TITN 10-K & 10-Q changes, risk factors and insider trading

The following risks should be considered in conjunction with Part II, Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, of this Form 10-K, including the risks and uncertainties described under the heading "Information Regarding Forward-Looking Statements", and our financial statements and the related notes appearing under Part II, Item 8, Financial Statements and Supplementary Data, of this Form 10-K. The following is a discussion of the material factors that we believe make an investment in our common stock risky. These risks may affect our operating results and, individually or in the aggregate, could cause our actual results to differ materially from past and projected future results. Some of these risks could affect particular revenue sources or segments, while others could affect our full business. Although risks are organized by headings, and each risk is discussed separately, many are interrelated. Furthermore, additional risks not currently known to us or that we currently consider immaterial also may materially adversely affect our business in the future. As a result, the trading price of our common stock could decline, and you could lose all or part of your investment in our common stock

Risks Related to our Reliance on CNH Industrial

We are dependent upon CNH Industrial to supply competitive products.

The substantial majority of our business involves the sale and distribution of new equipment and aftermarket parts supplied by CNH Industrial and the servicing of equipment manufactured by CNH Industrial.CNH. Therefore, our financial performance and future success are highly dependent on the overall reputation, brand and success of CNH Industrial in the agricultural and construction equipment manufacturing industries, including its ability to maintain a competitive position in product innovation, product quality, and product pricing.

Our ability to maintain or grow market share is dependent on CNH Industrial’sCNH's ability to design, manufacture, allocate and deliver to our stores at the right time high quality and desirable products that compare favorably to those of our principal competitors in terms of price, quality, functionality, features, connected and digital solutions, and autonomy. Supply chain issues, labor disputes such as strikes, and labor shortages have in the past, and could in the future, diminish the manufacturing output of CNH Industrial'sCNH's plants, resulting in our stores not receiving inventories in the expected or required quantities and timelines necessary to satisfy customer demand. Any failure of CNH Industrial to offer competitive products, or delays in bringing strategic new products to market or delivery of ordered products to our stores could have a material adverse effect on our business, results of operations and financial condition.

We are dependent upon CNH Industrial’sCNH's financial and marketing support.

CNH Industrial,CNH, directly or through its financing affiliate, supports our business by providing financial assistance and marketing support including the following:

•Retail financing used by many of our customers to purchase CNH Industrial equipment from us;

Our financial performance is dependent on CNH Industrial'sCNH's continued commitment to these offerings, at a level that allows us to be competitive in our markets.

We are dependent on CNH Industrial’sCNH's ongoing commitment to its product warranties and reimbursement of dealers for warranty repairs.

CNH Industrial provides product warranties and, in some cases, extended warranties to our customers. Our stores perform warranty work for equipment under these product warranties, and we direct bill CNH Industrial as opposed to invoicing the customer. At any particular time, we have significant receivables from CNH Industrial for warranty work performed. CNH Industrial’sCNH's ongoing commitment to its product warranties and timely payment for warranty work is important to both our market share success and our warranty related parts and service revenue.

Our CNH Industrial Dealer Agreements may be terminated by CNH Industrial and subject us to restrictions that may adversely impact our business.

We have entered into CNH Industrial Dealer Agreements under which we sell CNH Industrial’sCNH's branded agricultural and construction equipment, along with aftermarket parts and repair services. Subject to applicable state statutes that may govern the dealer-manufacturer legal relationship, CNH Industrial may terminate our CNH Industrial Dealer Agreements immediately in certain circumstances, following written notice and cure periods for certain breaches of the agreement, and for any reason under our Case Construction agreement following 120 days' prior written notice. If CNH Industrial were to terminate, including by non-renewal, all or any of its CNH Industrial Dealer Agreements with us, our business would be severely harmed.

Furthermore, CNH Industrial may unilaterally change its operating practices under the terms of the CNH Industrial Dealer Agreements to, among other things, change or authorize additional dealers in our sales and service areas, change its distribution system to the detriment of its dealers like us, limit our product offerings, and change pricing or delivery terms. If CNH Industrial were to change the terms of our CNH Industrial Dealer Agreements or its operating practices in a manner that adversely affects us, our business and results of operations would be harmed.

Our CNH Industrial Dealer Agreements impose significant obligations and restrictions on us.

Under our CNH Industrial Dealer Agreements, we are obligated to actively promote the sale of CNH Industrial equipment within our designated geographic areas of responsibility, fulfill the product warranty obligations of CNH Industrial (subject to CNH Industrial’sCNH's payment to us of the agreed upon reimbursement), maintain adequate facilities and workforce to service the needs of our customers, stock equipment and parts inventories at the level deemed necessary by CNH Industrial to meet sales goals as stated in the annual business plan mutually agreed upon by us and CNH Industrial,CNH, maintain adequate working capital, and maintain stores only in authorized locations.

Consent of CNH Industrial is required for certain material changes in our ownership, governance or business structure, including the acquisition by any person or group of persons of 30% or more of our outstanding stock or 20% or more of our outstanding stock if the acquiring person or group is a competitor of CNH Industrial.CNH. This requirement may have the effect of discouraging a sale or other change in control of the Company, including transactions that may be in the best interests of our stockholders.

