Hurco Stock Declines Post Q1 Earnings Despite a Rise in Orders

Shares of Hurco Companies, Inc. HURC have lost 9.1% since the company reported its earnings for the quarter ended Jan. 31, 2026. This compares to the S&P 500 Index’s 0.6% decline over the same time frame. Over the past month, the stock lost 15.3% compared with the S&P 500’s 0.8% decline.

HURC’s Earnings Snapshot

Hurco reported a net loss of $3.5 million, or $0.54 per diluted share, for the first quarter of fiscal 2026, compared with $4.3 million, or $0.67 per diluted share, in the prior-year quarter. Sales and service fees declined 7.6% year over year to $42.9 million from $46.4 million.

By region, sales fell 8% in the Americas to $16.6 million from $18.1 million, decreased 5% in Europe to $20.5 million from $21.6 million, and dropped 15% in the Asia Pacific region to $5.7 million from $6.7 million, reflecting weaker shipment volumes in multiple markets.

Hurco’s Segment and Product Performance

Hurco operates as a single reportable segment focused on industrial automation equipment, primarily CNC (Computer Numeric Control) machine tools. Within its product mix, computerized machine tool sales — the company’s largest revenue contributor — declined 11.3% year over year to $33.5 million from $37.8 million. The drop mainly reflected reduced shipments of Milltronics machines in the Americas and Hurco machines in the U.K., Germany, China and India.

Sales of computer control systems and software decreased 31.1% year over year to $0.5 million from $0.7 million, primarily due to lower software sales in the Americas and Europe. In contrast, service parts revenue rose 17% to $6.9 million from $5.9 million as aftermarket demand for Takumi and Hurco products improved in Europe and Asia Pacific. Service fees declined 3.8% to $2 million from $2.1 million due to lower aftermarket service activity in the Americas, partly offset by higher service demand in the U.K. and France.

Hurco Companies, Inc. Price, Consensus and EPS Surprise

Hurco Companies, Inc. price-consensus-eps-surprise-chart | Hurco Companies, Inc. Quote

HURC’s Other Key Business Metrics

Orders increased during the quarter despite the decline in sales. New orders totaled $41.9 million, up 5% from $40.1 million in the prior-year quarter. Orders in the Americas climbed 18% to $17.3 million from $14.6 million, driven by stronger demand for Hurco and Takumi machines. European orders declined 2% to $18.9 million from $19.4 million, while Asia Pacific orders fell 6% to $5.7 million from $6.1 million amid weaker demand in China.

Profitability metrics showed mixed trends. Gross profit was $7.9 million, down 4.2% from $8.3 million a year earlier. However, gross margin improved to 19% from 18% due to a more favorable sales mix of higher-performance Hurco and Takumi machines and better leverage of fixed production costs.

Selling, general and administrative expenses rose 6.9% to $11.1 million from $10.4 million, representing 26% of sales compared with 22% in the prior-year quarter. The increase reflected higher employee benefit costs and unfavorable currency impacts when translating foreign expenses into U.S. dollars.

Operating loss widened to $3.2 million from $2.1 million in the prior-year quarter, primarily due to lower shipment volumes. Income tax expense for the quarter was $0.5 million compared with $2 million in the year-ago period.

Hurco’s Management Commentary

Chief Executive Officer Greg Volovic noted that order activity in the United States improved during the quarter despite higher tariffs. Volovic added that HURC’s gross profit margin benefited from cost reductions and improved working capital efficiency. Management indicated that the uptick in U.S. orders could signal early signs of recovery in global machine tool markets, although broader demand improvement remains uncertain.

Hurco also emphasized ongoing efforts to manage operating costs and inventory levels during a period of cyclical industry weakness. The company has implemented cost-reduction initiatives in recent fiscal years and suspended its quarterly dividend to preserve cash and maintain balance-sheet flexibility.

HURC’s Liquidity and Capital Resources

Hurco ended the quarter with $48 million in cash and cash equivalents, slightly lower than $48.7 million at the end of fiscal 2025. Working capital totaled $169.5 million compared with $173.1 million as of Oct. 31, 2025. The decrease was primarily due to higher accounts payable and lower inventory balances.

Capital expenditures during the quarter were approximately $0.6 million, mainly related to software development and facility improvements. The company funded these investments using cash on hand.

During the quarter, HURC entered into a new credit agreement with Bank of America providing a secured revolving credit and letter-of-credit facility of up to $20 million, replacing earlier credit arrangements that expired at the end of 2025. As of Jan. 31, 2026, Hurco had no borrowings outstanding under its credit facilities.

Hurco’s Guidance

Hurco did not issue formal financial guidance for revenue, earnings or orders for the remainder of fiscal 2026. Management also did not provide specific quantitative forecasts for upcoming quarters, indicating that the company continues to navigate uncertain demand conditions in the global machine tool market.

HURC’s commentary suggested that visibility remains limited and management continues to focus on operational discipline and maintaining financial flexibility while monitoring broader demand trends across its key geographic markets.

HURC’s Other Developments

Hurco announced that its previous revolving credit agreement terminated on Dec. 31, 2025, and it subsequently entered into a new secured credit agreement on Jan. 5, 2026. The new facility provides access to up to $20 million in revolving credit and letters of credit and is secured by substantially all of the company’s personal property. The agreement is scheduled to mature on Dec. 31, 2026.

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