Hurco Companies, Inc. Annual Report 2024

FY2024 Annual Report · Hurco Companies, Inc.

Loading PDF…

1
TABLE OF CONTENTS
02
04
05
08
10
12
13
Letter to Shareholders
Global Locations
Product Brands
Financial Highlights
Eleven-Year Financial Data
Corporate Information, Leadership Team
Form 10-K

2
REPORT TO SHAREHOLDERS
2024 was a transformative year for Hurco Companies, marked both
by challenges and opportunities as we navigated an uncertain and
shifting manufacturing landscape. While we experienced an industry
decrease in demand and a delay in the timing of our cyclical recovery,
we responded with decisive actions to position the company for
future growth. This included implementing cost cutting measures,
rationalizing our global sales strategy, and bringing in new leadership
talent to drive our brands forward. These proactive measures,
combined with our focus on integrating advanced technologies,
such as artificial intelligence (AI), automation, and autonomous
manufacturing, have reinforced our position as a global leader in
the machine tool industry. These efforts reflect our dedication to
delivering exceptional value to our customers and creating sustainable
growth for our shareholders.
The 2024 International Manufacturing Technology Show (IMTS)
provided an ideal platform to showcase our latest advancements
and product offerings, such as the Hurco TM8MYi lathe, the Takumi
UA400 machining center, and Milltronics’ first true 5-axis mill, the
VM250IL-5X. We introduced our next-generation Hurco control system,
designed with a fully customizable interface and ergonomic features
that redefine simplicity and operator ease-of-use. Integrated with AI
tools like ChatCNC® and AI Feature Recognition, this system drastically
reduces programming time while simplifying complex tasks,
ensuring unparalleled productivity gains for our customers. These
advancements reflect our unique capability as a vertically integrated
company, enabling us to develop, test, and implement cutting-edge
technologies seamlessly across our machines, software, and controls.
This ensures that Hurco remains at the forefront of innovation and
delivers value-driven solutions to our customers.
Our advancements and partnerships in automation this year further
demonstrated our commitment to flexibility and connectivity on the
shop floor. For example, we have seamlessly integrated automated
machine-tending solutions into the Hurco control system, including the
ProCobots collaborative robot from Universal Robots and the industrial
robot from Kawasaki Robotics. These solutions address critical
and pervasive challenges, such as labor shortages, while providing
efficient automation capabilities that enhance productivity across
manufacturing environments.
Looking to the future, our vision for autonomous manufacturing
aligns with the principles of Industry 5.0, where intelligent systems

3
collaborate with human operators to achieve optimal productivity. Our focus on AI-driven feature detection, operation
sequencing, and process control is paving the way for smart, self-regulating systems that transform the manufacturing
floor. While fully autonomous machining remains a long-term goal, we are committed to commercializing incremental
advancements that deliver immediate benefits, ensuring that our customers experience measurable productivity gains
today, tomorrow, and for years to come.
Hurco’s progress would not be possible without the dedication of our people. We have continued to invest in talent
development, fostering partnerships with universities and research institutions to attract top talent and provide
opportunities for growth and collaboration. The expertise and passion of our employees fuel the innovation that drives
Hurco forward, and we remain committed to nurturing this cornerstone of our success.
As we prepare to meet the demands of an evolving industry, our innovation pipeline remains robust, with solutions that
enhance productivity and profitability for our customers while delivering long-term value to our shareholders.
As we move forward, I want to thank you, our shareholders, for your continued confidence and trust in Hurco. On behalf
of the Board of Directors, our management team, and our employees, I am excited to build on this year’s achievements
as we lead the industry into a new era of intelligent manufacturing solutions. Together, we are shaping the future of
manufacturing with unwavering dedication to innovation and operational excellence.
Sincerely,
Greg Volovic
President and CEO
Gregory S. Volovic
President and Chief Executive Officer
Sonja McClelland
Executive Vice President, Treasurer and
Chief Financial Officer
Michael Doar
Executive Chairman

4
GLOBAL LOCATIONS
1
2
3
6
9
11
4
7
10
12
5 8
13
1.
2.
3.
9.
4.
10.
5.
6.
11.
7.
12.
8.
13.
Indianapolis, IN
Hurco North America
Serving the USA, Canada, Mexico, and South America
Takumi USA, ProCobots
Serving the USA
A division of Hurco
North America.
Serving Southern
California.
A division of Hurco
North America.
Serving Western
Michigan.
Grand Rapids, MI
City of Industry, CA
Indianapolis, IN
HURCO COMPANIES, INC.
BRAUN MACHINERY
MACHINERY SALES CO.
MILLTRONICS
HURCO EUROPE LTD.
(United Kingdom)
United Kingdom, Ireland,
Africa, the Middle East,
and Scandinavia
MILLTRONICS EUROPE
B. V.
(The Netherlands)
HURCO S.A.R.L. (France)
France and Belgium
(Wallonia)
HURCO WERKZEUGMASCHINEN
GmbH (Germany)
Germany, Austria, Belarus,
Bosnia-Herzegovina, Bulgaria,
Croatia, the Czech Republic,
Hungary, Latvia, Lithuania,
Mazedonia, Montenegro, the
Netherlands, Portugal, Romania,
Russia, Serbia, Slovakia,
Slovenia, Switzerland, Turkey,
and Ukraine
HURCO SP. Z O.O.
(Poland)
HURCO S.R.L.
LCM PRECISION TECHNOLOGY
S.R.L. (Italy)
NINGBO HURCO TRADING CO., LTD.
(Shanghai, China)
NINGBO HURCO MACHINE TOOL
CO., LTD.
(Ningbo, China)
TAKUMI PRECISION CO., LTD.
(Taiwan)
HURCO MANUFACTURING LTD.
(Taiwan)
Manufacturing Limited:
manufacturing and assembly of
Hurco, Milltronics,
and Takumi machine tools.
HURCO AUTOMATION LTD.
(Taiwan)
Automation Limited:
manufacturing and assembly of
Hurco and Milltronics controls.
HURCO INDIA PRIVATE LTD.
Serving India, Pakistan,
Bangladesh, and Sri Lanka
HURCO S.E. ASIA PTE. LTD.
(Singapore)
Serving Australia, Indonesia,
Malaysia, Myanmar,
Philippines, Singapore,
South Korea, Thailand, and
Vietnam
4

5
PRODUCT BRANDS
MIND OVER METAL - Hurco CNC machines are
powered by proprietary technology that increases
customer productivity and profitability. We
provide customers with reliable machine tools
equipped with sophisticated technologies that
simplify complex processes. The integrated
Hurco control is the most versatile in the industry,
supporting both industry standard programming
and conversational programming.
BEYOND EXPECTATIONS - Milltronics CNC machines
are equipped with an interactive computer
control system that is compatible with G-codes
and M-codes generated from CAD/CAM software
and conversational visual-aid programming. The
Milltronics brand includes product lines of general
purpose CNC mills and lathes. The Milltronics line is
designed for excellent value with more standard
features for the price versus other brands.
When Precision MattersTM
WHEN PRECISION MATTERS - Takumi CNC machines
are designed and built for high-efficiency milling and
high-level precision. Equipped with control systems
such as Fanuc® and Heidenhain®, we have adapted
the world’s most used controls to our rugged, durable
machines to help manufacturers achieve higher
productivity through speed, accuracy, and reliability.
Beyond Expectations. ™

6
UNLEASH EFFICIENCY - ProCobots provides
automation solutions for high-mix/low-volume
production. Designed to be easy to use, safe, and
flexible, ProCobots solutions are standardized
systems that automate redundant processes.
ProCobots systems include robots, grippers,
material handling, and Industry 4.0-capable
software and controls. ProCobots has multiple
lines of flexible cell solutions and portable
systems in addition to a variety of automation
peripherals.

With several patents pending, the automation
software features provide our customers with
complete integration between the Hurco control
and the ProCobots automation system.
LCM designs and manufactures advanced components for machine tools, such as rotary
tables, tilt tables, swivel heads, and electro-mechanical spindles.
PRODUCT BRANDS
Automatic Job Setup
2019
2020
2021
2022
2023
2024
was Acquired
61%
European market
sales began
100% of unit sales were in the US market from 2019-2023
increase in overall unit sales from 2023
38%

7
At IMTS 2024, Hurco’s expanded
16,000-square-foot booth attracted an
abundance of visitors, showcasing our
leadership in CNC technology and control
systems, and ability to meet the evolving
needs of manufacturers.

8
FINANCIAL HIGHLIGHTS
2024
2023
Sales and service fees
$
186,584
$
227,807
Operating income (loss)
$
(8,286)
$
6,616
Net income (loss)
$
(16,608)
$
4,389
Earnings (loss) per
common share (diluted)
$
(2.56)
$
0.66
Order intake
$
198,302
$
209,676
Working capital
$
180,788
$
193,257
Total debt
$
—
$
—
Shareholders’ equity
$
207,172
$
222,231
Number of employees
688
716
Closing stock price as of October 31
$
21.01
$
20.00
Stock price range for the Fiscal Year
High
$
28.20
$
30.41
Low
$
14.83
$
19.59
(Dollars in thousands except per share data and number of employees)
Sales + Service Fees (In Thousands)
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0
Q1
Q2
Q3
Q4
2023
2024
54,682
53,819
53,201
66,105
45,059
45,172
42,651
53,702
8
TOTAL
2024
SALES: 186,584
ORDERS: 198,302
Total Sales + Orders

9
NORTH
AMERICA
2024 SALES
BY REGION
ASIA
EUROPE
FINANCIAL HIGHLIGHTS
30,000
25,000
20,000
15,000
10,000
5,000
0
Q1
Q1
Q1
Q2
Q2
Q2
Q3
Q3
Q3
Q4
Q4
Q4
North America
Sum of Orders
Sum of Sales
Europe
Asia
2024 Sales + Orders by Quarter

10
Sales and service fees
Cost of sales and service
Selling, general, and administrative expenses
Goodwill impairment
Operating income (loss)
Other income (expense)
Income before taxes
Income tax expense (benefit)
Net income (loss)
Average shares outstanding
Basic
Diluted/Primary
Earnings per share
Basic
Diluted/Primary
Capital expenditures
Depreciation and amortization
Gross profit margin %
Operating income (loss) as % of sales
Closing Stock Price as of October 31
Stock price range for the Fiscal Year
High
Low
At Fiscal Year End
(In thousands except per share data and number of employees)
Working capital
Current ratio
Total assets
Total debt
Shareholders' equity
Total debt to capitalization %
Shareholder's equity per share (1)
Number of employees
Dividends paid per share
(1) Based on shares outstanding at fiscal year end — diluted.
(In thousands except per share data and stock price)
For the Fiscal Year Ended
2024
2023
2022
2021
$186,584
$227,807
$250,814
$235,195
148,841
171,639
186,336
178,946
46,029
49,552
51,731
46,001
—
—
—
—
(8,286)
6,616
12,747
10,248
(1,564)
138
(869)
(127)
(9,850)
6,754
11,878
10,121
6,758
2,365
3,652
3,357
(16,608)
$4,389
$8,226
$6,764
6,489
6,499
6,580
6,595
6,489
6,528
6,632
6,608
($2.56)
$0.67
$1.24
$1.01
($2.56)
$0.66
$1.23
$1.01
$2,876
$2,577
$2,193
$2,369
$3,532
$4,093
$3,918
$4,193
20%
24.7%
25.7%
23.9%
(4%)
2.9%
5.1%
4.4%
$21.01
$20.00
$23.15
$32.45
$28.20
$30.41
$35.15
$38.83
$14.83
$19.59
$21.75
$28.27
2024
2023
2022
2021
$180,788
$193,257
$194,733
$208,700
4.78
4.52
3.66
3.57
$268,643
$290,589
$306,237
$332,935
$ —
$ —
$ —
$ —
$207,172
$222,231
$222,644
$238,419
0.0%
0.0%
0.0%
0.0%
$31.93
$34.04
$33.57
$36.08
688
716
735
706
$0.32
$0.63
$0.59
$0.55
ELEVEN YEAR FINANCIAL DATA

11
2020
2019
2018
2017
2016
2015
2014
$170,627
$263,377
$300,671
$243,667
$227,289
$219,383
$222,303
134,170
186,169
208,865
173,103
156,849
150,292
153,691
41,416
54,668
58,010
49,661
50,824
45,287
46,615
4,903
—
—
—
—
—
—
(9,862)
22,540
33,796
20,903
19,616
23,804
21,997
(941)
784
(1,300)
(187)
(731)
(251)
(636)
(10,803)
23,324
32,496
20,716
18,885
23,553
21,361
(4,556)
5,829
11,006
5,601
5,593
7,339
6,218
$(6,247)
$17,495
$21,490
$15,115
$13,292
$16,214
$15,143
6,670
6,759
6,700
6,615
6,569
6,543
6,497
6,670
6,815
6,771
6,680
6,642
6,602
6,538
$ (0.93)
$2.57
$3.19
$2.27
$2.01
$2.46
$2.31
$ (0.93)
$2.55
$3.15
$2.25
$1.99
$2.44
$2.30
$1,656
$4,870
$5,863
$4,445
$4,177
$4,533
$2,635
$4,547
$3,745
$3,713
$3,616
$3,868
$3,222
$3,309
21.4%
29.3%
30.5%
29.0%
31.0%
31.5%
30.9%
(5.8%)
8.6%
11.2%
8.6%
8.6%
10.9%
9.9%
$29.84
$34.79
$40.74
$44.75
$26.20
$26.87
$38.53
$39.38
$44.99
$50.50
$46.75
$33.65
$39.95
$39.64
$20.39
$31.07
$38.08
$24.80
$23.25
$24.93
$23.63
2020
2019
2018
2017
2016
2015
2014
$200,974
$207,229
$194,632
$175,526
$160,413
$151,026
$141,888
4.98
4.79
3.24
3.48
3.77
3.32
3.12
$295,655
$301,065
$315,407
$277,808
$251,949
$248,577
$239,176
$ —
$ —
$1,434
$1,507
$1,476
$1,583
$3,272
$231,148
$240,245
$222,853
$203,085
$185,475
$174,568
$164,645
0.0%
0.0%
0.6%
0.7%
0.8%
0.9%
1.9%
$34.65
$35.25
$32.91
$30.40
$27.92
$26.44
$25.18
710
785
800
749
758
769
617
$0.51
$0.47
$0.43
$0.39
$0.35
$0.31
$0.26
ELEVEN YEAR FINANCIAL DATA

12
Michael Doar

Executive Chairman
Gregory S. Volovic

President and Chief

Executive Officer
Sonja K. McClelland

Executive Vice

President,

Treasurer, and

Chief Financial Officer
HaiQuynh Jamison

Corporate Controller and

Principal Accounting

Officer
Jonathon D. Wright

General Counsel and

Corporate Secretary
Michael Auer

General Manager,
Hurco GmbH (Germany),
Hurco Sp. z o.o. (Poland)
Scott Camloh

General Manager, Hurco

North America
Paolo Casazza

General Manager, Hurco

S.r.l. (Italy)
Sanjib Chakraborty

General Manager,

Hurco India Private, Ltd.

(India)
Phillippe Chevalier

General Manager, Hurco

S.a.r.l. (France)
Ryan Delahanty

Managing Director,

Milltronics
STOCK MARKET
INFORMATION
Hurco Common Stock is traded on
the Nasdaq Global Select Market
under the ticker symbol HURC.
The following table sets forth the high
and low sales prices of the shares
of Common Stock for the periods
indicated, as reported by The Nasdaq
Stock Market LLC.
There were approximately 119 holders
of record of Hurco Common Stock as
of December 11, 2024.
FISCAL QUARTER ENDED
TRANSFER AGENT
Computershare Investor Services
462 South 4th Street,
Louisville, KY 40202
LEGAL COUNSEL
Corporate Law: Faegre Drinker
Biddle & Reath LLP
Patent Law: Faegre Drinker
Biddle & Reath LLP
600 E. 96th Street, Suite 600
Indianapolis, IN 46240
INDEPENDENT AUDITORS
Deloitte & Touche LLP
111 Monument Circle, Suite 4200
Indianapolis, IN 46204
INVESTOR RELATIONS
Sonja K. McClelland, Executive Vice
President, Treasurer, and
Chief Financial Officer
1 Technology Way
Indianapolis, IN 46268
Telephone (317) 293-5309
DISCLOSURE CONCERNING
FORWARD-LOOKING
STATEMENTS
Certain statements made in this
annual report may constitute
“forward-looking statements” within
the meaning of federal securities
laws. The forward-looking statements
are based on current expectations
and assumptions that are subject
to risks and uncertainties that
could cause actual results to differ
materially from such forward-
looking statements. These risks and
uncertainties are identified in Item 1A
of the annual report on form 10K. We
expressly disclaim any obligation to
update or revise any forward-looking
statements, whether as a result of
new information, future events,
or otherwise.
Paul Gray

Operations Manager,

ProCobots

Vice President R&D and

Product Development
Roberto La Vista

General Manager,
LCM Precision
Technology S.r.l. (Italy)
Wai Yip Lee

General Manager,

Hurco (S.E. Asia) Pte.

Ltd. (Singapore)
Leanor Lin

Managing Director,

Takumi (Taiwan)
Song Liu

Senior Vice President

Manufacturing,

Automation, and China

Business Development

Ningbo Hurco Machine

Tool Co., Ltd.

(Ningbo, China)

Ningbo Hurco Trading

Co., Ltd.

(Shanghai, China)
David Waghorn

General Manager, Hurco
Europe Limited
(United Kingdom)
Charlie Tsai, Martin Lee,
and Luke Wang

General Manager and
Vice General Managers,
Hurco Manufacturing
Limited (Taiwan)
ANNUAL MEETING
All shareholders are invited to attend
our annual meeting, which will be
held on Thursday, March 13, 2025, at
10:00 a.m. Eastern Time at Hurco’s
Corporate Offices, 1 Technology Way,
Indianapolis, IN 46268.
HURCO COMPANIES, INC., LEADERSHIP
1 Nominating and Governance Committee
2 Audit Committee
3 Compensation Committee
4 Presiding Independent Director
Thomas Aaro
Marketing Consultant (2)
Michael Doar
Executive Chairman
Hurco Companies, Inc.
Cynthia Dubin
Member, UK Competition
and Markets
Authority (CMA) (2)
Timothy Gardner
Former Executive, Illinois
Tool Works (1, 3)
Jay Longbottom
Operating Partner, BERKS
Group (1, 3)
Richard Porter
Private Equity Manager (1, 3, 4)
Janaki Sivanesan
Attorney, Sivanesan Law (2)
Gregory S. Volovic
President and Chief
Executive Officer
Hurco Companies, Inc.
BOARD OF DIRECTORS
CORPORATE OFFICERS AND DIVISION EXECUTIVES
2024
2023
High
Low
High
Low
January 31
$24.73
$19.29
$23.03
$28.94
April 30
$28.20
$18.01
$21.50
$30.41
July 31
$18.57
$14.83
$20.56
$23.41
October 31
$22.99
$15.18
$23.32
$19.59
CORPORATE INFORMATION

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
☒
Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the fiscal year ended October 31, 2024 or
☐
Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from _________ to
_________
Commission File No. 0-9143
HURCO COMPANIES, INC.
(Exact name of registrant as specified in its charter)

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

One Technology Way

Indianapolis, Indiana
46268
(Address of principal executive offices)

(Zip code)
Registrant’s telephone number, including area code (317) 293–5309

Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, no par value
HURC
The Nasdaq Stock Market LLC

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well–known seasoned issuer, as defined in Rule 405 of the Securities Act.
Yes  No 

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
Yes  No 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements
for the past 90 days.
Yes  No 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of
Regulation S–T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Yes  No 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non–accelerated filer, a smaller reporting company, or an
emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company”
in Rule 12b–2 of the Exchange Act.
 Large accelerated filer
 Accelerated filer  Non–accelerated filer
 Smaller reporting company
☐ Emerging growth
company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or
revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control
over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued
its audit report. 

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing
reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by
any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b–2 of the Act).
Yes ☐ No 

The aggregate market value of the registrant’s voting stock held by non–affiliates as of April 30, 2024 (the last business day of our most recently completed
second quarter) was $118,071,000.

The number of shares of the registrant’s common stock outstanding as of December 31, 2024 was 6,446,349.

DOCUMENTS INCORPORATED BY REFERENCE: Portions of the registrant’s Proxy Statement for its 2025 Annual Meeting of Shareholders (Part III).

Forward-Looking Statements
This report contains certain statements that are forward-looking statements within the meaning of federal
securities laws. Forward-looking statements can be identified by the fact that they do not relate strictly to
historical or current facts. When used in this report, the words “may”, “will”, “should”, “would”, “could”,
“anticipate”, “expect”, “plan”, “seek”, “believe”, “predict”, “estimate”, “potential”, “project”, “target”,
“forecast”, “intend”, “strategy”, “future”, “opportunity”, “assume”, “guide”, and similar expressions are
intended to identify forward-looking statements. Forward-looking statements are based on current expectations
and assumptions that are subject to risks and uncertainties that could cause actual results to differ materially
from such forward-looking statements. These risks and uncertainties include, among others, the cyclical nature
of the machine tool industry; uncertain economic conditions, which may adversely affect overall demand, in
the Americas, Europe and Asia Pacific markets; the risks of our international operations; governmental actions,
initiatives and regulations, including import and export restrictions, duties and tariffs and changes to tax laws;
the effects of changes in currency exchange rates; competition with larger companies that have greater financial
resources; our dependence on new product development; the need and/or ability to protect our intellectual
property assets; the limited number of our manufacturing and supply chain sources; increases in the prices of
raw materials, especially steel and iron products; the effect of the loss of members of senior management and
key personnel; our ability to integrate acquisitions; acquisitions that could disrupt our operations and affect
operating results; failure to comply with data privacy and security regulations; breaches of our network and
system security measures; possible obsolescence of our technology and the need to make technological
advances; impairment of our assets; negative or unforeseen tax consequences; uncertainty concerning our
ability to use tax loss carryforwards; changes in the SOFR rate; the impact of the COVID-19 pandemic and
other public health epidemics and pandemics on the global economy, our business and operations, our
employees and the business, operations and economies of our customers and suppliers; and the risks and other
important factors under the heading “Risk Factors” in Part I, Item 1A of this report. You should understand that
it is not possible to predict or identify all factors that could cause actual results to differ materially from forward-
looking statements. Consequently, you should not consider any list or discussion of such factors to be a
complete set of all potential risks or uncertainties. Readers of this report are cautioned not to place undue
reliance on these forward-looking statements. While we believe the assumptions on which the forward-looking
statements are based are reasonable, there can be no assurance that these forward-looking statements will prove
to be accurate. This cautionary statement is applicable to all forward-looking statements contained in this report.
We expressly disclaim any obligation to update or revise any forward-looking statements, whether as a result
of new information, future events or otherwise. You are advised, however, to consult any further disclosures
we make on related subjects in our Form 10-Q, 8-K and 10-K reports and our other filings with the Securities
and Exchange Commission (“SEC”).