The acquisition of additional CNH Industrial geographic areas of responsibility and store locations in our Agriculture, Construction, Europe and Australia segments requires the consent of CNH Industrial under our CNH Industrial Dealer Agreements. CNH Industrial may decline, in its sole discretion, to consent to any acquisition of an additional CNH Industrial store location we may pursue. If CNH Industrial is unwilling to consent to any future proposed acquisition of additional dealerships, our ability to execute our acquisition strategy and grow our business may be impaired. In the event of a proposed divestiture of a store location, CNH has significant influence on the purchaser given that it retains discretion whether or not to grant a dealer agreement to the new owner.

Our CNH Industrial Dealer Agreements require us to operate any material business activities not related to sales of CNH Industrial products or services to customers in agricultural, construction, industrial or similar markets separately from our CNH Industrial dealership business. In addition, our CNH Industrial Dealer Agreements for domestic and international Case Construction equipment prohibit us from carrying other suppliers' products (new equipment and parts) at our domestic and international Case Construction stores that are competitive with CNH Industrial'sCNH's products, unless consented to by CNH Industrial.CNH. These restrictions may discourage or prevent us from pursuing activities that we believe will grow our business.

•agriculturalgovernment policies, including aid and subsidies to agricultural enterprises provided by governments, policies impacting commodity prices or limiting the export or import of commodities, and alternative fuel mandates; and

•foreign government tariffs that affect export markets for U.S. farm products In addition to macroeconomic drivers of net farm income, local growing conditions also influence farmers’ buying sentiment. Therefore, droughts, excess rain, hail, and other unfavorable weather conditions affecting certain geographic regions will adversely impact the localaffected farmers’ buying sentiment.

Our construction equipment customers primarily operate in the naturalmining, resource,energy production, residential and commercial construction, transportation,public infrastructure projects, agriculture, manufacturing, industrial processing and utilitiesforestry industries. The construction equipment market is influenced by factors such as:

The construction industry in many of our geographical areas has experienced periodic, and sometimes prolonged, economic down cycles. During these downturns, our revenues and profitability could be materially adversely impacted.

Inflationary increases in the cost of equipment combined with a depressed used equipment market (resulting in lower trade values of customers' used equipment) and higher interest rates have negatively impacted our customers' equipment purchasing decisions.

Many of our customers finance their equipment purchases. The ability to obtain affordable financing is an important part of a customer's decision to purchase agricultural or construction equipment. The affordability of new equipment is influenced by three factors: (i) the cost of the new equipment, which has increased significantly due to inflation and other factors over the past few years, and may experience additional increases due to tariffs on imported materials, parts and components that are required to manufacture the equipment; (ii) the trade value granted to the customer by the dealer for the used equipment being traded (and in the current down cycle, the value of used equipment has fallen significantly, resulting in less trade value and requiring a greater cash contribution in the transaction); and (iii) the interest rate applied to the amount financed in the transaction. Interest rates have risen significantly over the past four years and remain elevated. All of these factors, along with significantly lower net farm income, have contributedreduced to make equipment purchases less affordable, resultingaffordability in a depressed agriculture equipment market. As a result, our revenue and profitability decreased significantly in fiscal 2025.2025 and has not recovered in fiscal 2026. The results of the past two fiscal yearyears evidence our susceptibility to these non-controllable market factors that adversely affected our financial performance.

The agricultural and construction equipment distribution (including parts and service) and rental industries are highly competitive and fragmented, with large numbers of companies operating on a regional or local basis. Historically, our competitors have competed aggressively on the basis of pricing or inventory availability, resulting in decreased margins on our sales to the extent we choose to match our competitors' pricing. To the extent we choose not to match or remain within a reasonable range of our competitors' pricing, we may lose sales and market share. In addition, to the extent CNH Industrial'sCNH's equipment manufacturer competitors (such as Deere, Caterpillar, Komatsu, Volvo Group, and AGCO) provide their dealers with more innovative or higher quality products, lower cost products, better customer financing, better warranty programs, or have more effective marketing programs, or the CNH Industrial reputation is tarnished in the marketplace or with our customers, our ability to compete and our results of operations could be materially adversely affected. In addition, e-commerce companies selling parts have negatively impacted dealers' parts sales and margins, and we expect that this competitive pressure will continue to increase in the future.

The recent agreements of equipment manufacturers, including CNH Industrial,CNH, to provide farmers and independent repair shops access to diagnostic tools could negatively impact our repair services business.

In the past, state and federal legislation has been introduced, including in states in our footprint, that generally would require the manufacturers of products to provide the purchaser or independent repair technicians with documents, diagnostic software, and other information that would allow the equipment to be repaired without having it returned to the dealer for repair. Separately, the American Farm Bureau Federation and CNH Industrial brands, Case IH and New Holland, signed a memorandum of understanding in March 2023 (the “Memorandum of Understanding”) that allows farmers and independent repair shops to access CNH Industrial'sCNH's brand manuals, tools, product guides and information to self-diagnose and self-repair machines, and enables farmers and independent repair shops to directly purchase diagnostic tools. The Memorandum of Understanding follows a similar format as agreed to by Deere in January 2023 which, in turn, follows the auto industry format. It is difficult to predict the long-term impact of the Memorandum of Understanding, or right to repair legislation if enacted in any area of our footprint, on our repair services business.

