0001558370-25-000129 | 10-K | XBRL Viewer

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

Schedule of effect of derivative instruments on the balance Sheets, statements of changes in shareholders' equity and 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

Schedule of derivative instruments not designated as hedging instruments

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

Schedule of accumulated other comprehensive loss

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)

Schedule of property and equipment estimated useful lives


		Number of Years
Land		Indefinite
Building		40
Machines		7 – 10
Shop and office equipment		3 – 7
Building & leasehold improvements		3 – 40

Schedule of estimated amortization expense

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

Schedule of intangible assets

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

Schedule of computation of basic and diluted net income (loss) per share



	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)		(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		6,489		6,499		6,499		6,580		6,580
Stock options and contingently issuable securities		—		—		—		29		—		52
		6,489		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

LEASES - Maturities of undiscounted cash flows of lease commitments (Details) $ in Thousands	Oct. 31, 2024 USD ($)
LEASES
2025	$ 4,219
2026	3,113
2027	2,362
2028	1,788
2028	531
2029 and thereafter	573
Total	12,586
Less: Imputed interest	(905)
Operating lease liabilities	$ 11,681

STOCK-BASED COMPENSATION (Summary of Stock Option Activity and Related Information) (Details) - Employee Stock Option - $ / shares	12 Months Ended
	Oct. 31, 2023	Oct. 31, 2022
Stock Options
Outstanding at beginning of period	11,559	16,996
Options exercised	(11,559)	(5,437)
Outstanding at end of period		11,559
Weighted Average Exercise Price
Outstanding at beginning of period	$ 23.3	$ 22.71
Options exercised	$ 23.3	21.45
Outstanding at end of period		$ 23.3

GUARANTEES AND PRODUCT WARRANTIES - Additional Information (Details) $ in Millions	12 Months Ended
	Oct. 31, 2024 USD ($) item
GUARANTEES AND PRODUCT WARRANTIES
Number Of Guarantees \| item	9
Guarantor Obligations, Maximum Exposure, Undiscounted \| $	$ 0.9
Term of Product Warranty	1 year

INVENTORIES (Tables)

12 Months Ended

Oct. 31, 2024

INVENTORIES

Schedule of inventories

Inventories are summarized below (in thousands):


	October 31,		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

CREDIT AGREEMENTS AND BORROWINGS (Narrative) (Details) € in Millions, ¥ in Millions, $ in Millions, $ in Millions	12 Months Ended
	Oct. 31, 2024 USD ($)	Oct. 31, 2024 EUR (€)	Oct. 31, 2024 CNY (¥)	Oct. 31, 2024 TWD ($)	Mar. 31, 2019 CNY (¥)	Mar. 31, 2019 TWD ($)
Line of Credit Facility [Line Items]
Line of credit amount outstanding	$ 0.0
Line Of Credit Agreement 2018
Line of Credit Facility [Line Items]
Line of credit, maximum borrowing capacity	40.0
Line of credit, maximum borrowing capacity in alternative currencies	$ 20.0
Variable interest rate	0.00%
Minimum working capital requirement	$ 125.0
Minimum tangible net worth requirement	$ 176.5
Line of credit, maturity date	Dec. 31, 2025
Allowable investments in alternative investments	$ 10.0
Borrowings available under credit facility	50.9
Line of Credit, covenant, minimum cash on hand before dividends are paid	10.0
Line of Credit, covenant, maximum annual share repurchase	25.0
Hurco BV \| Line Of Credit Agreement 2018
Line of Credit Facility [Line Items]
Line of credit, maximum borrowing capacity	$ 20.0
Federal funds \| Line Of Credit Agreement 2018
Line of Credit Facility [Line Items]
Variable interest rate	0.50%
SOFR \| Line Of Credit Agreement 2018
Line of Credit Facility [Line Items]
Variable interest rate	1.00%
Letter of credit \| Line Of Credit Agreement 2018
Line of Credit Facility [Line Items]
Line of credit, maximum borrowing capacity	$ 10.0
Stated interest rate	1.00%	1.00%	1.00%	1.00%
Revolving credit facility \| Line Of Credit Agreement 2018
Line of Credit Facility [Line Items]
Line of credit, maximum borrowing capacity	$ 40.0
Revolving credit facility \| Germany
Line of Credit Facility [Line Items]
Line of credit, maximum borrowing capacity \| €		€ 1.5
Taiwan credit facility
Line of Credit Facility [Line Items]
Line of credit, maximum borrowing capacity				$ 150.0		$ 150.0
China credit facility
Line of Credit Facility [Line Items]
Line of credit, maximum borrowing capacity \| ¥			¥ 32.5		¥ 32.5

RELATED PARTY TRANSACTIONS (Tables)