PART I
Item 1.
BUSINESS
General
Hurco Companies, Inc. is an international, industrial technology company. We design, manufacture, and sell
computerized (i.e., Computer Numeric Control (“CNC”)) machine tools, consisting primarily of vertical
machining centers (mills) and turning centers (lathes), to companies in the metal cutting industry through a
worldwide sales, service, and distribution network. Although most of our computer control systems and
software products are proprietary, they predominantly use industry standard personal computer components.
Our computer control systems and software products are primarily sold as integral components of our
computerized machine tool products. We also provide machine tool components, automation integration
equipment and solutions for job shops, software options, control upgrades, accessories, and replacement parts
for our products, as well as customer service, training, and applications support. As used in this report, the
words “we”, “us”, “our”, “Hurco” and the “Company” refer to Hurco Companies, Inc., and its consolidated
subsidiaries.

Since our founding in 1968, we have been a leader in the introduction of interactive computer control systems
that automate manufacturing processes and improve productivity in the metal parts manufacturing industry. 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. The
combination of microprocessor technology and patented interactive, conversational programming software in
our proprietary computer control systems enables operators on the production floor to create a program quickly
and easily to machine a particular part from a blueprint or computer aided design file, and immediately begin
machining that part.

Our strategy is to design, manufacture, and sell a comprehensive line of computerized machine tools that help
customers in the worldwide metal cutting market increase productivity and profitability. Most of our machine
tools employ proprietary, interactive computer control technology that increases productivity through ease of
operation via interactive conversational and graphical programming software. All of our machine tools,
regardless of brand, deliver high levels of machine performance (speed, accuracy and surface finish quality)
that increase productivity. We routinely expand our product offerings to meet customer needs, which has led
us to design and manufacture more complex machining centers with advanced capabilities.

Our executive offices and principal design and engineering operations are headquartered in Indianapolis,
Indiana, U.S. 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 bring a disciplined approach to strategically enter new
geographic markets, as appropriate.

Our strategy also focuses on market expansion to reach more customers with more products on a global basis.
We have made five acquisitions since 2013, which: (1) has given us more advanced products with significant
improvements in our machine tool accuracy and precision, (2) allows us to seek higher productivity in complex
manufacturing environments, (3) provides automation for machine tending solutions, and (4) minimizes
dependencies associated with volatilities from economic and geographic cyclicality. 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. We have not changed our overall
strategy to design, manufacture, and sell a comprehensive line of computerized machine tools; rather, we have
enhanced this strategy through growth both organically and through acquisitions in an effort to attain long-term
stability and profitability.

We have seen the demand for machine tools fluctuate over the last three years. Our industry has continued to
face global headwinds due to changing economic conditions. 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. 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”). 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. 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. Reports available for the U.S. machine tool market include:

•
Global Machine Tool Outlook – generated by Oxford Economics;
•
United States Machine Tool Consumption – generated by the Association for Manufacturing
Technology, this report includes metal cutting machines of all types and sizes, including
segments in which we do not compete;
•
Purchasing Manager’s Index – developed by the Institute for Supply Management, this report
includes activity levels in U.S. manufacturing plants that purchase machine tools; and
•
Capacity Utilization of Manufacturing Companies – issued by the Federal Reserve Board.

A limited amount of information is available for foreign markets, and different reporting methodologies are
used by various countries. Machine tool consumption data, published by the Association for Manufacturing
Technology, calculates machine tool consumption annually by country. 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.

Demand for capital equipment can fluctuate significantly during periods of changing economic conditions.
Manufacturers and suppliers of capital goods, such as our company, are often the first to experience these
changes in demand. Additionally, since we build to stock and our typical order backlog is approximately 45
days, it is difficult to estimate demand with any reasonable certainty. Therefore, we do not have the benefit of
relying on the common leading indicators that other industries use for market analysis and forecasting purposes.

Products
Our core products consist of general-purpose, computerized machine tools for the metal cutting industry,
principally, vertical and horizontal machining centers (mills), turning centers (lathes), and toolroom machines.
Most of our machine tools are equipped with our fully integrated computer control systems that are powered
by our proprietary software, while the remaining machine tools are equipped with industry standard controls.
Additionally, we produce and distribute software options, control upgrades, hardware accessories, and
replacement parts for our machine tool product lines, and we provide operator training and support services to
our customers. We also produce computer control systems and related software for press brake applications
that are sold as retrofit units for installation on existing or new press brake machines, and we own an automation
integration company that specializes in job shop automation.
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.
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. 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. 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.
The main product categories of each brand are outlined below.

The Hurco, Milltronics, and Takumi product lines represent a comprehensive product portfolio with more than
150 different CNC machine models. The combined machine tool product lines provide benefits related to the
development of product enhancements, technologies, and models. 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. Our computer control system enables a machine tool operator
to create complex two-dimensional (“2D”) or three-dimensional (“3D”) machining programs directly from an
engineering drawing or computer-aided design geometry file, such as a solid model. 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. In addition, WinMax® has a Windows®† based operating system that
enables users to improve shop floor flexibility and software productivity. 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. 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. 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. 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. UltiMotion®, our patented motion control system, provides significant cycle time reductions and
increases the quality of a part’s surface finish. 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:

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. 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. 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.

___________________
† Windows® is a registered trademark of Microsoft Corporation in the United States and other countries.

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. The small and
medium size models are available with either belted or inline (direct drive) spindles and the larger models are
offered as either #40 or #50 taper. The VMX line consists of 14 models in eight sizes with X-axis travels of
24, 26, 30, 42, 50, 60, 64, and 84 inches.

HSi Product Line
Due to the integral, motorized spindle with a maximum speed of 20,000rpm, the HS product line is desirable
for the die and mold industry because of that industry’s particular interest in the improvement of surface finish
quality and the reduction of cycle time. Additionally, this product line offers us the opportunity to expand our
customer base to manufacturers that produce larger batches. The HS product line consists of four models with
X-axis travels of 24, 30, 42, and 60 inches.

Ui Series Product Line
This product line features five-axis trunnion tables integrated onto familiar C-frame style machines, making an
easy entry into five-axis for first-time users. U Series models are offered with eight, ten, and 14-inch diameter
rotary tables with either standard (belted) or direct drive (inline) spindles. 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. 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. Customers can choose between standard and high-speed spindles.

VCi/VCXi Product Line
The B-axis configuration of the VC/VCX Series provides greater undercut capability in both positive and
negative directions, allowing users to access more part surface area for machining. These cantilever machines
are available with either a 20-inch or 23.6-inch pallet, moderately-priced models or high performance model,
with a torque motor-driven 23.6-inch-diameter rotary table. 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. Four
models are available, two with 40-inch X-axis travels (a three-axis version and a five-axis version), as well as
53-inch and 63-inch X-axis travel models. The 53-inch and 63-inch models are available with #40 or #50 taper.

HMi Product Line
The HM product line offers customers moderately-priced horizontal machining centers designed for small lot
sizes. Two models are available, one with a rotary table and one with a plain table. They both have X-axis
travels of 67 inches. These products are designed for high-mix, low-volume applications that benefit from a
horizontal spindle configuration, but do not require an expensive pallet switching system typically found on
competitive horizontal machines.

HBMXi Product Line
The HBMX product line is beneficial to manufacturers that build custom machinery and parts for a multitude
of industries, such as packaging, pharmaceutical, automotive, energy, and medical. Additionally, boring mills
are also used to repair and/or rebuild large components. The HBMX boring mill product line consists of four
models with X-axis travels of 55, 79, 94, and 120 inches.

DCXi Product Line
The double column DCX series offers four different sizes, based on two, three, and four-meter X-axis travels
and Y-axis travel. These machining centers are designed to facilitate production of large parts and molds often
required by the aerospace, energy, and custom machinery industries. The 2- and 3-meter models offer two
different spindle sizes to fit different applications. 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. DCX machines are the largest models offered by Hurco that feature the powerful and flexible
WinMax® control.

TMi Product Line
The TM 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. The 2-axis turning TM models
are in four sizes, measured by chuck size: six, eight, ten, and 12 inches. We added motorized tooling on the
lathe turret to further enhance the capability of the TM turning centers and designated it as the TM-M product
line. These turning centers with live tooling allow our customers to complete a number of secondary milling,
drilling, and tapping operations while the part is still held in the chuck after the turning operations are complete,
which provides significant productivity gains. The TM-M product line consists of three models: TM8Mi,
TM10Mi, and TM12Mi. The newly introduced TM8MY and TM10MY models further expand productivity
and flexibility by adding a Y-axis, making the models suitable for complex jobs.

TMXi Product Line
The TMX product line consists of high-performance turning centers. There are six models in two sizes. 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. These
products are designed for customers who want to reduce part handling and complete complex components that
require speed, accuracy, and superior surface finish in a single set-up. They are available in either eight or ten-
inch main chuck sizes.

Product Development
Since Hurco is the technology and innovation brand of our corporate portfolio, we have focused our attention
on product enhancements of existing models in an effort to align the Hurco brand with the newest engineering
innovations and components available to compete with other premium brands in the marketplace. 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. 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. 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. 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 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. 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. Unlike most competitive models, it is not a retrofit
kit but rather designed from the ground up as a CNC.

TRQ/TRM Product Line
Products with the TRQ or TRM designation are part of the toolroom bed mill category, which are machines
that are available without an enclosure (also referred to as open bed machines), that provide easy access to the
worktable. 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. 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. Customers can choose models with X-axis travels of
25, 30, 40, or 50 inches. There is also a model with extended spindle nose-to-table dimensions for large fourth-
axis rotary applications.

VM Inline Performance (IL) Product Line
The VM-IL product line consists of moderately-priced performance vertical machining centers for high-speed
applications, such as die and mold, aerospace, and medical machining. Featuring heavier castings, faster
motion, and inline spindles, these 40-taper machines are available in four sizes. Models include X-axis travels
of 30, 42, 50, or 60 inches. Many of these models have extended Y-axis travels.

VM Extra Power (XP) Product Line
The VM-XP product line consists of moderately-priced, vertical machining centers for more demanding metal
removal applications, such as castings or forgings. These heavy-duty, 50-taper models are designed for
applications that require more power and torque. 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. 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. 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. 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. 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 X5 line is available in both belted and in-line spindle models,
featuring a 200- or 250-millimeter trunnion table.

Takumi CNC Machine Tools

The Takumi brand features machines designed for applications requiring precision and high speed, high
efficiency milling. 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®. 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 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. 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. The
VC machines are available in five sizes with X-axis travels of 34, 42, 47, 50, and 60 inches. An extended Y-
________________________
* Fanuc® is a registered trademark of GE Fanuc Automation Americas, Inc. Siemens® is a registered trademark of
Siemens AG. Mitsubishi® is a registered trademark of Mitsubishi Electric Corporation. Heidenhain® is a registered
trademark of HEIDENHAIN CORPORATION, a wholly-owned subsidiary of the German company DR. JOHANNES
HEIDENHAIN GmbH.

axis travel version of the 42-inch model is offered for mold shops making square mold bases.

V Series
The V Series vertical machining centers are heavy-duty, box-way machines built for tough applications such
as roughing cast iron. These massive three-axis machines feature belt or geared spindles to provide maximum
torque. The V Series product line includes eight models with X-axis travels of 39, 43, 47, 60, 70, 78, 86, and
126 inches.

H Series
Designed to produce parts that require high precision and superior surface finishes, H Series machines offer an
extremely rigid and thermally stable double-column design. These three-axis models feature high-speed, direct-
drive spindles, or built-in HSK spindles, with up to 20,000rpm, in addition to spindle speed options of
24,000rpm and 36,000rpm. The H Series product line consists of 11 models with X-axis travels of 24, 40, 49,
63, 86, 126, 157, and 197 inches, with select models available with extended Y-axis travel and/or high-speed
spindles. 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. The U Series product line consists of six models, four of which
offer trunnion table sizes of 10, 16, 24, and 31.5 inches. The UB version is equipped with a B/C swivel head
and a 12,000rpm built-in spindle. Its double-column design provides a spacious X-axis travel of 126 inches.
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. The G Series product line consists of three models with X-
axis travels of 22, 30, and 40 inches.

BC Series
BC Series machines are double column, three-axis machining centers designed for heavy cutting and
applications that require high power and torque, such as die and mold. These models include a heavy cutting,
6,000rpm geared-head spindle for maximum cutting power. The BC Series models are available in eight sizes,
including X-axis travels of 83, 122, 126, 157 and 197 inches, with several models featuring different choices
of Y-axis travel.

HMX Series
The HMX Series are high-speed horizontal machining centers that are capable of up to 1G acceleration. These
models include twin pallets to maximize cutting time along with very fast pallet exchange times and rapid
traverse rates. Available in 400-, 500-, and 630-millimeter pallet sizes, they can also be fitted with expandable
automatic tool changers that hold up to 220 tools. The HMX500 model is available in either #40 or #50 taper
spindles.

SL Lathes
SL slant-bed lathes are turning centers equipped with box ways and designed for heavy cutting to provide

superior part finishes. 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. This machine features faster rapids with a 15,000rpm direct drive spindle for production of high accuracy
and complex parts. The UA400 five-axis model was also introduced and has a 15,000rpm direct drive spindle
with a trunnion table mounted 90 degrees on the front of the machine for ease of part loading and provision to
integrate automation. 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”).

Autobend®
Our Autobend® computer control systems are applied to metal bending press brake machines that form parts
from sheet metal and steel plate. They consist of a microprocessor-based computer control and back gauge (an
automated gauging system that determines where the bend will be made). We have manufactured and sold the
Autobend® product line since 1968. 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. These products are sold to users of our Hurco computerized machine tools equipped with our
dual touch-screen or single touch-screen consoles featuring WinMax® control software. Each international
division packages the options as appropriate for its market. The most common options include Advanced
Verification Graphics, Solid Model Import with 3D DXF Technology, Swept Surface, DXF Transfer,
UltiMonitor, UltiPocket with Helical Ramp Entry and Insert Pockets, Conversational Part and Tool Probing,
Tool and Material Library, NC/Conversational Merge, Job List, Automation Job Manager, Stream Load, Active
Thermal Compensation, Thread Repair, and Simultaneous Five-Axis Contouring.

The Advanced Verification Graphics option displays a picture of the rendered part on the screen of the control
that can be viewed from any angle. The detail allows the customer to evaluate how the part is programmed to
be machined before cutting commences, which eliminates the need to scrap expensive material.

Our Swept Surface software option simplifies programming of 3D contours and significantly reduces
programming time.

The DXF Transfer software option increases operator productivity because it eliminates manual data entry of
part features by transferring AutoCAD®* drawing files directly into our computer control or into our desktop
programming software, WinMax® Desktop.

________________________
* AutoCAD® is a registered trademark of Autodesk, Inc., and/or its subsidiaries/ affiliates in the U.S. and/or other
countries.

Solid Model Import with 3D DXF Technology automatically uses geometry from a 3D CAD model to easily
create conversational programs for 2D and 3D parts or even 3+2 and 5-sided parts.

Designed to take advantage of the Internet of Things, UltiMonitor is a web-based productivity, management,
and service tool that enables customers to monitor, inspect, and receive notifications about their Hurco
machines from any location where they can access the internet. 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. Islands can also be rotated, scaled, and repeated.

Conversational Part and Tool Probing options permit the computerized dimensional measurement of machined
parts and the associated cutting tools. 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. The user enters the tool data and geometry one time and chooses
the particular tool from the list when it is needed. Additionally, the library reads the part program and
automatically locates the tool or displays an alert if the tool does not exist. 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. This allows the user to create continuous tool-paths along complex geometries with only a single
machine/part setup, providing increased productivity along with the performance benefits of using shorter
cutting tools. The sale of simultaneous five-axis contouring software is subject to government export licensing
requirements.

ProCobots CNC Automation

ProCobots provides automation solutions including collaborative robots (cobots), grippers, material handling,
and Industry 4.0-capable software and controls. Designed to be easy to use, safe, and flexible, ProCobots
solutions are standardized systems aimed at customers who are in high-mix, low- and medium-volume
manufacturing environments. Products include portable models, such as the ProFeeder Flex and ProFeeder
Table, as well as flexible cell solutions, including the ProFeeder and Easy Desk, and higher volume systems
including the ProFeeder Compact, ProFeeder X, and ProFeeder XL models. 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. 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.
These trunnion tables have faster rpm feedrates, interchangeable platter diameters, the ability to add power
work holding devices and provision to easily incorporate rotary union. LCM has several lines of CNC rotary
tables for both horizontal and vertical-horizontal positioning. Customers can choose rotary tables with either
hydraulic or pneumatic clamping systems. Additionally, LCM offers CNC rotary tables powered by either a
torque motor or a high-precision mechanical transmission.

CNC Tilt Tables
LCM has several lines of CNC tilting rotary tables, intended specifically for five-axis machining centers. Each
of the lines is differentiated by the technology used for clamping (hydraulic or pneumatic) and by the type of
transmission (either mechanical transmission or torque motor).

Swivel Heads and Electro-spindles
LCM has two primary lines of swivel heads that enable the spindle axis to be tilted with continuous motion and
several electro-spindle (built-in motors for swivel heads) options. The two lines of swivel heads are
differentiated by the type of transmission (either mechanical transmission or torque motor).

Non-Hurco Branded Products & Technologies

While our three brands of CNC machine tools, related software products, Autobend®, ProCobots, and LCM are
responsible for the vast majority of our revenue, we have added certain other non-Hurco OEM products to our
portfolio that contribute to our top and bottom line, provide product diversity and market penetration
opportunity, and reduce the impact of geographic cyclicality. We believe these non-Hurco branded products
help us partially offset the cyclical nature of the machine tool market and potentially reduce the risks associated
with expansion into new geographic markets by diversifying our product offering. 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. We also offer select models
of Milltronics branded machines as OEM ready machines that can be branded and sold under a private label by
independent third parties.

Parts and Service

Our service organization provides installation, warranty, operator training, and customer support for our
products on a worldwide basis. In the United States, our principal distributors generally have the primary
responsibility for machine installation and warranty service and support for product sales. Our service
organization also sells software options, computer control upgrades, accessories, and replacement parts for our
products. We believe our after-sales parts and service business strengthens our customer relationships and
provides continuous information concerning the evolving requirements of end-users.

Manufacturing

Our computerized metal cutting machine tools are manufactured and assembled to our specifications primarily
by our wholly-owned subsidiary in Taiwan (Hurco Manufacturing Limited (“HML”)). 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. The LCM
line of electro-mechanical components and accessories for machine tools is designed and manufactured in Italy.
Our facility in Indianapolis, Indiana, also conducts final assembly operations for certain Hurco VMX machines,
Milltronics IL/XP models, Milltronics bridge mills for the American market, certain electro-spindle
components for LCM, and automation systems for ProCobots.

We have a contract manufacturing agreement for computer control systems with Hurco Automation, Ltd.
(“HAL”), a Taiwanese company in which we have a 35% ownership interest. This company produces all of
our computer control systems to our specifications, sources industry standard computer components and our
proprietary parts, performs final assembly, and conducts test operations.

We work closely with our subsidiaries, key component suppliers, and HAL to ensure that their production
capacity will be sufficient to meet the projected demand for our machine tool products. Many of the key
components used in our machines can be sourced from multiple suppliers. 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. Although some distributors carry competitive
products, we are the primary line for the majority of our distributors globally. We also have our own direct
sales and service organizations in China, the Czech Republic, France, Germany, India, Italy, the Netherlands,
Poland, Singapore, Taiwan, the United Kingdom, and certain parts of the United States, which are among the
world’s principal machine tool consuming markets. 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. No single end-user or distributor of our products accounted for more than 5% of our
total sales and service fees. The end-users of our products are precision tool, die and mold manufacturers,
independent job shops, specialized short-run production applications within large manufacturing operations,

and manufacturing facilities that focus on medium-to-high run production of large batches of a few types of
parts instead of small batches of many different parts. Industries served include aerospace, defense, medical
equipment, energy, automotive/transportation, electronics, and computer industries.

We also sell our Autobend® computer control systems to OEMs of new metal fabrication machine tools that
integrate them with their own products prior to the sale of those products to their own customers, to retrofitters
of used metal fabrication machine tools that integrate them with those machines as part of the retrofitting
operation, and to end-users that have an installed base of metal fabrication machine tools, either with or without
related computer control systems.

Demand

We believe demand for our products is driven by advances in industrial technology and the related demand for
automated process improvements. 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. Most of our
competitors are larger and have greater financial resources than us. 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. We offer our products in a range of prices and
capabilities to target a broad potential market. We also believe that our competitiveness is aided by our
reputation for reliability and quality, our strong international sales and distribution organization, and our
extensive customer service organization.

Intellectual Property

We consider the majority of our products to be proprietary. Various features of our Hurco and Milltronics
control systems and machine tools employ technologies covered by patents and trademarks that are material to
our business. 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.

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. 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 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. 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. We
have not experienced any employee-generated work stoppages or disruptions, and we consider our employee
relations to be satisfactory.