•compliance with the U.S. Foreign Corrupt Practices Act of 1977, as amended, and other U.S. laws that apply to the international operations of U.S. companiescompanies, which may be difficult and costly to implement and monitor, can create competitive disadvantages if our competitors are not subject to such laws, and which, if violated, may result in substantial financial and reputational harm;

The Russian military occupation of Ukraine has significantly disrupted our Ukrainian operations. While all of our Ukrainian stores are open, the outcome of the Russian military operation remains unclear, and we cannot predict the impact this conflict will have on our Ukrainian operations. The military conflict and related political instability, if it intensifies, may make it impossible for us to effectively operate our Ukraine dealerships, which may result in our decision to cease operations or dispose of our assets in Ukraine. This would result in asset write-offs and a loss in revenues and profits. See additional information in Note 1, Business Activity and Significant Accounting Policies, to the Consolidated Financial Statements atin Part II, Item 8, Financial Statements and Supplementary Data, of this Form 10-K. Moreover, upon any sale of our assets in Ukraine the existing currency restrictions may limit our ability to repatriate those funds to the United States or Europe. Even if we continue operations, the military conflict has significantly impacted, and we expect that it will continue to impact, our customers' liquidity and purchasing decisions for our products and services. If no crops are planted or a growing season is negatively impacted, this occurrence will limit our Ukrainian subsidiary's ability to generate cash and repay outstanding debt, and as a result of imposed currency exchange controls and other restrictions, restrict our ability to manage our cash held in Ukraine and our investment in our Ukrainian business. The military intervention has disrupted our Ukrainian work force, with certain employees being called to active military duty and other employees leaving the country and working remotely. Additional risks related to our operations in Ukraine, likely made more acute by the impact of the military conflict, include further devaluation of the local currency, increased interest rates and increased inflation.

Our orders for the purchase of new equipment and parts are based primarily on pre-sold equipment and projected demand. Our equipment orders from CNH Industrial typically must be slotted months in advance of actual delivery. If actual sales are materially less than our forecasts, for example because of a significant drop in net farm income, weather disruptions in our agricultural growing regions, or a construction industry recession, we would experience an over-supply of new equipment and parts inventory. This over-supplyoversupply situation occurred in fiscal year2025 2025,and continued through fiscal 2026, which has generally caused downward pressure on our product sale prices and margins, decreased our inventory turns, and increased our floorplan financing expenses. Given the variability of the macroeconomic factors affecting demand for equipment, our business will be subject to the risks arising from “overan supply”,oversupply situation, both in the current economic downcycle and beyond.

Our used equipment is generally acquired as trade-ins from customers in connection with equipment sales. In accordance with generally accepted accounting principles, each item of our used equipment inventory is valued at the lower of cost or net realizable value. In the current down market,downturn, the agreed upon tradetrade-in values on new equipment deals (frequently agreed to months in advance of the transaction closing of the transaction) and our used equipment in stock have not retained the valuevalues that we attributedpreviously agreed to it atwith the timecustomer. of the trade or receipt, and accordinglyAccordingly, ongoing downward adjustments to those trade-in values have occurred overthroughout thefiscal past2025 severaland monthsfiscal 2026 in accordance with the lower of cost or market accounting principles. The amountamounts of these write-downs of inventory are included in our cost of goods sold, and reduce our operating income.

Due to the length and severity of the current downturn,economic downcycle, or in any future downturn,downcycle, it is possible that we may need to change from our normal retail marketing channel to more aggressive marketing channels (such as auctions) for specific pieces or categories of equipment inventory, particularly as equipment inventory ages. If we determine that such measures are appropriate responses in the current or any future downturn,economic downcycle, these aggressive measures will generally result in lower profit margins than those we would obtain through our normal marketing channel.

Our credit facilities with CNH Industrial Capital, DLL Finance, and certain of our real estate lenders require us to satisfy aan adjusted debt to tangible net leverageworth ratio and fixed charge coverage ratio on an ongoing basis, measured at the end of each fiscal quarter. Under the Bank Syndicate Agreement, if our excess availability (i.e., borrowing base capacity less outstanding loan balance and certain reserves) falls below a certain threshold, we become subject to a minimum fixed charge coverage ratio. Our ability to borrow under these credit agreements depends upon compliance with these financial covenants.

Our failure to satisfy any covenant, absent a waiver or amendment, would cause us to be in default under our credit facilities and would enable our lenders to accelerate payment of the outstanding indebtedness. Each of our credit agreements includeincludes cross-default provisions which provideso that certain types of defaults under any other indebtednesscredit agreement will also constitute a default under that credit agreement. If a default occurred, and the lender demanded accelerated payment, we may not be able to satisfy a pay-off request, whether through internal funds or new financing.

A substantial portion of our floorplan and working capital borrowings, including the credit facilities with CNH Industrial Capital, the Bank Syndicate, DLL Finance, and our international floorplan facilities are at variable interest rates and expose us to interest rate risk. There are many factors outside our control that have in the past and may, in the future, impact interest rates including publicly announced indices that underlie the interest obligations related to a certain portion of our debt. Factors that impact interest rates include governmental monetary policies, inflation, recession, changes in unemployment, the money supply, and international instability impacting domestic and foreign financial markets. Any increases in interest rates could have an adverse effect on our results of operations. The adverse impact of higher rates on our financial performance is magnified during industry economic downcycles, such as we are experiencing now, when we are more likely to have an oversupply of inventory.

The agricultural and construction equipment businesses are highly seasonal, which causes our quarterly results and cash flows to fluctuate during the year. Farmers generally purchase agricultural equipment and service work in preparation for, or in conjunction with, the planting and harvesting seasons. Construction equipment customers’customers purchases of equipment and service work, as well as rental of construction equipment, are also seasonal in our stores located in colder climates where construction work slows significantly in the winter months. In addition, the fourth quarter typically is a significant period for equipment sales in the U.S. because of our customers’ year-end tax considerations, the timing of dealer incentives and the increase in availability of farmers’ funds from completed harvests and construction customers' funds from completed projects. Also, numerous external factors such as credit markets, commodity prices, weather conditions, and other circumstances may disrupt normal purchasing practices and customers’ sentiment, further contributing to the seasonal fluctuations.

