market expectations, portions of our inventory may become obsolete or excessive.
In addition, fluctuations in demand and other implications associated with a global health crisis, such as COVID-19, have resulted in, and could continue resulting in, certain supply chain constraints and challenges. ​ Financial, Credit, and Liquidity Risks ​ Our credit facility contains covenants that restrict our business and financing activities, and the property that secures our obligations under the credit facility may be subject to foreclosure in the event of a default.
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We depend on our wholly owned subsidiaries, HML, NHML, Milltronics, and LCM, to produce our machine tools and electro-mechanical components and accessories in Taiwan, China, the U.S., and Italy, respectively.
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The U.S. government has adopted new approaches to trade policy, and in some cases may renegotiate, or potentially terminate, certain existing bilateral or multi-lateral trade agreements. The U.S. government has also imposed tariffs on most foreign goods and has raised the possibility of imposing significant tariff increases or expanding the tariffs to capture other countries and types of goods.
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Other states have considered and/or enacted similar privacy laws.
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Tariffs on imports from nations from whom we procure products or materials and components used in our manufacturing process have increased our operating costs and, in the future, could require us to incur significant costs to transition to alternative manufacturers or suppliers.
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Future tariff increases, expanding the tariffs to cover other countries or other changes in U.S. trade policy could exacerbate these challenges. ​ In addition, in response to these tariffs, other countries have threatened, announced or implemented retaliatory tariffs on U.S. goods.
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Political tensions and uncertainty as a result of trade policies and ongoing judicial challenges to such policies could reduce trade volume, investment, technological exchange, and other economic activities between major international economies, resulting in a material adverse effect on global economic conditions and the stability of global financial markets, which could in turn have a material adverse impact on our business, financial condition and results of operations. ​ Our international operations pose additional risks that may adversely impact sales and earnings.
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The credit agreement we entered into with Bank of America, N.A., as the lender, in January 2026 (the “2026 Credit Agreement”) contains a number of customary restrictions and covenants, which, among other things and subject to certain expressly permitted transactions or parameters set forth therein, restrict our ability to acquire or merge with another entity, dispose of our assets, make investments, loans or guarantees, incur additional indebtedness, create liens or other encumbrances, or pay dividends or make other distributions beyond stated thresholds.
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The 2026 Credit Agreement requires us to maintain compliance with a maximum consolidated leverage ratio of total debt to EBITDA, which also effectively prohibits us from borrowing any amounts under the 2026 Credit Agreement when our consolidated EBITDA for the most recently completed measurement period is negative.
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As of the date we entered into the 2026 Credit Agreement, and as of the date of the filing of this report, the most recently completed measurement period was our fiscal year ended October 31, 2025, during which our consolidated EBITDA was negative, thereby effectively prohibiting us from currently borrowing under the 2026 Credit Agreement.
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There can be no assurance that our consolidated EBITDA will be positive, or sufficiently positive, in future periods, and therefore we may be unable to borrow any amounts under the 2026 Credit Agreement. ​ 27 ​ Our ability to comply with the provisions under the 2026 Credit Agreement may be affected by events beyond our control and our inability to comply with any of these provisions could result in a default under the 2026 Credit Agreement.
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If such a default occurs, the lender may elect to declare any borrowings outstanding, together with accrued interest and other fees, to be immediately due and payable, and it would have the right to terminate any commitments it has to provide further borrowings.
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If we are unable to repay any outstanding borrowings when due, the lender under the 2026 Credit Agreement also has the right to proceed against the collateral, including a significant portion of our domestic personal property, granted to it to secure the indebtedness under the facility.
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If any indebtedness under the 2026 Credit Agreement were to be accelerated, we cannot assure you that our personal property would be sufficient to repay in full that indebtedness.
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The occurrence of any of these events could have a material adverse effect on our business, financial condition, results of operations and liquidity. ​ Due to future changes in technology, changes in market demand, or changes in market expectations, portions of our inventory may become obsolete or excessive.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Further, we work with third party experts and leverage external resources to evaluate known vulnerabilities in existing systems and provide remediation steps, as appropriate, and/or otherwise further protect the organization from cyber risk or threats, in each case including cybersecurity threats associated with our use of any third-party service provider. ​ Based upon results of the foregoing, we deploy a wide variety of technical safeguards that are designed to protect our information systems from cybersecurity threats, including advanced endpoint detection and response, next-generation firewalls with intrusion detection systems, access and credential controls, and multifactor authentication.
Further, we work with third party experts and leverage external resources to evaluate known vulnerabilities in existing systems and provide remediation steps, as appropriate, and/or otherwise further protect the organization from cyber risk or threats, in each case including cybersecurity threats associated with our use of any third-party service provider. ​ 29 ​ Based upon results of the foregoing, we deploy a wide variety of technical safeguards that are designed to protect our information systems from cybersecurity threats, including advanced endpoint detection and response, next-generation firewalls with intrusion detection systems, access and credential controls, and multifactor authentication.
This plan provides a framework for identifying, controlling, and mitigating the attack while reducing the recovery time and keeping the executive management team and Audit Committee of our Board of Directors informed. ​ 28 ​ Notably, our cybersecurity strategy and incident response plan intentionally prioritize frequent and automated backup and recovery processes in an attempt to minimize the potential for critical data loss and/or business interruption.
This plan provides a framework for identifying, controlling, and mitigating the attack while reducing the recovery time and keeping the executive management team and Audit Committee of our Board of Directors informed. ​ Notably, our cybersecurity strategy and incident response plan intentionally prioritize frequent and automated backup and recovery processes in an attempt to minimize the potential for critical data loss and/or business interruption.
These periodic reports include detailed updates on our activities preparing for, preventing, detecting, responding to, and recovering from cyber incidents, if applicable. ​ Senior management with primary oversight responsibility for day-to-day cybersecurity risk management includes our Chief Executive Officer, Chief Financial Officer, Director of Information Technology, General Counsel, Corporate Controller, and Chief Accounting Officer.
These periodic reports include updates on our activities preparing for, preventing, detecting, responding to, and recovering from cyber incidents, if applicable. ​ Senior management with primary oversight responsibility for day-to-day cybersecurity risk management includes our Chief Executive Officer, Chief Financial Officer, Director of Information Technology, General Counsel, Corporate Controller, and Chief Accounting Officer.
The group’s collective education and experience informs our cybersecurity risk assessment and management process and includes, among others, the following: higher education degrees (including master’s level or equivalent) in computer science and/or technology; decades of experience in the information technology and computer science field; experience configuring and maintaining firewalls, VPNs, and endpoint security frameworks for sophisticated, multinational organizations; proficiency in programming languages; certifications as developers and network engineers; and responsibility for managing large-scale international implementations of enterprise resource planning software systems for global companies. ​ ​ 29 ​
The group’s collective education and experience informs our cybersecurity risk assessment and management process and includes, among others, the following: higher education degrees (including master’s level or equivalent) in computer science and/or technology; decades of experience in the information technology and computer science field; experience configuring and maintaining firewalls, VPNs, and endpoint security frameworks for sophisticated, multinational organizations; proficiency in programming languages; certifications as developers and network engineers; and responsibility for managing large-scale international implementations of enterprise resource planning software systems for global companies. ​ ​ 30 ​
More specifically, the information technology department regularly informs executive management, including the Chief Executive Officer, Chief Financial Officer and General Counsel, on all aspects pertaining to cybersecurity risks and incidents; and the Audit Committee receives periodic reports from executive management, senior information technology leadership, and risk management personnel on our cybersecurity and information security risks and postures on a regular basis.
More specifically, the information technology department regularly informs executive management, including the Chief Executive Officer, Chief Financial Officer and General Counsel, on all aspects pertaining to cybersecurity risks and incidents; and the Audit Committee receives periodic reports from executive management, senior information technology leadership, and risk management personnel on our cybersecurity and information security risks and postures.

Item 2. Properties

Properties — owned and leased real estate

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The leases have terms expiring at various dates ranging from January 2025 to July 2032. We believe that all of our facilities are well maintained and are adequate for our needs now and in the foreseeable future.
The leases have terms expiring at various dates ranging from January 2026 to July 2032. We believe that all of our facilities are well maintained and are adequate for our needs now and in the foreseeable future.
We do not believe that we would experience significant difficulty in replacing any of the currently leased facilities if any of our leases were not renewed at expiration. ​ 30 ​
We do not believe that we would experience significant difficulty in replacing any of the currently leased facilities if any of our leases were not renewed at expiration. ​ 31 ​
PROPERTIES ​ The following table sets forth the principal use, location, and size of each of our facilities: ​ ​ ​ ​ ​ ​ Principal Uses ​ Locations ​ Square Footage Corporate headquarters, design and engineering, product testing, sales and marketing, application engineering, customer service, manufacturing and assembly Indianapolis, Indiana, U.S. 165,000 ​ Manufacturing, assembly, sales, application engineering and customer service Taichung, Taiwan 485,100 ​ Castell’Alfero, Italy 32,300 ​ Sales, application engineering, customer service, and warehousing High Wycombe, England 26,300 ​ Paris, France 12,800 ​ Munich and Verl, Germany 20,900 ​ Milan, Italy 13,800 ​ Venlo, the Netherlands 9,700 ​ Toh Guan, Singapore 9,600 ​ Shanghai, Dongguan and Kunshan, China 8,200 ​ Chennai and Pune, India 14,800 ​ Liegnitz, Poland 1,000 ​ ​ Indianapolis, Indiana, U.S. 19,200 ​ Grand Rapids, Michigan, U.S. 3,700 ​ Los Angeles, California, U.S. 11,400 ​ Stritez, the Czech Republic ​ 5,500 ​ We own the Indianapolis corporate headquarters facility and lease all other facilities.