Employee Engagement, Development, and Training
We encourage and support the growth and development of our employees and, wherever possible, seek to fill
positions by promotion and transfer from within the organization. We advance continual learning and career
development through ongoing performance and development conversations or evaluations with employees,
internally and externally developed training programs, and educational reimbursement programs. In connection
with the latter, reimbursement is available to employees enrolled in pre-approved degree or certification
programs at accredited institutions that teach skills or knowledge relative to our business or otherwise to the
development of the employee’s skill set or knowledge base. 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. This
commitment includes a policy to provide equal access to, and participation in, equal employment opportunities,
programs, and services without regard to race, religion, color, national origin, disability, sex, sexual orientation,
gender identity, stereotypes or assumptions based thereon. 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
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 also maintain a whistleblower policy and anonymous
hotline for the confidential reporting of any suspected policy violations or unethical business conduct on the
part of our businesses, employees, officers, directors, or vendors, and we provide training and education to our
global workforce with respect to our Code of Business Conduct and Ethics and anti-corruption and anti-bribery
policies. We intend to disclose any amendment to, or a waiver from, a provision of our Code of Business
Conduct and Ethics that applies to our principal executive officer, principal financial officer, principal
accounting officer or controller, or persons performing similar functions by posting such information on our
website at www.hurco.com.

Backlog

For information on orders and backlog, see Item 7. Management’s Discussion and Analysis of Financial
Condition and Results of Operations in this report.

Availability of Reports and Other Information

Our website can be found at www.hurco.com. We use this website as a means of disclosing pertinent
information about the Company, free of charge, including:

•
Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, proxy materials, Current Reports on
Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after we electronically
file that material with or furnish it to the SEC;
•
Press releases on quarterly earnings, product announcements, legal developments, and other material
news that we may post from time to time;
•
Corporate governance information including our Corporate Governance Principles, Code of Business
Conduct and Ethics, information concerning our Board of Directors and its committees, including the
charters of the Audit Committee, Compensation Committee, Nominating and Governance Committee
and other governance-related policies; and
•
Opportunities to sign up for email alerts and RSS feeds to have information provided in real time.

The information available on our website is not incorporated by reference in, or a part of, this or any other
report we file with, or furnish to, the SEC.

Item 1A.
RISK FACTORS

In this section, we describe what we believe to be the material risks related to our business. The risks and
uncertainties described below or elsewhere in this report are not the only ones to which we are exposed.
Additional risks and uncertainties not presently known and/or risks we currently deem immaterial may also
adversely affect our business and operations. If any of the developments included in the following risks were
to occur, our business, financial condition, results of operations, cash flows, or prospects could be materially
adversely affected.

Risks Related to Our Industry and International Operations

The cyclical nature of our business causes fluctuations in our operating results.
The machine tool industry is highly cyclical and changes in demand can occur abruptly in the geographic
markets we serve. As a result of this cyclicality, we have experienced significant fluctuations in our sales,
which, in periods of reduced demand, have adversely affected our results of operations and financial condition,
which could re-occur in the future.

Material adverse developments in global economic conditions, or the occurrence of certain other world
events, could negatively affect demand for our products and harm our business.
Economic uncertainty and business downturns in the U.S., European, and Asian Pacific markets have adversely
affected, and may in the future adversely affect, our results of operations and financial condition. Global
economic uncertainty has produced, and continues to produce, substantial stress, volatility, illiquidity, and
disruption of global credit and other financial markets. Various factors contribute to the uncertain economic

environment, including geopolitical tensions, military conflicts, the level and volatility of interest rates, the
level of inflation, the continuing effects of regional or global health pandemics, an actual recession or fears of
a recession, trade policies and tariffs, and political and governmental instability.

Economic uncertainty has and could continue to negatively affect the businesses and purchasing decisions of
companies in the industries we serve. Such disruptions present considerable risks to our businesses and
operations. 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.
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. 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.

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. Also, in some foreign jurisdictions, we may be subject to laws limiting the right and ability
of entities organized or operating therein to pay dividends or remit earnings to affiliated companies unless
specified conditions are met. These factors may adversely affect our future operating results. The vast majority
of our products are shipped from our manufacturing facility in Taiwan from the Port of Taichung to four ports
of destination: Los Angeles, California; Tacoma, Washington; Venlo, the Netherlands; and Shanghai, China.
Changes in customs requirements, as a result of national security or other constraints put upon these ports, may
also have an adverse impact on our results of operations. Similarly, significant delays at one or more of the

ports where our products are shipped or received has impacted, and could continue to impact, the amount of
time required to ship our products to customers, which could materially adversely impact our business, demand
for our products, our ability to meet quoted delivery dates, our results of operations, future operations, and/or
financial condition.

Additionally, we must comply with complex foreign and U.S. laws and regulations in a multitude of
jurisdictions, such as the U.S. Foreign Corrupt Practices Act, the U.K. Bribery Act, other foreign laws
prohibiting corrupt payments to governmental officials, and anti-competition regulations. Violations of these
laws and regulations could result in fines and penalties, criminal sanctions, tariffs or duties, restrictions on our
business conduct and on our ability to offer our products in one or more countries, and could also materially
adversely affect our brand, our ability to attract and retain employees, our international operations, our business
and our operating results. 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”). The geopolitical environment and ongoing sovereign relationship between China and Taiwan,
including recent heightened tensions between them, could have a material impact on our business. Specifically,
if a trade war, tariff, physical or economic blockade, or war ensued and impacted access to or from the Taiwan
or Chinese markets or workforce, we could have challenges maintaining production plans or output, accessing
the skilled labor necessary to produce our products without interruption, accessing and/or shipping our finished
goods, work in progress, or other inventories located in either of those territories, accessing or maintaining our
supply base that is located in those territories or elsewhere, and/or otherwise experience significant disruptions
in our business. Such disruptions, if prolonged, could have a material adverse effect on our business, results of
operations, and financial condition. 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.
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. Therefore, our results of operations and financial condition are affected by fluctuations in
exchange rates between these currencies and the U.S. dollar, both for purposes of actual conversion and for
financial reporting purposes. In addition, we are exposed to exchange risk associated with our purchases of
materials and components for our Taiwan manufacturing operations, which are primarily made in the New
Taiwan Dollar and the Euro. We hedge a portion of our foreign currency exposure with the purchase of forward
exchange contracts. These hedge contracts only mitigate the impact of changes in foreign currency exchange
rates that occur during the term of the related contract period and carry risks of counterparty failure. There can
be no assurance that our hedges will have their intended effects.

We compete with larger companies that have greater financial resources, and our business could be harmed
by competitors’ actions.
The markets in which our products are sold are extremely competitive and highly fragmented. In marketing our
products, we compete with other manufacturers in terms of quality, reliability, price, value, delivery time,

service, and technological characteristics. We compete with a number of U.S., European, and Asian
competitors, many of which are larger and have substantially greater financial resources and some of which
have been supported by governmental or financial institution subsidies and, therefore, may have competitive
advantages over us. 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.
The machine tool industry is subject to technological change, evolving industry standards, changing customer
requirements, and improvements in and expansion of product offerings. Our ability to anticipate changes in
technology, industry standards, customers’ requirements, and competitors’ product offerings, and to develop
and introduce new and enhanced products on a timely basis that are accepted in the market, are significant
factors in maintaining and improving our competitive position and growth prospects, and we may not be able
to accomplish those actions on a timely basis or at all. If the technologies or standards used in our products
become obsolete or fail to gain widespread commercial acceptance, our business would be materially adversely
affected. Developments by others may render our products or technologies obsolete or noncompetitive.

Our continued success depends on our ability to protect our intellectual property.
Our future success depends, in part, upon our ability to protect our intellectual property. We rely principally
on nondisclosure agreements, other contractual arrangements, trade secret law, trademark registration, and
patents to protect our intellectual property. However, these measures may be inadequate to protect our
intellectual property from infringement by others or to prevent misappropriation of our proprietary rights. In
addition, the laws of some foreign countries do not protect proprietary rights to the same extent as do U.S. laws.
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. While it is not possible to predict the outcome of patent and other intellectual property litigation,
such litigation could result in our payment of significant monetary damages and/or royalty payments, negatively
impact our ability to sell current or future products, reduce the market value of our products and services, lower
our profits, and could otherwise have an adverse effect on our business, financial condition, and results of
operations.

Finally, certain subcontractors, vendors, and third parties provide inputs, components, code, and/or similar
items that are complimentary and compatible with our products, software, and controls. 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.
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.
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. An unplanned

interruption in manufacturing or supply, or a significant increase in price from third party suppliers, would have
a material adverse effect on our business, results of operations, and financial condition. Such an interruption or
increase in price could result from various factors, including a change in the political environment, such as
trade wars or tariffs, military conflicts, a natural disaster, such as an earthquake, typhoon, or tsunami, or
vulnerabilities in our technology or cyber-attacks against our information systems, such as ransomware attacks.
Any interruption in service by one of our key component suppliers, if prolonged, could have a material adverse
effect on our business, results of operations and financial condition. In addition, we may not be able to establish
additional or replacement suppliers for such components in a reasonable period of time, or on commercially
reasonable terms, if at all, which could result in delays or interruptions in our operations, which would adversely
affect our business, results of operations and financial condition.

Fluctuations in the price of raw materials and other inputs, especially steel, iron, and energy, could adversely
affect our sales, costs, and profitability.
We manufacture products with a high iron and steel content. The availability and price for these and other raw
materials, as well as for other inputs such as energy, are subject to volatility due to worldwide supply and
demand forces, speculative actions, inventory levels, exchange rates, production costs, anticipated or perceived
shortages, geopolitical relationships or conflicts, and tariffs or other trade restrictions. In some cases, those cost
increases can be passed on to customers in the form of price increases, in other cases, they cannot. If the prices
of raw materials and other inputs increase and we are not able to charge our customers higher prices to
compensate, our results of operations would be adversely affected.

The unanticipated loss of current members of our senior management team and other key personnel may
adversely affect our operating results.
The unexpected loss of members of our senior management team or other key personnel could impair our ability
to carry out our business plan. We believe that our future success will depend, in part, on our ability to attract
and retain highly skilled and qualified personnel. 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 actively seek opportunities to expand our product offerings or the markets we serve by acquiring other
companies, product lines, technologies, and personnel. 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. No assurance can be given that our acquisitions will be
successful. Further, no assurance can be given that an acquisition will not adversely affect our business,
operating results, or financial condition. Failure to manage and successfully integrate an acquisition could harm
our business and operating results in a material way. Even when an acquired company has already developed
and marketed products, there can be no assurance that enhancements to those products will be made in a timely
manner or that pre-acquisition due diligence will identify all possible issues that might arise with respect to
such products or the acquired business.

Risks related to new product development also apply to acquisitions. 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.
A number of U.S. states have enacted data privacy and security laws and regulations that govern the collection,
use, disclosure, transfer, storage, disposal, and protection of sensitive personal information, such as social
security numbers, financial information, and other personal information. For example, several U.S. territories
and all 50 states now have data breach laws that require timely notification to individual victims, and at times
regulators, if a company has experienced the unauthorized access or acquisition of sensitive personal data.
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, 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. Other states have considered and/or enacted similar privacy laws. 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. General Data Protection Regulation (the
“GDPR”), also apply to some of our operations. Legal requirements in these countries relating to the collection,
storage, processing and transfer of personal data continue to evolve. The GDPR imposes, among other things,
strict obligations and restrictions on the collection and use of U.K. and E.U. personal data, a requirement for
prompt notice of data breaches in certain circumstances, a requirement for implementation of certain approved
safeguards (such as the use of approved “standard contractual clauses” and the performance of appropriate data
transfer impact assessments) for transfers of personal data to other countries that have not been determined by
the E.U. or the U.K. to provide adequate data privacy protections, and possible substantial fines for any
violations. Brazil, India, South Africa, Japan, China, Israel, Canada, and numerous other countries have

introduced and, in some cases, enacted, similar data privacy and cyber and data security laws.

The interpretation and enforcement of the laws and regulations described above are uncertain and subject to
change and may require substantial costs to monitor and implement compliance with any additional
requirements. 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.
As part of our business, we store our data and certain data about our employees, customers, and vendors in our
information technology systems. If a third party gained unauthorized access to our data, including any data
regarding our employees, customers, or vendors, the security breach could expose us to risks, including loss of
business, litigation, and possible liability. Our security measures may be breached as a result of third-party
action, including intentional misconduct by computer hackers, employee error, malfeasance, or otherwise.
Third parties may attempt to fraudulently induce employees or customers into disclosing sensitive information
such as usernames, passwords, or other information to gain access to our customers' data or our data, including
our intellectual property and other confidential business information, or our information technology systems.
In addition, given their size and complexity, our information systems could be vulnerable to service
interruptions or to security breaches from inadvertent or intentional actions by our employees, third-party
vendors, and/or business partners, or from cyber-attacks by malicious third parties attempting to gain
unauthorized access to our products, systems, or confidential information.

Like other public, multi-national corporations, we have and will continue to be subject to, instances of phishing
attacks on our email systems, other cyber-attacks, including state-sponsored cyber-attacks, industrial espionage,
insider threats, computer denial-of-service attacks, computer viruses, ransomware, and other malware, wire
fraud, or other cyber incidents.

The techniques used to obtain unauthorized access, or to sabotage systems, are becoming more sophisticated,
frequent, and adaptive, and therefore, we may be unable to anticipate these techniques or to implement adequate
preventative measures. Any security breach could result in: the unauthorized publication of our confidential
business or proprietary information; the unauthorized release of employee, customer, or vendor data and
payment information; a loss of confidence by our customers; damage to our reputation; a disruption to our
business; litigation and legal liability; and a negative impact on our future sales. 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.
Widespread public health emergencies or outbreaks of epidemics, pandemics, or contagious diseases, such as
the COVID-19 pandemic, have had, and could in the future have, a material adverse effect on our business,
financial condition, and results of operations. 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. Any or all of the foregoing in jurisdictions where
we or our customers, suppliers, or business partners are located have had and could in the future have a material
adverse effect on our business, results of operations, cash flows, and financial condition. 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.
The technology within our products evolves, and we periodically bring new versions of our machines to market.
The phasing out of an old product involves estimating the amount of inventory required to satisfy the final
demand for those machines and to satisfy future repair part needs. Based on changing customer demand and
expectations of delivery times for repair parts, we may find that we have either obsolete or excess inventory on
hand. Because of changes in technology, market demand or market expectations, we might have to write off
unusable inventory, which would adversely affect our results of operations.

Assets have become, and may become further, impaired, requiring us to record a significant charge to
earnings.
We review our assets, including intangible assets, for indications of impairment annually and when events or
changes in circumstances indicate the carrying value may not be recoverable. We could be required to record
a significant charge to earnings in our financial statements for the period in which any impairment of these
assets is determined, which would adversely affect our results of operations for that period.

We may experience negative or unforeseen tax consequences.
We may experience negative or unforeseen tax consequences, which could materially adversely affect our
results of operations. We review the probability of the realization of our net deferred tax assets each period
based on forecasts of taxable income in both the U.S. and foreign jurisdictions. This review uses historical
results, projected future operating results based upon approved business plans, eligible carryforward periods,
tax-planning opportunities, and other relevant considerations. Adverse changes in our profitability and
financial outlook in the U.S. or foreign jurisdictions may require the creation of a valuation allowance to reduce
our net deferred tax assets. Such changes could result in material non-cash expenses in the period in which the
changes are made and could have a material adverse impact on our results of operations and financial condition.
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. Due to economic and political
conditions, tax rates in various jurisdictions, including the U.S., may be subject to significant change. Our
effective tax rates could be adversely affected by changes in the mix of earnings in countries with differing
statutory tax rates, changes in the valuation of deferred tax assets and liabilities, or changes in tax laws or their
interpretation, including tax laws in the U.S. Similarly, changes in tax laws or regulations, including those in

the U.S., could negatively impact our effective tax rate and results of operations. 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.

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. For example, changes in the tax laws of foreign jurisdictions could arise as a result of the “base erosion
and profit shifting” project undertaken by the Organisation for Economic Co-operation and Development
(“OECD”). The OECD, which represents a coalition of member countries, has recommended changes to
numerous long-standing tax principles. These changes, as adopted by countries, could increase tax uncertainty
and may adversely affect our provision for income taxes.

Item 1B.
UNRESOLVED STAFF COMMENTS
None.

Item 1C.
CYBERSECURITY

We recognize the importance of developing, implementing, and maintaining processes for assessing,
identifying and managing material risks from cybersecurity threats.

Risk Management and Strategy

We continue to invest in strengthening our cybersecurity strategy and platform and, as specifically set forth
below, have integrated cybersecurity risk management into our broader enterprise risk management process.
This integration will promote cybersecurity considerations as an integral part of our decision-making processes
and operational practices. Our information technology department works closely with our senior management
team to consistently identify, evaluate, and manage cybersecurity risks in alignment with our business strategy
and objectives and operational needs.

We regularly monitor alerts from governmental authorities and industry experts, as well as third party system
and organizational controls reports, to remain informed about prevailing and developing cybersecurity threats
and bad actor tactics. We also periodically engage third party consultants to conduct independent assessments
of our cybersecurity readiness and control effectiveness; to gain insights into emerging threats and
vulnerabilities, industry trends, and leading practices; and to inform our cybersecurity strategy. 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. We have also developed, implemented, and maintain a cyber incident response plan,
which is periodically reviewed and updated and includes procedures for addressing and recovering from cyber
incidents while reducing the impact on the business and operations. 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. In doing so, we use systems that provide immutable backup and recovery of files and virtual
machines, encryption of data at rest and in transit to protect against unauthorized access, and transmission of
copies offsite at predetermined, recurring, and frequent intervals.

While we have experienced cybersecurity incidents and expect to continue to be subject to such incidents, to
date, we have not experienced any cybersecurity incidents that have materially affected our business strategy,
results of operations or financial condition. However, we are subject to ongoing risks from cybersecurity threats
that could materially affect us, including our business strategy, results of operations, or financial condition, as
further described in Part I, Item 1A, "Risk Factors" of this Annual Report on Form 10-K.

Governance

The Audit Committee of our Board of Directors oversees cybersecurity risk management as part of its risk
oversight function and oversees the design and effectiveness of management’s implementation of our
cybersecurity risk management program, procedures, and contingency plans. Senior management plays a
critical role in informing the Audit Committee on cybersecurity risks. 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. 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. 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.

Item 2.
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. 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. 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.

Item 3.
LEGAL PROCEEDINGS
From time to time, we are involved in various claims and lawsuits arising in the normal course of
business. Pursuant to applicable accounting rules, we accrue the minimum liability for each known claim when
the estimated outcome is a range of possible loss and no one amount within that range is more likely than
another. We maintain insurance policies for such matters, and we record insurance recoveries when we
determine such recovery to be probable. We do not expect any of these claims, individually or in the aggregate,
to have a material adverse effect on our consolidated financial position or results of operations. We believe
that the ultimate resolution of claims for any losses will not exceed our insurance policy coverages.

Item 4.
MINE SAFETY DISCLOSURES
None.
Information about our Executive Officers
Executive officers are appointed each year by the Board of Directors following the Annual Meeting of
Shareholders to serve during the ensuing year and until their respective successors are elected and qualified.
There are no family relationships between any of our executive officers or between any of them and any of the
members of the Board of Directors.
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

Executive Chairman of the Board
Gregory S. Volovic

Director, President, and Chief Executive Officer
Sonja K. McClelland
53

Executive Vice President, Treasurer and Chief Financial Officer
HaiQuynh Jamison

Corporate Controller and Principal Accounting Officer
Jonathon D. Wright

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. 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. 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. 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 was employed by Unisys Corporation.

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. McClelland has been an executive officer
of our company since 2004 when she was appointed as Principal Accounting Officer, Corporate Controller and

Assistant Secretary. Ms. McClelland held various finance and accounting roles with us between 1996 and
2004. Prior to joining us, Ms. McClelland was employed by Arthur Andersen LLP.

HaiQuynh Jamison has been employed by us since March 2006 and was appointed as Corporate Controller and
Principal Accounting Officer in March 2021. Prior to her appointment as Corporate Controller, Ms. Jamison
served as the Director of Financial Reporting and Policy from 2014 to 2021 and as Corporate Accounting
Manager then Division Controller from 2006 to 2014. Prior to joining us, Ms. Jamison was employed by
various international public accounting firms, including Ernst & Young Global Limited and
PricewaterhouseCoopers International Limited.

Jonathon D. Wright has been employed by us since September 2016, was appointed as Corporate Secretary in
March 2021, and has served as our General Counsel since 2016. Prior to joining us, Mr. Wright served as an
attorney for Dentons Bingham Greenebaum LLP, specializing in corporate law, mergers and acquisitions,
capital formation, and complex commercial transactions.

PART II
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.
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. The declaration and amount of any
future cash dividends will be subject to the sole discretion of our Board of Directors and will depend upon many
factors, including our results of operations, financial condition, capital requirements, regulatory and contractual
restrictions, our business strategy and other factors deemed relevant by our Board of Directors from time to
time.

Our payment of dividends is limited by our U.S. credit agreement, as further described in Item 7. Management’s
Discussion and Analysis of Financial Condition and Results of Operations and in Note 4 of Notes to
Consolidated Financial Statements.

Stock Repurchases
On January 6, 2023, we announced a share repurchase program in an aggregate amount of up to $25.0 million.

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. The program may be amended, suspended, or discontinued at any time and does not commit us to
repurchase any shares of our common stock. 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.
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.

Item 6.
RESERVED

Item 7.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following Management’s Discussion and Analysis of Financial Condition and Results of Operations
(“MD&A”) contains information intended to help provide an understanding of our financial condition and other
related matters, including our liquidity, capital resources and results of 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. 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.
EXECUTIVE OVERVIEW
Hurco Companies, Inc. is an international, industrial technology company operating in a single segment. We
design, manufacture, and sell computerized (i.e., CNC) machine tools, consisting primarily of vertical
machining centers (mills) and turning centers (lathes), to companies in the metal cutting industry through a
worldwide sales, service, and distribution network. Although most of our computer control systems and
software products are proprietary, they predominantly use industry standard personal computer
components. Our computer control systems and software products are primarily sold as integral components
of our computerized machine tool products. We also provide machine tool components, automation integration
equipment and solutions for job shops, software options, control upgrades, accessories, and replacement parts
for our products, as well as customer service, training, and applications support.