12 Months Ended

Oct. 31, 2024

RELATED PARTY TRANSACTIONS

Schedule of Financial Information

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

GUARANTEES AND PRODUCT WARRANTIES

12 Months Ended

Oct. 31, 2024

GUARANTEES AND PRODUCT WARRANTIES

GUARANTEES AND PRODUCT WARRANTIES

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		23		31		(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.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional information (Details) € in Millions	1 Months Ended	12 Months Ended
	Nov. 30, 2024	Oct. 31, 2024 USD ($)	Oct. 31, 2023 USD ($)	Oct. 31, 2022 USD ($)	Nov. 30, 2023 EUR (€)
Translation of Foreign Currencies
Cumulative foreign currency translation adjustments		$ (14,511,000)
Derivative financial instruments:
Notional principal of foreign exchange contracts		85,100,000	$ 97,800,000
Gains or (losses) from hedges deemed ineffective		0	0	$ 0
Property and Equipment
Depreciation and amortization expense		1,700,000	2,300,000	2,300,000
Research and Development Costs
Research and development expenses		3,900,000	4,200,000	3,400,000
Software Development Costs
Capitalized costs		1,600,000	1,300,000	1,100,000
Accumulated amortization		24,900,000	25,300,000
Amortization expense		1,600,000	1,600,000	1,300,000
Gross carrying amount		32,000,000	32,300,000
Goodwill and Intangible Assets
Intangible assets amortization expense		237,000	271,000	272,000
Expected future amortization expense, 2025		143,000
Expected future amortization expense, 2026		118,000
Expected future amortization expense, 2027		45,000
Expected future amortization expense, 2028		45,000
Expected future amortization expense, 2029		45,000
Impairment of long-lived assets		$ 0	0	$ 0
Minimum \| Technology equipment
Property and Equipment
Estimated useful life		3 years
Maximum \| Technology equipment
Property and Equipment
Estimated useful life		5 years
Designated as Hedging Instrument
Derivative financial instruments:
Unrealized gain (loss), net of tax, to be reclassified in next 12 months		$ 200,000
Forward Contracts
Derivative financial instruments:
(Losses) gains, net of tax, related to cash flow hedges deferred in Accumulated Other Comprehensive Loss		700,000
Forward Contracts \| Designated as Hedging Instrument
Derivative financial instruments:
Notional principal of foreign exchange contracts \| €					€ 3.0
Unrealized gain (loss), net of tax, recorded as cumulative translation adjustments in Accumulated Other Comprehensive Loss		1,200,000
Derivative maturity date	November 2024
Forward Contracts \| Designated as Hedging Instrument \| Subsequent event
Derivative financial instruments:
Derivative maturity date	November 2025
Euros \| Designated as Hedging Instrument
Derivative financial instruments:
Notional principal of foreign exchange contracts		8,200,000
Pounds Sterling \| Designated as Hedging Instrument
Derivative financial instruments:
Notional principal of foreign exchange contracts		4,400,000
New Taiwan Dollars \| Designated as Hedging Instrument
Derivative financial instruments:
Notional principal of foreign exchange contracts		15,600,000
New Taiwan Dollars \| Not Designated as Hedging Instrument
Derivative financial instruments:
Notional principal of foreign exchange contracts		$ 42,700,000
Forward Contracts Denominated In Euros Pounds Sterling And New Taiwan \| Designated as Hedging Instrument
Derivative financial instruments:
Derivative maturity date		November 2024 through October 2025
Forward Contracts Denominated In Euros Pounds Sterling and South African Rand \| Not Designated as Hedging Instrument
Derivative financial instruments:
Notional principal of foreign exchange contracts		$ 10,400,000
Derivative maturity date		November 2024 through March 2025
Hurco Automation Ltd
Consolidation
Ownership interest		35.00%
Equity investment in affiliate		$ 5,300,000	$ 5,100,000

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Changes in Components of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands	12 Months Ended
	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
Derivative [Line Items]
Reclassifications	$ 1,339	$ (488)	$ 191
Deferred income tax valuation allowances	(276)
AOCI Attributable to Parent [Member]
Derivative [Line Items]
Beginning Balance	(20,204)	(21,525)
Other comprehensive income (loss) before reclassifications	2,747	1,809
Reclassifications	1,339	(488)
Deferred income tax valuation allowances	(276)
Ending Balance	(16,394)	(20,204)	(21,525)
Foreign Currency Translation
Derivative [Line Items]
Beginning Balance	(17,985)	(21,259)
Other comprehensive income (loss) before reclassifications	3,474	3,274
Ending Balance	(14,511)	(17,985)	(21,259)
Cash Flow Hedging
Derivative [Line Items]
Beginning Balance	(2,219)	(266)
Other comprehensive income (loss) before reclassifications	(727)	(1,465)
Reclassifications	1,339	(488)
Deferred income tax valuation allowances	(276)
Ending Balance	$ (1,883)	$ (2,219)	$ (266)

- Definition

Amount after tax, before reclassification adjustments of other comprehensive income (loss).

+ References + Details

- Definition

Amount of equity (deficit) attributable to parent and noncontrolling interest. Excludes temporary equity.

+ References

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+ Details

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Oct. 31, 2024

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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

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.


		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.


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)		(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		6,489		6,499		6,499		6,580		6,580
Stock options and contingently issuable securities		—		—		—		29		—		52
		6,489		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.

LEASES (Tables)

12 Months Ended

Oct. 31, 2024

LEASES

Schedule of supplemental cash flow information and non-cash activity related to operating leases

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

Schedule of maturities of undiscounted cash flows of lease commitments reconciled to the total lease liability

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

INVENTORIES

12 Months Ended

Oct. 31, 2024

INVENTORIES

INVENTORIES

3. INVENTORIES

Inventories are summarized below (in thousands):


	October 31,		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.

SEGMENT INFORMATION (Tables)

12 Months Ended

Oct. 31, 2024

SEGMENT INFORMATION

Schedule of Net Sales and Service Fees by Product Category

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.