The Company is subject to taxes in the U.S. and a number of foreign jurisdictions where it conducts business. The Company’s effective tax rate has beenbeen, and may continue to be affected by changes in the mix of earnings in jurisdictions with differing statutory tax rates, changes in the valuation of deferred tax assets, and changes in tax laws or their interpretation, such as the 15% global minimum tax under the Organization for Economic Cooperation and Development Pillar Two, Global Anti-Base Erosion Rules. In addition, the U.S. government could adopt changes to international trade agreements, tariffs, taxes and other related regulations. If the Company’s effective tax rate were to increase, or if the ultimate determination of the Company’s taxes owed is for an amount in excess of amounts previously accrued, our financial results could be adversely affected.

Weather conditions, particularly severe floods and droughts, can have a significant adverse effect on growing conditions and on regional agricultural and construction markets. Adverse weather conditions may result in fewer acres being planted or harvested by farmers, reduced crop yields on those acres that are planted, and delays or cancellations of construction projects. This in turn could result in lower demand for our agricultural and construction equipment and services and adversely affect our results of operation.operations. Many scientific reports predict that severe weather events can be expected to become more frequent as a result of global climate change. Furthermore, the long-term impacts of climate change, whether involving physical risks (such as the extreme weather conditions discussed above) or transition risks (such as regulatory changes discussed below) are expected to be widespread and unpredictable. As severe weather events become increasingly common, our or our customers’ operations may be disrupted, which could result in increased operational costs or reduced demand for our products and services and extended periods of disruptions could have an adverse effect on our results of operations. In addition, climate change may also reduce the availability or increase the cost of insurance for weather-related events as well as impact the global economy, including potential disruptions to supply chains. We anticipate that climate change-related risks will increase over time.

There is global scientific consensus that emissions of greenhouse gases ("GHG") continue to alter the composition of Earth’s atmosphere in ways that are affecting and are expected to continue to affect the global climate. These considerationsdevelopments have ledprompted to certainvarious regulatory responses, including but not limited tothough the EU Corporate Sustainability Reporting Directivescope and theultimate SEC’s finalized rules (March 6, 2024) requiring public companies to make disclosures regarding climate risks and related matters (such rules are currently stayed pending the outcomeimpact of litigation).these Weemerging expectrequirements our European subsidiaries to beremain subject to theuncertainty. CSRD disclosure rules beginning in 2028. TheAny associated future compliance costs are currentlysimilarly uncertain, but we expect that they will be substantial.uncertain. Various stakeholders, including legislators and regulators, shareholders and non-governmental organizations, as well as companies in many business sectors are continuing to look for ways to reduce GHG emissions.

The regulation of GHG emissions from the equipment we sell could result in additional manufacturing costs to our suppliers who,that, in turn, will likely pass along those costs to us through higher wholesale prices of the equipment. We may not be successful in passing along the equipment price increases to our customers, which could impact our results of operation and margins. To the extent that we attempt to pass along price increases to our customers, the increased costs of equipment may negatively affect their purchasing decisions or result in their decision to purchase equipment from a different dealer or brand.

Our ability to grow through the acquisition of additional CNH Industrial geographic areas of responsibility and store locations or other businesses will be dependent upon the availability of suitable acquisition candidates at acceptable values,prices, our ability to compete effectively for available acquisition candidates and the availability of capital to complete the acquisitions. We may not successfully identify suitable targets, or if we do, we may not be able to close the transactions, or if we close the transactions, they may not be profitable. In addition, CNH Industrial'sCNH's consent is required for the acquisition of any CNH Industrial dealership, and the consent of our lenders may beis required for certain acquisitions. CNH Industrial typically evaluates management, historical performance, and capitalization of a prospective acquirer, along with CNH Industrial’sCNH's desired make-up of its distribution network, in determining whether to consent to the sale of a CNH Industrial dealership. We may not obtain the consent of CNH Industrial or our lenders for certain acquisitions we may propose.

Furthermore, there are risks associated with acquisitions of new dealerships. These risks include: incurring significantly higher than anticipated capital expenditures and operating expenses; unexpected liabilities; synergies, economies of scale and cost reductions not occurring as anticipated; failing to integrate the operations and personnel of the acquired dealerships; employee attrition at the acquired business; disrupting our ongoing business; diluting the effectiveness of our management; failing to maintain uniform standards, controls and policies; and impairing relationships with employees and customers as a result of changes in management. To the extent we do not successfully avoid or overcome the risks or problems related to acquisitions, our results of operations and financial condition could be adversely affected. Future acquisitions also may have a significant impact on our financial position and capital needs, and could cause substantial fluctuations in our quarterly and yearly results of operations or result in a diversion of management's time and attention from our core business. Acquisitions could include significant intangible assets and goodwill. If the acquisitions giving rise to these intangible assets are unsuccessful, this may result in future impairment charges that would reduce our stated earnings.

In addition, in recent years it has been increasingly difficult to hire and retain qualified employees, which we believe is primarily attributable to market conditionsconditions, which in turn has created increased competition in labor markets. Difficulties in hiring and retaining employees and heightened competition for employees may impact our ability to serve customers, increase our costs, and impair our efficiency and effectiveness and our ability to pursue growth opportunities.