PROPERTIES ​ The following table sets forth the principal use, location, and size of each of our facilities: ​ ​ ​ ​ ​ ​ Principal Uses ​ Locations ​ Square Footage Corporate headquarters, design and engineering, product testing, sales and marketing, application engineering, customer service, manufacturing and assembly ​ ​ ​ Indianapolis, Indiana, U.S. ​ ​ ​ 165,000 ​ ​ ​ Manufacturing, assembly, sales, application engineering and customer service Taichung, Taiwan 370,100 ​ Castell’Alfero, Italy 32,300 ​ ​ ​ Sales, application engineering, customer service, and warehousing High Wycombe, England 26,300 ​ Paris, France 12,800 ​ Munich and Verl, Germany 20,200 ​ Milan, Italy 13,800 ​ Venlo, the Netherlands 9,700 ​ Toh Guan, Singapore 8,400 ​ Shanghai, Dongguan and Kunshan, China 9,200 ​ Chennai and Pune, India 14,700 ​ Liegnitz, Poland 1,000 ​ Kentwood, Michigan, U.S. 6,000 ​ Los Angeles, California, U.S. 11,400 ​ Indianapolis, Indiana, U.S. ​ ​ ​ 19,200 ​ We own the Indianapolis corporate headquarters facility and lease all other facilities.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Volovic was employed by Unisys Corporation. ​ 31 ​ Sonja K. McClelland has been employed by us since September 1996 and was appointed as Vice President, Treasurer and Chief Financial Officer in 2014, then as Executive Vice President in March 2017. She also served as our Corporate Secretary from 2014 until March 2021. Ms.
Volovic was employed by Unisys Corporation. ​ 32 ​ Sonja K. McClelland has been employed by us since September 1996 and was appointed as Vice President, Treasurer and Chief Financial Officer in 2014, then as Executive Vice President in March 2017. She also served as our Corporate Secretary from 2014 until March 2021. Ms.
Wright ​ 42 ​ General Counsel and Corporate Secretary ​ Michael Doar has been employed by us since November 2001 and has been a member of our Board of Directors since 2000. Mr.
Wright ​ 43 ​ General Counsel and Corporate Secretary ​ Michael Doar has been employed by us since November 2001 and has been a member of our Board of Directors since 2000. Mr.
Prior to becoming President in 2013, Mr. Volovic held various positions within our company including Vice President Software & Controls, Executive Vice President Engineering & Technology, and Executive Vice President Engineering & Manufacturing Operations. Prior to joining us, Mr. Volovic held various positions with Thomson, Inc. including Director of E-Business, Engineering, and Information Technology. Prior to Thomson, Mr.
Volovic held various positions within our company including Vice President Software & Controls, Executive Vice President Engineering & Technology, and Executive Vice President Engineering & Manufacturing Operations. Prior to joining us, Mr. Volovic held various positions with Thomson, Inc. including Director of E-Business, Engineering, and Information Technology. Prior to Thomson, Mr.
The following information sets forth as of October 31, 2024, the name of each executive officer and his or her age, tenure as an officer, principal occupation, and business experience: ​ ​ ​ ​ ​ Name Age Position(s) with the Company Michael Doar ​ 69 ​ Executive Chairman of the Board Gregory S.
The following information sets forth as of October 31, 2025, the name of each executive officer and his or her age, tenure as an officer, principal occupation, and business experience: ​ ​ ​ ​ ​ Name ​ ​ ​ Age ​ ​ ​ Position(s) with the Company Michael Doar ​ 70 ​ Executive Chairman of the Board Gregory S.
Volovic ​ 60 ​ Director, President, and Chief Executive Officer Sonja K. McClelland ​ 53 ​ Executive Vice President, Treasurer and Chief Financial Officer HaiQuynh Jamison ​ 46 ​ Corporate Controller and Principal Accounting Officer Jonathon D.
Volovic ​ 61 ​ Director, President, and Chief Executive Officer Sonja K. McClelland ​ 54 ​ Executive Vice President, Treasurer and Chief Financial Officer HaiQuynh Jamison ​ 47 ​ Corporate Controller and Principal Accounting Officer Jonathon D.
Volovic has been employed by us since March 2005 and has been a member of our Board of Directors since March 2019. Mr. Volovic was appointed as our President in March 2013, and he served as our Chief Operating Officer from March 2019 until he was appointed as our Chief Executive Officer in March 2021.
Volovic was appointed as our President in March 2013, and he served as our Chief Operating Officer from March 2019 until he was appointed as our Chief Executive Officer in March 2021. Prior to becoming President in 2013, Mr.
Doar was appointed as Executive Chairman of the Board in March 2021 and previously served as our Chairman of the Board and Chief Executive Officer from November 2001 to March 2021. Mr. Doar held various management positions with Ingersoll Milling Machine Company from 1989 until 2001. Gregory S.
Doar was appointed as Executive Chairman of the Board in March 2021 and previously served as our Chairman of the Board and Chief Executive Officer from November 2001 to March 2021. Mr. Doar has announced his intention to retire from his position as Executive Chairman of the Board, effective on the date of the Company’s 2026 Annual Meeting of Shareholders.
Added
Mr. Doar held various management positions with Ingersoll Milling Machine Company from 1989 until 2001. Gregory S. Volovic has been employed by us since March 2005 and has been a member of our Board of Directors since March 2019. Mr.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Dividend Policy We began declaring cash dividends on our common stock in the third quarter of fiscal year 2013, and continued to do so on a quarterly basis subsequently until the third quarter of fiscal year 2024, when we announced a temporary suspension of our regular quarterly cash dividend as we seek to enhance our financial flexibility and improve our ability to manage market volatility while focusing on strengthening our balance sheet, reinvesting in our core business and research and development related to emerging technologies, and returning value to shareholders via the appropriate channels in both the near- and long-term.
Dividend Policy We began declaring cash dividends on our common stock in the third quarter of fiscal year 2013, and continued to do so on a quarterly basis subsequently until the third quarter of fiscal year 2024, when we announced a suspension of our regular quarterly cash dividend as we seek to enhance our financial flexibility and improve our ability to manage market volatility while focusing on strengthening our balance sheet, reinvesting in our core business and research and development related to emerging technologies, and returning value to shareholders via the appropriate channels in both the near- and long-term.
Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our common stock is traded on the Nasdaq Global Select Market under the symbol “HURC”. Holders There were 119 holders of record of our common stock as of December 11, 2024.
Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our common stock is traded on the Nasdaq Global Select Market under the symbol “HURC”. Holders There were 122 holders of record of our common stock as of December 13, 2025.
The disclosure under the caption “Equity Compensation Plan Information at 2024 Fiscal Year End” in our 2025 proxy statement is incorporated by reference in Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. The performance graph information is included in Item 9B. Other Information. ​ ​
We did not repurchase any shares of our common stock during the final three months ended October 31, 2025. The disclosure under the caption “Equity Compensation Plan Information at 2025 Fiscal Year End” in our 2026 proxy statement is incorporated by reference in Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
Removed
Management’s Discussion and Analysis of Financial Condition and Results of Operations and in Note 4 of Notes to Consolidated Financial Statements. 32 ​ Stock Repurchases On January 6, 2023, we announced a share repurchase program in an aggregate amount of up to $25.0 million.
Added
Management’s Discussion and Analysis of Financial Condition and Results of Operations and in Note 4 of Notes to Consolidated Financial Statements. 33 ​ Other Information During the period covered by this report, we did not sell any equity securities that were not registered under the Securities Act of 1933, as amended.
Removed
Repurchases under the program may be made in the open market or through privately negotiated transactions from time to time, subject to applicable laws, regulations, and contractual provisions. On September 25, 2024, we announced an extension of the term of this repurchase program from November 10, 2024 to November 10, 2026.
Added
The performance graph information is included in Item 9B. Other Information. ​ ​
Removed
The program may be amended, suspended, or discontinued at any time and does not commit us to repurchase any shares of our common stock.
Removed
The following table summarizes the repurchases of common stock made by us during the three months ended October 31, 2024, based on the trade date of the repurchase: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Approximate ​ ​ ​ ​ ​ ​ ​ Total Number of ​ ​ Dollar Value of ​ ​ ​ ​ ​ ​ ​ Shares ​ ​ Shares that ​ ​ ​ ​ ​ ​ ​ Purchased as ​ ​ May Yet Be ​ ​ ​ ​ ​ ​ ​ Part of Publicly ​ ​ Purchased ​ ​ Total Number ​ ​ Average Price ​ Announced ​ ​ Under Plans or ​ ​ of Shares ​ ​ Paid per ​ Plans or ​ ​ Programs ​ Purchased ​ Share Programs ​ ($ in thousands) August 2024 ​ 44,352 ​ $ 16.92 (1) ​ 44,352 ​ $ 21,933 September 2024 ​ 13,870 ​ $ 17.64 (1) ​ 13,870 ​ $ 21,688 October 2024 ​ - ​ $ - ​ - ​ $ 21,688 Total ​ 58,222 ​ ​ ​ ​ 58,222 ​ ​ ​ ​ (1) Reflects the average weighted price of the shares repurchased as part of the publicly announced programs and includes commissions paid related to our repurchase of shares of common stock. ​ Other Information During the period covered by this report, we did not sell any equity securities that were not registered under the Securities Act of 1933, as amended.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Components to support our SRT line of five-axis machining centers, such as the direct-drive spindle, swivel head, and rotary table, are manufactured by our wholly-owned subsidiary in Italy, LCM. ​ Our sales to foreign customers are denominated, and payments by those customers are made, in the prevailing currencies in the countries in which those customers are located (primarily the Euro, Pound Sterling, and Chinese Yuan).