Schedule of Revenues by Geographic Area

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

Schedule of Long-Lived Assets by Geographic Area

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

Schedule of Assets by Geographic Area

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

INCOME TAXES (Schedule of reconciliation of unrecognized tax benefits) (Details) - USD ($) $ in Thousands	12 Months Ended
	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
INCOME TAXES
Unrecognized Tax Benefits, Beginning Balance	$ 138	$ 138	$ 167
Additions based on tax positions related to the current year			21
Additions (reductions) related to prior year tax positions	0	0	0
Reductions due to statute expiration	(117)		(50)
Unrecognized Tax Benefits, Ending Balance	$ 21	$ 138	$ 138

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Effect of Derivative Instruments on Consolidated Balance Sheets, Statements of Changes in Shareholders' Equity and Statements of Income (Details) - USD ($) $ in Thousands	12 Months Ended
	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
Derivative Instruments, Gain (Loss) [Line Items]
Amount of Gain (Loss) Recognized in Other Comprehensive Income (Loss)	$ (727)	$ (1,465)	$ (384)
Designated as Hedging Instrument \| Foreign Exchange Forward \| Intercompany sales/purchases
Derivative Instruments, Gain (Loss) [Line Items]
Amount of Gain (Loss) Recognized in Other Comprehensive Income (Loss)	(727)	(1,465)	(384)
Amount of Gain (Loss) Reclassified from Other Comprehensive Income (Loss)	(1,339)	488	(191)
Designated as Hedging Instrument \| Foreign Exchange Forward \| Net Investment Hedging
Derivative Instruments, Gain (Loss) [Line Items]
Amount of Gain (Loss) Recognized in Other Comprehensive Income (Loss)	(29)	(99)	401
Not Designated as Hedging Instrument \| Foreign Exchange Forward \| Other Income And Expense
Derivative Instruments, Gain (Loss) [Line Items]
Amount of Gain (Loss) Recognized in Operations	$ (1,751)	$ (3,112)	$ 2,374

INCOME TAXES (Schedule of Deferred Tax Assets and Liabilities) (Details) - USD ($) $ in Thousands	Oct. 31, 2024	Oct. 31, 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	58	0
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
Deferred tax assets, gross	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	0	(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

BUSINESS OPERATIONS

12 Months Ended

Oct. 31, 2024

BUSINESS OPERATIONS

BUSINESS OPERATIONS

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.

NEW ACCOUNTING PRONOUNCEMENTS

12 Months Ended

Oct. 31, 2024

NEW ACCOUNTING PRONOUNCEMENTS

NEW ACCOUNTING PRONOUNCEMENTS

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.

- Definition

The entire disclosure for change in accounting principle. Includes, but is not limited to, nature, reason, and method of adopting amendment to accounting standards or other change in accounting principle.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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Reference 18: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

FINANCIAL INSTRUMENTS - Additional Information (Details) - USD ($) $ in Millions	Oct. 31, 2024	Oct. 31, 2023
FINANCIAL INSTRUMENTS
Notional amount of contracts	$ 85.1	$ 97.8

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Thousands	12 Months Ended
	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(Gain) / loss on derivative instruments reclassified into operations, tax	$ 401	$ (146)	$ 59
Gain / (loss) on derivative instruments	$ (218)	$ (439)	$ (119)

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY (Parenthetical) - $ / shares	12 Months Ended
	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY
Dividends paid per share	$ 0.32	$ 0.63	$ 0.59

Document And Entity Information - USD ($)	12 Months Ended
Document And Entity Information - USD ($)	Oct. 31, 2024	Oct. 31, 2023	Dec. 31, 2024	Apr. 30, 2024
Document And Entity Information [Abstract]
Document Type	10-K
Document Annual Report	true
Document Period End Date	Oct. 31, 2024
Document Transition Report	false
Entity File Number	0-9143
Entity Registrant Name	HURCO COMPANIES INC
Entity Incorporation, State or Country Code	IN
Entity Tax Identification Number	35-1150732
Entity Address, Address Line One	One Technology Way
Entity Address, City or Town	Indianapolis
Entity Address, State or Province	IN
Entity Address, Postal Zip Code	46268
City Area Code	317
Local Phone Number	293–5309
Title of 12(b) Security	Common Stock, no par value
Trading Symbol	HURC
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Document Financial Statement Error Correction [Flag]	false
Entity Shell Company	false
Entity Public Float				$ 118,071,000
Entity Common Stock, Shares Outstanding			6,446,349
Auditor Name	Deloitte & Touche LLP	RSM US LLP
Auditor Firm ID	34	49
Auditor Location	Indianapolis, Indiana	Indianapolis, IN
Entity Central Index Key	0000315374
Current Fiscal Year End Date	--10-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	FY
Amendment Flag	false
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
ICFR Auditor Attestation Flag	true

SEGMENT INFORMATION (Narrative) (Details)	12 Months Ended
SEGMENT INFORMATION (Narrative) (Details)	Oct. 31, 2024 segment entity
Revenues from External Customers and Long-Lived Assets [Line Items]
Number of operating segments \| segment	1
Minimum
Revenues from External Customers and Long-Lived Assets [Line Items]
Number of independent agents and distributors products are sold through \| entity	180
Geographic Concentration Risk
Revenues from External Customers and Long-Lived Assets [Line Items]
Concentration risk, geographic	In fiscal year 2024, approximately 61% of our revenues were from customers located outside of the Americas,
Revenue from Rights Concentration Risk
Revenues from External Customers and Long-Lived Assets [Line Items]
Concentration risk, customer	no single distributor or end-user of our products accounted for more than 5% of our total sales and service fees.
Outside the Americas \| Geographic Concentration Risk \| Revenue Benchmark
Revenues from External Customers and Long-Lived Assets [Line Items]
Percentage	61.00%

STOCK-BASED COMPENSATION

12 Months Ended

Oct. 31, 2024

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

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.