The following overview is intended to provide a brief explanation of the principal factors that have contributed
to our recent financial performance. 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. 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. 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. 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 used that cashflow to manage our capital allocation strategies to continue investing in new
technologies, product development, and necessary capital expenditures to maximize cashflows without
incurring any significant indebtedness as we continue to seek new acquisitions and other growth opportunities.
The cyclicality of our business requires that we exercise discipline in managing through unexpected changes in
the markets and industries in which we operate. 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 brands of CNC machine tools in our product portfolio. Hurco is the technology 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. The Takumi brand is for customers that need very high speed, high efficiency performance,
such as that required in the production, 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. These three brands of CNC machine tools are responsible for the vast majority of our revenue.
However, we have added other non-Hurco branded products to our product portfolio that have contributed
product diversity and market penetration opportunity. 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. 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. We also have our own direct sales and service organizations in
China, the Czech Republic, France, Germany, India, Italy, the Netherlands, Poland, Singapore, Taiwan, the
United Kingdom, and certain parts of the United States, which are among the world's principal machine tool
consuming markets. 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. 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). Our product costs are incurred and paid primarily in the New Taiwan Dollar and the U.S. dollar.
Changes in currency exchange rates may have a material effect on our operating results and consolidated
financial statements as reported under U.S. Generally Accepted Accounting Principles. For example, when the
U.S. dollar weakens in value relative to a foreign currency, sales made, and expenses incurred, in that currency
when translated to U.S. dollars for reporting in our financial statements, are higher than would be the case when
the U.S. dollar is stronger. In the comparison of our period-to-period results, we discuss the effect of currency
translation on those results, which reflect translation to U.S. dollars at exchange rates prevailing during the
period covered by those financial statements.

Our high levels of foreign manufacturing and sales also expose us to cash flow risks due to fluctuating currency
exchange rates. 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
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. 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. 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. 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 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.

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.

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 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. 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.
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. 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. 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.
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 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.

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 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 increase in Asian
Pacific orders was driven primarily by increased customer demand for Hurco and Takumi machines in China,
India, and Southeast Asia. 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 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. 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. 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 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. 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. 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.
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. 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. 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.
Provision for Income Taxes. Income tax expense for fiscal year 2024 was $6.8 million, compared to $2.4 million
for fiscal year 2023. 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. 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. 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. 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. 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 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 balance is attributable to our foreign
operations and is held in the local currencies of our various foreign entities, subject to fluctuations in currency
exchange rates. We do not believe that the indefinite reinvestment of these funds offshore impairs our ability
to meet our domestic working capital needs.
Working capital as of October 31, 2024 was $180.8 million, compared to $193.3 million as of October 31,
2023. 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. 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. 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.
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. The program may be amended, suspended, or discontinued at any time and does not
commit us to repurchase any shares of our common stock. 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.

During fiscal year 2024, we paid cash dividends to our shareholders of $2.1 million. 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. Future dividends
are subject to approval of our Board of Directors and will depend upon many factors, including our results of
operations, financial condition, capital requirements, regulatory and contractual restrictions, our business
strategy and other factors deemed relevant by our Board of Directors from time to time.

On December 31, 2018, we and our subsidiary Hurco B.V. entered into a credit agreement with Bank of
America, N.A., as the lender, which was subsequently amended on each of March 13, 2020, December 23,
2020, December 17, 2021, January 4, 2023, and December 19, 2023 (as amended, the “2018 Credit
Agreement”). 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 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. Under the 2018 Credit Agreement, we and Hurco B.V. are borrowers, and certain of
our other subsidiaries are guarantors. 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. 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. We may use the proceeds from advances under the 2018 Credit Agreement for general
corporate purposes.

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. 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. 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. 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. 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

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 some of these obligations arise under long-term supply agreements, we are not
committed under these agreements to accept or pay for requirements that are not needed to meet our production
needs. We have no material minimum purchase commitments or “take-or-pay” type agreements or
arrangements. 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.

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. We expect to fund these commitments with cash on hand
and cash generated from operations.

Off Balance Sheet Arrangements

From time to time, our subsidiaries guarantee third party payment obligations in connection with the sale of
machines to customers that use financing. 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. Upon shipment of
a machine, the customer assumes the risk of ownership. The customer does not obtain title, however, until the
customer has paid for the machine. A retention of title clause allows us to recover the machine if the customer
defaults on the financing. We accrue liabilities under these guarantees at fair value, which amounts are
insignificant.

Critical Accounting Estimates

Our discussion and analysis of financial condition and results of operations is based upon our consolidated
financial statements, which have been prepared in accordance with U.S. Generally Accepted Accounting
Principles. The preparation of financial statements in conformity with those accounting principles requires us
to make judgments and estimates that affect the amounts reported in the consolidated financial statements and
accompanying notes. Our accounting policies are frequently evaluated as our judgment and estimates are based
upon historical experience and on various other assumptions that we believe to be reasonable under the
circumstances.

Our judgments and estimates have a significant effect on the financial statements because they result primarily
from the need to make estimates about the effects of matters that are inherently uncertain. Actual results could
differ from those estimates and such differences could be material to our financial condition and results of
operations. Critical accounting estimates are those that involve a significant level of estimation uncertainty and
have had or are reasonably likely to have a material impact on our financial condition and results of operations.

While our significant accounting policies are more fully described in Note 1 to our consolidated financial
statements included elsewhere in this report, we believe the following discussion addresses our most critical
accounting estimates, which involve significant subjectivity and judgment, and changes to such estimates or
assumptions could have a material impact on our financial condition or operating results. 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.

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. The
determination as to when in the product development cycle technological feasibility has been established, and
the expected product life, require judgments and estimates by management and can be affected by technological
developments, innovations by competitors, and changes in market conditions affecting demand. We
periodically review the carrying values of these assets and make judgments as to ultimate realization
considering the above-mentioned risk factors.

Item 7A.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk
Interest on borrowings under our bank credit agreements are tied to prevailing domestic and foreign interest
rates. 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. 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. Our
purchases are predominantly in foreign currencies and in some cases our arrangements with these suppliers
include foreign currency risk sharing agreements, which reduce (but do not eliminate) the effects of currency
fluctuations on product costs. The predominant portion of the exchange rate risk associated with our product
purchases relates to the New Taiwan Dollar and the Euro.

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). We also enter into foreign currency forward exchange contracts
to protect against the effects of foreign currency fluctuations on inter-company receivables, payables, and loans
denominated in foreign currencies. 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. 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

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

We are also exposed to foreign currency exchange risk related to our investment in net assets in foreign
countries. 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. The forward method requires all changes in the fair value of the contract to
be reported as a cumulative translation adjustment, net of tax, in Accumulated other comprehensive loss in the
same manner as the underlying hedged net assets. 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. 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. 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

Item 8.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Report of Independent Registered Public Accounting Firm
To the Shareholders
and the Board of Directors
of Hurco Companies, Inc.
Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheet of Hurco Companies, Inc. and its subsidiaries
(the "Company") as of October 31, 2024, the related consolidated statements of operations, comprehensive
income (loss), cash flows, and changes in shareholders' equity for the period ended October 31, 2024, and the
related notes and schedule listed in Item 15(a) (collectively referred to as the "financial statements"). We also
have audited the Company's internal control over financial reporting as of October 31, 2024, based on criteria
established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO).

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial
position of the Company as of October 31, 2024, and the results of its operations and its cash flows for the
period ended October 31, 2024, in conformity with accounting principles generally accepted in the United
States of America. Also, in our opinion, the Company maintained, in all material respects, effective internal
control over financial reporting as of October 31, 2024, based on criteria established in Internal Control —
Integrated Framework (2013) issued by COSO.

Basis for Opinions

The Company's management is responsible for these financial statements, for maintaining effective internal
control over financial reporting, and for its assessment of the effectiveness of internal control over financial
reporting, included in the accompanying Management’s Annual Report on Internal Control Over Financial
Reporting. Our responsibility is to express an opinion on these financial statements and an opinion on the
Company's internal control over financial reporting based on our audits. We are a public accounting firm
registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required
to be independent with respect to the Company in accordance with the U.S. federal securities laws and the
applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan
and perform the audits to obtain reasonable assurance about whether the financial statements are free of material
misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was
maintained in all material respects.

Our audits of the financial statements included performing procedures to assess the risks of material
misstatement of the financial statements, whether due to error or fraud, and performing procedures to respond
to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and
disclosures in the financial statements. Our audits also included evaluating the accounting principles used and
significant estimates made by management, as well as evaluating the overall presentation of the financial
statements. Our audit of internal control over financial reporting included obtaining an understanding of internal
control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating

the design and operating effectiveness of internal control based on the assessed risk. Our audits also included
performing such other procedures as we considered necessary in the circumstances. We believe that our audits
provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

A company's internal control over financial reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external purposes
in accordance with generally accepted accounting principles. A company's internal control over financial
reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in
reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;
(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial
statements in accordance with generally accepted accounting principles, and that receipts and expenditures of
the company are being made only in accordance with authorizations of management and directors of the
company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the company's assets that could have a material effect on the financial
statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect
misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that
controls may become inadequate because of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial
statements that was communicated or required to be communicated to the audit committee and that (1) relates
to accounts or disclosures that are material to the financial statements and (2) involved our especially
challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in
any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical
audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures
to which it relates.

Income Taxes — Realizability of Deferred Tax Assets — Refer to Notes 1 and 6 to the Financial
Statements

Critical Audit Matter Description
The Company recognizes deferred income taxes for tax attributes and for differences between the financial
statement and tax basis of assets and liabilities at enacted statutory tax rates in effect for the years in which the
deferred tax liability or asset is expected to be settled or realized. A valuation allowance is provided to offset
deferred tax assets if, based upon the available evidence, it is more likely than not that some or all of the deferred
tax assets will not be realized. Judgments related to the existence of sufficient taxable income and the realization
of deferred tax assets include consideration of future profitability and market conditions, changes in U.S. or
foreign tax laws and other factors. Management has determined that it is not more likely than not that sufficient
taxable income will be generated in the future to realize its U.S. deferred tax assets; therefore, a valuation
allowance of $8.3 million was recorded during the year ended October 31, 2024.

Given the determination of whether it is more likely than not that sufficient U.S. taxable income will be

generated in the future to realize deferred tax assets requires management to make significant judgments and
estimates related to taxable income, performing audit procedures to evaluate the reasonableness of
management’s estimates of taxable income required a high degree of auditor judgment and an increased extent
of effort, including the need to involve our income tax specialists.

How the Critical Audit Matter Was Addressed in the Audit
Our audit procedures related to the determination of whether it is more likely than not that sufficient taxable
income will be generated in the future to realize deferred tax assets included the following, among others:

• We tested the effectiveness of controls over deferred tax assets, including management’s controls over
whether it is more likely than not that the deferred tax assets will be realized.
• We evaluated the reasonableness of the methods, assumptions, and judgments used by management to
determine whether it is more likely than not that sufficient taxable income will be generated in the
future to utilize the net deferred tax assets and therefore whether a valuation allowance was necessary.
• We evaluated the reasonableness of management's assessment of the significance and weighting of
negative evidence and positive evidence that is objectively verifiable.
• With the assistance of our income tax specialists, we evaluated (1) the appropriateness of qualifying
tax planning strategies, including whether they were prudent, feasible and would more likely than not
result in the realization of U.S. deferred tax assets and (2) management's assessment of whether
sufficient U.S. taxable income will be generated in the future to realize a portion of the deferred tax
assets prior to expiration.
• We tested the valuation allowances recorded by testing the mathematical accuracy and management’s
conclusions on the realizability of the deferred tax assets.
• We tested the income tax provision by selecting a sample of permanent and temporary differences in
the U.S., testing the calculation of the effective tax rate and resulting deferred tax assets and liabilities,
while considering compliance with tax laws and regulations for those samples.

/s/ Deloitte & Touche LLP
Indianapolis, Indiana
January 10, 2025

We have served as the Company's auditor since 2024.

Report of Independent Registered Public Accounting Firm
To the Shareholders
and the Board of Directors
of Hurco Companies, Inc.
Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheet of Hurco Companies, Inc. and its subsidiaries
(the Company) as of October 31, 2023, and the related consolidated statements of operations, comprehensive
income (loss), changes in shareholders’ equity and cash flows, for each of the two years in the period ended
October 31, 2023, and the related notes and schedule listed in Item 15(a) (collectively, the financial statements).
In our opinion, the financial statements present fairly, in all material respects, the financial position of the
Company as of October 31, 2023, and the results of their operations and their cash flows for each of the two
years in the period ended October 31, 2023, in conformity with accounting principles generally accepted in the
United States of America.

Basis for Opinions

These financial statements are the responsibility of the Company’s management. Our responsibility is to express
an opinion on the Company’s financial statements based on our audits. We are a public accounting firm
registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required
to be independent with respect to the Company in accordance with the U.S. federal securities laws and the
applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

Our audits included performing procedures to assess the risks of material misstatement of the financial
statements, whether due to error or fraud, and performing procedures to respond to those risks. Such procedures
included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
Our audits also included evaluating the accounting principles used and significant estimates made by
management, as well as evaluating the overall presentation of the financial statements. We believe that our
audits provide a reasonable basis for our opinions.

/s/ RSM US LLP
Indianapolis, IN
January 5, 2024

We served as the Company’s auditor from 2017 to 2024.

HURCO COMPANIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS

Year Ended October 31,

2024

2023

2022

(In thousands, except per share amounts)
Sales and service fees
$
186,584
$
227,807
$
250,814

Cost of sales and service

148,841
171,639

186,336

Gross profit

37,743
56,168

64,478

Selling, general and administrative expenses

46,029
49,552

51,731

Operating (loss) income

(8,286)
6,616

12,747

Interest expense

578
282

Interest income

621
369

Investment income, net

80
61

174

Income from equity investments

292
494

733

Other expense, net

1,979
504

1,828

(Loss) income before income taxes

(9,850)

6,754

11,878

Provision for income taxes

6,758
2,365

3,652

Net (loss) income
$
(16,608)
$
4,389
$
8,226

(Loss) income per common share

Basic
(2.56)
0.67
1.24
Diluted
(2.56)
0.66
1.23

Weighted average common shares outstanding

Basic
6,489
6,499
6,580
Diluted
6,489
6,528
6,632

The accompanying notes are an integral part of the consolidated financial statements.

HURCO COMPANIES, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Year Ended October 31,

2024

2023

2022

(In thousands)
Net (loss) income
$ (16,608)
$
4,389
$
8,226
Other comprehensive (loss) income:

Translation (loss) gain of foreign currency financial
statements

3,474
3,274
(19,591)
(Gain) / loss on derivative instruments reclassified into
operations, net of tax (expense) / benefit of $401, $(146),
$59, respectively

1,339
(488)

191
Gain / (loss) on derivative instruments, net of tax expense /
(benefit) of $(218), $(439), $(119) respectively

(727)
(1,465)

(384)
Total other comprehensive (loss) income

4,086
1,321
(19,784)

Comprehensive (loss) income
$ (12,522)
$
5,710
$ (11,558)

The accompanying notes are an integral part of the consolidated financial statements.

HURCO COMPANIES, INC.
CONSOLIDATED BALANCE SHEETS

October 31,
October 31,

2024

2023

ASSETS

Current assets:

Cash and cash equivalents
$
33,330
$
41,784
Accounts receivable, net

36,678
39,965
Inventories

153,037
157,952
Derivative assets

323
740
Prepaid and other assets

5,209
7,789
Total current assets

228,577
248,230
Property and equipment:

Land

1,046
1,046
Building

7,381
7,387
Machinery and equipment

28,106
26,779
Leasehold improvements

4,667
4,473

41,200
39,685
Less accumulated depreciation and amortization

(32,404)
(30,826)
Total property and equipment, net

8,796
8,859
Non–current assets:

Software development costs, less accumulated amortization

7,044
7,030
Intangible assets, net

763
994
Operating lease - right of use assets
11,313
10,971
Deferred income taxes

1,349
4,749
Investments and other assets

10,801
9,756
Total non–current assets

31,270
33,500
Total assets
$
268,643
$
290,589
LIABILITIES AND SHAREHOLDERS’ EQUITY

Current liabilities:

Accounts payable
$
24,951
$
29,661
Customer deposits
4,308
2,827
Derivative liabilities
705
1,821
Operating lease liabilities
3,829
3,712
Accrued payroll and employee benefits

7,786
9,853
Accrued income taxes

866
1,713
Accrued expenses

4,258
4,092
Accrued warranty expenses

1,086
1,294
Total current liabilities

47,789
54,973
Non–current liabilities:

Deferred income taxes

53
83
Accrued tax liability
537
1,293
Operating lease liabilities
7,852
7,606
Deferred credits and other

5,240
4,403
Total non–current liabilities

13,682
13,385
Commitment and contingencies

—
—
Shareholders’ equity:

Preferred stock: no par value per share, 1,000,000 shares authorized; no shares issued

—
—
Common stock: no par value, $.10 stated value per share, 12,500,000 shares authorized; 6,548,838
and 6,553,673 shares issued and 6,435,624 and 6,462,138 shares outstanding, as of October 31,
2024 and October 31, 2023, respectively

644
646
Additional paid-in capital

61,500
61,665
Retained earnings

161,422
180,124
Accumulated other comprehensive loss

(16,394)
(20,204)
Total shareholders’ equity

207,172
222,231
Total liabilities and shareholders’ equity
$
268,643
$
290,589

The accompanying notes are an integral part of the consolidated financial statements.

HURCO COMPANIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Year Ended October 31,

2024

2023

2022

(In thousands)
Cash flows from operating activities:

Net (loss) income
$
(16,608)
$
4,389
$
8,226
Adjustments to reconcile net income (loss) to net cash provided by (used
for) operating activities:

Provision for doubtful accounts

(36)
32
(159)
Deferred income taxes

(4,283)
(120)
(1,043)
Deferred income tax valuation allowance
8,590
141
412
Equity in (income) loss of affiliates

(292)
(494)
(733)
Foreign currency (gain) loss
(426)
(2,551)
1,393
Unrealized (gain) loss on derivatives

(96)
(754)
727
Depreciation and amortization

3,532
4,093
3,918
Stock–based compensation

1,648
2,699
2,686
Change in assets and liabilities:

(Increase) decrease in accounts receivable

3,996
(84)
280
(Increase) decrease in inventories

8,383
(648)
(24,440)
(Increase) decrease in prepaid and other assets

1,236
(805)
7,022
Increase (decrease) in accounts payable

(5,266)
(11,767)
(2,278)
Increase (decrease) in customer deposits

1,392
(2,179)
(3,056)
Increase (decrease) in accrued expenses

(97)
(1,978)
1,018
Increase (decrease) in accrued payroll and employee benefits
(2,067)
(901)
362
Increase (decrease) in accrued income tax
(885)
(985)
1,698
Increase (decrease) in accrued tax liability
(756)
11
(467)
Net change in deferred tax assets and liabilities
481
(1,277)
(25)
Net change in derivative assets and liabilities

(445)
885
264
Other

(520)
(528)
229
Net cash provided by (used for) operating activities

(2,519)
(12,821)
(3,966)

Cash flows from investing activities:

Proceeds from sale of property and equipment

18
407
101
Purchase of property and equipment

(1,241)
(1,286)
(1,107)
Software development costs

(1,635)
(1,291)
(1,086)
Other investments
119
273
—
Net cash provided by (used for) investing activities

(2,739)
(1,897)
(2,092)

Cash flows from financing activities:

Proceeds from exercise of common stock options
—
270
117
Dividends paid

(2,094)
(4,142)
(3,923)
Taxes paid related to net settlement of restricted shares

(315)
(313)
(207)
Stock repurchases
(1,500)
(4,609)
(2,890)
Excise tax payable related to stock repurchases
—
(28)
—
Net cash provided by (used for) financing activities

(3,909)
(8,822)
(6,903)

Effect of exchange rate changes on cash and cash equivalents

713
1,402
(7,180)

Net decrease in cash and cash equivalents

(8,454)
(22,138)
(20,141)

Cash and cash equivalents at beginning of period

41,784
63,922
84,063

Cash and cash equivalents at end of period
$
33,330
$
41,784
$
63,922

Supplemental disclosures:

Cash paid (received) for:

Interest
$
—
$
—
$
—
Income taxes, net
$
3,018
$
4,336
$
(1,628)

The accompanying notes are an integral part of the consolidated financial statements.

HURCO COMPANIES, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

Common

Accumulated

Stock
Common Additional
Other
(In thousands,
Shares
Stock
Paid–In
Retained
Comprehensive
except shares outstanding)
Outstanding Amount Capital Earnings
Loss

Total
Balances, October 31, 2021
6,617,717
$
662
$ 63,924
$ 175,574
$
(1,741)
$ 238,419

Net income (loss)
—
—
—
8,226

—
8,226
Other comprehensive income (loss)
—
—
—
—

(19,784)
(19,784)
Stock–based compensation expense, net of
taxes withheld for vested restricted shares
33,761
3
2,476
—

—
2,479
Exercise of common stock options
5,437
1
116
—
—
117
Stock repurchases
(89,921)
(9)
(2,881)
—
—
(2,890)
Dividends paid ($0.59 per share)
—
—
—
(3,923)

—
(3,923)
Balances, October 31, 2022
6,566,994
$
657
$ 63,635
$ 179,877
$
(21,525)
$ 222,644

Net income (loss)
—
—
—
4,389

—
4,389
Other comprehensive income (loss)
—
—
—
—

1,321
1,321
Stock–based compensation expense, net of
taxes withheld for vested restricted shares
49,874
5
2,381
—

—
2,386
Exercise of common stock options
11,559
1
269
—
—
270
Stock repurchases, net of excise tax payable
(166,289)
(17)
(4,620)
—
—
(4,637)
Dividends paid ($0.63 per share)
—
—
—
(4,142)

—
(4,142)
Balances, October 31, 2023
6,462,138
$
646
$ 61,665
$ 180,124
$
(20,204)
$ 222,231

Net income (loss)
—
—
—
(16,608)

—
(16,608)
Other comprehensive income (loss)
—
—
—
—

4,086
4,086
Deferred income tax valuation allowances

(276)
(276)
Stock-based compensation expense, net of
taxes withheld for vested restricted shares
61,121
6
1,327
—

—
1,333
Stock repurchases
(87,635)
(8)
(1,492)
—
—
(1,500)
Dividends paid ($0.32 per share)
—
—
—
(2,094)

—
(2,094)
Balances, October 31, 2024
6,435,624
$
644
$ 61,500
$ 161,422
$
(16,394)
$ 207,172

The accompanying notes are an integral part of the consolidated financial statements.