Components to support our SRT line of five-axis machining centers, such as the direct-drive spindle, swivel head, and rotary table, are manufactured by our wholly-owned subsidiary in Italy, LCM. ​ 35 ​ Our sales to foreign customers are denominated, and payments by those customers are made, in the prevailing currencies in the countries in which those customers are located (primarily the Euro, Pound Sterling, and Chinese Yuan).
This overview is intended to be read in conjunction with the more detailed information included in our financial statements, and notes thereto, that appear elsewhere in this report. ​ The market for machine tools is international in scope. We have both significant foreign sales and significant foreign manufacturing operations.
This overview is intended to be read in conjunction with the more detailed information included in our financial statements, and notes thereto, that appear elsewhere in this report. ​ 34 ​ The market for machine tools is international in scope. We have both significant foreign sales and significant foreign manufacturing operations.
The MD&A is provided as a supplement to, and should be read in conjunction with, our consolidated financial statements and the notes thereto included elsewhere in this report. The following MD&A generally focuses on the operating results and year-over-year comparisons between fiscal years 2024 and 2023.
The MD&A is provided as a supplement to, and should be read in conjunction with, our consolidated financial statements and the notes thereto included elsewhere in this report. The following MD&A generally focuses on the operating results and year-over-year comparisons between fiscal years 2025 and 2024.
Therefore, we consider an understanding of the variability and judgment required in making these estimates and assumptions to be critical in fully understanding and evaluating our reported financial results. ​ 42 ​ Income Taxes – We account for income taxes and the related accounts under the asset and liability method.
Therefore, we consider an understanding of the variability and judgment required in making these estimates and assumptions to be critical in fully understanding and evaluating our reported financial results. ​ 43 ​ Income Taxes – We account for income taxes and the related accounts under the asset and liability method.
In February and December 2023, NHML and HML, respectively, renewed the above-referenced credit facilities on substantially similar terms and identical maximum aggregate limits. ​ As of October 31, 2024, our existing credit facilities consisted of a €1.5 million revolving credit facility in Germany, the 150 million New Taiwan dollars Taiwan credit facility, the 32.5 million Chinese Yuan China credit facility and the $40.0 million revolving credit facility under the 2018 Credit Agreement.
In February and December 2023, NHML and HML, respectively, renewed the above-referenced credit facilities on substantially similar terms and identical maximum aggregate limits. ​ 40 ​ As of October 31, 2025, our credit facilities consisted of a €1.5 million revolving credit facility in Germany, the 150 million New Taiwan Dollars Taiwan credit facility, the 32.5 million Chinese Yuan China credit facility and the $40.0 million revolving credit facility under the 2018 Credit Agreement.
Discussion of fiscal year 2023 results and year-over-year comparisons between fiscal years 2023 and 2022 that are not included in this Annual Report on Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended October 31, 2023, filed with the SEC on January 5, 2024.
Discussion of fiscal year 2024 results and year-over-year comparisons between fiscal years 2024 and 2023 that are not included in this Annual Report on Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended October 31, 2024, filed with the SEC on January 10, 2025.
We believe that our long history of profitability and the strength of our balance sheet can provide us with stability to manage through these business cycles and we rely on our past experience in making measured decisions for the long-term success of our business. 34 ​ We have three brands of CNC machine tools in our product portfolio.
We believe that our long history of profitability and the strength of our balance sheet can provide us with stability to manage through these business cycles and we rely on our past experience in making measured decisions for the long-term success of our business. ​ We have three CNC machine tool brands in our product portfolio.
During fiscal year 2024, approximately 51% of our revenues were attributable to customers in Europe, where we typically sell more of our higher-performance, higher-priced VMX series machines.
During fiscal year 2025, approximately 51% of our revenues were attributable to customers in Europe, where we typically sell more of our higher-performance, higher-priced VMX series machines.
Additionally, approximately 10% of our revenues were attributable to customers in the Asia Pacific region, where we encounter greater pricing pressures. ​ During a time of global uncertainty and lower sales volumes, we have turned our attention to adjusting overhead expenses and operating expenses to help minimize the impact of the lower volumes of sales on operating income.
Additionally, approximately 11% of our revenues were attributable to customers in the Asia Pacific region, where we encounter greater pricing pressures. ​ During a time of global uncertainty and lower sales volumes experienced recently, we have turned our attention to adjusting overhead expenses and operating expenses to help minimize the impact of the lower volumes of sales on operating income.
The 2018 Credit Agreement provides for an unsecured revolving credit and letter of credit facility in a maximum aggregate amount of $40.0 million.
The 2018 Credit Agreement provided for an unsecured revolving credit and letter of credit facility in a maximum aggregate amount of $40.0 million.
As uncommitted facilities, both the Taiwan and China credit facilities are subject to review and termination by the respective underlying lending institution from time to time.
As uncommitted facilities, both the Taiwan and China credit facilities were subject to review and termination by the respective underlying lending institution from time to time.
The scheduled maturity date of the 2018 Credit Agreement is December 31, 2025. ​ Borrowings under the 2018 Credit Agreement bear interest at floating rates based on, at our option, either (i) a rate based upon the secured overnight financing rate (“SOFR”), the Sterling Overnight Index Average Reference Rate, the Euro Interbank Offering Rate, or another alternative currency-based rate approved by the lender, depending on the term of the loan and the currency in which such loan is denominated, plus 1.00% per annum, or (ii) a base rate (which is the highest of (a) the federal funds rate plus 0.50%, (b) the prime rate or (c) the one month SOFR-based rate plus 1.00%), plus 0.00% per annum.
The scheduled maturity date of the 2026 Credit Agreement is December 31, 2026. ​ Borrowings under the 2026 Credit Agreement bear interest at floating rates based on, at our option, either (i) a rate based upon the SOFR, the Sterling Overnight Index Average Reference Rate, the Euro Interbank Offering Rate, or another alternative currency-based rate approved by the lender, depending on the term of the loan and the currency in which such loan is denominated, plus 2.50% per annum, or (ii) a base rate (which is the highest of (a) the federal funds rate plus 0.50%, (b) the prime rate or (c) the one month SOFR-based rate plus 1.00%), plus 1.50% per annum.
The 2018 Credit Agreement provides that the maximum amount of outstanding letters of credit at any one time may not exceed $10.0 million, the maximum amount of outstanding loans made to our subsidiary Hurco B.V. at any one time may not exceed $20.0 million, and the maximum amount of all outstanding loans denominated in alternative currencies at any one time may not exceed $20.0 million.
The 2018 Credit Agreement provided that the maximum amount of outstanding letters of credit at any one time could not exceed $10.0 million, the maximum amount of outstanding loans made to our subsidiary Hurco B.V. at any one time could not exceed $20.0 million, and the maximum amount of all outstanding loans denominated in alternative currencies at any one time could not exceed $20.0 million.
We seek to mitigate those risks through the use of derivative instruments – principally foreign currency forward exchange contracts. ​ Results of Operations The following table presents, for the fiscal years indicated, selected items from the Consolidated Statements of Operations expressed as a percentage of our worldwide sales and service fees and the year-to-year percentage changes in the dollar amounts of those items. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 35 ​ ​ Percentage of Revenues Year-to-Year % Change ​ 2024 2023 2022 Increase/(Decrease) ​ ​ ​ ​ ​ ​ ​ ​ ’24 vs. ’23 ​ ’23 vs. ’22 Sales and service fees ​ 100 % 100 % 100 % (18) % (9) % Gross profit ​ 20 % 25 % 26 % (33) % (13) % Selling, general and administrative expenses ​ 25 % 22 % 21 % (7) % (4) % Operating (loss) income ​ (4) % 3 % 5 % (225) % (48) % Net (loss) income ​ (9) % 2 % 3 % (478) % (47) % ​ Fiscal Year 2024 Compared to Fiscal Year 2023 Sales and Service Fees.
We seek to mitigate those risks through the use of derivative instruments – principally foreign currency forward exchange contracts. ​ Results of Operations The following table presents, for the fiscal years indicated, selected items from the Consolidated Statements of Operations expressed as a percentage of our worldwide sales and service fees and the year-to-year percentage changes in the dollar amounts of those items. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Percentage of Revenues ​ ​ ​ Year-to-Year % Change ​ ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ 2023 ​ ​ ​ Increase/Decrease ​ ​ ​ ​ ​ ​ ​ ​ ’25 vs. ’24 ​ ’24 vs. ’23 Sales and service fees ​ 100 % 100 % 100 % (4) % (18) % Gross profit ​ 18 % 20 % 25 % (13) % (33) % Selling, general and administrative expenses ​ 24 % 25 % 22 % (6) % (7) % Operating income (loss) ​ (6) % (4) % 3 % 24 % (225) % Net income (loss) ​ (8) % (9) % 2 % (9) % (478) % ​ Fiscal Year 2025 Compared to Fiscal Year 2024 Sales and Service Fees.