SEGMENT INFORMATION (Schedule of Long-Lived Tangible Assets and net assets, Net by Geographic Area) (Details) - USD ($) $ in Thousands	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
Revenues from External Customers and Long-Lived Assets [Line Items]
Long-Lived Assets	$ 22,535	$ 11,106	$ 10,569
Net Assets	207,172	222,231	222,644
United States of America
Revenues from External Customers and Long-Lived Assets [Line Items]
Long-Lived Assets	9,510	7,072	5,628
Foreign
Revenues from External Customers and Long-Lived Assets [Line Items]
Long-Lived Assets	13,025	4,034	4,941
Total Americas
Revenues from External Customers and Long-Lived Assets [Line Items]
Net Assets	45,798	70,649	87,476
Total Europe
Revenues from External Customers and Long-Lived Assets [Line Items]
Net Assets	88,810	81,730	67,797
Total Asia Pacific
Revenues from External Customers and Long-Lived Assets [Line Items]
Net Assets	$ 72,564	$ 69,852	$ 67,371

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Oct. 31, 2024	Oct. 31, 2023
CONSOLIDATED BALANCE SHEETS
Preferred stock, no par value	$ 0	$ 0
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued	0	0
Common Stock, No Par Value	$ 0	$ 0
Common stock, stated value per share	$ 0.10	$ 0.10
Common stock, shares authorized	12,500,000	12,500,000
Common stock, shares issued	6,548,838	6,553,673
Common stock, shares outstanding	6,435,624	6,462,138

SEGMENT INFORMATION (Schedule of Net Sales and Service Fees by Product Category) (Details) - USD ($) $ in Thousands	12 Months Ended
	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
Revenue from External Customer [Line Items]
Net Sales and Service Fees	$ 186,584	$ 227,807	$ 250,814
Computerized Machine Tools
Revenue from External Customer [Line Items]
Net Sales and Service Fees	147,561	188,335	211,804
Computer Control Systems and Software
Revenue from External Customer [Line Items]
Net Sales and Service Fees	2,447	2,805	2,634
Service Parts
Revenue from External Customer [Line Items]
Net Sales and Service Fees	27,628	28,439	28,219
Service Fees
Revenue from External Customer [Line Items]
Net Sales and Service Fees	$ 8,948	$ 8,228	$ 8,157

- Definition

Amount of revenue recognized from goods sold, services rendered, insurance premiums, or other activities that constitute an earning process. Includes, but is not limited to, investment and interest income before deduction of interest expense when recognized as a component of revenue, and sales and trading gain (loss).

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+ Details

SEGMENT INFORMATION

12 Months Ended

Oct. 31, 2024

SEGMENT INFORMATION

SEGMENT INFORMATION

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

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

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+ Details

FINANCIAL INSTRUMENTS (Tables)

12 Months Ended

Oct. 31, 2024

FINANCIAL INSTRUMENTS

Schedule of fair value hierarchy for financial assets and liabilities measured at fair value

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

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
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
Cash paid (received) for:
Income taxes, net	$ 3,018	$ 4,336	$ (1,628)

LEASES

12 Months Ended

Oct. 31, 2024

LEASES

LEASES

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%.

INCOME TAXES

12 Months Ended

Oct. 31, 2024

INCOME TAXES

INCOME TAXES

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		58		—
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.

- Definition

The entire disclosure for income tax.

+ References

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+ Details

INCOME TAXES (Tables)

12 Months Ended

Oct. 31, 2024

INCOME TAXES

Components of Income (loss) before 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

Schedule of provision (benefit) for income taxes

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

Schedule of Reconciliation of Statutory Tax Rate to Effective Tax Rate


	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	%

Schedule of Deferred Tax Assets and Liabilities

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		58		—
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

Schedule of reconciliation of unrecognized tax benefits

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

Summary of open tax years by major jurisdiction


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.

FINANCIAL INSTRUMENTS - Fair value hierarchy (Details) - Fair Value measurements recurring - USD ($) $ in Thousands	Oct. 31, 2024	Oct. 31, 2023
Level 1
Assets
Mutual Funds	$ 2,942	$ 2,217
Level 2
Assets
Derivatives	323	740
Liabilities
Derivatives	$ 705	$ 1,821

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	12 Months Ended
	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
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)

- Definition

Amount after tax of increase (decrease) in equity from transactions and other events and circumstances from net income and other comprehensive income, attributable to parent entity. Excludes changes in equity resulting from investments by owners and distributions to owners.