HURCO COMPANIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Consolidation. The consolidated financial statements include the accounts of Hurco Companies, Inc. (an
Indiana corporation) and its wholly–owned subsidiaries (“we”, “us”, “our”, “Hurco” or the “Company”). We
have a 35% ownership interest in a Taiwan affiliate that is accounted for using the equity method. Our
investment in that affiliate was approximately $5.3 million and $5.1 million as of October 31, 2024 and 2023,
respectively. That investment is included in Investments and other assets, net on the accompanying
Consolidated Balance Sheets. Inter-company accounts and transactions have been eliminated.

Statements of Cash Flows. We consider all highly liquid investments with a stated maturity at the date of
purchase of three months or less to be cash equivalents. Cash flows from hedges are classified consistent with
the items being hedged.

Translation of Foreign Currencies. All balance sheet accounts of non–U.S. subsidiaries are translated at the
exchange rate as of the end of the year and translation adjustments of foreign currency balance sheets are
recorded as a component of Accumulated other comprehensive loss in shareholders’ equity. Income and
expenses are translated at the average exchange rates during the year. Cumulative foreign currency translation
adjustments, net of gains related to our net investment hedges, as of October 31, 2024, were a net loss of $14.5
million, net of tax, and are included in Accumulated other comprehensive loss. Foreign currency transaction
gains and losses are recorded as income or expense as incurred and are recorded in Other expense, net.

Hedging. We are exposed to certain market risks relating to our ongoing business operations, including foreign
currency risk, interest rate risk and credit risk. We manage our exposure to these and other market risks through
regular operating and financing activities. Currently, the only risk that we manage through the use of derivative
instruments is foreign currency risk.

We operate on a global basis and are exposed to the risk that our financial condition, results of operations, and
cash flows could be adversely affected by changes in foreign currency exchange rates. To reduce the potential
effects of foreign exchange rate movements on our net equity investment in one of our foreign subsidiaries, and
the gross profit and net earnings of certain of our foreign subsidiaries, we enter into derivative financial
instruments in the form of foreign exchange forward contracts with a major financial institution. We are
primarily exposed to foreign currency exchange rate risk with respect to transactions and net assets denominated
in Euros, Pounds Sterling, Indian Rupee, Singapore Dollars, Chinese Yuan, Polish Zloty, and New Taiwan
Dollars.

We account for derivative instruments as either assets or liabilities and carry them at fair value. The accounting
for changes in the fair value of a derivative depends on the intended use of the derivative and the resulting
designation. For derivative instruments designated as a fair value hedge, the gain or loss is recognized in
earnings in the period of change together with the offsetting loss or gain on the hedged item attributed to the
risk being hedged. For a derivative instrument designated as a cash flow hedge, the effective portion of the
derivative’s gain or loss is initially reported as a component of Accumulated other comprehensive loss in
shareholders’ equity and subsequently reclassified into earnings when the hedged exposure affects earnings.
The ineffective portion of the gain or loss is reported in earnings immediately.

For derivative instruments that are not designated as accounting hedges under the Derivatives and Hedging
Topic of the Financial Accounting Standards Board (the “FASB”), changes in fair value are recognized in
earnings in the period of change. We do not hold or issue derivative financial instruments for speculative trading
purposes. We only enter into derivatives with one counterparty, which is among one of the largest U.S. banks
(ranked by assets), in order to minimize credit risk and, to date, that counterparty has not failed to meet its
financial obligations under such contracts.

Derivatives Designated as Hedging Instruments

We enter into foreign currency forward exchange contracts periodically to hedge certain forecasted inter–
company sales and purchases denominated in foreign currencies (the Pound Sterling, Euro, and New Taiwan
Dollar). The purpose of these instruments is to mitigate the risk that the U.S. dollar net cash inflows and
outflows resulting from sales and purchases denominated in foreign currencies will be adversely affected by
changes in exchange rates. These forward contracts have been designated as cash flow hedge instruments, and
are recorded in the Consolidated Balance Sheets at fair value in Derivative assets and Derivative liabilities. The
effective portion of the gains and losses resulting from the changes in the fair value of these hedge contracts is
deferred in Accumulated other comprehensive loss and recognized as an adjustment to Cost of sales and service
in the period that the corresponding inventory sold that is the subject of the related hedge contract is recognized,
thereby providing an offsetting economic impact against the corresponding change in the U.S. dollar value of
the inter–company sale or purchase being hedged. The ineffective portion of gains and losses resulting from
the changes in the fair value of these hedge contracts is immediately reported in Other expense, net. We perform
quarterly assessments of hedge effectiveness by verifying and documenting the critical terms of the hedge
instrument and determining that forecasted transactions have not changed significantly. We also assess on a
quarterly basis whether there have been adverse developments regarding the risk of a counterparty default.

We had forward contracts outstanding as of October 31, 2024, in Euros, Pounds Sterling, and New Taiwan
Dollars with set maturity dates ranging from November 2024 through October 2025. The contract amount at
forward rates in U.S. dollars as of October 31, 2024 for Euros and Pounds Sterling was $8.2 million and $4.4
million, respectively. The contract amount at forward rates in U.S. dollars for New Taiwan Dollars was $15.6
million as of October 31, 2024. As of October 31, 2024, we had approximately $0.7 million of losses, net of
tax, related to cash flow hedges deferred in Accumulated other comprehensive loss. Of this amount, $0.2 million
represented unrealized loss, net of tax, related to cash flow hedge instruments that remain subject to currency
fluctuation risk. The majority of these deferred losses will be recorded as an adjustment to Cost of sales and
service in periods through October 2025, in which the corresponding inventory that is the subject of the related
hedge contract is sold, as described above.

We are exposed to foreign currency exchange risk related to our investment in net assets in foreign countries.
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 FASB guidance related to the accounting for derivative
instruments and hedging activities. The forward method requires all changes in the fair value of the contract to
be reported as a cumulative translation adjustment, net of tax, in Accumulated other comprehensive loss in the
same manner as the underlying hedged net assets. 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. As
of October 31, 2024, we had a realized gain of $1.2 million and an immaterial amount of unrealized loss, net
of tax, recorded as cumulative translation adjustments in Accumulated other comprehensive loss, related to this
forward contract.

Derivatives Not Designated as Hedging Instruments

We enter into foreign currency forward exchange contracts to protect against the effects of foreign currency
fluctuations on inter-company receivables and payables denominated in foreign currencies. These derivative
instruments are not designated as hedges under FASB guidance and, as a result, changes in their fair value are
reported currently as Other expense, net in the Consolidated Statements of Operations consistent with the
transaction gain or loss on the related inter-company receivables, payables and loans denominated in foreign
currencies.

We had forward contracts outstanding as of October 31, 2024, in Euros, Pounds Sterling, and New Taiwan
Dollars with set maturity dates ranging from November 2024 through March 2025. The contract amounts at
forward rates in U.S. dollars as of October 31, 2024 for Euros and Pounds Sterling totaled $10.4 million. The
contract amount at forward rates in U.S. dollars for New Taiwan Dollars was $42.7 million as of October 31,
2024.

Fair Value of Derivative Instruments

We recognize the fair value of derivative instruments as assets and liabilities on a gross basis on our
Consolidated Balance Sheets. As of October 31, 2024 and October 31, 2023, all derivative instruments were
recorded at fair value on our Consolidated Balance Sheets as follows (in thousands):

October 31, 2024
October 31, 2023

Balance Sheet
Fair
Balance Sheet
Fair
Derivatives

Location
Value
Location
Value
Designated as Hedging Instruments:

Foreign exchange forward contracts
Derivative assets
$ 165
Derivative assets
$ 363
Foreign exchange forward contracts
Derivative liabilities $ 430
Derivative liabilities
$ 1,232

Not Designated as Hedging Instruments:

Foreign exchange forward contracts
Derivative assets
$ 158
Derivative assets
$ 377
Foreign exchange forward contracts
Derivative liabilities $ 275
Derivative liabilities
$ 589

Effect of Derivative Instruments on the Consolidated Balance Sheets, Consolidated Statements of Changes in
Shareholders’ Equity, and Consolidated Statements of Operations
Derivative instruments had the following effects on our Consolidated Balance Sheets, Consolidated Statements
of Changes in Shareholders’ Equity, and Consolidated Statements of Operations, net of tax, during the
fiscal years ended October 31, 2024, 2023, and 2022 (in thousands):

Location of

Amount of Gain (Loss)
Gain (Loss)
Amount of Gain (Loss)

Recognized in
Reclassified
Reclassified from
Other Comprehensive
From Other
Other Comprehensive
Income (Loss)
Comprehensive
Income (Loss)
Derivatives
2024 2023
2022 Income (Loss) 2024
2023 2022
Designated as Hedging
Instruments:

(Effective Portion)

Foreign exchange forward
contracts

Cost of sales
– Intercompany sales/purchases
(727)
(1,465)
(384)
and service
(1,339)
488
(191)
Foreign exchange forward
contract

– Net investment
(29)
(99)
401

We did not recognize any gains or losses as a result of hedges deemed ineffective during fiscal years ended
October 31, 2024, 2023, and 2022.
We recognized the following gains and losses in our Consolidated Statements of Operations during the
fiscal years ended October 31, 2024, 2023, and 2022 on derivative instruments not designated as hedging
instruments (in thousands):

Amount of Gain (Loss)

Location of Gain (Loss)
Recognized in Operations
Derivatives
Recognized in Operations
2024

2023

2022
Not Designated as Hedging
Instruments:

Foreign exchange forward contracts Other expense, net
$ (1,751) $ (3,112)
$ 2,374

The following table presents the changes in the components of Accumulated other comprehensive loss, net of
tax, for the fiscal years ended October 31, 2024 and 2023 (in thousands):

Foreign
Cash
Currency
Flow

Translation
Hedges

Total
Balance, October 31, 2022
$
(21,259) $
(266)
$ (21,525)
Other comprehensive income (loss) before reclassifications

3,274

(1,465)

1,809
Reclassifications

—

(488)

(488)
Balance, October 31, 2023
$
(17,985) $
(2,219)
$ (20,204)
Other comprehensive income (loss) before reclassifications

3,474

(727)

2,747
Reclassifications

—

1,339

1,339
Deferred income tax valuation allowances

—

(276)

(276)
Balance, October 31, 2024
$
(14,511) $
(1,883)
$ (16,394)

Inventories. Inventories are stated at the lower of cost or net realizable value, with cost determined using the
first–in, first–out method. Provisions are made to reduce excess or obsolete inventories to their estimated
realizable value.

Property and Equipment. Property and equipment are carried at cost. Depreciation and amortization of assets
are provided primarily under the straight–line method over the shorter of the estimated useful lives or the lease
terms as follows:

Number of Years
Land

Indefinite
Building

40
Machines

7 – 10
Shop and office equipment

3 – 7
Building & leasehold improvements

3 – 40

Total depreciation and amortization expense recognized for property and equipment was $1.7 million for fiscal
year 2024, $2.3 million for fiscal year 2023, and $2.3 million for fiscal year 2022.
Revenue Recognition. We design, manufacture, and sell computerized machine tools. Our computer control
systems and software products are primarily sold as integral components of our computerized machine tool
products. We also provide machine tool components, automation integration equipment and solutions for job
shops, software options, control upgrades, accessories, and replacement parts for our products, as well as
customer service, training, and applications support.
We recognize revenues from the sale of machine tools, components and accessories and services, and reflect
the consideration to which we expect to be entitled. We record revenues based on a five-step model in
accordance with FASB guidance codified in Accounting Standards Codification (“ASC”) 606, “Revenue from
Contracts with Customers” (“ASC 606”). In accordance with ASC 606, we have defined contracts as
agreements with our customers and distributors in the form of purchase orders, packing or shipping documents,
invoices, and, periodically, verbal requests for components and accessories. For each contract, we identify our
performance obligations, which are delivering goods or services, determine the transaction price, allocate the
contract transaction price to each of the performance obligations (when applicable), and recognize the revenue
when (or as) the performance obligation to the customer is fulfilled. A good or service is transferred when the
customer obtains control of that good or service. Our computerized machine tools are general purpose
computer-controlled machine tools that are typically used in stand–alone operations. Prior to shipment, we test
each machine to ensure the machine’s compliance with standard operating specifications. We deem that the
customer obtains control upon delivery of the product and that obtaining control is not contingent upon
contractual customer acceptance. Therefore, we recognize revenue from sales of our machine tool systems upon
delivery of the product to the customer or distributor, which is normally at the time of shipment.
Depending upon geographic location, after shipment, a machine may be installed at the customer’s facility by
a distributor, independent contractor, or by one of our service technicians. In most instances where a machine
is sold through a distributor, we have no installation involvement. If sales are direct or through sales agents, we
will typically complete the machine installation, which consists of the reassembly of certain parts that were
removed for shipping and the re-testing of the machine to ensure that it is performing within the standard
specifications. We consider the machine installation process for our 3-axis machines to be inconsequential and
immaterial within the context of the contract. For our 5-axis machines that we install, we estimate the fair value
of the installation performance obligation and recognize that installation revenue on a prorata basis over the
period of the installation process.

From time to time, and depending upon geographic location, we may provide training or freight services. We
consider these services to be immaterial within the context of the contract, as the value of these services
typically does not rise to a material level as a component of the total contract value. Service fees from
maintenance contracts are deferred and recognized in earnings on a prorata basis over the term of the contract
and are generally sold on a stand-alone basis. Customer discounts and estimated product returns are recorded
as a reduction of revenue in the same period that the related sales are recorded. We have reviewed the overall
sales transactions for variable consideration and have determined that these amounts are not material.
Allowance for Doubtful Accounts. The allowance for doubtful accounts is based on our best estimate of probable
credit issues and historical experience. We perform credit evaluations of the financial condition of our
customers. No collateral is required for sales made on open account terms. Concentrations of credit risk with
respect to accounts receivable are limited due to the large number of customers comprising our customer base
and their dispersion across many geographic areas. We consider trade accounts receivable to be past due when
payment is not made by the due date as specified on the customer invoice, and we charge off uncollectible
balances when all reasonable collection efforts have been exhausted.
Product Warranty. Expected future product warranty claims are recorded to expense when the product is sold.
Product warranty estimates are established using historical information about the nature, frequency, and average
cost of warranty claims. Warranty claims are influenced by factors such as new product introductions,
technological developments, the competitive environment, and the costs of component parts. Actual payments
for warranty claims could differ from the amounts estimated, requiring adjustments to the liabilities in future
periods. See Note 11 of these Notes to Consolidated Financial Statements for further discussion of warranties.
Research and Development Costs. The costs associated with research and development programs for new
products and significant product improvements, other than software development costs, which are eligible for
capitalization per FASB guidance, are expensed as incurred and are included in Selling, general, and
administrative expenses. Research and development expenses totaled $3.9 million, $4.2 million, and $3.4
million, in fiscal years 2024, 2023, and 2022, respectively.
Software Development Costs. We sell software products that are essential to our machine tools. Costs incurred
to develop computer software products and significant enhancements to software features of existing products
to be sold or otherwise marketed are capitalized, after technological feasibility is established. Software
development costs are amortized on a straight–line basis over the estimated product life of the related software,
which ranges from three to five years. We capitalized costs related to software development projects of $1.6
million in fiscal year 2024, $1.3 million in fiscal year 2023, and $1.1 million in fiscal year 2022. Amortization
expense for software development costs was $1.6 million, $1.6 million, and $1.3 million for the fiscal years
ended October 31, 2024, 2023, and 2022, respectively. The gross carrying amount as of October 31, 2024 and
2023 was $32.0 million and $32.3 million, respectively. Accumulated amortization as of October 31, 2024 and
2023 was $24.9 million and $25.3 million, respectively.
Estimated amortization expense for the remaining unamortized software development costs, which includes
projects still in progress, for the fiscal years ending October 31, is as follows (in thousands):
Fiscal Year

Amortization Expense
2025

$
1,065
2026

931
2027

1,302
2028

1,151
2029 and thereafter

2,594

Intangible Assets. For indefinite-lived intangible assets, if the carrying amount exceeds the fair value, an
impairment loss is recognized in an amount equal to that excess. Intangible assets that are determined to have
a finite life are amortized over their estimated useful lives and are also subject to review for impairment if
indicators of impairment are identified. There were no impairments recognized with respect to the carrying
value of intangible assets for the years ended October 31, 2024, 2023, or 2022.

As of October 31, 2024, the balances of intangible assets were as follows (in thousands):

Weighted

Average
Gross

Amortization
Intangible
Accumulated
Net Intangible

Period

Assets
Amortization
Assets
Tradenames and trademarks

indefinite
$
177 $
—
$
177
Tradenames and trademarks

14 years

749

(381)

368
Customer relationships

15 years

371

(286)

85
Technology

13 years

666

(581)

85
Noncompete
5 years
580
(580)
—
Patents

6 years

2,973

(2,933)

40
Other

8 years

393

(385)

8
Total

$
5,909 $
(5,146)
$
763

As of October 31, 2023, the balances of intangible assets, other than goodwill, were as follows (in thousands):

Weighted

Average
Gross

Amortization
Intangible
Accumulated
Net Intangible

Period

Assets
Amortization
Assets
Tradenames and trademarks

indefinite
$
177 $
—
$
177
Tradenames and trademarks

14 years

742

(324)

418
Customer relationships

15 years

369

(270)

99
Technology

13 years

647

(514)

133
Noncompete
5 years
580
(493)
87
Patents

6 years

2,973

(2,909)

64
Other

8 years

392

(376)

16
Total

$
5,880 $
(4,886)
$
994

Intangible asset amortization expense was $237,000, $271,000, and $272,000 for fiscal years 2024, 2023, and
2022, respectively. Annual intangible asset amortization expense for the next five years is estimated to be
$143,000 for fiscal year 2025, $118,000 for fiscal year 2026, and $45,000 for each of fiscal years 2027 through
2029.

Impairment of Long–Lived Assets. Annually, or when there are indicators of impairment, we evaluate the
carrying value of long–lived assets to be held and used, including property and equipment, software
development costs, and intangible assets, when events or circumstances warrant such a review. The carrying
value of a long-lived asset (or group of assets) to be held and used is considered impaired when the anticipated
separately identifiable undiscounted cash flows from such an asset (or group of assets) are less than the carrying
value of the asset (or group of assets). There was no impairment recognized with respect to the carrying values
of long-lived assets for the years ended October 31, 2024, 2023, or 2022.

Earnings (Loss) Per Share. Basic earnings (loss) per share is calculated under the two class method by dividing
net income (loss) by the weighted–average number of common shares actually outstanding during the period.
Diluted earnings (loss) per share assumes the issuance of additional shares of common stock upon exercise of
all outstanding stock options and contingently issuable securities if the effect is dilutive, in accordance with the
treasury stock method.
The following table presents a reconciliation of our basic and diluted earnings (loss) per share computation:

Fiscal Year Ended October 31,

2024
2023
2022
Basic
Diluted
Basic
Diluted
Basic
Diluted
Net (loss) income
$ (16,608)
$ (16,608)
$
4,389
$
4,389
$
8,226
$ 8,226
Undistributed earnings allocated to
participating shares

—

(61)

(97)

(97)
Net (loss) income applicable to common
shareholders
$ (16,608)
$ (16,608)
$
4,328
$
4,328
$
8,129
$ 8,129

Weighted average shares outstanding

6,489

6,499

6,580
6,580
Stock options and contingently issuable
securities

—

—
29

—

6,489

6,499

6,528

6,580
6,632
(Loss) income per share
$
(2.56)
$
(2.56)
$
0.67
$
0.66
$
1.24
$ 1.23

Income Taxes – We account for income taxes and the related accounts under the asset and liability method.
Deferred tax assets and liabilities are measured using enacted income tax rates in each jurisdiction in effect for
the year in which the temporary differences are expected to be recovered or settled. These deferred tax assets
are reduced by a valuation allowance, which is established when it is more likely than not that some portion or
all of the deferred tax assets will not be realized. Net deferred tax assets and liabilities are classified as non-
current in the consolidated financial statements. Our judgment regarding the realization of deferred tax assets
may change due to future profitability and market conditions, changes in U.S. or foreign tax laws and other
factors. These changes, if any, may require material adjustments to these deferred tax assets and an
accompanying reduction or increase in net income in the period when such determinations are made.
The determination of our provision for income taxes requires judgment, the use of estimates, and the
interpretation and application of complex federal, state and foreign tax laws. Our provision for income taxes
reflects a combination of income earned and taxed at the federal and state level in the U.S., as well as in various
foreign jurisdictions.
In addition to the risks to the effective tax rate described above, the future effective tax rate reflected in forward–
looking statements is based on currently effective tax laws. Significant changes in those laws could materially
affect these estimates.
We operate in multiple jurisdictions through wholly-owned subsidiaries, and our global structure is complex.
The estimates of our uncertain tax positions involve judgments and assessment of the potential tax implications.
We recognize uncertain tax positions when it is more likely than not that the tax position will be sustained upon
examination by relevant taxing authorities, based on the technical merits of the position. The amount recognized
is measured as the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate
settlement. Our tax positions are subject to audit by taxing authorities across multiple global jurisdictions, and

the resolution of such audits may span multiple years. Tax law is complex and often subject to varied
interpretations. Accordingly, the ultimate outcome with respect to taxes we may owe may differ from the
amounts recognized.
Stock Compensation. We account for share–based compensation according to FASB guidance relating to share-
based payments, which requires the measurement and recognition of compensation expense for all share-based
awards made to employees and directors based on estimated fair values on the grant date. This guidance requires
that we estimate the fair value of share-based awards on the date of grant and recognize as expense the value
of the portion of the award that is ultimately expected to vest over the requisite service period.
Estimates. The preparation of financial statements in conformity with U.S. Generally Accepted Accounting
Principles requires us to make estimates and assumptions that affect the reported amounts presented and
disclosed in our consolidated financial statements. Significant estimates and assumptions in these consolidated
financial statements require the exercise of judgment and are used for, but not limited to, allowance for doubtful
accounts, estimates of future cash flows and other assumptions associated with intangible and long–lived asset
impairment tests, if applicable, inventory reserves, product warranties, income taxes and deferred tax valuation
allowances, capitalized software development costs, derivative instruments, stock compensation, and
contingencies. Due to the inherent uncertainty involved in making estimates, actual results reported in future
periods may be different from these estimates.