We follow Financial Accounting Standards Board (“FASB”) guidance for accounting for guarantees (codified in Accounting Standards Codification (“ASC”) 460). As of October 31, 2024, we had nine outstanding third party payment guarantees totaling approximately $0.9 million. The terms of these guarantees are consistent with the underlying customer financing terms.
We follow Financial Accounting Standards Board (“FASB”) guidance for accounting for guarantees (codified in Accounting Standards Codification (“ASC”) 460). As of October 31, 2025, we had four outstanding third party payment guarantees totaling approximately $0.4 million. The terms of these guarantees are consistent with the underlying customer financing terms.
During fiscal year 2024, sales for all product categories included a favorable currency impact of less than 1%, when translating foreign sales to U.S. dollars for financial reporting purposes. ​ Orders and Backlog .
During fiscal year 2025, sales for all product categories included a favorable currency impact of 1%, when translating foreign sales to U.S. dollars for financial reporting purposes. 37 ​ Orders and Backlog .
Because we have a valuation allowance recorded against our U.S. deferred tax assets, we did not record a tax benefit for our U.S. net losses for fiscal year 2024. ​ Capitalized Software Development Costs – Costs incurred to develop computer software products and significant enhancements to software features of existing products are capitalized as required by FASB guidance relating to accounting for the costs of computer software to be sold, leased, or otherwise marketed, and such capitalized costs are amortized over the estimated product life of the related software.
Because we have a $13.2 million full valuation allowance recorded against our U.S., China and certain Italian deferred tax assets, we did not record a tax benefit for our net losses in these countries in either fiscal year 2025 or 2024. ​ Capitalized Software Development Costs – Costs incurred to develop computer software products and significant enhancements to software features of existing products are capitalized as required by FASB guidance relating to accounting for the costs of computer software to be sold, leased, or otherwise marketed, and such capitalized costs are amortized over the estimated product life of the related software.
Selling, general, and administrative expenses for fiscal year 2024 were $46.0 million, or 25% of sales, compared to $49.6 million, or 22% of sales, in fiscal year 2023, and included an unfavorable currency impact of $0.4 million, when translating foreign expenses to U.S. dollars for financial reporting purposes.
Selling, general, and administrative expenses for fiscal year 2025 were $43.2 million, or 24% of sales, compared to $46.0 million, or 25% of sales, in fiscal year 2024, and included an unfavorable currency impact of $0.4 million, when translating foreign expenses to U.S. dollars for financial reporting purposes.
Unrecognized tax benefits, excluding any interest and penalties, were immaterial for fiscal year 2024 and have been excluded from the table above because we are unable to determine a reasonably reliable estimate of the timing of future payment. ​ ​ ​ 41 ​ We expect capital spending in fiscal year 2025 to be approximately $4.1 million, which includes investments for software development, leasehold improvement, factory equipment, and production facilities, as well as general software and equipment for selling facilities.
Unrecognized tax benefits, excluding any interest and penalties, were immaterial for fiscal year 2025 and have been excluded from the table above because we are unable to determine a reasonably reliable estimate of the timing of future payment. 42 ​ We expect capital spending in fiscal year 2026 to be approximately $4.5 million, which includes investments for software development, leasehold improvement, factory equipment, and general software and equipment for our manufacturing and sales facilities.
We implemented cost reductions in the third quarter of fiscal year 2024, adjusted and managed inventories (excluding the impact of foreign currency) and temporary suspended our regular quarterly cash dividend .
We implemented cost reductions in fiscal years 2024 and 2025, adjusted and managed inventories (excluding the impact of foreign currency) and suspended our regular quarterly cash dividend .
These non-Hurco branded products are sold by our wholly-owned distributors and are comprised primarily of other general-purpose vertical milling centers and lathes, laser cutting machines, waterjet cutting machines, CNC grinders, compact horizontal machines, metal cutting saws, and CNC swiss lathes. ProCobots is our wholly-owned subsidiary that provides automation solutions.
These non-Hurco branded products are sold by our wholly-owned distributors and are comprised primarily of other general-purpose vertical milling centers and lathes, laser cutting machines, CNC grinders, compact horizontal machines, metal cutting saws, and CNC Swiss lathes. ProCobots is our wholly-owned subsidiary that provides automation solutions. In addition, through our wholly-owned subsidiary in Italy, LCM Precision Technologies S.r.l.
In addition, through our wholly-owned subsidiary in Italy, LCM, we produce high value machine tool components and accessories. ​ We principally sell our products through approximately 180 independent agents and distributors throughout the Americas, Europe, and Asia. Although some distributors carry competitive products, we are the primary line for the majority of our distributors globally.
(“LCM”), we produce high value machine tool components and accessories. ​ We principally sell our products through approximately 160 independent agents and distributors throughout the Americas, Europe, and Asia. Although some distributors carry competitive products, we are the primary line for the majority of our distributors globally.
The year-over-year decrease in European sales was primarily attributable to a decreased volume of shipments of Hurco and Takumi machines in Germany, Italy, and the United Kingdom, and of electro-mechanical components and accessories manufactured by LCM, partially offset by an increased volume of shipments of Hurco and Takumi machines in France and increased sales of ProCobots automation solutions. ​ Asian Pacific sales for fiscal year 2024 increased by 2%, compared to fiscal year 2023, and included an unfavorable currency impact of 1%, when translating foreign sales to U.S. dollars for financial reporting purposes.
The year-over-year decrease in European sales was primarily attributable to a decreased volume of shipments of Hurco 5-axis vertical machines and entry-level Hurco 3-axis machines in Germany and France, and of electro-mechanical components and accessories manufactured by LCM, partially offset by an increased volume of shipments of Hurco machines in the United Kingdom. ​ Asian Pacific sales for fiscal year 2025 decreased by 1%, compared to fiscal year 2024, and included an unfavorable currency impact of less than 1%, when translating foreign sales to U.S. dollars for financial reporting purposes.
Other expense, net for fiscal year 2024 increased by $1.5 million from fiscal year 2023, due mainly to an increase in foreign currency exchange losses. 38 ​ Provision for Income Taxes . Income tax expense for fiscal year 2024 was $6.8 million, compared to $2.4 million for fiscal year 2023.
Other Expense, Net. Other expense, net for fiscal year 2025 increased by $0.5 million from fiscal year 2024, due mainly to an increase in foreign currency exchange losses. Income Taxes . Income taxes expense for fiscal year 2025 was $2.9 million, compared to $6.8 million for fiscal year 2024.
The vast majority of our machine tools are manufactured and assembled to our specifications primarily by our wholly-owned subsidiary in Taiwan, HML. Machine castings to support HML’s production are manufactured at our wholly-owned subsidiary in Ningbo, China, NHML.
The vast majority of our machine tools are manufactured and assembled to our specifications primarily by our wholly-owned subsidiary in Taiwan, HML.
Service fees increased by 9% for fiscal year 2024, compared to fiscal year 2023, primarily due to increased service of Hurco machines in the United Kingdom, France and North America.
Service fees decreased by 2% for fiscal year 2025, compared to fiscal year 2024, primarily due to decreased service of Hurco machines in the United Kingdom, France and North America, partially offset by increased service of Hurco and Takumi machines in Germany.
The decrease in working capital was primarily driven by decreases in cash and cash equivalents, inventories, accounts receivable, net, and prepaid and other assets, as well as increases in customer deposits, partially offset by decreases in accounts payable and accrued payroll and employee benefits. ​ Inventories were $153.0 million as of October 31, 2024, compared to $158.0 million as of October 31, 2023, and included a favorable currency impact of $3.2 million, or 2%, when translating foreign inventories to U.S. dollars for financial reporting purposes.
The decrease in working capital was primarily driven by decreases in inventories and accounts receivable, net, as well as increases in accounts payable and derivative liabilities, partially offset by an increase in cash and cash equivalents. ​ 39 ​ Inventories were $142.9 million as of October 31, 2025, compared to $153.0 million as of October 31, 2024, and included a favorable currency impact of $4.2 million, or 3%, when translating foreign inventories to U.S. dollars for financial reporting purposes.
Repurchases under the program may be made in the open market or through privately negotiated transactions from time to time, subject to applicable laws, regulations, and contractual provisions. On September 25, 2024, we announced an extension of the term of this $25.0 million repurchase program from November 10, 2024 to November 10, 2026.
On January 6, 2023, we announced approval of a share repurchase program in an aggregate amount of up to $25.0 million and later extended this program through November 10, 2026. Repurchases under the program may be made in the open market or through privately negotiated transactions from time to time, subject to applicable laws, regulations and contractual provisions.
Inventory turns as of October 31, 2024 were 1.0 compared to 1.1 as of October 31, 2023. Capital expenditures were $2.9 million in fiscal year 2024, compared to $2.6 million in fiscal year 2023.
Inventory turns as of October 31, 2025, remained the same at October 31, 2024 at 1.0. Capital expenditures were $3.0 million in fiscal year 2025, compared to $2.9 million in fiscal year 2024.