Although none of our employees are covered by a collective bargaining agreement, there have been attempts to unionize our storeemployees personnel.at certain stores. The unionization of all or a substantial portion of our workforce could result in work slowdowns or stoppages, increased overall costs, reduced operating margins, reduced efficiency of our operations at the affected locations, and reduced flexibility in running our business competitively.

Products sold, rented or serviced by us may expose us to potential liabilities for personal injury or property damage claims that arise from the use and transportation of those products. Our commercial liability insurance may not be adequate to cover significant liability claims, or we may not be able to secure such insurance on economically reasonable terms. An uninsured or partially insured product liability claim for which indemnification from the manufacturer is not available could have a material adverse effect on our financial condition or results of operations. Furthermore, if any significant claims are made against us or against CNH Industrial or any of our other suppliers, our business may be adversely affected by any related negative publicity or any adverse impact on the reputation or brand of any of our suppliers, including CNH Industrial.CNH.

We maintain cyber risk insurance, but this insurance may not be sufficient to cover all of our losses from any future breaches of our systems, and we cannot guarantee that applicable insurance will be available to us in the future on economically reasonable terms or at all. While we have experienced cybersecurity incidents in the past, to date, none has materially impacted the Company or our financial position, results of operations and/or cash flows. See more information below in Item 1C, Cybersecurity, of this Form 10-K.

You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and the related notes appearing under Item 8, Financial Statements and Supplementary Data, of this Form 10-K. Some of the information contained in this discussion and analysis or set forth elsewhere in this annual report, including information with respect to our plans and strategy for our business and expected financial results, includes forward-looking statements that involve risks and uncertainties. You should review the "Information Regarding Forward-Looking Statements" in this Item 7 and the risks and uncertainties described under Part I, Item 1A, Risk Factors, of this Form 10-K for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis in this Form 10-K.

A discussion of changes in our Financial Results and Cash Flow Comparisons from fiscal year 20232024 to fiscal year 20242025 has been omitted from this Form 10-K, but may be found in Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, of our Annual Report on Form 10-K for the fiscal year ended January 31, 2024,2025, filed with the SEC on April 3,7, 2024.2025.

We own and operate a network of full service agricultural and construction equipment stores in the United States, Europe, and Australia. Based upon information provided to us by CNH Industrial N.V.,CNH, we are the largest retail dealer of Case IH Agriculture equipment in the world, one of the largest retail dealers of Case Construction equipment in North America and one of the largest retail dealers of New Holland Agriculture and New Holland Construction equipment in the U.S. We operate our business through four reportable segments: Agriculture, Construction, Europe and Australia. Within each segment, we have four principal sources of revenue: new and used equipment sales, parts sales, service,equipment repair and maintenance services and equipment rental and other business activities.

•equipment rental and other business activities.

The new equipment and parts we sell are supplied primarily by CNH Industrial.CNH. According to its public reports, CNH Industrial is a leading manufacturer and supplier of agricultural and construction equipment based on the number of units sold, primarily through the Case IH Agriculture, New Holland Agriculture, Case Construction and New Holland Construction brands. Sales of new CNH Industrial products accounted for approximately 75%69% of our new equipment revenue in fiscal 2025,2026, with our single largest manufacturer other than CNH Industrial representing approximately 4%3% of our total new equipment revenue in fiscal 2025.2026. We acquire used equipment for resale primarily through trade-ins from our customers and in some cases through selective purchases. We sell parts and provide in-store and on-site repair and maintenance services. We rent equipment and provide other ancillary products and services such as equipment transportation, GPS signal subscriptions, farm data management systems, precision farming equipment, and finance and insurance products.

Throughout our 44-year45-year operating history, we have built an extensive, geographically contiguous network of 9390 full service stores located in the United States, 4039 in Europe and 15 in Australia. We have a history of growth through acquisitions, including completing over 60 acquisitions with locations in 15 U.S. states, four European countries and three Australian states since January 1, 2003. We believe that there will continue to be opportunities for dealership consolidation in the future, and we expect that acquisitions will continue to be a component of our long-term growth strategy.

We are subject to a number of factors that affect our business including those factors discussed in this Form 10-K under Part I, Item 1A, Risk Factors, and under the heading “Information Regarding Forward-Looking Statements” in this Item 7. Certain of these external factors include, but are not limited to, the following:

Russia/UkraineRussia-Ukraine Geopolitical Conflict

Since the onset of the activeRussia-Ukraine conflict in February 2022, most of Titan MachineryMachinery's Ukraine'sUkrainian customers have been able to continue their work, although at a reduced capacity and schedule. The Company's business systems in Ukraine have continued to function but have been, and could continue to be, negatively impacted in the future. To date, the impact of this conflict has not been, and in the future is not expected to be, material to Titan Machinery’s consolidated business operations and financial performance. However, the full impact of the conflict remains uncertain and will depend on future developments, including the severity and duration of the conflicts and its impact on regional and global economic conditions. The Company will continue to monitor the ongoing conflict between Russia and Ukraine as it is highly complex and continues to evolve.