+ References + Details

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

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+ Details

SEGMENT INFORMATION (Schedule of Revenues by Geographic Area) (Details) - USD ($) $ in Thousands	12 Months Ended
	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	$ 186,584	$ 227,807	$ 250,814
United States of America
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	70,342	83,747	92,050
Canada
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	1,701	3,827	3,996
Central & South Americas
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	1,255	1,839	1,279
Total Americas
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	73,298	89,413	97,325
Germany
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	28,139	30,468	42,026
United Kingdom
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	26,668	29,704	26,629
Italy
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	9,894	15,554	16,499
France
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	12,917	11,851	14,291
Other Europe
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	13,299	28,204	24,437
Total Europe
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	90,917	115,781	123,882
China
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	6,545	7,529	10,293
India
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	9,077	6,016	6,578
Other Asia Pacific
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	5,704	7,858	11,975
Total Asia Pacific
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	21,326	21,403	28,846
Foreign
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	$ 1,043	$ 1,210	$ 761

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
CONSOLIDATED STATEMENTS OF OPERATIONS
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	27
Interest income	621	369	79
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
(Loss) income per common share - diluted	$ (2.56)	$ 0.66	$ 1.23
Weighted average common shares outstanding - basic	6,489	6,499	6,580
Weighted average common shares outstanding - diluted	6,489	6,528	6,632

RELATED PARTY TRANSACTIONS

12 Months Ended

Oct. 31, 2024

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

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

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References

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+ Details

Schedule II - Valuation and Qualifying Accounts and Reserves (Details) - USD ($)
$ in Thousands

12 Months Ended

Oct. 31, 2024

Oct. 31, 2023

Oct. 31, 2022

Schedule II - Valuation and Qualifying Accounts and Reserves

Allowance for Doubtful Accounts Receivable, Beginning Balance

$ 1,518

$ 1,486

$ 1,645

Charged to Costs and Expenses

214

(79)

(74)

Deductions

^[1]

250

Allowance for Doubtful Accounts Receivable, Ending Balance

1,482

1,518

1,486

Income tax valuation allowance Balance at Beginning of Period

1,810

1,754

1,871

Charged to/ (Recovered from) Costs and Expenses

8,590

249

502

Deductions

1,197

193

619

Income tax valuation allowance Balance at End of Period

$ 9,203

$ 1,810

$ 1,754

[1]	Receivable write–offs

INCOME TAXES (Schedule of Comparison of Income Tax Expense) (Details)	12 Months Ended
	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
Tax rates:
U.S. statutory rate	21.00%	21.00%	21.00%
Effect of tax rate of international jurisdictions different than U.S. statutory rates	(4.00%)	6.00%	4.00%
Valuation allowance	(87.00%)	2.00%	3.00%
State taxes	4.00%	(1.00%)	1.00%
Tax credits	0.00%	0.00%	1.00%
US benefit of foreign intangible income	0.00%	0.00%	(3.00%)
US tax on distributed and undistributed earnings	(2.00%)	0.00%	0.00%
Stock-based compensation	(3.00%)	6.00%	4.00%
Other	2.00%	1.00%	0.00%
Effective tax rate	(69.00%)	35.00%	31.00%

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Oct. 31, 2024

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Consolidation

Statements of Cash Flows

Translation of Foreign Currencies

Hedging

Derivatives Designated as Hedging Instruments

Derivatives Not Designated as Hedging Instruments

Fair Value of Derivative Instruments


	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

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.


		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

Property and Equipment


		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

Allowance for Doubtful Accounts

Product Warranty

Research and Development Costs

Software Development Costs


Fiscal Year	Amortization Expense
2025	$	1,065
2026		931
2027		1,302
2028		1,151
2029 and thereafter		2,594

Intangible Assets

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

Impairment of Long-Lived Assets

Earnings Per Share

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)		(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		6,489		6,499		6,499		6,580		6,580
Stock options and contingently issuable securities		—		—		—		29		—		52
		6,489		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

Stock Compensation

Estimates

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Estimated Amortization Expense (Details) $ in Thousands	Oct. 31, 2024 USD ($)
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
2025	$ 1,065
2026	931
2027	1,302
2028	1,151
2029 and thereafter	$ 2,594

Pay vs Performance Disclosure - USD ($) $ in Thousands	12 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
Pay vs Performance Disclosure
Net Income (Loss)	$ (16,608)	$ 4,389	$ 8,226

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

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+ Details

INCOME TAXES (Details) - USD ($)	12 Months Ended
INCOME TAXES (Details) - USD ($)	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
Income Tax Contingency [Line Items]
Effective tax rate	(69.00%)	35.00%	31.00%
Income tax expense	$ 6,758,000	$ 2,365,000	$ 3,652,000
Non-cash valuation allowance	8,400,000
Deferred tax assets, net operating loss carryforwards	6,115,000	2,249,000
Deferred tax assets for research and development tax credits	900,000
Valuation allowance	9,203,000	$ 1,810,000
Deferred tax assets, net operating loss carryforwards	37,800,000
Tax credits subject to expiration	$ 900,000
Tax credits expiration term	expire at various tax years from 2025 to 2044
Unrecognized tax benefits, interest accrued	$ 7,000
Unrecognized tax benefits expiration term	expire in August 2025
U.S.
Income Tax Contingency [Line Items]
Valuation allowance	$ 8,300,000

EMPLOYEE BENEFITS (Narrative) (Details) - USD ($) $ in Millions	12 Months Ended
	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
EMPLOYEE BENEFITS
Contributions to defined contribution plans	$ 1.2	$ 1.4	$ 1.3

CONTINGENCIES AND LITIGATION

12 Months Ended

Oct. 31, 2024

CONTINGENCIES AND LITIGATION

CONTINGENCIES AND LITIGATION

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.