Outstanding letters of credit will carry an annual rate of 1.00%. ​ The 2018 Credit Agreement contains customary affirmative and negative covenants and events of default, including covenants (1) restricting us from making certain investments, loans, advances and acquisitions (but permitting us to make investments in subsidiaries of up to $10.0 million); (2) restricting us from making certain payments, including (a) cash dividends, except that we may pay cash dividends as long as immediately before and after giving effect to such payment, the sum of the unused amount of the commitments under the 2018 Credit Agreement plus our cash on hand is not less than $10.0 million, and as long as we are not in default before and after giving effect to such dividend payments and (b) payments made to repurchase shares of our common stock, except that we may repurchase shares of our common stock as long as we are not in default before and after giving effect to such repurchases and the aggregate amount of payments made by us for all such repurchases during any fiscal year does not exceed $25.0 million; (3) requiring that we maintain a minimum working capital of $125.0 million; and (4) requiring that we maintain a minimum tangible net worth of $176.5 million.
Outstanding letters of credit will carry an annual rate of 2.50%. ​ The 2026 Credit Agreement contains customary affirmative and negative covenants and events of default, including covenants (1) restricting us from making certain investments, loans, advances and acquisitions (but permitting us to make investments in subsidiaries of up to $10.0 million); (2) restricting us from making certain payments, including (a) cash dividends, except that we may pay cash dividends as long as immediately before and after giving effect to such payment, the sum of the unused amount of the commitments under the 2026 Credit Agreement plus our cash on hand is not less than $10.0 million, we are in pro forma compliance with the maximum consolidated leverage ratio covenant as described below, and we are not in default before and after giving effect to such dividend payments and (b) payments made to repurchase shares of our common stock, except that we may repurchase shares of our common stock as long as we are not in default before and after giving effect to such repurchases and the aggregate amount of payments made by us for all such repurchases during any fiscal year does not exceed $10.0 million; and (3) requiring that we maintain a maximum consolidated leverage ratio of total debt to EBITDA no greater than 2.00 to 1.00, with EBITDA defined as the greater of (i) consolidated EBITDA for the most recently completed measurement period and (ii) $1.00.
Orders for fiscal year 2024 were $198.3 million, a decrease of $11.4 million, or 5%, compared to fiscal year 2023, and included a favorable currency impact of $1.9 million, or less than 1%, when translating foreign orders to U.S. dollars.
Orders for fiscal year 2025 were $171.3 million, a decrease of $27.0 million, or 14%, compared to fiscal year 2024, and included a favorable currency impact of $1.8 million, or less than 1%, when translating foreign orders to U.S. dollars.
The year-over-year decrease in net income was primarily due to decreased volume of machine shipments, as well as the valuation allowance recorded against our U.S. and China deferred tax assets. ​ Liquidity and Capital Resources As of October 31, 2024, we had cash and cash equivalents of $33.3 million, compared to $41.8 million as of October 31, 2023.
The year-over-year decrease in net loss was primarily due to a lower valuation allowance recorded against our U.S. deferred tax assets. ​ Liquidity and Capital Resources As of October 31, 2025, we had cash and cash equivalents of $48.7 million, compared to $33.3 million as of October 31, 2024.
Working capital as of October 31, 2024 was $180.8 million, compared to $193.3 million as of October 31, 2023.
Working capital as of October 31, 2025, was $173.1 million, compared to $180.8 million as of October 31, 2024.
Sales of service parts for fiscal year 2024 decreased by 3%, compared to fiscal year 2023, due mainly to a decreased volume of aftermarket sales of Hurco and LCM parts in Europe and North America.
Sales of computer control systems and software for fiscal year 2025 decreased by 1%, compared to fiscal year 2024. Sales of service parts for fiscal year 2025 decreased by 9%, compared to fiscal year 2024, due mainly to a decreased volume of aftermarket sales of Hurco and Takumi parts in Europe and North America.
The decrease in orders was driven primarily by decreased customer demand for Hurco and Takumi machines in Germany, France, and Italy, as well as decreased demand for electro-mechanical components and accessories manufactured by LCM, partially offset by increased demand for Hurco higher-performance VMX machines in the United Kingdom and for ProCobots automation solutions sold across the European region. ​ Asian Pacific orders for fiscal year 2024 increased by 54%, compared to fiscal year 2023, and included an unfavorable currency impact of 2%, when translating foreign orders to U.S. dollars.
The year-over-year decrease in orders was driven primarily by decreased customer demand for Hurco and Takumi machines in the United Kingdom, Germany, and France, as well as decreased demand for electro-mechanical components and accessories manufactured by LCM. ​ Asian Pacific orders for fiscal year 2025 decreased by 6%, compared to fiscal year 2024, and included an unfavorable currency impact of less than 1% when translating foreign orders to U.S. dollars.
We believe our access to cash pooling and our borrowing capacity under our credit facilities provide adequate liquidity to fund our global operations over the next twelve months and beyond, and allow us to remain committed to our strategic plan of product innovation, acquisitions, targeted penetration of developing markets, and a balanced capital allocation program. ​ We continue to receive and review information on businesses and assets for potential acquisition, including intellectual property assets that are available for purchase. ​ Contractual Obligations and Commitments ​ The following is a table of contractual obligations and commitments as of October 31, 2024 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Payments Due by Period ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ More ​ ​ ​ ​ ​ ​ Less than ​ ​ ​ ​ ​ ​ ​ ​ than ​ Total 1 Year 1-3 Years 4-5 Years 5 Years Operating leases ​ $ 12,586 ​ $ 4,219 ​ $ 5,475 ​ $ 2,319 ​ $ 573 Accrued and deferred taxes and credits ​ 6,239 ​ 436 ​ 563 ​ ​ — ​ 5,240 Total ​ $ 18,825 ​ $ 4,655 ​ $ 6,038 ​ $ 2,319 ​ $ 5,813 ​ In addition to the contractual obligations and commitments disclosed above, we also have a variety of other obligations for the procurement of materials and services, none of which subject us to any material non-cancelable commitments.
While we are currently in the process of evaluating a longer-term global credit solution that aligns with our best interest, we believe our current cash on hand, expected cash flow from operations, access to cash pooling and our current credit facilities provide adequate liquidity to fund our global operations over the next twelve months and beyond, and allow us to remain committed to our strategic plan of product innovation, acquisitions, targeted penetration of developing markets, and a balanced capital allocation program. ​ We continue to receive and review information on businesses and assets for potential acquisition, including intellectual property assets that are available for purchase. ​ Contractual Obligations and Commitments ​ The following is a table of contractual obligations and commitments as of October 31, 2025 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Payments Due by Period ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ More ​ ​ ​ ​ ​ ​ Less than ​ ​ ​ ​ ​ ​ ​ ​ than ​ ​ ​ ​ Total ​ ​ ​ 1 Year ​ ​ ​ 1-3 Years ​ ​ ​ 3-5 Years ​ ​ ​ 5 Years Operating leases ​ $ 12,674 ​ $ 4,712 ​ $ 6,235 ​ $ 1,189 ​ $ 538 Accrued compensation benefits and other ​ 6,437 ​ 509 ​ 38 ​ ​ — ​ 5,890 Total ​ $ 19,111 ​ $ 5,221 ​ $ 6,273 ​ $ 1,189 ​ $ 6,428 ​ In addition to the contractual obligations and commitments disclosed above, we also have a variety of other obligations for the procurement of materials and services, none of which subject us to any material non-cancelable commitments.
Net loss for fiscal year 2024 was $16.6 million, or $(2.56) per diluted share, compared to net income of $4.4 million, or $0.66 per diluted share, for fiscal year 2023.
Net loss for fiscal year 2025 was $15.1 million, or $2.34 per diluted share, compared to a net loss of $16.6 million, or $2.56 per diluted share, for fiscal year 2024.
On June 14, 2024, we announced a temporary suspension of our regular quarterly cash dividend as we seek to enhance our financial flexibility and improve our ability to manage market volatility while focusing on strengthening our balance sheet, reinvesting in our core business and research and development related to emerging technologies, and returning value to shareholders via the appropriate channels in both the near- and long-term.
As of October 31, 2025, we had repurchased $5.3 million, or 259,620 common shares, under this program since inception, leaving $19.7 million available for future repurchases thereunder. ​ On June 14, 2024, we announced a suspension of our regular quarterly cash dividend as we seek to enhance our financial flexibility and improve our ability to manage market volatility while focusing on strengthening our balance sheet, reinvesting in our core business and research and development related to emerging technologies, and returning value to shareholders via the appropriate channels in both the near and long-term.
The year-over-year increase in Asian Pacific sales for the fiscal year was primarily attributable to increased shipments of Hurco and Takumi machines in India and to one customer with multiple machine orders in China, partially offset by decreased shipments of Hurco and Takumi machines in China and Southeast Asia. ​ 36 ​ Net Sales and Service Fees by Product Category ​ The following table sets forth net sales and service fees by product group and services for the fiscal years ended October 31, 2024 and 2023 (dollars in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal Year Ended October 31, ​ Increase/Decrease ​ ​ ​ 2024 2023 Amount % Computerized Machine Tools ​ $ 147,561 79 % $ 188,335 83 % $ (40,774) (22) % Computer Control Systems and Software † ​ 2,447 1 % 2,805 1 % (358) (13) % Service Parts ​ 27,628 15 % 28,439 12 % (811) (3) % Service Fees ​ 8,948 5 % 8,228 4 % 720 9 % Total ​ $ 186,584 100 % $ 227,807 100 % $ (41,223) (18) % † Amounts shown do not include computer control systems and software sold as an integrated component of computerized machine tools.