2. BUSINESS OPERATIONS
Nature of Business. We design, manufacture, and sell computerized CNC machine tools, computer control
systems and software products, machine tool components, automation integration equipment and solutions for
job shops, software options, control upgrades, accessories and replacement parts for our products, as well as
customer service, training, and applications support, to companies in the metal cutting industry through a
worldwide sales, service, and distribution network. The machine tool industry is highly cyclical and changes in
demand can occur abruptly in the geographic markets we serve. As a result of this cyclicality, we have
experienced significant fluctuations in our sales, which, in periods of reduced demand, have adversely affected
our results of operations and financial condition.
The end market for our products consists primarily of precision tool, die and mold manufacturers, independent
job shops, and specialized short–run production applications within large manufacturing operations. Industries
served include: aerospace, defense, medical equipment, energy, automotive/transportation, electronics, and
computer industries. Our products are sold principally through approximately 180 independent agents and
distributors throughout the Americas, Europe and Asia. We also have our own direct sales and service
organizations in China, the Czech Republic, France, Germany, India, Italy, the Netherlands, Poland, Singapore,
Taiwan, the United Kingdom, and certain areas of the United States.
We operate in the industrial equipment industry and have a global footprint that subjects us to various business
risks in many different countries. During fiscal years 2022 through 2024, there was economic slowdown in
Europe, political friction in the U.S. and many other regions of the world, geopolitical tensions, conflicts, wars
in Europe and Asia, competitive labor markets, vendor delays, transportation issues, unusually high inflation,
volatility of foreign currencies, and the COVID-19 pandemic. Because of the potential for extended
vulnerability due to these and other factors, we have closely evaluated the estimates we have made in preparing
the financial statements as of October 31, 2024, with the understanding that these estimates could change in the
near term. We will continue to evaluate and disclose any uncertainty associated with key assumptions
underlying fair value estimates, trends, and uncertainties that have had, or are reasonably expected to have, a
material effect on our consolidated financial position, results of operations, changes in shareholders' equity, and

cash flows for and at the end of each interim period.

Credit Risk. We sell products to customers located throughout the world. We perform ongoing credit
evaluations of customers and generally do not require collateral. Allowances are maintained for potential credit
losses. Concentration of credit risk with respect to trade accounts receivable is limited due to the large number
of customers and their dispersion across many geographic areas. Although a significant amount of trade
receivables are with distributors primarily located in the United States, no single distributor or region represents
a significant concentration of credit risk.
Manufacturing Risk. At present, our wholly–owned subsidiaries, Hurco Manufacturing Limited (“HML”),
Ningbo Hurco Machine Tool Co., Ltd. (“NHML”), and Milltronics USA, Inc. (“Milltronics”) produce the vast
majority of our machine tools for all three brands, Hurco, Milltronics, and Takumi. In addition, we manufacture
electro–mechanical components and accessories for machine tools through our wholly–owned subsidiary, LCM
Precision Technology S.r.l. (“LCM”). HML, NHML, Milltronics, and LCM manufacture their products in
Taiwan, China, the U.S., and Italy, respectively. Any interruption in manufacturing at any of these locations
would have an adverse effect on our financial operating results. Interruption in manufacturing at one of these
locations could result from a change in the political environment, such as conflicts or wars; trade wars,
blockages, embargoes, or tariffs; or a natural disaster, such as an earthquake, typhoon, or tsunami. Any
interruption with one of our other third-party key suppliers may also have an adverse effect on our operating
results and our financial condition.

3. INVENTORIES
Inventories are summarized below (in thousands):

October 31,

2024
2023
Purchased parts and sub–assemblies
$
35,385
$
37,161
Work–in–process

13,428

16,217
Finished goods

104,224

104,574
Inventories
$
153,037
$
157,952

Finished goods inventory consigned to our distributors and agents throughout the Americas, Europe, and Asia
was $10.3 million and $9.6 million as of October 31, 2024 and 2023, respectively.

4. CREDIT AGREEMENTS AND BORROWINGS

On December 31, 2018, we and our subsidiary Hurco B.V. entered into a credit agreement with Bank of
America, N.A., as the lender, which was subsequently amended on each of March 13, 2020, December 23,
2020, December 17, 2021, January 4, 2023, and December 19, 2023 (as amended, the “2018 Credit
Agreement”). 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 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. Under the 2018 Credit Agreement, we and Hurco B.V. are borrowers, and certain of our other
subsidiaries are guarantors. 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. Outstanding letters of credit will carry an
annual rate of 1.00%.

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. 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. 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 a result, 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.

As of October 31, 2024, there were no borrowings under any of our credit facilities and there was approximately
$50.9 million of available borrowing capacity thereunder. At October 31, 2024, we believe we were in
compliance with all covenants relating thereto.

5. FINANCIAL INSTRUMENTS
Estimated Fair Value of Financial Instruments
FASB fair value guidance establishes a three–tier fair value hierarchy, which categorizes the inputs used in
measuring fair value. These tiers include: Level 1, defined as observable inputs, such as quoted prices in active
markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly
observable; and Level 3, defined as unobservable inputs for which little or no market data exists, therefore
requiring an entity to develop its own assumptions.
The carrying amounts for cash and cash equivalents approximate their fair values due to the short maturity of
these instruments, and such instruments meet the Level 1 criteria of the three–tier fair value hierarchy discussed
above. The carrying amount of short-term debt approximates fair value due to the variable rate of interest and
the short-term nature of the instrument.

In accordance with this guidance, the following table represents the fair value hierarchy for our financial assets
and liabilities measured at fair value as of October 31, 2024 and 2023 (in thousands):

Assets
Liabilities

October 31,

October 31,
October 31,
October 31,

2024

2023

2024

2023
Level 1

Mutual Funds
$
2,942
$
2,217
$
—
$
—

Level 2

Derivatives
$
323
$
740
$
705
$
1,821

Recurring Fair Value Measurements
Included in Level 1 assets are mutual fund investments under a nonqualified deferred compensation plan. We
estimate the fair value of these investments on a recurring basis using market prices that are readily available.
Included as Level 2 fair value measurements are derivative assets and liabilities related to gains and losses on
foreign currency forward exchange contracts entered into with a third party. We estimate the fair value of these
derivatives on a recurring basis using foreign currency exchange rates obtained from active markets. Derivative
instruments are reported in the accompanying consolidated financial statements at fair value. We have
derivative financial instruments in the form of foreign currency forward exchange contracts as described in
Note 1 of Notes to Consolidated Financial Statements. The U.S. dollar equivalent notional amount of these
contracts was $85.1 million and $97.8 million as of October 31, 2024 and 2023, respectively.

The fair value of the foreign currency forward exchange contracts and the related currency positions are subject
to offsetting market risk resulting from foreign currency exchange rate volatility. The counterparty to the
forward exchange contract is a substantial and creditworthy financial institution. We do not consider either the
risk of counterparty non–performance or the economic consequences of counterparty non–performance to be
material risks.

6. INCOME TAXES
We utilize the asset and liability method of accounting for income taxes. Under this method, the provision
(benefit) for income taxes represents income taxes payable or refundable for the current year plus the change
in deferred taxes during the year.

The Inflation Reduction Act of 2022 (the “Inflation Reduction Act” or “IRA”) was signed into law on August
16, 2022. The IRA provides investment in clean energy, promotes reductions in carbon emissions, and extends
select Affordable Care Act premium reductions. We currently do not expect that the Inflation Reduction Act
will have a material impact on its income taxes.

The components of income (loss) before taxes are (in thousands):

Year Ended October 31,

2024

2023

2022
Income (loss) before income taxes:

Domestic
$
(15,024) $
(3,259)
$
(232)
Foreign

5,174
10,013
12,110
$
(9,850) $
6,754
$
11,878

In the fiscal years set forth below, the provision (benefit) for income taxes consisted of the following (in
thousands):

Year Ended October 31,

2024

2023

2022
Current:

U.S. taxes
$
647
$
(431)
$
1,092
Foreign taxes

1,804

2,775

3,191

2,451

2,344

4,283
Deferred:

U.S. taxes

(3,765)

167

(839)
Foreign taxes

(518)

(287)

(204)

(4,283)

(120)

(1,043)
Valuation allowance
8,590
141
412
$
6,758
$
2,365
$
3,652

A comparison of income tax expense at the U.S. statutory rate to our effective tax rate is as follows:

Year Ended October 31,

2024

2023

2022

U.S. statutory rate

21 %

21 %
21 %
Effect of tax rate of international jurisdictions different than
U.S. statutory rates

(4) %

6 %
4 %
Valuation allowance

(87) %

2 %
3 %
State taxes

4 %

(1)%
1 %
Tax credits

— %

— %
1 %
US benefit of foreign intangible income
— %
— %
(3)%
US tax on distributed and undistributed earnings
(2) %
— %
— %
Stock-based compensation
(3) %
6 %
4 %
Other

2 %

1 %
— %
Effective tax rate

(69) %

35 %
31 %

The Tax Reform Act enacted on December 22, 2017, made comprehensive changes to U.S. federal income tax
laws by moving from a global to a modified territorial tax regime. As a result, cash repatriated to the U.S. is
generally no longer subject to U.S. federal income tax. As of October 31, 2024, the undistributed earnings of
our foreign subsidiaries are expected to be permanently reinvested and retained for continuing operations.
Accordingly, we did not accrue any withholding taxes on the undistributed earnings of our foreign subsidiaries,
consistent with the position adopted on January 1, 2018.

Deferred income taxes are determined based on the difference between the amounts used for financial reporting
purposes and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the
differences are expected to reverse. Deferred taxes are adjusted for changes in tax rates and tax laws when
changes are enacted. Valuation allowances are recorded to reduce deferred tax assets when it is more likely

than not that a tax benefit will not be realized. Net deferred tax assets and liabilities are classified as non-current
in the consolidated financial statements.

Our effective tax rate for the fiscal year ended October 31, 2024 was (69%), compared to 35% in the prior fiscal
year. Income tax expense for fiscal year 2024 was $6.8 million, compared to $2.4 million for fiscal year 2023.
The year-over-year increase in income tax expense for the fiscal year ended October 31, 2024 was primarily
due to an $8.4 million non-cash valuation allowance on U.S. and China deferred tax assets, changes in
geographic mix of income and loss that includes jurisdictions with differing tax rates, and discrete items related
to unvested stock compensation. As a result of a cumulative three-year loss in the U.S., we have an $8.3 million
valuation allowance recorded against our U.S. deferred tax assets, and we did not record a tax benefit for our
U.S. net losses for fiscal year ended October 31, 2024. The valuation allowance recorded during fiscal year
ended October 31, 2024 reflects a full valuation allowance of the U.S. deferred tax assets and was recorded
based on our conclusion that the deferred tax assets were not more likely than not going to be realized.

As of October 31, 2024, we had deferred tax assets established for accumulated net operating loss carryforwards
of $6.1 million, primarily related to federal, state and foreign jurisdictions. We also have deferred tax assets for
tax credits of $0.9 million. We established a valuation allowance against these carryforwards due to the
uncertainty of their full realization. As of October 31, 2024, and 2023, the balance of this valuation allowance
was $9.2 million and $1.8 million, respectively.

Significant components of our deferred tax assets and liabilities as of October 31, 2024 and 2023 are as follows
(in thousands):

October 31,

2024

2023
Deferred Tax Assets:

Accrued inventory reserves
$
1,605 $
1,580
Accrued warranty expenses

191

241
Compensation related expenses

1,800

2,222
Net derivative gain
500
683
Unrealized exchange gain

—
Other accrued expenses

351

344
Net operating loss carryforwards

6,115

2,249
Other credit carryforwards

948

712
Operating lease liabilities
2,924
2,818
Goodwill and intangibles
750
798
Other

118

131

15,360

11,778
Less: Valuation allowance – net operating loss and other credit carryforwards

(9,203)

(1,810)
Deferred tax assets

6,157

9,968
Deferred Tax Liabilities:

Unrealized exchange loss

—

(159)
Property and equipment and capitalized software development costs

(1,525)

(1,915)
Operating lease - right of use assets
(2,837)
(2,731)
Other

(499)

(497)
Net deferred tax assets
$
1,296 $
4,666
As of October 31, 2024, we had net operating loss carryforwards for international and U.S. income tax purposes
of $37.8 million. Our U.S. federal net operating loss has an unlimited carryforward potential. Our U.S. state
net operating losses will either expire at various tax years from 2025 to 2044 or have unlimited carryforward

potential. Our foreign net operating losses will either expire at various tax years from 2025 to 2029 or have
unlimited carryforward potential. We also have tax credits of $0.9 million which will expire at various tax
years from 2025 to 2044.
A reconciliation of the beginning and ending amount of unrecognized tax benefits, excluding the related accrual
for interest or penalties, is as follows (in thousands):

2024

2023

2022
Balance, beginning of year
$
138 $
138 $
167
Additions based on tax positions related to the current year

—

21
Additions (reductions) related to prior year tax positions

—

—
Reductions due to statute expiration

(117)

—

(50)
Balance, end of year
$
21 $
138 $
138

The entire balance of the unrecognized tax benefits and related interest on October 31, 2024, if recognized,
could affect the effective tax rate in future periods.

We recognize accrued interest and penalties related to unrecognized tax benefits as components of our income
tax provision. As of October 31, 2024, the amount of interest accrued, reported in other liabilities, was
approximately $7,000 which did not include the federal tax benefit of interest deductions. The statute of
limitations with respect to unrecognized tax benefits will expire in August 2025.

We file U.S. federal and state income tax returns, as well as tax returns in applicable foreign jurisdictions.

A summary of open tax years by major jurisdiction is presented below:

United States federal
Fiscal year 2021 through the current period
Germany¹
Fiscal year 2022 through the current period
Taiwan
Fiscal year 2019 through the current period
United Kingdom
Fiscal year 2018 through the current period

¹
Includes federal as well as state, provincial or similar local jurisdictions, as applicable.

7. EMPLOYEE BENEFITS
We have defined contribution plans that include a majority of our U.S. employees, under which our matching
contributions are primarily discretionary. The purpose of these plans is generally to provide additional financial
security during retirement by providing employees with an incentive to save throughout their employment. Our
contributions and related expense totaled $1.2 million, $1.4 million, and $1.3 million, for the fiscal years ended
October 31, 2024, 2023, and 2022, respectively.

8. STOCK–BASED COMPENSATION

In March 2016, we adopted the Hurco Companies, Inc. 2016 Equity Incentive Plan (as amended, the “2016
Equity Plan”), which allows us to grant awards of stock options, stock appreciation rights, restricted stock,
stock units and other stock–based awards. The 2016 Equity Plan replaced the Hurco Companies, Inc. 2008
Equity Incentive Plan (the “2008 Equity Plan”) and is the only active plan under which equity awards may be
made by us to our employees and non–employee directors. No further awards will be made under our 2008
Equity Plan. The total number of shares of our common stock that may be issued pursuant to awards under the

2016 Equity Plan initially was 856,048, which included 386,048 shares that remained available for future grants
under the 2008 Equity Plan as of March 10, 2016, the date our shareholders approved the 2016 Equity Plan.
On March 10, 2022, our shareholders approved the Amended and Restated Hurco Companies, Inc. 2016 Equity
Incentive Plan, which, among other items, increased the aggregate number of shares that may be issued under
the 2016 Equity Plan by 850,000 shares.

The Compensation Committee of our Board of Directors has the authority to determine the officers, directors
and key employees who will be granted awards under the 2016 Equity Plan; designate the number of shares
subject to each award; determine the terms and conditions upon which awards will be granted; and prescribe
the form and terms of award agreements. We have granted restricted shares and performance units under the
2016 Equity Plan that are currently outstanding. We previously granted stock options under the 2008 Equity
Plan; none of which remained outstanding as of October 31, 2024. The market value of a share of our common
stock, for purposes of the 2016 Equity Plan, is the closing sale price as reported by the Nasdaq Global Select
Market on the date in question or, if not a trading day, on the last preceding trading date.
Stock Options

A summary of the status of the stock options as of October 31, 2024, 2023, and 2022, and the related activity
for the year is as follows:

Shares Under Weighted Average Grant

Option

Date Fair Value
Balance October 31, 2021

16,996
$
22.71
Granted

—

—
Cancelled

—

—
Expired

—

—
Exercised

(5,437)
$
21.45
Balance October 31, 2022

11,559
$
23.30
Granted

—

—
Cancelled

—

—
Expired

—

—
Exercised

(11,559)
23.30
Balance October 31, 2023

—
$
—
Granted

—

—
Cancelled

—

—
Expired

—

—
Exercised

—
—
Balance October 31, 2024

—
$
—

The total intrinsic value of stock options exercised during the fiscal year ended October 31, 2024, 2023, and
2022, was approximately $0, $0, $9,000, respectively.

Time-based Restricted Shares and Performance Stock Units

On March 14, 2024, March 9, 2023, and March 10, 2022, the Compensation Committee granted a total of
22,878 shares, 17,226 shares, and 13,914 shares of time-based restricted shares, respectively, to our non-
employee directors, which vest in full one year from the date of grant provided the recipient remains on the
board of directors through that date. The grant date fair values of the restricted shares were based on the closing
sales price of our common stock on the grant dates, which were $20.98, $27.86, and $34.49 per share,
respectively.
On November 8, 2023, November 9, 2022, and November 10, 2021, the Compensation Committee granted a
total of 16,673 shares, 12,223 shares, and 8,234 shares of time-based restricted shares, respectively, to our non-
executive employees. The restricted shares vest in thirds over three years from the date of grant provided the
recipient remains employed through that date. The grant date fair values of the restricted shares were based
upon the closing sales price of our common stock on the dates of grant, which were $19.78, $24.53, and $33.99
per shares, respectively.
On January 4, 2024, the Compensation Committee approved a long-term incentive compensation arrangement
for our executive officers in the form of time-based restricted shares and performance stock units (“PSUs”)
under the 2016 Equity Plan, which will be payable in shares of our common stock if earned and vested. The
awards were approximately 25% time-based vesting and approximately 75% performance-based vesting. The
three-year performance period for the PSUs is fiscal year 2024 through fiscal year 2026.
On that date, the Compensation Committee granted a total of 36,574 shares of time-based restricted shares to
our executive officers. The restricted shares vest in thirds over three years from the date of grant provided the
recipient remains employed through that date. The grant date fair value of the restricted shares was based upon
the closing sales price of our common stock on the date of grant, which was $21.53 per share.
On January 4, 2024, the Compensation Committee also granted a total target number of 58,520 PSUs to our
executive officers designated as “PSU – NI”. These PSUs were weighted as approximately 40% of the overall
2024 executive long-term incentive compensation arrangement and will vest and be paid based upon the
achievement of pre-established goals related to our average net income over the three-year period of fiscal years
2024-2026. Participants will have the ability to earn between 50% of the target number of the PSUs – NI for
achieving threshold performance and 200% of the target number of the PSUs – NI for achieving maximum
performance. The grant date fair value of the PSUs – NI was based on the closing sales price of our common
stock on the grant date, which was $21.53 per PSU.
On January 4, 2024, the Compensation Committee also granted a total target number of 51,205 PSUs to our
executive officers designated as “PSU –FCF”. These PSUs were weighted as approximately 35% of the overall
2024 executive long-term incentive compensation arrangement and will vest and be paid based upon the
achievement of pre-established goals related to our average free cash flow over the three-year period of fiscal
years 2024-2026. Participants will have the ability to earn between 50% of the target number of the PSUs –
FCF for achieving threshold performance and 200% of the target number of the PSUs – FCF for achieving
maximum performance. The grant date fair value of the PSUs – FCF was based on the closing sales price of
our common stock on the grant date, which was $21.53 per PSU.
On January 3, 2023, the Compensation Committee approved a long-term incentive compensation arrangement
for our executive officers in the form of time-based restricted shares and PSUs under the 2016 Equity Plan,
which will be payable in shares of our common stock if earned and vested. The awards were approximately
25% time-based vesting and approximately 75% performance-based vesting. The three-year performance
period for the PSUs is fiscal year 2023 through fiscal year 2025.