LEASES - Supplemental cash flow information (Details) - USD ($) $ in Thousands	12 Months Ended
	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
LEASES
Cash paid for amounts included in the measurement of lease liabilities	$ 4,950	$ 4,770	$ 4,457
Right-of-use assets obtained in exchange for new operating lease liabilities	$ 4,929	$ 7,485	$ 3,577

INVENTORIES (Details) - USD ($) $ in Thousands	Oct. 31, 2024	Oct. 31, 2023
INVENTORIES
Purchased parts and sub-assemblies	$ 35,385	$ 37,161
Work-in-process	13,428	16,217
Finished goods	104,224	104,574
Inventories, net	$ 153,037	$ 157,952

STOCK-BASED COMPENSATION (Reconciliation of Restricted shares and PSU Activity and Related Information) (Details)	12 Months Ended
	Oct. 31, 2024 $ / shares shares
Number of Shares
Unvested at beginning of period \| shares	318,317
Shares or units granted \| shares	185,850
Shares or units vested \| shares	(61,121)
Shares or units cancelled \| shares	(50,375)
Shares or units withheld \| shares	(14,579)
Unvested at end of period \| shares	378,092
Weighted Average Grant Date Fair Value
Unvested at beginning of period \| $ / shares	$ 28.27
Shares or units granted \| $ / shares	21.31
Shares or units vested \| $ / shares	27.9
Shares or units cancelled \| $ / shares	27.97
Shares or units withheld \| $ / shares	27.77
Unvested at end of period \| $ / shares	$ 24.97

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Oct. 31, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false
Rule 10b5-1 Arrangement Modified	false
Non-Rule 10b5-1 Arrangement Modified	false

RELATED PARTY TRANSACTIONS (Narrative) (Details) - USD ($) $ in Thousands	12 Months Ended
	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
Related Party Transaction [Line Items]
Revenues	$ 186,584	$ 227,807	$ 250,814
Accounts payable	24,951	29,661
Related Party \| Hurco Automation Ltd
Related Party Transaction [Line Items]
Related party transaction, purchases from related party	6,600	10,200	10,500
Revenues		100	$ 300
Accounts payable	700	1,100
Related Party \| Hurco Automation Ltd \| Maximum
Related Party Transaction [Line Items]
Revenues	$ 100
Hurco Automation Ltd
Related Party Transaction [Line Items]
Equity method investment, ownership percentage	35.00%
Equity method investments	$ 5,300	$ 5,100

RELATED PARTY TRANSACTIONS (Schedule of financial information for HAL's operations and financial conditions ) (Details) - USD ($) $ in Thousands	12 Months Ended
	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
Related Party Transaction [Line Items]
Gross Profit	$ 37,743	$ 56,168	$ 64,478
Current Assets	228,577	248,230
Current Liabilities	47,789	54,973
Non-current Liabilities	13,682	13,385
Hurco Automation Ltd
Related Party Transaction [Line Items]
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

INVENTORIES - Additional information (Details) - USD ($) $ in Millions	Oct. 31, 2024	Oct. 31, 2023
INVENTORIES
Finished goods inventory consigned to distributors and agents	$ 10.3	$ 9.6

STOCK-BASED COMPENSATION (Tables)

12 Months Ended

Oct. 31, 2024

STOCK-BASED COMPENSATION

Schedule of stock option activity

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	—	$	—

Schedule of reconciliation of our restricted stock, performance share and PSU activity and related information

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

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Oct. 31, 2024	Oct. 31, 2023
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
Property and equipment, gross	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
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	0	0
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

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands	Oct. 31, 2024	Oct. 31, 2023
Finite-Lived Intangible Assets [Line Items]
Gross Intangible Assets	$ 5,909	$ 5,880
Accumulated Amortization	(5,146)	(4,886)
Net Intangible Assets	763	994
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Gross Intangible Assets	371	369
Accumulated Amortization	(286)	(270)
Net Intangible Assets	$ 85	$ 99
Weighted Average Amortization Period	15 years	15 years
Technology
Finite-Lived Intangible Assets [Line Items]
Gross Intangible Assets	$ 666	$ 647
Accumulated Amortization	(581)	(514)
Net Intangible Assets	$ 85	$ 133
Weighted Average Amortization Period	13 years	13 years
Noncompete
Finite-Lived Intangible Assets [Line Items]
Gross Intangible Assets	$ 580	$ 580
Accumulated Amortization	$ (580)	(493)
Net Intangible Assets		$ 87
Weighted Average Amortization Period	5 years	5 years
Patents
Finite-Lived Intangible Assets [Line Items]
Gross Intangible Assets	$ 2,973	$ 2,973
Accumulated Amortization	(2,933)	(2,909)
Net Intangible Assets	$ 40	$ 64
Weighted Average Amortization Period	6 years	6 years
Other
Finite-Lived Intangible Assets [Line Items]
Gross Intangible Assets	$ 393	$ 392
Accumulated Amortization	(385)	(376)
Net Intangible Assets	$ 8	$ 16
Weighted Average Amortization Period	8 years	8 years
Tradenames and trademarks
Finite-Lived Intangible Assets [Line Items]
Gross Intangible Assets	$ 749	$ 742
Accumulated Amortization	(381)	(324)
Net Intangible Assets	368	418
Indefinite tradenames and trademarks	$ 177	$ 177
Weighted Average Amortization Period	14 years	14 years