The decrease in Asian Pacific sales in fiscal year 2025 was primarily due to a decrease in sales of Hurco machines in India and China, partially offset by increased sales of Takumi machines in the Asian Pacific region. ​ Net Sales and Service Fees by Product Category ​ The following table sets forth net sales and service fees by product group and services for the fiscal years ended October 31, 2025 and 2024 (dollars in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal Year Ended October 31, ​ Increase/Decrease ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ Amount ​ ​ ​ % Computerized Machine Tools ​ $ 142,259 ​ ​ ​ 80 % $ 147,561 ​ ​ ​ 79 % $ (5,302) (4) % Computer Control Systems and Software † ​ 2,416 1 % 2,447 1 % (31) (1) % Service Parts ​ 25,095 14 % 27,628 15 % (2,533) (9) % Service Fees ​ 8,784 5 % 8,948 5 % (164) (2) % Total ​ $ 178,554 100 % $ 186,584 100 % $ (8,030) (4) % † Amounts shown do not include computer control systems and software sold as an integrated component of computerized machine tools.
Sales and service fees for fiscal year 2024 were $186.6 million, a decrease of $41.2 million, or 18%, compared to fiscal year 2023, and included a favorable currency impact of $1.8 million, or less than 1%, when translating foreign sales to U.S. dollars for financial reporting purposes. ​ Net Sales and Service Fees by Geographic Region ​ The following table sets forth net sales and service fees by geographic region for the fiscal years ended October 31, 2024 and 2023 (dollars in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal Year Ended October 31, ​ Increase/Decrease ​ ​ ​ 2024 2023 Amount % Americas ​ $ 72,317 39 % $ 88,329 39 % $ (16,012) (18) % Europe ​ 94,919 51 % 120,525 53 % (25,606) (21) % Asia Pacific ​ 19,348 10 % 18,953 8 % 395 2 % Total ​ $ 186,584 100 % $ 227,807 100 % $ (41,223) (18) % ​ Sales in the Americas for fiscal year 2024 decreased by 18%, compared to fiscal year 2023, primarily due to decreased shipments of Hurco and Takumi machines.
Sales and service fees for fiscal year 2025 were $178.6 million, a decrease of $8.0 million, or 4%, compared to fiscal year 2024, and included a favorable currency impact of $2.0 million, or 1%, when translating foreign sales to U.S. dollars for financial reporting purposes. ​ Net Sales and Service Fees by Geographic Region ​ The following table sets forth net sales and service fees by geographic region for the fiscal years ended October 31, 2025 and 2024 (dollars in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal Year Ended October 31, ​ Increase/Decrease ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ Amount ​ ​ ​ % Americas ​ $ 68,604 ​ ​ ​ 38 % $ 72,317 ​ ​ ​ 39 % $ (3,713) (5) % Europe ​ 90,863 51 % 94,919 51 % (4,056) (4) % Asia Pacific ​ 19,087 11 % 19,348 10 % (261) (1) % Total ​ $ 178,554 100 % $ 186,584 100 % $ (8,030) (4) % ​ 36 ​ Sales in the Americas for fiscal year 2025 decreased by 5%, compared to fiscal year 2024, primarily due to a change in mix of machine model shipments in the fourth quarter.
We may use the proceeds from advances under the 2018 Credit Agreement for general corporate purposes. ​ 40 ​ In March 2019, our wholly-owned subsidiaries in Taiwan, HML, and China, NHML, closed on uncommitted revolving credit facilities with maximum aggregate amounts of 150 million New Taiwan dollars and 32.5 million Chinese Yuan, respectively.
The scheduled maturity date of the 2018 Credit Agreement was December 31, 2025, and on that date, the 2018 Credit Agreement terminated in accordance with its terms. ​ In March 2019, our wholly-owned subsidiaries in Taiwan, HML, and China, NHML, closed on uncommitted revolving credit facilities with maximum aggregate amounts of 150 million New Taiwan Dollars and 32.5 million Chinese Yuan, respectively.
The decrease in orders was primarily due to decreased customer demand for Hurco 3-axis vertical machines, partially offset by increased demand for Hurco higher-performing 5-axis machines. ​ 37 ​ European orders for fiscal year 2024 decreased by 13%, compared to fiscal year 2023, and included a favorable currency impact of 2%, when translating foreign orders to U.S. dollars.
The decrease in orders was primarily due to a shift in customer demand from Hurco 5-axis vertical machines, Milltronics toolroom and 3-axis vertical machines, and non-Hurco branded machine tools sold by one of our wholly owned distributors to a higher volume of Hurco lathes and entry-level and higher-performance Hurco 3-axis vertical machines. ​ European orders for fiscal year 2025 decreased by 18%, compared to fiscal year 2024, and included a favorable currency impact of 2%, when translating foreign orders to U.S. dollars.
Capital expenditures for fiscal year 2024 were primarily for software development costs, purchases of factory equipment for production facilities, and purchases of general software and equipment for sales and service divisions. We funded these expenditures with cash flows from operations. On January 6, 2023, we announced a share repurchase program in an aggregate amount of up to $25.0 million.
Capital expenditures for fiscal year 2025 were primarily for software development costs, purchases of factory equipment for production facilities, building and leasehold improvements, and purchases of general software and equipment for sales and service divisions. We funded these expenditures with cash flows from operations.
The following table sets forth new orders booked by geographic region for the fiscal years ended October 31, 2024 and 2023 (dollars in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal Year Ended October 31, ​ Increase/Decrease ​ ​ ​ 2024 2023 Amount % Americas ​ $ 76,711 39 % $ 80,412 38 % $ (3,701) (5) % Europe ​ 99,633 50 % 114,961 55 % (15,328) (13) % Asia Pacific ​ 21,958 11 % 14,303 7 % 7,655 54 % Total ​ $ 198,302 100 % $ 209,676 100 % $ (11,374) (5) % ​ Orders in the Americas for fiscal year 2024 decreased by 5%, compared to fiscal year 2023.
The following table sets forth new orders booked by geographic region for the fiscal years ended October 31, 2025, and 2024 (dollars in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal Year Ended October 31, ​ Increase/Decrease ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ Amount ​ ​ ​ % Americas ​ $ 69,148 ​ ​ ​ 40 % $ 76,711 ​ ​ ​ 39 % $ (7,563) (10) % Europe ​ 81,569 48 % 99,633 50 % (18,064) (18) % Asia Pacific ​ 20,573 12 % 21,958 11 % (1,385) (6) % Total ​ $ 171,290 100 % $ 198,302 100 % $ (27,012) (14) % ​ Orders in the Americas for fiscal year 2025 decreased by 10%, compared to fiscal year 2024.
Because we have an $8.3 million valuation allowance recorded against our U.S. deferred tax assets, we did not record a tax benefit for our U.S. net losses for fiscal year 2024.
We have a $13.2 million full valuation allowance recorded against our U.S., Chinese and certain Italian deferred tax assets and we did not record a tax benefit for our net losses in these countries. ​ Net (Loss) Income.
Backlog orders as of October 31, 2024 are expected to be fulfilled in fiscal year 2025. ​ Gross Profit. Gross profit for fiscal year 2024 was $37.7 million, or 20% of sales, compared to $56.2 million, or 25% of sales, for fiscal year 2023.
Gross profit for fiscal year 2025 was $33.0 million, or 18% of sales, compared to $37.7 million, or 20% of sales, for fiscal year 2024.
The year-over-year reduction in selling, general, and administrative expenses was primarily due to cost reductions implemented in the third quarter of fiscal year 2024 to help offset the impact of lower sales volume, partially offset by increased tradeshow costs (for IMTS) in the fourth quarter of fiscal year 2024.
The year-over-year reduction in selling, general, and administrative expenses was primarily due to decreased tradeshow costs due to IMTS being in the fourth quarter of fiscal year 2024 and additional global cost reductions that we have implemented over the last twelve months during the continued recessed period of sales. Operating (Loss) Income.
The decrease in sales of these machines was mainly attributable to decreased shipments of Hurco and Takumi 3-axis vertical machines, partially offset by increased sales of higher-performance Hurco 5-axis machines and Milltronics 3-axis vertical machines. ​ European sales for fiscal year 2024 decreased by 21%, compared to fiscal year 2023, and included a favorable currency impact of 2%, when translating foreign sales to U.S. dollars for financial reporting purposes.
Even though the mix of machine model shipments in fiscal year 2025 produced lower sales in dollars compared to the prior year, the overall volume of machine shipments in the Americas increased from fiscal 2024 to fiscal 2025. ​ European sales for fiscal year 2025 decreased by 4%, compared to fiscal year 2024, and included a favorable currency impact of 2%, when translating foreign sales to U.S. dollars for financial reporting purposes.
The decrease in cash and cash equivalents was primarily a result of net cash used for payments of outstanding accounts payable, stock repurchases and dividend payments . Approximately 12% of our $33.3 million of cash and cash equivalents is held in the U.S.
The increase in cash and cash equivalents was primarily a result of net cash provided by the reductions in inventories and accounts receivable . Approximately 21% of our $48.7 million of cash and cash equivalents is held in the U.S.
The year-over-year increase in income tax expense was primarily due to an $8.4 million non-cash valuation allowance recorded on U.S. and China deferred tax assets, as well as changes in geographic mix of income and loss that includes jurisdictions with differing tax rates, and discrete items related to unvested stock compensation.