Our Agriculture and International businesses are primarily driven by the demand for agricultural equipment for use in the production of food, fiber, feed grain and feedstock for renewable energy. Agriculture industry factors such as changes in agricultural commodity prices and net farm income, have an effect on our customers' sentiment and their ability to secure financing for equipment purchases. Macroeconomic and industry factors that affect commodity prices and net farm income include changingchanges to worldwide demand for agriculture commodities, crop yields and supply disruptions caused by weather patterns and crop diseases, crop stock levels, production costs, and changingchanges to U.S. dollar foreign currency exchange rates. Based on the February 2026 U.S. Department of Agriculture ("USDA") publications, the most recent estimate of net farm incomecash receipts for calendar year 20242025 decreasedis 5.6%estimated to increase 3.0% compared with calendar year 2023.2024. The commodity prices of corn and soybeans, which are the predominant crops in our Agriculture store footprint, were at or near record prices in fiscal 2023 but declined in fiscal 2024 and have remained depressed in fiscal 2025. Based on its February 2025 report,and the2026. The USDA projected net farm incomecash receipts for calendar year 20252026 to increasedecrease 29.5%,2.7%, as compared to the estimated results of calendar year 2024.2025.

The majority of our business involves the distribution and servicing of equipment manufactured by CNH Industrial.CNH. In fiscal 2025,2026, CNH Industrial supplied approximately 75%69% of our new equipment revenue on a consolidated basis and 76%,74%, 79%,75%, 65%57% and 74%60% in our Agriculture, Construction, Europe, and Australia segments, respectively. CNH Industrial also represented a significant portion of our parts revenue. Thus, we believe the following factors have a significant impact on our operating results:

•CNH Industrial’sCNH's product offerings, reputation and market share;

•CNH Industrial’sCNH's product prices and incentive and discount programs;

•CNH Industrial'sCNH's supply of inventory and ability to match demand levels and delivery timelines;

•CNH Industrial'sCNH's offering of floorplan payable financing for the purchase of a substantial portion of our inventory; and

•CNH Industrial'sCNH's offering of financing and leasing used by our customers to purchase CNH Industrial equipment from us.

Changes in credit markets can affect our customers' ability and willingness to make capital expenditures, including purchasing our equipment. Tight credit markets, a low level of liquidity in many financial markets, and extreme volatility in fixed income, credit, currency and equity markets have the potential to adversely affect our business. Such disruptionseconomic in the overall economyinstability and financial markets and the related reduction inreduced consumer confidence incan thelead economy,to slowtighter activity in the capitalcredit markets, negativelypotentially affectlimiting access to credit on commercially acceptable terms,capital and maynegatively adverselyimpacting impactthe financial terms available to our customers'customers. access to credit and the terms of any such credit. However, highHigh retail interest rates negatively impact customer demand due to higher borrowing costs, which makes purchasing equipment less attractive.

Absorption is an industry term that refers to the percentage of an equipment dealer's operating expense covered by the combined gross profit from parts, service and rental fleet activity. We calculate absorption by dividing our gross profit from sales of parts, service and rental fleet by our operating expenses, less commission expense on equipment sales, plus interest expense on floorplan payables and rental fleet debt. We believe that absorption is an important management metric because during economic down cyclesdowncycles our customers tend to postpone new and used equipment purchases while continuing to run, maintain and repair their existing equipment. Thus, operating at a high absorption rate enables us to operate profitably throughout economic down cycles.downcycles.

The cost of financing inventory is an important factor affecting our results of operations. Floorplan payable financing from CNH Industrial Capital, the Bank Syndicate Agreement, DLL Finance and various credit facilities related to our foreign subsidiaries represent the primary sources of financing for equipment inventories. CNH Industrial regularly offers interest-free periods as well as additional incentives and special offers. As of January 31, 2025,2026, 44.1%54.0% of our floorplan payable financing was non-interest bearing.

Interest expense represents the interest on our debt instruments, other than floorplan payable financing facilities. This includes long-termlong term debt used to finance the purchase of real estate and vehicles.

Comparative financial data for each of our four sources of revenue for fiscal 20252026 and 20242025 are presented below. The results include the acquisitions made during these periods. The year-to-year comparison included below is not necessarily indicative of future results. Information regarding segment revenue and income (loss) before income taxes is presented for each fiscal year following our discussion of the consolidated results of operations. Additional information regarding our segments is included in Note 21, Business Segment Information and OperatingGeographic Results,Information, to the Consolidated Financial Statements in Item 8, Financial Statements and Supplementary Data, of this Form 10-K.

Gross profit for fiscal 20252026 decreased 25.5%,3.3%, or $135.7$13.1 million, as compared to fiscal 2024.2025. Gross profit margin also decreasedincreased to 15.8% in fiscal 2026 from 14.6% in fiscal 2025 from 19.3% in fiscal 2024.2025. The decreaseincrease in gross profit margin for fiscal 20252026 was primarily due to lowerhigher equipment margins,margins whichand area beingchange drivenin bysales highermix, levelswith a greater proportion of inventoryrevenue andearned softeningfrom demand.parts during fiscal 2026 as compared to fiscal 2025.

Our Company-wide absorption rate decreasedincreased to 68.0%75.2% for fiscal 20252026 as compared to 79.2%75.0% during fiscal 2024. The decrease in absorption was primarily driven by increased floorplan interest expense in fiscal 2025 compared to fiscal 2024.2025.

Operating expenses for fiscal 20252026 increaseddecreased by 7.5%,1.2%, or $27.3$4.5 million, as compared to fiscal 2024.2025. The increasedecrease was led by lower variable expenses associated with the year-over-year decline in operatingrevenue expensesand wasprofitability primarilydue drivento bychallenging acquisitionsindustry thatfundamentals, occurredas latewell inas fiscalmanagement's 2024,expense whichreduction includes the O'Connors acquisition.efforts. Operating expenses as a percentage of revenue increased to 15.9% in fiscal 2026 from 14.4% in fiscal 20252025. fromThe 13.1%increase in fiscaloperating 2024.expenses as a percentage of total revenue was due to lower revenue sales caused by challenging industry conditions.

