Titan Machinery Inc.

Total revenue was $522.4 million, down from $594.3 million in the prior-year quarter. Gross profit was $89.3 million versus $90.9 million, while gross margin expanded to 17.1% from 15.3%; equipment margin rose to 7.8%, about 100 bps higher year over year. Operating expenses were $94.4 million versus $96.4 million. Net loss was $12.6 million, or $0.55 per diluted share, compared with a $13.2 million loss, or $0.58 per share, last year; adjusted EBITDA was $1 million versus $2.6 million. Cash was about $30 million, adjusted debt to tangible net worth was 1.6x, and inventory was $914.8 million, up $12 million from year-end. For fiscal 2027, the company reaffirmed segment assumptions of agriculture down 15% to 20%, construction flat to up 5%, Europe down 20% to 25%, and Australia up 10% to 15%. Full-year equipment margin is still expected to be about 8.4%, operating expenses about 17% of sales, floorplan interest expense down about 25% year over year, adjusted EBITDA of $17 million to $29 million, and adjusted diluted loss per share of $1.25 to $1.75.

Bryan Knutson said the quarter was a slightly better-than-expected start to fiscal 2027, with faster-than-anticipated equipment margin improvement driven by disciplined aged-inventory reduction. He emphasized that the business has shifted from broad inventory reduction to mix optimization and that Titan’s inventory health is improving, even though the demand backdrop remains challenged by low commodity prices and high input costs. He also pointed to stable parts and service performance and said the company believes its work over the past two years has positioned it well for the next phase of the cycle.

Bo Larsen highlighted the main financial drivers: revenue of $522.4 million, gross profit of $89.3 million, gross margin of 17.1%, operating expenses of $94.4 million, and floorplan and other interest expense of $8.2 million, down 26% from $11.1 million. He said lower interest expense reflected significantly reduced interest-bearing inventory, and he noted cash of about $30 million with leverage at 1.6x versus a 3.5x covenant. He reaffirmed the full-year model, including 8.4% equipment margin, about 17% operating expenses as a percent of sales, and a roughly 25% decline in floorplan interest expense.

Analysts focused on the Q1 delivery pull-forward and whether it changes the cadence for the rest of the year. Management said the timing was driven by when equipment was received and turned around to customers, and that the offset would mostly show up in the back half of the year, with some impact in Q2. On margins, management said further upside beyond the 8.4% full-year target would require additional aging improvement and better mix, but they do not want to get ahead of themselves given the trough-like demand environment.