The year-over-year decrease in annual income tax expense was primarily due to an $8.4 million non-cash change in valuation allowance recorded in fiscal year 2024 on U.S. and China deferred tax assets, compared to a $4.8 million non-cash change in valuation allowance recorded in fiscal year 2025 on U.S., China, and certain Italian deferred tax assets.
These changes, if any, may require material adjustments to these deferred tax assets and an accompanying reduction or increase in net income.
These changes, if any, may require material adjustments to these deferred tax assets and an accompanying reduction or increase in net income. During fiscal years 2025 and 2024, we recorded non-cash valuation allowances of $4.8 million and $8.6 million, respectively, on our U.S. and China deferred tax assets and on our U.S., China and certain Italian deferred tax assets, respectively.
The decreases in both sales volume and pricing negatively impacted gross profit in dollars and as a percentage of sales, reducing our leverage of fixed costs, in comparison to fiscal year 2023. Further, certain cost reductions were implemented in the third quarter of fiscal year 2024 to help offset the impact of lower sales volumes and pricing. ​ Operating Expenses.
The decrease in overall sales dollars and the increase in tariffs negatively impacted gross profit in dollars and percentage of sales, reducing the leverage of fixed costs, in comparison to fiscal year 2024. ​ 38 ​ Operating Expenses.
Operating loss for fiscal year 2024 was $8.3 million, or 4% of sales, compared to operating income of $6.6 million, or 3% of sales, for fiscal year 2023. The year-over-year decrease in operating income was primarily due to lower volume of vertical milling machine sales in the Americas and Europe. Other Expense, Net.
Operating loss for fiscal year 2025 was $10.3 million, or 6% of sales, compared to operating loss of $8.3 million, or 4% of sales, for fiscal year 2024.
Sales of computerized machine tools for fiscal year 2024 decreased by 22%, compared to fiscal year 2023, primarily due to a decreased volume of shipments of Hurco and Takumi machines in all regions where our customers are located, except India and France, partially offset by increased sales of Milltronics vertical machines in North America.
Sales of computerized machine tools for fiscal year 2025 decreased by 4%, compared to fiscal year 2024, primarily due to a lower sales volume of higher-performance 5-axis machines in the Americas, France, India and Germany, and of electro-mechanical components and accessories manufactured by LCM, partially offset by an increased volume of shipments of Hurco machines in the United Kingdom and increased sales of Takumi machines in Asia Pacific .
The increased customer demand for Hurco machines in China and India for the fiscal year included two customers with multiple machine orders. ​ Backlog as of October 31, 2024 increased to $40.8 million from $28.3 million as of October 31, 2023, primarily due to increased customer demand during the last six months of fiscal year 2024, compared to the same period in prior year.
The decrease in Asian Pacific orders was driven primarily by decreased customer demand for Hurco machines in China and India. ​ Backlog as of October 31, 2025 decreased to $34.3 million from $40.8 million as of October 31, 2024, primarily due to decreased customer demand for Hurco machines in the United Kingdom, as well as decreased demand for electro-mechanical components and accessories manufactured by LCM.
We had no debt or borrowings under any of our credit facilities as of October 31, 2024. ​ As of October 31, 2024, we had an aggregate of approximately $50.9 million available for borrowing under our credit facilities and were in compliance with all covenants relating thereto. ​ We have an international cash pooling strategy that generally provides access to available cash deposits and credit facilities when needed in the U.S., Europe or Asia Pacific.
As of October 31, 2025, we had an aggregate of approximately $51.2 million available for borrowing under our credit facilities and were in compliance with all covenants relating thereto. ​ On January 5, 2026, we entered into a credit agreement with Bank of America, N.A., as the lender (the “2026 Credit Agreement”).
The year-over-year decrease in gross profit was primarily due to the lower volume of vertical milling machine sales in the Americas and Europe. Additionally, there were decreases in average net selling prices for certain machines during fiscal year 2024 that were designed to penetrate key markets and reduce inventories.
The year-over-year decreases in both gross profit dollars and as a percentage of sales were primarily due to the lower overall sales volume of vertical milling machines and the change in mix and volume from higher-performance 5-axis machines to 3-axis machines in the Americas and Europe.
Removed
Sales of computer control systems and software for fiscal year 2024 decreased by 13%, compared to fiscal year 2023, due to decreased sales of software for Hurco machines in North America and Germany.
Added
The decrease in sales was attributable to decreased shipments of Hurco 5-axis vertical machines and entry-level Hurco and Milltronics 3-axis machines, partially offset by increased sales of higher-performance Hurco 3-axis vertical machines and multi-axis lathes.
Removed
The increase in Asian Pacific orders was driven primarily by increased customer demand for Hurco and Takumi machines in China, India, and Southeast Asia.
Added
We do not believe backlog is a useful measure of past performance or indicative of future performance. Backlog orders as of October 31, 2025 are expected to be fulfilled in fiscal year 2026. ​ Gross Profit.
Removed
The increase in backlog was driven primarily by increased demand for higher-performance VMX and 5-axis Hurco machines in the U.S. and Europe, Milltronics toolroom and 3-axis vertical machines in the U.S., and Hurco 3-axis vertical machines and Takumi bridge mills in Asia Pacific. We do not believe backlog is a useful measure of past performance or indicative of future performance.
Added
Additionally, gross profit was negatively impacted by an increase in cost of goods sold as a result of tariffs on goods imported into the U.S. implemented in the second half of fiscal year 2025.
Removed
Despite the reduction from an absolute dollar perspective, selling, general, and administrative expenses increased as a percentage of sales in fiscal year 2024, compared to fiscal year 2023, due to the lower volume of sales year-over-year. Operating (Loss) Income.
Added
The year-over-year increase in operating loss was primarily due to lower overall sales volume of vertical milling machines and the change in mix and volume from higher-performance 5-axis machines to 3-axis machines in the Americas and Europe. Additionally, operating loss was negatively impacted by increased costs related to tariffs implemented in the second half of fiscal year 2025.
Removed
The valuation allowance recorded during fiscal year 2024 reflected a full valuation allowance of the U.S. deferred tax assets and was recorded after evaluating changes to tax laws, statutory tax rates, and our cumulative three-year income (loss) levels for the U.S. for fiscal year 2024. ​ Net (Loss) Income.
Added
Additionally, income taxes were also impacted by a change in geographic mix of income and loss that includes jurisdictions with differing tax rates and discrete items related to unvested stock compensation.
Removed
The program may be amended, suspended, or discontinued at any time and does not commit us to repurchase any shares of our common stock.
Added
During fiscal 2025, we repurchased $2.0 million, or 104,472 common shares, under this program.
Removed
During fiscal year 2024, we repurchased $1.5 million, or 87,635 shares, under the program, and $21.7 million remained available under the program as of October 31, 2024. ​ 39 ​ During fiscal year 2024, we paid cash dividends to our shareholders of $2.1 million.
Added
On December 31, 2025, the 150 million New Taiwan Dollars Taiwan credit facility, the 32.5 million Chinese Yuan China credit facility and the $40.0 million revolving credit facility under the 2018 Credit Agreement terminated in accordance with their terms. ​ We had no debt or borrowings outstanding under any of our credit facilities as of October 31, 2025, or December 31, 2025.
Removed
Under the 2018 Credit Agreement, we and Hurco B.V. are borrowers, and certain of our other subsidiaries are guarantors.
Added
The 2026 Credit Agreement provides for a secured revolving credit and letter of credit facility in a maximum aggregate amount of $20.0 million.
Removed
During fiscal year 2024, we recorded an $8.6 million non-cash valuation allowance on U.S. and China deferred tax assets, of which $8.3 million reflected a full valuation allowance of the U.S. deferred tax assets, and was recorded after evaluating changes to tax laws, statutory tax rates, and our cumulative three-year income (loss) levels for the U.S. for fiscal year 2024.
Added
The 2026 Credit Agreement provides that the maximum amount of outstanding letters of credit at any one time may not exceed $10.0 million and the maximum amount of all outstanding loans denominated in alternative currencies at any one time may not exceed $20.0 million. Under the 2026 Credit Agreement, we are the borrower, and certain of our subsidiaries are guarantors.
Added
Our obligations under the 2026 Credit Agreement are secured by a security interest in substantially all of our personal property and substantially all of the personal property of each subsidiary guarantor.
Added
We may use the proceeds from advances under the 2026 Credit Agreement for general corporate purposes. 41 ​ The maximum consolidated leverage ratio covenant effectively prohibits us from borrowing any amounts under the 2026 Credit Agreement when our consolidated EBITDA for the most recently completed measurement period is negative.
Added
As of the date we entered into the 2026 Credit Agreement, and as of the date of the filing of this report, the most recently completed measurement period was our fiscal year ended October 31, 2025, during which our consolidated EBITDA was negative.
Added
In order to borrow in compliance with the maximum consolidated leverage ratio covenant set forth above, we are effectively prohibited from borrowing under the 2026 Credit Agreement until we have positive consolidated EBITDA for our most recently completed four fiscal quarters. ​ We also have an international cash pooling strategy that generally provides access to available cash deposits and credit facilities when needed in the U.S., Europe, or Asia Pacific. ​ We have borrowed only $1.6 million during the fiscal years ended 2015-2018 to fund start-up costs related to expansion in China and have not had any borrowings under any of our previous debt facilities at any other time over the previous ten fiscal years, even during prolonged recessionary industry cycles.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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All of our computerized machine tools and computer control systems, as well as certain proprietary service parts, are sourced by our U.S.-based engineering and manufacturing division and re-invoiced to our foreign sales and service subsidiaries, primarily in their functional currencies. ​ Our products are sourced from foreign suppliers or built to our specifications by either our wholly-owned subsidiaries in Taiwan, the U.S., Italy, and China or an affiliated contract manufacturer in Taiwan.