Impairment Charges and Restructuring Costs

In fiscal 2025,2026, we recognized $1.3$2.3 million of impairment expense related to other intangible and long-lived assetsassets, of,of which $0.2$0.9 million was within the Agriculture segment, $0.2$0.1 million was within the Construction segmentsegment, and $0.9$0.7 million was within the Europe segment.segment and $0.5 million was within Shared Resources. We also recognized $1.7 million of restructuring costs within our Europe segment related to employee severance costs for our Germany liquidation.

Interest and other income (expense) for fiscal 20252026 decreasedincreased by approximately $7.5$8.6 million as compared to fiscal 2024.2025. The decreaseincrease in interest and other income (expense) compared to fiscal 20242025 was primarily due to a $9.7 million non-cash, sale-leaseback financingfinance modification expense related to the agreement to purchase 13 of our leased facilities at the end of the respective lease terms and partially offset by a $3.6 million gain on cancellation of debt in relation to the U.S. Treasury Department’s New Market Tax Credit Program. Floorplan interest expense increased $20.9 million for fiscal 2025, as compared to fiscal 2024, primarily due to a higher level of interest-bearing inventory, including the usage of existing floorplan capacity to finance the O'Connors acquisition in October 2023. The increase in other interest expense in fiscal 2025 is the result of an increased amount of long term debt outstanding resulting from purchases of previously leased facilities during fiscal 2024 and fiscal 2025 as well as increased borrowing on our CNH Industrial Capital revolving line of credit.

Provision for (Benefit from) Provision for Income Taxes

Agriculture segment revenue for fiscal 20252026 decreased 7.6%,17.5%, or $155.8$330.6 million, compared to fiscal 2024.2025. The revenue decrease was due to a same-store sales decrease of 9.2%17.4% during the fiscal 20252026 as compared to fiscal 2024.2025. The same-store sales decrease was due to a decrease in equipment revenue resulting from challenging industry conditions, such as decreases in agricultural commodity prices and projectedtotal netcrop farm income,receipts, which negatively affected customer sentiment in fiscal 2025,2026, as compared to the fiscalsame 2024.period in the prior year. Changes in actual or anticipated netcrop farmreceipts incomeand farmer profitability generally have a direct correlation with retail demand for equipment.

Agriculture segment loss before income taxes was $28.9 million for fiscal 2026 compared to $39.8 million for fiscal 2025 compared to income before income taxes of $121.1 million for fiscal 2024.2025. The decreaseincrease in grosssegment profitresults is primarily due to lowermaterial equipmentprogress margins,in whichthe are driven by higher levels ofCompany's inventory reduction and softeningoptimization demand.initiatives. InThe addition,fiscal we2025 recordedperiod was also negatively impacted by a net $5.2 million non-cash, sale-leaseback finance modification expense related to the agreement to purchase 13 of our leased facilities at the end of the respective lease terms and had an increase in our operating expenses and floorplan interest expense.terms.

Construction segment revenue for fiscal 2025 decreased 0.3%, or $0.9 million, compared to fiscal 2024 Our Construction segment loss before income taxes was $8.1 million for fiscal 2026 compared to $6.7 million for fiscal 2025 compared to $18.3 million of income before income taxes for fiscal 2024.2025. The decrease in segment results was dueprimarily related to lower equipment margins compared to the same period last year. The fiscal 2025 period was also negatively impacted by a $4.5 million non-cash, sale-leaseback finance modification expense related to the agreement to purchase 13 of our leased facilities at the end of the respective lease terms, lower equipment gross margins as a result of increased supply and moderately softer demand, and increased floorplan interest expense compared to fiscal 2024.terms. In addition, the dollar utilization of our rental fleet decreased from 29.3% for fiscal 2024 to 23.8% for fiscal 2025.2025 to 23.1% for fiscal 2026.

Europe segment revenue for fiscal 20252026 decreasedincreased 16.3%,44.7%, or $50.9$116.7 million, compared to fiscal 2024.2025. The decreaseincrease in revenue reflectsresulted thefrom softeningan ofincrease newin equipment demanddemand, causedwhich was driven by a decreasestrong response to European Union stimulus programs in global agricultural commodity prices, sustained higher interest rates and drought conditions in Eastern Europe which negatively impacted crop yields and grower profitability.Romania.

Our Europe segment income before income taxes was $15.2 million for fiscal 2026 compared to a loss before income taxes wasof $3.9 million for fiscal 2025 compared to $16.5 million of income before income taxes for fiscal 2024.2025. The decreaseincrease in segment pre-tax income was primarily the result of decreasedincreased equipment sales as noted above.above, Additionally,which wewas partially offset by Germany wind down activities in fiscal 2026. During fiscal 2026, the Europe segment recorded $0.5a millionwaiver of impairment$10.3 expensemillion related to certainan goodwillintercompany assetsloan. A corresponding amount was recorded to Shared Resources and $0.9the millionamounts are eliminated in impairment expense related to other intangible assets and long-lived assets.consolidation.

We incur centralized expenses/income at our general corporate level, which we refer to as “Shared Resources,” and then allocate most of these net expenses to our segments. Since these allocations are set early in the year, and a portion is planned to be unallocated, unallocated balances may occur. Shared Resources loss before income taxes was $19.7 million for fiscal 2026 compared to $2.6 million for fiscal 20252025. comparedFiscal 2026 results include the corresponding $10.3 million intercompany amount related to $9.0the millionloan forwaiver fiscalrecorded 2024.in Europe Segment, which is eliminated at consolidation.