On that date, the Compensation Committee granted a total of 29,376 shares of time-based restricted shares to
our executive officers. The restricted shares vest in thirds over three years from the date of grant provided the
recipient remains employed through that date. The grant date fair value of the restricted shares was based upon
the closing sales price of our common stock on the date of grant, which was $26.38 per share.
On January 3, 2023, the Compensation Committee also granted a total target number of 47,003 PSUs to our
executive officers designated as “PSU – NI”. These PSUs were weighted as approximately 40% of the overall
2023 executive long-term incentive compensation arrangement and will vest and be paid based upon the
achievement of pre-established goals related to our average net income over the three-year period of fiscal years
2023-2025. Participants will have the ability to earn between 50% of the target number of the PSUs – NI for
achieving threshold performance and 200% of the target number of the PSUs – NI for achieving maximum
performance. The grant date fair value of the PSUs – NI was based on the closing sales price of our common
stock on grant date, which was $26.38 per PSU.
On January 3, 2023, the Compensation Committee also granted a total target number of 41,126 PSUs to our
executive officers designated as “PSU –FCF”. These PSUs were weighted as approximately 35% of the overall
2023 executive long-term incentive compensation arrangement and will vest and be paid based upon the
achievement of pre-established goals related to our average free cash flow over the three-year period of fiscal
years 2023-2025. Participants will have the ability to earn between 50% of the target number of the PSUs –
FCF for achieving threshold performance and 200% of the target number of the PSUs – FCF for achieving
maximum performance. The grant date fair value of the PSUs – FCF was based on the closing sales price of
our common stock on the grant date, which was $26.38 per PSU.
On January 4, 2022, the Compensation Committee approved a long-term incentive compensation arrangement
for our executive officers in the form of time-based restricted shares and PSUs under the 2016 Equity Plan,
which will be payable in shares of our common stock if earned and vested. The awards were approximately
25% time-based vesting and approximately 75% performance-based vesting. The three-year performance
period for the PSUs is fiscal year 2022 through fiscal year 2024.
On that date, the Compensation Committee granted a total of 23,442 shares of time-based restricted shares to
our executive officers. The restricted shares vest in thirds over three years from the date of grant provided the
recipient remains employed through that date. The grant date fair value of the restricted shares was based upon
the closing sales price of our common stock on the date of grant, which was $30.39 per share.
On January 4, 2022, the Compensation Committee also granted a total target number of 34,203 PSUs to our
executive officers designated as “PSU – TSR”. These PSUs were weighted as approximately 40% of the overall
2022 executive long-term incentive compensation arrangement and will vest and be paid based upon the total
shareholder return of our common stock over the three-year period of fiscal years 2022-2024, relative to the
total shareholder return of the companies in a specified peer group over that period. Participants will have the
ability to earn between 50% of the target number of the PSUs – TSR for achieving threshold performance and
200% of the target number of the PSUs – TSR for achieving maximum performance. The grant date fair value
of the PSUs – TSR was $33.33 per PSU and was calculated using the Monte Carlo approach.
On January 4, 2022, the Compensation Committee also granted a total target number of 32,821 PSUs to our
executive officers designated as “PSU – ROIC”. These PSUs were weighted as approximately 35% of the
overall 2022 executive long-term incentive compensation arrangement and will vest and be paid based upon
the achievement of pre-established goals related to our average return on invested capital over the three-year
period of fiscal years 2022-2024. Participants will have the ability to earn between 50% of the target number
of the PSUs – ROIC for achieving threshold performance and 200% of the target number of the PSUs – ROIC

for achieving maximum performance. The grant date fair value of the PSUs – ROIC was based on the closing
sales price of our common stock on the grant date, which was $30.39 per share.
A reconciliation of our restricted shares and PSU activity and related information is as follows:

Number of Restricted

Weighted Average Grant

Shares and PSUs

Date Fair Value
Unvested as of October 31, 2023

318,317
$
28.27
Shares or units granted

185,850
21.31
Shares or units vested

(61,121)
27.90
Shares or units cancelled

(50,375)
27.97
Shares withheld

(14,579)
27.77
Unvested as of October 31, 2024

378,092
$
24.97

During fiscal years 2024, 2023, and 2022, we recorded approximately $1.6 million, $2.7 million, and $2.7
million, respectively, of stock–based compensation expense related to grants under the 2016 Equity Plan. As
of October 31, 2024, there was an estimated $2.2 million of total unrecognized stock–based compensation cost
that we expect to recognize by the end of the first quarter of fiscal year 2027.

9. RELATED PARTY TRANSACTIONS

As of October 31, 2024, we owned approximately 35% of the outstanding shares of a Taiwanese–based contract
manufacturer, Hurco Automation, Ltd. (“HAL”). HAL’s scope of activities includes the design, manufacture,
sales, and distribution of industrial automation products, software systems, and related components, including
control systems and components produced under contract for sale exclusively to us. We are accounting for this
investment using the equity method. The investment of $5.3 million and $5.1 million as of October 31, 2024
and 2023, respectively, is included in Investments and other assets, net on the Consolidated Balance Sheets.
Purchases of control systems and components from HAL amounted to $6.6 million, $10.2 million, and $10.5
million in fiscal years 2024, 2023, and 2022, respectively. Sales of control component parts to HAL were less
than $0.1 million, $0.1 million, and $0.3 million for the fiscal years ended October 31, 2024, 2023, and 2022,
respectively. Trade payables to HAL were $0.7 million and $1.1 million as of October 31, 2024 and 2023,
respectively. Trade receivables from HAL each were immaterial as of October 31, 2024 and 2023.

Summary financial information for HAL’s operations and financial condition is as follows (in thousands):

2024

2023

2022
Net Sales
$
10,065
$
13,025
$
14,171
Gross Profit

1,915

2,224

2,397
Operating Income

749

1,025

1,053
Net Income

1,060

2,007

2,528

Current Assets
$
13,101
$
13,669
$
15,018
Non–current Assets

8,389

7,115

6,430
Current Liabilities

3,000

3,385

4,998
Non-current Liabilities
2,509
2,027
1,619

10. CONTINGENCIES AND LITIGATION

From time to time, we are involved in various claims and lawsuits arising in the normal course of business.
Pursuant to applicable accounting rules, we accrue the minimum liability for each known claim when the
estimated outcome is a range of possible loss and no one amount within that range is more likely than another.
We maintain insurance policies for such matters, and we record insurance recoveries when we determine such
recovery to be probable. We do not expect any of these claims, individually or in the aggregate, to have a
material adverse effect on our consolidated financial position or results of operations. We believe that the
ultimate resolution of claims for any losses will not exceed our insurance policy coverages.

11. GUARANTEES AND PRODUCT WARRANTIES

From time to time, our subsidiaries guarantee third party payment obligations in connection with the sale of
machines to customers that use financing. We follow FASB guidance for accounting for guarantees (codified
in 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. Upon shipment of a machine, the customer assumes the risk of ownership. The customer does
not obtain title, however, until it has paid for the machine. A retention of title clause allows us to recover the
machine if the customer defaults on the financing. We accrue liabilities under these guarantees at fair value,
which amounts are not material.

We provide warranties on our products with respect to defects in material and workmanship. The terms of these
warranties are generally one year for machines and shorter periods for service parts. We recognize an estimated
liability with respect to this obligation at the time of product sale, with subsequent warranty claims recorded
against the estimated liability. The amount of the warranty estimated liability is determined based on historical
trend experience and any known warranty issues that could cause future warranty costs to differ from historical
experience. A reconciliation of the changes in our warranty estimated liability for each of the last three fiscal
years is as follows (in thousands):

2024
2023
2022
Balance, beginning of period
$
1,294 $
1,426 $
1,516
Provision for warranties during the period

2,296

2,629

2,915
Charges to the estimated liability

(2,527)

(2,792)

(2,877)
Impact of foreign currency translation

(128)
Balance, end of period
$
1,086 $
1,294 $
1,426

The decreases in our warranty estimated liability from October 31, 2023 to October 31, 2024 and from October
31, 2022 to October 31, 2023 were primarily due to decreases in the number of machines under warranty from
decreased sales volume in fiscal years 2024 and 2023.

12. LEASES

Our lease portfolio includes leased production and assembly facilities, warehouses and distribution centers,
office space, vehicles, material handling equipment utilized in our production and assembly facilities, laptops
and other information technology equipment, as well as other miscellaneous leased equipment. Most of the
leased production and assembly facilities have lease terms ranging from two to five years, although the terms
and conditions of our leases can vary significantly from lease to lease. We have assessed the specific terms and
conditions of each lease to determine the amount of the lease payments and the length of the lease term, which
includes the minimum period over which lease payments are required plus any renewal options that are both
within our control to exercise and reasonably certain of being exercised upon lease commencement. In

determining whether or not a renewal option is reasonably certain of being exercised, we assessed all relevant
factors to determine if sufficient incentives exist as of lease commencement to conclude renewal is reasonably
certain. There are no material residual value guarantees provided by us, nor any restrictions or covenants
imposed by the leases to which we are a party. In determining the lease liability, we utilize our incremental
borrowing rate to discount the future lease payments over the lease term to present value.

We record a right-of-use asset and lease liability on our Consolidated Balance Sheets for all leases that, at the
commencement date, have a lease term of more than 12 months and are classified as leases under ASC 842.

We recorded total operating lease expense for the fiscal years ended October 31, 2024, 2023, and 2022 of $5.4
million, $5.2 million, and $5.1 million, respectively, which is classified within Cost of sales and service and
Selling, general and administrative expenses within the Consolidated Statements of Operations. Operating
lease expense includes short-term leases and variable lease payments, which are immaterial. There has been
no cost to obtain leases capitalized on the Consolidated Balance Sheets as of October 31, 2024.

The following table summarizes supplemental cash flow information and non-cash activity related to operating
leases for fiscal years 2024 and 2023 (in thousands):

2024
2023 2022
Operating cash flow information:
Cash paid for amounts included in the measurement of lease liabilities
$ 4,950
$ 4,770 $ 4,457
Noncash information:

Right-of-use assets obtained in exchange for new operating lease
liabilities
$ 4,929
$ 7,485 $ 3,577

The following table summarizes the maturities of undiscounted cash flows of lease commitments reconciled to
the total lease liability as of October 31, 2024 (in thousands):

2025
$
4,219
2026

3,113
2027

2,362
2028

1,788
2029
531
2030 and thereafter

573
Total

12,586
Less: Imputed interest
(905)
Operating lease liabilities
$
11,681

As of October 31, 2024, the weighted-average remaining term of our lease portfolio was approximately 3.8
years, and the weighted-average discount rate was approximately 3.5%.

13. SEGMENT INFORMATION
We operate in a single operating and reportable segment: industrial automation equipment. We design,
manufacture, and sell computerized (i.e., Computer Numeric Control) machine tools, consisting primarily of
vertical machining centers (mills) and turning centers (lathes), to companies in the metal cutting industry
through a worldwide sales, service, and distribution network. Although most of our computer control systems
and software products are proprietary, they predominantly use industry standard personal computer

components. Our computer control systems and software products are primarily sold as integral components of
our computerized machine tool products. We also provide machine tool components, automation integration
equipment and solutions for job shops, software options, control upgrades, accessories and replacement parts
for our products, as well as customer service, training, and applications support.
We principally sell our products through approximately 180 independent agents and distributors throughout the
Americas, Europe, and Asia. Our line is the primary line for the majority of our distributors globally, even
though some may carry competitive products. We also have our own direct sales and service organizations in
China, the Czech Republic, France, Germany, India, Italy, the Netherlands, Poland, Singapore, Taiwan, the
United Kingdom, and certain areas of the United States, which are among the world's principal machine tool
consuming countries. In fiscal year 2024, approximately 61% of our revenues were from customers located
outside of the Americas, and no single distributor or end-user of our products accounted for more than 5% of
our total sales and service fees.
The following table sets forth the contribution of each of our product groups and services to our total sales and
service fees 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 $
188,335 $
211,804
Computer Control Systems and Software †

2,447

2,805

2,634
Service Parts

27,628

28,439

28,219
Service Fees

8,948

8,228

8,157
Total
$
186,584
$
227,807
$
250,814
† Amounts shown do not include computer control systems and software sold as an integrated component of
computerized machine systems.

The following table sets forth revenues by geographic area, based on customer location, for each of the past
three fiscal years (in thousands):

Year Ended October 31,

2024

2023

2022
United States of America
$ 70,342 $ 83,747 $ 92,050
Canada

1,701

3,827

3,996
Central & South Americas

1,255

1,839

1,279
Total Americas
73,298
89,413
97,325

Germany
28,139
30,468
42,026
United Kingdom
26,668
29,704
26,629
Italy

9,894
15,554
16,499
France
12,917
11,851
14,291
Other Europe
13,299
28,204
24,437
Total Europe
90,917
115,781
123,882

China

6,545

7,529
10,293
India

9,077

6,016

6,578
Other Asia Pacific

5,704

7,858
11,975
Total Asia Pacific
21,326
21,403
28,846

Other Foreign

1,043

1,210

761
Grand Total
$ 186,584 $ 227,807 $ 250,814

Long–lived tangible assets, net by geographic area, were (in thousands):

As of October 31,

2024

2023

2022
United States of America
$
9,510 $
7,072 $
5,628
Foreign countries

13,025

4,034

4,941
$
22,535 $
11,106 $
10,569

Net assets by geographic area were (in thousands):

As of October 31,

2024

2023

2022
Americas
$
45,798 $
70,649 $
87,476
Europe

88,810

81,730

67,797
Asia Pacific

72,564

69,852

67,371
$
207,172 $
222,231 $
222,644

14. NEW ACCOUNTING PRONOUNCEMENTS
New Accounting Pronouncements:

In November 2023, the FASB issued Accounting Standards Update (“ASU”) No. 2023-07, Segment Reporting
(Topic 280): Improvements to Reportable Segment Disclosures, to update reportable segment disclosure
requirements, primarily through enhanced disclosures about significant segment expenses and information used
to assess segment performance. This update will be effective for our fiscal year 2025 annual reporting and
subsequent interim periods. We are currently assessing the impact this new accounting guidance will have on
our consolidated financial statements and disclosures.

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to income
tax disclosures, which aims to improve disclosures and presentation requirements to the transparency of the
income tax disclosures by requiring consistent categories and greater disaggregation of information in the rate
reconciliation and income taxes paid disaggregated by jurisdiction. The amendments will be effective for our
fiscal year 2026, with the option to early adopt at any time prior to the effective date. We are currently assessing
the impact this new accounting guidance will have on our consolidated financial statements and disclosures.

In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive
Income—Expense Disaggregation Disclosures (Subtopic 220-40), which requires companies to disclose
disaggregated information about any relevant expense caption presented on the face of the income statement
within continuing operations into the following required natural expense categories, as applicable: (1) purchases
of inventory, (2) employee compensation, (3) depreciation, (4) intangible asset amortization, and (5)
depreciation, depletion, and amortization (“DD&A”) recognized as part of oil- and gas-producing activities or
other depletion expenses. This update will be effective for our fiscal year 2028 annual reporting. Early adoption
is permitted. We are currently assessing the impact this new accounting guidance will have on our consolidated
financial statements and disclosures.

Item 9.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE
None.

Item 9A.
CONTROLS AND PROCEDURES
Under the supervision and with the participation of management, including our Chief Executive Officer and
Chief Financial Officer, we carried out an evaluation of the effectiveness of the design and operation of our
disclosure controls and procedures as of October 31, 2024, pursuant to Rule 13a-15(b) under the Securities
Exchange Act of 1934, as amended. Based upon that evaluation, our management, including the Chief
Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were
effective as of the evaluation date.
There have been no changes in our internal control over financial reporting that occurred during the fourth
quarter of the fiscal year ended October 31, 2024, that have materially affected, or are reasonably likely to
materially affect, our internal control over financial reporting.
The attestation report of our independent registered public accounting firm on our internal control over financial
reporting is included in this report under Item 8. Financial Statements and Supplementary Data. Our
management’s annual report on internal control over financial reporting is below.

Management’s Annual Report on Internal Control over Financial Reporting

To the Shareholders and
Board of Directors
of Hurco Companies, Inc.
Management of Hurco Companies, Inc. (the “Company”) has assessed the effectiveness of the Company’s
internal control over financial reporting as of October 31, 2024, based on criteria established in Internal
Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission (2013 framework) (COSO). Management is responsible for the Company’s financial statements,
for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of
internal control over financial reporting.
Because of its inherent limitations, the Company’s internal control over financial reporting may not prevent or
detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the
risk that controls may become inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.
In management’s opinion, the Company’s internal control over financial reporting as of October 31, 2024, was
effective based on the criteria specified above.
Our independent registered public accounting firm, Deloitte & Touche LLP (“Deloitte”), which also audited
our consolidated financial statements, audited the effectiveness of our internal control over financial reporting
as of October 31, 2024. Deloitte has issued their attestation report, which is included in Part II, Item 8 of this
Annual Report on Form 10-K.

/s/ Gregory S. Volovic

Gregory S. Volovic

President and Chief Executive Officer

/s/ Sonja K. McClelland

Sonja K. McClelland

Executive Vice President, Treasurer, and
Chief Financial Officer

Indianapolis, Indiana
January 10, 2025

Item 9B.
OTHER INFORMATION
Trading Arrangements

During the three months ended October 31, 2024, none of our directors or officers (as defined in Rule 16a-1(f)
of the Exchange Act) adopted, modified or terminated any contract, instruction or written plan for the purchase
or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) of the
Exchange Act or any non-Rule 10b5-1 trading arrangement (as defined in the Securities and Exchange
Commission’s rules).

Stock Price Performance Graph

The graph below matches the cumulative 5-year total return of holders of Hurco Companies, Inc.'s common
stock with the cumulative total returns of the Russell 2000 index, the Nasdaq Global Select index and a
customized peer group of eighteen companies that includes: Ampco-Pittsburgh Corporation, Broadwind, Inc.,
Douglas Dynamics, Inc., DMC Global Inc., The Eastern Company, Energy Recovery, Inc., FARO
Technologies, Inc., Graham Corporation, Helios Technologies, Inc., Key Tronic Corporation, The L.S. Starrett
Company, Omega Flex, Inc., Onto Innovation Inc., Proto Labs, Inc., Transcat, Inc., Twin Disc, Incorporated,
UFP Technologies, Inc., and Vishay Precision Group, Inc. The graph assumes that the value of the investment
in our common stock, in each index, and in the peer group (including reinvestment of dividends) was $100 on
October 31, 2019 and tracks it through October 31, 2024.

10/31/2019
10/31/2020
10/31/2021
10/31/2022
10/31/2023
10/31/2024
Hurco Companies, Inc.
100.00
87.33
96.60
70.45
62.50
66.68
Russell 2000

100.00
99.86
150.59
122.67
112.17
150.39
NASDAQ Global Select

100.00
132.04
183.11
126.94
153.83
218.99
Peer Group

100.00
107.17
145.28
112.42
120.20
164.19

The stock price performance included in this graph is not necessarily indicative of future stock price performance.

Item 9C.
DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT
INSPECTIONS

Not Applicable.

PART III
Item 10.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The information required by this item is incorporated herein by reference to the definitive proxy statement for
our 2025 annual meeting of shareholders except that the information required by Item 10 regarding our
executive officers is included herein under the caption “Information about our Executive Officers” at the end
of Part I.

Item 11.
EXECUTIVE COMPENSATION
The information required by this item is incorporated herein by reference to the definitive proxy statement for
our 2025 annual meeting of shareholders.

Item 12.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The information required by this item is incorporated herein by reference to the definitive proxy statement for
our 2025 annual meeting of shareholders.

Item 13.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE
The information required by this item is incorporated herein by reference to the definitive proxy statement for
our 2025 annual meeting of shareholders.

Item 14.
PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information required by this item is incorporated herein by reference to the definitive proxy statement for
our 2025 annual meeting of shareholders.

PART IV
Item 15.
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) 1. Financial Statements. The following consolidated financial statements of the Company are included
herein under Item 8 of Part II:

Page
Report of Independent Registered Public Accounting Firm – Deloitte & Touche LLP, PCAOB Firm ID No.
00034
43
Report of Independent Registered Public Accounting Firm – RSM US LLP, PCAOB Firm ID No. 00049
46
Consolidated Statements of Operations – years ended October 31, 2024, 2023, and 2022
47
Consolidated Statements of Comprehensive Income (Loss) – years ended October 31, 2024, 2023 and 2022
48
Consolidated Balance Sheets – as of October 31, 2024 and 2023
49
Consolidated Statements of Cash Flows – years ended October 31, 2024, 2023 and 2022
50
Consolidated Statements of Changes in Shareholders’ Equity – years ended October 31, 2024, 2023 and 2022
51
Notes to Consolidated Financial Statements
52

2. Financial Statement Schedule. The following financial statement schedule is included in this Item.

Schedule II – Valuation and Qualifying Accounts and Reserves
for the Years Ended October 31, 2024, 2023 and 2022
(Dollars in thousands)

Charged to/

(Recovered

Balance at
from)
Charged

Balance
Beginning
Costs and
to Other

at End
Description
of Period Expenses Accounts Deductions of Period
Allowance for doubtful accounts for
the year ended:

October 31, 2024
$
1,518 $
214
$
— $
250 (1) $ 1,482
October 31, 2023
$
1,486 $
79
$
— $
47 (1) $ 1,518
October 31, 2022
$
1,645 $
(74) $
— $
85 (1) $ 1,486

Income tax valuation allowance for
the year ended:

October 31, 2024
$
1,810 $
8,590
$
— $
1,197 $ 9,203
October 31, 2023
$
1,754 $
249
$
— $
193 $ 1,810
October 31, 2022
$
1,871 $
502
$
— $
619 $ 1,754

(1) Receivable write–offs.
All other financial statement schedules are omitted because they are not applicable or the required information
is included in the consolidated financial statements or notes thereto.