All of our computerized machine tools and computer control systems, as well as certain proprietary service parts, are sourced by our U.S.-based engineering and manufacturing division and re-invoiced to our foreign sales and service subsidiaries, primarily in their functional currencies. ​ Our products are sourced from foreign suppliers or built to our specifications by either our wholly-owned subsidiaries in Taiwan, the U.S. and Italy, or an affiliated contract manufacturer in Taiwan.
We do not speculate in the financial markets and, therefore, do not enter into these contracts for trading purposes. ​ Forward contracts for the sale or purchase of foreign currencies as of October 31, 2024, which are designated as cash flow hedges under FASB guidance related to accounting for derivative instruments and hedging activities, were as follows (in thousands, except weighted average forward rates): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Contract Amount at ​ ​ ​ ​ Notional ​ Weighted ​ Forward Rates in ​ ​ ​ ​ Amount ​ Avg. ​ U.S.
We do not speculate in the financial markets and, therefore, do not enter into these contracts for trading purposes. ​ Forward contracts for the sale or purchase of foreign currencies as of October 31, 2025, which are designated as cash flow hedges under FASB guidance related to accounting for derivative instruments and hedging activities, were as follows (in thousands, except weighted average forward rates): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Contract Amount at ​ ​ ​ ​ Notional ​ Weighted ​ Forward Rates in ​ ​ ​ ​ Amount ​ Avg. ​ U.S.
The predominant portion of the exchange rate risk associated with our product purchases relates to the New Taiwan Dollar and the Euro. ​ 43 ​ We enter into foreign currency forward exchange contracts from time to time to hedge the cash flow risk related to forecasted inter-company sales and purchases denominated in, or based on, foreign currencies (primarily the Euro, Pound Sterling, and New Taiwan Dollar).
The predominant portion of the exchange rate risk associated with our product purchases relates to the New Taiwan Dollar and the Euro. ​ 44 ​ We enter into foreign currency forward exchange contracts from time to time to hedge the cash flow risk related to forecasted inter-company sales and purchases denominated in, or based on, foreign currencies (primarily the Euro, Pound Sterling, and New Taiwan Dollar).
To manage this risk, we entered into a forward contract with a notional amount of €3.0 million in November 2023. We designated this forward contract as a hedge of our net investment in Euro denominated assets. We selected the forward method under the FASB guidance related to the accounting for derivative instruments and hedging activities.
To manage this risk, we entered into a forward contract with a notional amount of €3.0 million in November 2024. We designated this forward contract as a hedge of our net investment in Euro denominated assets. We selected the forward method under the FASB guidance related to the accounting for derivative instruments and hedging activities.
As of October 31, 2024, we had $1.2 million of realized gain and an immaterial amount of unrealized loss, net of tax, recorded as cumulative translation adjustments in Accumulated other comprehensive loss, related to these forward contracts. ​ Forward contracts designated as net investment hedges under this guidance as of October 31, 2024, were as follows (in thousands, except weighted average forward rates): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Notional ​ Weighted Contract Amount at Forward Rates in ​ ​ ​ ​ ​ Amount ​ Avg. ​ U.S.
As of October 31, 2025, we had $1.2 million of realized gain and an unrealized loss of $0.2 million, net of tax, recorded as cumulative translation adjustments in Accumulated other comprehensive loss, related to these forward contracts. ​ Forward contracts designated as net investment hedges under this guidance as of October 31, 2025, were as follows (in thousands, except weighted average forward rates): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Notional ​ Weighted Contract Amount at Forward Rates in ​ ​ ​ ​ ​ Amount ​ Avg. ​ U.S.
This forward contract matured in November 2024 and we entered into a new forward contract for the same notional amount that is set to mature in November 2025.
This forward contract matured in November 2025 and we entered into a new forward contract for the same notional amount that is set to mature in November 2026.
As of October 31, 2024, we had no borrowings outstanding under any of our credit facilities. ​ Foreign Currency Exchange Risk In fiscal year 2024, we derived approximately 61% of our revenues from customers located outside of the Americas, where we invoiced and received payments in several foreign currencies.
As of October 31, 2025, we had no borrowings outstanding under any of our credit facilities. ​ Foreign Currency Exchange Risk In fiscal year 2025, we derived approximately 62% of our revenues from customers located outside of the Americas, where we invoiced and received payments in several foreign currencies.
Dollars ​ ​ Forward in Foreign Forward Contract October 31, ​ ​ Contracts Currency Rate Date 2024 Maturity Dates Sale Contracts: ​ ​ Euro 7,500 ​ 1.1037 ​ 8,278 ​ 8,201 ​ Nov 2024 - Oct 2025 Sterling 3,400 ​ 1.2830 ​ 4,362 ​ 4,374 ​ Nov 2024 - Oct 2025 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Purchase Contracts: ​ ​ ​ ​ ​ New Taiwan Dollar 490,000 ​ 30.7269 * 15,947 ​ 15,628 ​ Nov 2024 - Oct 2025 * New Taiwan Dollars per U.S. dollar ​ Forward contracts for the sale or purchase of foreign currencies as of October 31, 2024, which were entered into to protect against the effects of foreign currency fluctuations on inter-company receivables, payables, and loans and are not designated as hedges under this guidance denominated in foreign currencies, were as follows (in thousands, except weighted average forward rates): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Contract Amount at ​ ​ ​ ​ Notional ​ Weighted ​ Forward Rates in ​ ​ ​ ​ Amount ​ Avg. ​ U.S.
Dollars ​ ​ Forward in Foreign Forward Contract October 31, ​ ​ Contracts ​ ​ ​ Currency ​ ​ ​ Rate ​ ​ ​ Date ​ ​ ​ 2025 ​ ​ ​ Maturity Dates Sale Contracts: ​ ​ ​ ​ ​ ​ Euro 7,800 ​ 1.1449 ​ 8,930 ​ 9,073 ​ Nov 2025 - Oct 2026 Sterling 2,400 ​ 1.3014 ​ 3,123 ​ 3,153 ​ Nov 2025 - Oct 2026 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Purchase Contracts: ​ ​ ​ ​ ​ New Taiwan Dollar 570,000 ​ 29.7886 * 19,135 ​ 18,738 ​ Nov 2025 - Oct 2026 * New Taiwan Dollars per U.S. dollar ​ Forward contracts for the sale or purchase of foreign currencies as of October 31, 2025, which were entered into to protect against the effects of foreign currency fluctuations on inter-company receivables, payables, and loans and are not designated as hedges under this guidance denominated in foreign currencies, were as follows (in thousands, except weighted average forward rates): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Contract Amount at ​ ​ ​ ​ Notional ​ Weighted ​ Forward Rates in ​ ​ ​ ​ Amount ​ Avg. ​ U.S.
Dollars ​ ​ ​ Forward ​ in Foreign ​ Forward ​ Contract ​ October 31, ​ Maturity ​ Contracts Currency Rate Date 2024 Date Sale Contracts: Euro 3,000 1.0823 3,247 3,258 Nov 2024 ​ ​ ​ ​ 45 ​
Dollars ​ ​ ​ Forward ​ in Foreign ​ Forward ​ Contract ​ October 31, ​ Maturity ​ Contracts ​ ​ ​ Currency ​ ​ ​ Rate ​ ​ ​ Date ​ ​ ​ 2025 ​ ​ ​ Date ​ ​ ​ Sale Contracts: ​ ​ ​ ​ ​ Euro 3,000 1.1005 3,302 3,461 Nov 2025 ​ ​ ​ ​ 46 ​
Dollars ​ ​ Forward in Foreign Forward Contract October 31, ​ ​ Contracts Currency Rate Date 2024 Maturity Dates Sale Contracts: Euro 9,061 ​ 1.0913 ​ 9,888 ​ 9,859 ​ Nov 2024 - Feb 2025 Sterling 400 ​ 1.2916 ​ 517 ​ 515 ​ Nov 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Purchase Contracts: ​ ​ ​ ​ ​ ​ ​ ​ ​ New Taiwan Dollar 1,352,500 ​ 31.5496 * 42,869 ​ 42,721 ​ Nov 2024 - Mar 2025 * New Taiwan Dollars per U.S. dollar ​ 44 ​ We are also exposed to foreign currency exchange risk related to our investment in net assets in foreign countries.
Dollars ​ ​ Forward in Foreign Forward Contract October 31, ​ ​ Contracts ​ ​ ​ Currency ​ ​ ​ Rate ​ ​ ​ Date ​ ​ ​ 2025 ​ ​ ​ Maturity Dates Sale Contracts: ​ ​ ​ ​ ​ Euro 11,941 ​ 1.0701 ​ 12,778 ​ 13,804 ​ Nov 2025 - Feb 2026 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Purchase Contracts: ​ ​ ​ ​ ​ ​ ​ ​ ​ New Taiwan Dollar 1,301,758 ​ 29.7438 * 43,766 ​ 42,700 ​ Nov 2025 - Jun 2026 * New Taiwan Dollars per U.S. dollar ​ 45 ​ We are also exposed to foreign currency exchange risk related to our investment in net assets in foreign countries.

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