STOCK-BASED COMPENSATION (Narrative) (Details) - USD ($)										12 Months Ended
	Mar. 14, 2024	Jan. 04, 2024	Nov. 08, 2023	Mar. 09, 2023	Jan. 03, 2023	Nov. 09, 2022	Mar. 10, 2022	Jan. 04, 2022	Nov. 10, 2021	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022	Mar. 10, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock granted										185,850
Total intrinsic value of stock options exercised										$ 0	$ 0	$ 9,000
Grant date fair value of restricted stock										$ 24.97	$ 28.27
Grant date fair value per share										$ 21.31
Unrecognized Stock-based compensation expense										$ 2,200,000
2016 Equity Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total number of shares of common stock that may be issued as awards under 2016 Plan													856,048
Number of additional shares authorized							850,000
Stock-based compensation expense										$ 1,600,000	$ 2,700,000	$ 2,700,000
2008 Equity Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock granted										0
Number of Shares Available for Grant under the 2008 Plan													386,048
Options outstanding										0
Time Based
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock granted		36,574			29,376
Vesting period		3 years			3 years
Grant date fair value of restricted stock		$ 21.53			$ 26.38
Percentage of incentive compensation arrangement		25.00%			25.00%			25.00%
Time Based \| 2016 Equity Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock granted								23,442
Vesting period								3 years
Grant date fair value per share								$ 30.39
Time Based \| Non-employee directors
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock granted	22,878		16,673	17,226		12,223	13,914		8,234
Vesting period	1 year		3 years	1 year		3 years	1 year		3 years
Grant date fair value of restricted stock	$ 20.98		$ 19.78	$ 27.86		$ 24.53	$ 34.49		$ 33.99
Performance Based
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period		3 years			3 years			3 years
Percentage of incentive compensation arrangement		75.00%			75.00%			75.00%
Performance Based \| Performance Shares TSR
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock granted		58,520			47,003
Vesting period		3 years			3 years
Grant date fair value of restricted stock		$ 21.53			$ 26.38
Percentage of incentive compensation arrangement		40.00%			40.00%
Performance Based \| Performance Shares TSR \| 2016 Equity Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock granted								34,203
Vesting period								3 years
Percentage of incentive compensation arrangement								40.00%
Grant date fair value per share								$ 33.33
Performance Based \| Performance Shares TSR \| Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of target number of shares to be earned		50.00%			50.00%			50.00%
Performance Based \| Performance Shares TSR \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of target number of shares to be earned		200.00%			200.00%			200.00%
Performance Based \| Performance Shares ROIC
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock granted		51,205			41,126
Vesting period		3 years			3 years
Grant date fair value of restricted stock		$ 21.53			$ 26.38
Percentage of incentive compensation arrangement		35.00%			35.00%
Performance Based \| Performance Shares ROIC \| 2016 Equity Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock granted								32,821
Vesting period								3 years
Percentage of incentive compensation arrangement								35.00%
Grant date fair value per share								$ 30.39
Performance Based \| Performance Shares ROIC \| Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of target number of shares to be earned		50.00%			50.00%			50.00%
Performance Based \| Performance Shares ROIC \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of target number of shares to be earned		200.00%			200.00%			200.00%

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Estimated Useful Lives (Details)	Oct. 31, 2024
Building
Property, Plant and Equipment [Line Items]
Estimated useful life	40 years
Machines \| Minimum
Property, Plant and Equipment [Line Items]
Estimated useful life	7 years
Machines \| Maximum
Property, Plant and Equipment [Line Items]
Estimated useful life	10 years
Shop and office equipment \| Minimum
Property, Plant and Equipment [Line Items]
Estimated useful life	3 years
Shop and office equipment \| Maximum
Property, Plant and Equipment [Line Items]
Estimated useful life	7 years
Building & leasehold improvements \| Minimum
Property, Plant and Equipment [Line Items]
Estimated useful life	3 years
Building & leasehold improvements \| Maximum
Property, Plant and Equipment [Line Items]
Estimated useful life	40 years

GUARANTEES AND PRODUCT WARRANTIES (Tables)

12 Months Ended

Oct. 31, 2024

GUARANTEES AND PRODUCT WARRANTIES

Schedule of reconciliation of the changes in warranty reserve

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		23		31		(128)
Balance, end of period	$	1,086	$	1,294	$	1,426

BUSINESS OPERATIONS (Narrative) (Details)	12 Months Ended
BUSINESS OPERATIONS (Narrative) (Details)	Oct. 31, 2024 entity
Minimum
Number of independent agents and distributors products are sold through	180

INCOME TAXES (Schedule of income (loss) before income taxes & provision for Income Taxes) (Details) - USD ($) $ in Thousands	12 Months Ended
	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
Income (loss) before income taxes:
Domestic	$ (15,024)	$ (3,259)	$ (232)
Foreign	5,174	10,013	12,110
(Loss) income before income taxes	(9,850)	6,754	11,878
Current:
U.S. taxes	647	(431)	1,092
Foreign taxes	1,804	2,775	3,191
Current (benefit) provision for income taxes	2,451	2,344	4,283
Deferred:
U.S. taxes	(3,765)	167	(839)
Foreign taxes	(518)	(287)	(204)
Deferred Income Tax Expense (Benefit), Total	(4,283)	(120)	(1,043)
Valuation allowance for U.S. and foreign income tax expense	8,590	141	412
Provision (benefit) for income taxes	$ 6,758	$ 2,365	$ 3,652

CREDIT AGREEMENTS AND BORROWINGS

12 Months Ended

Oct. 31, 2024

CREDIT AGREEMENTS AND BORROWINGS

CREDIT AGREEMENTS AND BORROWINGS

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%.