(b) Exhibits

EXHIBITS INDEX

Exhibits Filed. The following exhibits are filed with this report:

4.1
Description of the Company’s Common Stock.
21.1
Subsidiaries of the Registrant.
23.1
Consent of Independent Registered Public Accounting Firm, Deloitte and Touche, LLP.
23.2
Consent of Independent Registered Public Accounting Firm, RSM US LLP.
31.1
Certification by the Chief Executive Officer, pursuant to Rule 13a-14(a) under the Securities
Exchange Act of 1934, as amended.
31.2
Certification by the Chief Financial Officer, pursuant to Rule 13a-14(a) under the Securities
Exchange Act of 1934, as amended.
32.1
Certification by the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
32.2
Certification by the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
101
The following information from the Registrant’s Annual Report on Form 10-K for the fiscal year
ended October 31, 2024, formatted in Inline XBRL: (i) Consolidated Statements of Operations; (ii)
Consolidated Statements of Comprehensive Income (Loss); (iii) Consolidated Balance Sheets; (iv)
Consolidated Statements of Cash Flows; (v) Consolidated Statements of Changes in Shareholders’
Equity; (vi) Notes to Consolidated Financial Statements; and (vii) information set forth under
“Trading Arrangements” in Part II, Item 9B.
104
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

Exhibits Incorporated by Reference. The following exhibits are incorporated into this report:

3.1
Amended and Restated Articles of Incorporation of the Registrant, as amended effective March 15,
2024, incorporated by reference to Exhibit 3.1 to the Registrant’s Quarterly Report on Form 10-Q
for the quarter ended April 30, 2024.
3.2
Amended and Restated By-Laws of the Registrant as amended through March 15, 2024 incorporated
by reference to Exhibit 3.2 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended
April 30, 2024.
10.1*
Hurco Companies, Inc. 2016 Equity Incentive Plan, as amended and restated as of March 10, 2022,
incorporated herein by reference to Appendix A to the Company’s definitive proxy statement for its
2022 annual meeting of shareholders filed on January 24, 2022.
10.2*
Form of Restricted Stock Agreement (Director) under the 2016 Equity Incentive Plan, incorporated
herein by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on March
10, 2016.
10.3*
Form of Restricted Stock Award Agreement (Employee) under the 2016 Equity Incentive Plan,
incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 10-Q for the
quarter ended January 31, 2017.
10.4*
Form of Performance Stock Unit Award Agreement (Employee) under the 2016 Equity Incentive
Plan, incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 10-Q for
the quarter ended January 31, 2017.
10.5*
Hurco Companies, Inc. Cash Incentive Plan, incorporated herein by reference to Exhibit 10.3 to the
Company’s Current Report on Form 8-K filed on March 10, 2016.
10.6*
Employment Agreement dated March 15, 2012, between Hurco Companies, Inc. and Michael Doar,
incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed
March 16, 2012.
10.7*
First Amendment to Employment Agreement, dated as of November 11, 2021, by and between Hurco
Companies, Inc. and Michael Doar, incorporated by reference to Exhibit 10.1 to the Registrant’s
Current Report on Form 8-K filed on November 17, 2021.
10.8*
Employment Agreement dated March 15, 2012, between Hurco Companies, Inc. and Gregory S.
Volovic, incorporated by reference to Exhibit 10.4 to the Registrant’s Current Report on Form 8-K
filed March 16, 2012.
10.9*
First Amendment to Employment Agreement, dated as of November 11, 2021, by and between Hurco
Companies, Inc. and Gregory S. Volovic, incorporated by reference to Exhibit 10.2 to the
Registrant’s Current Report on Form 8-K filed on November 17, 2021.
10.10*
Employment Agreement dated March 15, 2012, between Hurco Companies, Inc. and Sonja K.
McClelland, incorporated by reference to Exhibit 10.5 to the Registrant’s Current Report on Form 8-
K filed March 16, 2012.
10.11*
Hurco Companies, Inc. 2008 Equity Incentive Plan, incorporated by reference to Appendix A of the
Registrant’s definitive Proxy Statement on Schedule 14A filed January 28, 2008.
10.12*
Form of restated split-dollar insurance agreement, incorporated by reference to Exhibit 10.2 to the
Registrant’s Annual Report on Form 10-K for the year ended October 31, 2008.
10.13
Credit Agreement, dated as of December 31, 2018, among Hurco Companies, Inc. and Hurco B.V.,
as the Borrowers, certain subsidiaries party thereto, as the Guarantors, and Bank of America, N.A.,
as the Lender, incorporated by reference to Exhibit 10.1 to the Registrant’s Annual Report on Form
10-K for the year ended October 31, 2018.

10.14
First Amendment to Credit Agreement, dated as of March 13, 2020, to the Credit Agreement, dated
as of December 31, 2018, among Hurco Companies, Inc. and Hurco B.V., as the Borrowers, certain
subsidiaries party thereto, as the Guarantors, and Bank of America, N.A., as the Lender, incorporated
by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed March 13, 2021.
10.15

Second Amendment to Credit Agreement, dated as of December 23, 2020, to the Credit Agreement,
dated as of December 31, 2018, among Hurco Companies, Inc. and Hurco B.V., as the Borrowers,
certain subsidiaries party thereto, as the Guarantors, and Bank of America, N.A., as the Lender,
incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed
December 29, 2021.
10.16

Third Amendment to Credit Agreement, dated as of December 17, 2021, to the Credit Agreement,
dated as of December 31, 2018, among Hurco Companies, Inc. and Hurco B.V., as the Borrowers,
certain subsidiaries party thereto, as the Guarantors, and Bank of America, N.A., as the Lender,
incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed
December 23, 2021.
10.17

Fourth Amendment to Credit Agreement, dated as of January 4, 2023, to the Credit Agreement, dated
as of December 31, 2018, among Hurco Companies, Inc. and Hurco B.V., as the Borrowers, certain
subsidiaries party thereto, as the Guarantors, and Bank of America, N.A., as the Lender, incorporated
by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed January 6, 2023.
10.18
Fifth Amendment to Credit Agreement, dated as of December 19, 2023, to the Credit Agreement,
dated as of December 31, 2018, among Hurco Companies, Inc. and Hurco B.V., as the Borrowers,
certain subsidiaries party thereto, as the Guarantors, and Bank of America, N.A., as the Lender,
incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed
December 22, 2023.
19.1
Hurco Companies, Inc. Insider Trading Policy incorporated by reference to Exhibit 19.1 to the
Registrant’s Annual Report on Form 10-K for the year ended October 31, 2023.
97.1
Hurco Companies, Inc. Compensation Recovery Policy incorporated by reference to Exhibit 97.1 to
the Registrant’s Annual Report on Form 10-K for the year ended October 31, 2023.

*
The indicated exhibit is a management contract, compensatory plan, or arrangement required to be listed
by Item 601 of Regulation S-K.

Item 16.
FORM 10-K SUMMARY
None.

SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has
duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized, this 10th day
of January, 2025.

HURCO COMPANIES, INC.

By: /s/ Sonja K. McClelland

Sonja K. McClelland

Executive Vice President, Treasurer and

Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the
following persons on behalf of the Registrant and in the capacities and on the dates indicated:

Signature and Title(s)

Date

/s/ Gregory S. Volovic

January 10, 2025
Gregory S. Volovic

Chief Executive Officer, President and Director
of Hurco Companies, Inc.

(Principal Executive Officer)

/s/ Sonja K. McClelland

January 10, 2025
Sonja K. McClelland

Executive Vice President, Treasurer and

Chief Financial Officer of Hurco Companies, Inc.

(Principal Financial Officer)

/s/ HaiQuynh Jamison

January 10, 2025
HaiQuynh Jamison
Corporate Controller of Hurco Companies, Inc.
(Principal Accounting Officer)

/s/ Michael Doar

January 10, 2025
Michael Doar, Executive Chairman of the Board

/s/ Thomas A. Aaro

January 10, 2025
Thomas A. Aaro, Director

/s/ Cynthia Dubin

January 10, 2025
Cynthia Dubin, Director

/s/ Timothy J. Gardner

January 10, 2025
Timothy J. Gardner, Director

/s/ Jay C. Longbottom

January 10, 2025
Jay C. Longbottom, Director

/s/ Richard Porter

January 10, 2025
Richard Porter, Director

/s/ Janaki Sivanesan

January 10, 2025
Janaki Sivanesan, Director

Exhibit 4.1

DESCRIPTION OF HURCO COMPANIES, INC.’S
COMMON STOCK

The following is a description of the common stock, no par value (the “Common Stock”), of Hurco Companies,
Inc. (the “Company”), which is the only security of the Company registered pursuant to Section 12 of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”).

General

The Company is authorized to issue up to 12,500,000 shares of Common Stock. As of December 31, 2024, the
Company had 6,446,349 shares of Common Stock outstanding.

The following description summarizes selected information regarding the Common Stock, as well as relevant
provisions of (i) the Company’s Amended and Restated Articles of Incorporation, as currently in effect (the
“Articles”), (ii) the Company’s Amended and Restated By-Laws, as currently in effect (the “By-Laws”), and
(iii) the Indiana Business Corporation Law (the “IBCL”). The following summary description of the Common
Stock of the Company is qualified in its entirety by reference to the provisions of the Company’s Articles and
By-Laws, copies of which have been filed as exhibits to the Company’s periodic reports under the Exchange
Act, and the applicable provisions of the IBCL.

Common Stock

Voting Rights. The holders of shares of Common Stock are entitled to one vote per share on all matters submitted
to shareholders for a vote. The holders of shares of Common Stock do not have cumulative voting rights with
respect to the election of directors or any other matter.

Dividend Rights. Subject to preferences to which holders of any preferred stock of the Company may be
entitled, the holders of shares of Common Stock are entitled to receive such dividends as may be declared from
time to time by the Board of Directors, in its discretion, from any assets legally available therefor.

Liquidation Rights. Subject to the prior payment or provision for payment of the debts and other liabilities of
the Company and any preferential amounts to be distributed to holders of any preferred stock of the Company,
in the event of any liquidation, dissolution or winding up of the Company, the holders of shares of Common
Stock shall be entitled to share ratably in the remaining net assets of the Company.

Other Rights and Preferences. The holders of shares of Common Stock have no preemptive rights to subscribe
to or purchase any shares of Common Stock or other Company securities. There are no redemption, sinking
fund, or conversion provisions applicable to the Common Stock. The holders of shares of Common Stock are
not subject to further calls or assessments by the Company.

Transfer Agent and Registrar. The transfer agent and registrar for the Common Stock is Computershare Trust
Company, N.A.

Listing. The Common Stock is traded on the Nasdaq Global Select Market under the symbol “HURC.”

Anti-Takeover Effects of Provisions of the Company’s Articles, By-Laws and the IBCL

Under certain circumstances, certain provisions of the IBCL, the Company’s Articles and the Company’s By-
Laws may render more difficult, or may discourage, a merger, a tender offer, a proxy contest, the assumption
of control of the Company by a holder of a large block of the Common Stock or other person, or the removal
of incumbent management, even if such actions may be beneficial to the Company’s shareholders generally.

Meetings of Shareholders. Under Chapter 29 of the IBCL and the Company’s Articles, any action required to
be taken by the Company’s shareholders may be effected only at an annual meeting or special meeting of
shareholders, and shareholders may act in lieu of such meetings only by unanimous written consent. The
Company’s By-Laws provide that special meetings of shareholders may be called by the Company’s Board of
Directors or President, or by the holders of a majority of all the votes entitled to be cast on any issue proposed
to be considered at the proposed special meeting.

The Company’s By-Laws also establish an advance notice procedure for the nomination, other than by or at the
direction of the Company’s Board of Directors, of persons for election as directors as well as for other
shareholder proposals to be considered at annual meetings of shareholders. In general, notice of intent to
nominate a director or raise business at such meetings must be delivered to the Company by a shareholder not
less than 60 days prior to such meeting. Such notice must contain certain specified information concerning the
person to be nominated and the shareholder submitting the proposal.

Amendment of By-Laws. The Company’s Articles and By-Laws provide that the Company’s By-Laws may be
amended or repealed from time to time, or new By-Laws may be adopted, by either: (i) the Board of Directors
if such amendment, repeal, or adoption is approved by the affirmative vote of at least a majority of the entire
Board of Directors; or (ii) the affirmative vote, at a meeting of the shareholders of the Company for which the
meeting designates that making, amending, or repealing provisions of the By-Laws is to be considered, of at
least a majority of the votes entitled to be cast by the holders of the outstanding shares of all classes of stock of
the Company entitled to vote generally in the election of directors (considered as a single voting group).

Special Transactions. The Company’s Articles require the affirmative vote of the holders of not less than three-
fourths of the outstanding shares of Common Stock for certain proposed transactions, including, but not limited
to: (i) the merger or consolidation of the Company and a “related corporation”; (ii) the sale or exchange of all
or substantially all of the Company’s assets or business to or with a related corporation; (iii) the issue or delivery
of Common Stock or any other Company securities in exchange or payment for property, assets or securities of
a related corporation; and (iv) the merger of any of the Company’s affiliates with or into a related corporation
or any of its affiliates.

For purposes of the above provisions, the below definitions shall apply:

(a) “affiliate” means any person (including a corporation, partnership, trust, estate or individual) who,
directly or indirectly, controls, is controlled by, or is under common control with the person specified;
and

(b) “related corporation” means a corporation or entity or any of its affiliates, singly or in the aggregate,
that are beneficial owners, directly or indirectly, of more than 5% of the total outstanding shares of
Common Stock.

The foregoing requirements shall not apply to any transaction that has been (i) approved by resolution of the
Board of Directors adopted by the affirmative vote of not less than two-thirds of the then authorized number of
directors; or (ii) approved by resolution of the Board of Directors prior to the acquisition of the beneficial
ownership of more than 5% of the total voting power of all outstanding shares of Common Stock by such related
corporation and its affiliates.

Control Share Acquisitions. Under Chapter 42 of the IBCL, an acquiring person or group who makes a “control
share acquisition” in an “issuing public corporation” may not exercise voting rights on any “control shares”
unless these voting rights are conferred by a majority vote of the disinterested shareholders of the issuing public
corporation at a special meeting of those shareholders held upon the request and at the expense of the acquiring
person. If control shares acquired in a control share acquisition are accorded full voting rights and the acquiring
person has acquired control shares with a majority or more of all voting power, all shareholders of the issuing
public corporation have dissenters’ rights to receive the fair value of their shares pursuant to Chapter 44 of the
IBCL.

For purposes of Chapter 42 of the IBCL, the below definitions shall apply:

(a) “control share acquisition” means, subject to specified exceptions, the acquisition, directly or indirectly,
by any person of ownership of, or the power to direct the exercise of voting power with respect to,
issued and outstanding control shares. For the purposes of determining whether an acquisition
constitutes a control share acquisition, shares acquired within 90 days or under a plan to make a control
share acquisition are considered to have been acquired in the same acquisition;

(b) “control shares” means shares acquired by a person that, when added to all other shares of the issuing
public corporation owned by that person or in respect to which that person may exercise or direct the
exercise of voting power, would otherwise entitle that person to exercise voting power of the issuing
public corporation in the election of directors within any of the following ranges: (i) one-fifth or more
but less than one-third; (ii) one-third or more but less than a majority; or (iii) a majority or more; and

(c) “issuing public corporation” means a corporation which has (i) 100 or more shareholders, (ii) its
principal place of business or its principal office in Indiana, or that owns or controls assets within
Indiana having a fair market value of greater than $1,000,000, and (iii) (A) more than 10% of its
shareholders resident in Indiana, (B) more than 10% of its shares owned of record or owned
beneficially by Indiana residents, or (C) 1,000 shareholders resident in Indiana.

The above provisions do not apply if, before a control share acquisition is made, an Indiana corporation’s
articles of incorporation or by-laws, including a by-law adopted by the Indiana corporation’s board of directors,
provide that they do not apply. The Company’s Articles and By-Laws do not exclude the Company from these
provisions.

Certain Business Combinations. Chapter 43 of the IBCL restricts the ability of a “resident domestic
corporation” to engage in any business combinations with an “interested shareholder” for five years after the
date the interested shareholder became such, unless the business combination or the purchase of shares by the
interested shareholder on the interested shareholder’s share acquisition date is approved by the board of
directors of the resident domestic corporation before the interested shareholder’s share acquisition date. If such
prior approval is not obtained, the interested shareholder may effect a business combination after the five-year
period only if such shareholder receives approval from a majority of the disinterested shareholders or the offer
meets specified fair price criteria.

For purposes of Chapter 43 of the IBCL, the below definitions shall apply:

(a) “beneficial owner” means a person who, directly or indirectly, owns the subject shares, has the right to
acquire or vote the subject shares (excluding voting rights under revocable proxies made in accordance
with federal law), has any agreement, arrangement or understanding for the purpose of acquiring,
holding, voting or disposing of the subject shares, or holds any derivative instrument that includes the
opportunity to profit or share in any profit derived from any increase in the value of the subject shares;

(b) “interested shareholder” means any person, other than the resident domestic corporation or its
subsidiaries, that is (i) the beneficial owner, directly or indirectly, of 10% or more of the voting power
of the outstanding voting shares of the resident domestic corporation or (ii) an affiliate or associate of
the resident domestic corporation, which at any time within the five-year period immediately before
the date in question, was the beneficial owner, directly or indirectly, of 10% or more of the voting
power of the then outstanding shares of the resident domestic corporation; and

The above provisions do not apply to corporations that elect not to be subject to Chapter 43 of the IBCL in an
amendment to their articles of incorporation approved by a majority of the disinterested shareholders. That
amendment, however, cannot become effective until 18 months after its passage and would apply only to share
acquisitions occurring after its effective date. The Company’s Articles do not exclude the Company from
Chapter 43 of the IBCL.

Mandatory Classified Board of Directors. Under Chapter 33 of the IBCL, an Indiana corporation with a class
of voting shares registered with the U.S. Securities and Exchange Commission under Section 12 of the
Exchange Act must have a classified board of directors unless the Indiana corporation adopts a by-law expressly
electing not to be governed by this provision. The Company’s By-Laws contain a provision electing not to be
subject to this mandatory requirement.

Exhibit 21.1
SUBSIDIARIES OF THE REGISTRANT
SUBSIDIARIES OF HURCO COMPANIES, INC.
Name
Jurisdiction of Incorporation

Hurco B.V
The Netherlands
Hurco Europe Limited
United Kingdom
Hurco GmbH
Federal Republic of Germany
Hurco India Private, Ltd.
India
Hurco Manufacturing Limited
Taiwan R.O.C.
Hurco S.a.r.l.
France
Hurco S.r.l.
Italy
Hurco (S.E. Asia) Pte Ltd.
Singapore
LCM Precision Technology S.r.l.
Italy
Machinery Sales Co.
United States
Milltronics USA, Inc.
United States
Milltronics Europe B.V.
The Netherlands
Ningbo Hurco Machine Tool Co., Ltd.
China
Takumi Precision Co, Ltd.
Taiwan

Hurco Companies, Inc. is the Company’s headquarters in Indianapolis, Indiana, U.S.A. The foregoing list
does not include other subsidiaries which, individually or in the aggregate, did not constitute a significant
subsidiary as of October 31, 2024.

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the incorporation by reference in Registration Statement Nos. 333-48204, 333-126036, 333-
149809, 333-210072, and 333-263461 on Form S-8 of our report dated January 10, 2025, relating to the
financial statements of Hurco Companies, Inc. and the effectiveness of Hurco Company Inc.'s internal control
over financial reporting appearing in this Annual Report on Form 10-K for the year ended October 31, 2024.
/s/ Deloitte and Touche LLP
Indianapolis, Indiana
January 10, 2025

Exhibit 23.2
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the incorporation by reference in the Registration Statement (No. 333-48204, 333-126036, 333-
149809, 333-210072, and 333-263461) on Form S-8 of Hurco Companies, Inc. of our report dated January 5,
2024, relating to the consolidated financial statements, the financial statement schedule and the effectiveness
of internal control over financial reporting of Hurco Companies, Inc. appearing in this Annual Report on Form
10-K of Hurco Companies, Inc. for the year ended October 31, 2024.
/s/ RSM US LLP
Indianapolis, Indiana
January 10, 2025

Exhibit 31.1
CERTIFICATION PURSUANT TO RULE 13a-14(a) UNDER THE SECURITIES EXCHANGE ACT
OF 1934, AS AMENDED
I, Gregory S. Volovic, certify that:
1. I have reviewed this annual report on Form 10-K of Hurco Companies, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report,
fairly present in all material respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure
controls and procedures [as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)] and internal control
over financial reporting [as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)] for the registrant and
have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures
to be designed under our supervision, to ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by others within those entities, particularly
during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance
with U.S. Generally Accepted Accounting Principles; and
(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this
report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end
of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant's internal control over financial reporting that
occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the
case of an annual report) that has materially affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting; and
5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of
internal control over financial reporting, to the registrant's auditors and the audit committee of the
registrant's board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant's ability to record,
process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a
significant role in the registrant's internal control over financial reporting.

/s/ Gregory S. Volovic

Gregory S. Volovic

Chief Executive Officer and President

January 10, 2025

Exhibit 31.2
CERTIFICATION PURSUANT TO RULE 13a-14(a) UNDER THE SECURITIES EXCHANGE ACT
OF 1934, AS AMENDED
I, Sonja K McClelland, certify that:
1. I have reviewed this annual report on Form 10-K of Hurco Companies, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report,
fairly present in all material respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure
controls and procedures [as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)] and internal control
over financial reporting [as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)] for the registrant and
have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures
to be designed under our supervision, to ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by others within those entities, particularly
during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with U.S. Generally Accepted Accounting Principles; and
(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this
report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end
of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant's internal control over financial reporting that
occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the
case of an annual report) that has materially affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting; and
5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of
internal control over financial reporting, to the registrant's auditors and the audit committee of the
registrant's board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant's ability to record,
process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a
significant role in the registrant's internal control over financial reporting.

/s/ Sonja K. McClelland

Sonja K. McClelland

Executive Vice President, Treasurer and Chief Financial Officer

January 10, 2025

Exhibit 32.1

CERTIFICATION PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Hurco Companies, Inc. (the “Company”) on Form 10-K for the year
ended October 31, 2024, as filed with the Securities and Exchange Commission on the date hereof (the
“Report”), the undersigned hereby certifies, pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange
Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition
and results of operations of the Company.

/s/ Gregory S. Volovic

Gregory S. Volovic

Chief Executive Officer and President

January 10, 2025

Exhibit 32.2

CERTIFICATION PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange
Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition
and results of operations of the Company.

/s/ Sonja K. McClelland

Sonja K. McClelland

Executive Vice President, Treasurer and

Chief Financial Officer
January 10, 2025

In fiscal year 2024, Hurco Companies, Inc. introduced/announced 3 new system controls:
TAKUMI - FANUC® 0i-XL
0i-XL uses the Fanuc® 0i-F Plus as the back-
end controller and runs a Windows 10 PC i7 CPU
front-end and interface. It features intelligent
advanced path planning and spindle monitor,
digital twin solid-rendering part and machine
graphical simulation and a 19” touch screen.
MILLTRONICS - INSPIRE+
INSPIRE+ enhances the user interface and
improves surface finish and cycle times. It also
provides faster and complete simulation for
complex parts, industry 4.0 and IoT support,
and remote troubleshooting and diagnostics.
INSPIRE+ was built with an open architecture
for future developments, including 5-axis mills
and live-tooling lathes.
HURCO - NEXT GENERATION
Hurco’s new control concept features an
ergonomic design and fully customizable
interface. With integrated AI tools like
ChatCNC® and AI feature recognition, the
system offers a transformative solution for
simplifying machine operations and reducing
programming time.
CONTROL HIGHLIGHTS

1 TECHNOLOGY WAY | INDIANAPOLIS, IN 46268
800.634.2416 | HURCO.COM/INVESTORS
PRINTED IN THE USA | 004CTN3DC0 | HP 950M | 49403-1 | C000-A-C054