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 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.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

LEASES (Details) - USD ($) $ in Millions	12 Months Ended
LEASES (Details) - USD ($) $ in Millions	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
LEASES
Operating lease expense	$ 5.4	$ 5.2	$ 5.1
Weighted-average remaining term	3 years 9 months 18 days
Weighted-average discount rate	3.50%
Capitalized lease costs	$ 0.0
Minimum
LEASES
Lease term (in years)	2 years
Maximum
LEASES
Lease term (in years)	5 years

EMPLOYEE BENEFITS

12 Months Ended

Oct. 31, 2024

EMPLOYEE BENEFITS

EMPLOYEE BENEFITS

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.

- Definition

The entire disclosure for retirement benefits.

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-Topic 715
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (l)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480506/715-20-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 715
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org/715/tableOfContent

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 715
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (d)(iii)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480506/715-20-50-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 715
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (o)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480506/715-20-50-1

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 715
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (p)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480506/715-20-50-1

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 715
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (r)(1)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480506/715-20-50-1

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 715
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (r)(2)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480506/715-20-50-1

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 715
-SubTopic 20
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480126/715-20-S99-2

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 715
-SubTopic 60
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480266/715-60-50-3

+ Details

FINANCIAL INSTRUMENTS

12 Months Ended

Oct. 31, 2024

FINANCIAL INSTRUMENTS

FINANCIAL INSTRUMENTS

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.


	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.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Fair Value of Derivative Instruments (Details) - USD ($) $ in Thousands	Oct. 31, 2024	Oct. 31, 2023
Derivatives, Fair Value [Line Items]
Derivative assets	$ 323	$ 740
Derivative liabilities	705	1,821
Designated as Hedging Instrument
Derivatives, Fair Value [Line Items]
Derivative assets	165	363
Derivative liabilities	430	1,232
Not Designated as Hedging Instrument
Derivatives, Fair Value [Line Items]
Derivative assets	158	377
Derivative liabilities	$ 275	$ 589

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Reconciliation of Basic and Diluted Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Net Income (Loss)	$ (16,608)	$ 4,389	$ 8,226
Undistributed earnings allocated to participating shares- Basic		(61)	(97)
Undistributed earnings allocated to participating shares - Diluted		(61)	(97)
Net income applicable to common shareholders - Basic	(16,608)	4,328	8,129
Net income applicable to common shareholders - Diluted	$ (16,608)	$ 4,328	$ 8,129
Weighted average shares outstanding - Basic	6,489	6,499	6,580
Weighted average shares outstanding - Diluted	6,489	6,528	6,632
Stock options and contingently issuable securities		29	52
Income per share -Basic	$ (2.56)	$ 0.67	$ 1.24
Income per share - Diluted	$ (2.56)	$ 0.66	$ 1.23

Schedule II - Valuation and Qualifying Accounts and Reserves

12 Months Ended

Oct. 31, 2024

Schedule II - Valuation and Qualifying Accounts and Reserves

Schedule II - Valuation and Qualifying Accounts and Reserves

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.

GUARANTEES AND PRODUCT WARRANTIES - Reconciliation of the changes in warranty reserve (Details) - USD ($) $ in Thousands	12 Months Ended
	Oct. 31, 2024	Oct. 31, 2023	Oct. 31, 2022
GUARANTEES AND PRODUCT WARRANTIES
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	23	31	(128)
Balance, end of period	$ 1,086	$ 1,294	$ 1,426

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY - USD ($) $ in Thousands	Common Stock	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Loss	Total
Balances at Oct. 31, 2021	$ 662	$ 63,924	$ 175,574	$ (1,741)	$ 238,419
Balances (in shares) at Oct. 31, 2021	6,617,717
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	$ 3	2,476			2,479
Stock-based compensation expense, net of taxes withheld for vested restricted shares (in shares)	33,761
Exercise of common stock options	$ 1	116			117
Exercise of common stock options (in shares)	5,437
Stock repurchases, net of excise tax payable	$ (9)	(2,881)			(2,890)
Stock repurchases, net of excise tax payable (in shares)	(89,921)
Dividends paid			(3,923)		(3,923)
Balances at Oct. 31, 2022	$ 657	63,635	179,877	(21,525)	222,644
Balances (in shares) at Oct. 31, 2022	6,566,994
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	$ 5	2,381			2,386
Stock-based compensation expense, net of taxes withheld for vested restricted shares (in shares)	49,874
Exercise of common stock options	$ 1	269			270
Exercise of common stock options (in shares)	11,559
Stock repurchases, net of excise tax payable	$ (17)	(4,620)			(4,637)
Stock repurchases, net of excise tax payable (in shares)	(166,289)
Dividends paid			(4,142)		(4,142)
Balances at Oct. 31, 2023	$ 646	61,665	180,124	(20,204)	222,231
Balances (in shares) at Oct. 31, 2023	6,462,138
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	$ 6	1,327			1,333
Stock-based compensation expense, net of taxes withheld for vested restricted shares (in shares)	61,121
Stock repurchases, net of excise tax payable	$ (8)	(1,492)			(1,500)
Stock repurchases, net of excise tax payable (in shares)	(87,635)
Dividends paid			(2,094)		(2,094)
Balances at Oct. 31, 2024	$ 644	$ 61,500	$ 161,422	$ (16,394)	$ 207,172
Balances (in shares) at Oct. 31, 2024	6,435,624