Our primary sources of liquidity are cash reserves, cash generated from operations, and borrowings under our floorplan payable and other credit facilities. We expect these sources of liquidity to be sufficient to fund our working capital requirements, acquisitions, capital expenditures and other investments in our business, service our debt, pay our tax and lease obligations and other commitments and contingencies, and meet any seasonal operating requirements for the foreseeable future, provided,subject, however, to the fact that our borrowing capacity under our credit agreements is dependent on compliance with various financial covenants as further described in Note 8, Floorplan Payable/Lines of Credit, to the Consolidated Financial Statements in Item 8, Financial Statements and Supplementary Data, of this Form 10-K. As of January 31, 2026, we are in compliance with all such covenants. We have worked in the past, and will continue to work in the future if necessary, with our lenders to implement satisfactory modifications to these financial covenants when appropriate for the business conditions confronted by us.

Floorplan payable balances reflect the amount owed for new equipment inventory purchased from a manufacturer and used equipment inventory, which is primarily purchased through trade-in on equipment sales, net of unamortized debt issuance costs incurred for floorplan credit facilities. Certain manufacturers from which we purchase new equipment inventory offer financing on these purchases, either offered directly from the manufacturers or through the manufacturers’ captive finance affiliate. CNH Industrial'sCNH's captive finance subsidiary, CNH Industrial Capital, also provides financing of used equipment inventory. We also have floorplan payable balances with non-manufacturer lenders for new and used equipment inventory. Borrowings and repayments on manufacturer floorplan facilities are reported as operating cash flows, while borrowings and repayments on non-manufacturer floorplan facilities are reported as financing cash flows in our consolidated statements of cash flows.

During the year ended January 31, 2025, letters were received from CNH Industrial Capital America LLC (“CNH Industrial Capital”) and DLL Finance to waive the Consolidated Fixed Charge Coverage Ratio covenants for the reporting periods between January 31, 2025 to January 31, 2026. OnIn DecemberMarch 3,2026, 2024,the weCNH enteredwaiver intowas Amendmentfurther No. 1extended to thecover Bankreporting Syndicateperiods Agreementbetween thatFebruary lowered1, the adjusted excess availability metric from 15%2026 to 10%January for31, the period from December 15, 2024 to March 15, 2025, and thereafter reverts to 15%.2027.

As of January 31, 2025,2026, we had floorplan payable lines of credit for equipment purchases totaling $1.5 billion, which includes a $875.0 million credit facility with CNH Industrial Capital, a $390.0 million floorplan payable line under the Bank Syndicate Agreement, a $80.0$70.0 million credit facility with DLL Finance, and additional credit facilities related to our foreign subsidiaries. Available borrowing capacity under these lines of credit are reduced by amounts outstanding under such facilities, borrowing base calculations and amount of standby letters of credit outstanding with respect to the Bank Syndicate Agreement, and certain acquisition-related financing arrangements with respect to the CNH Industrial Capital credit facility. Due to the waivers listed above, as of January 31, 2025,2026, the Company was not subject to the financial covenants under its credit agreements. Additional details on each of these credit facilities are disclosed in Note 8, Floorplan Payable/Lines of Credit, to the Consolidated Financial Statements in Item 8, Financial Statements and Supplementary Data, of this Form 10-K.

Our primary uses of cash have been to fund our operating activities, including the purchase of inventory and providing for other working capital needs; meeting our debt service requirements; making payments due under our various leasing arrangements; and funding capital expenditures. The primary factor affecting our ability to generate cash and to meet cash requirements, is our operating performance as impacted by (i) industry factors, (ii) competition, (iii) general economic conditions, (iv) the timing and extent of acquisitions, and (v) business and other factors including those identified in Item 1A, Risk Factors, and otherwise discussed in this Form 10-K.

In fiscal 2026, we used $22.4 million in cash for property and equipment purchases. The property and equipment purchases in fiscal 2026 primarily related to improvements to, or purchases of, real estate assets and the purchase of vehicles. In fiscal 2025, we used $51.8 million in cash for property and equipment purchasespurchases, and financed $36.0 million in property and equipment purchases with long-term debt and finance leases. The property and equipment purchases in fiscal 2025 primarily related to improvements to, or purchases of, real estate assets and the purchase of vehicles. In fiscal 2024, we used $62.4 million in cash for property and equipment purchases, and financed $17.9 million in property and equipment purchases with long-term debt. The property and equipment purchases in fiscal 2024 primarily related to the purchase of vehicles, trucks and real estate. We expect our cash expenditures for property and equipmentequipment, exclusive of fleet, for fiscal 20262027 to be approximately $40.0$15.0 million. The actual amount of our fiscal 20262027 capital expenditures will depend upon factors such as general economic conditions, growth prospects for our industry and our decisions regarding financing and leasing options. We currently expect to finance property and equipment purchases with borrowings under our existing credit facilities, financing with long-term debt, with available cash or with cash flow from operations. We may need to incur additional debt if we pursue any future acquisitions.

In addition to the other information set forth in this Quarterly Report,Report on Form 10-Q, including the important information in “Forward-Looking Statements,” you should carefully consider the information provided under “Risk Factors” and “Information Regarding Forward-Looking Statements” in our Annual Report on Form 10-K for the fiscal year ended January 31, 2026, as filed with the SEC on March 31, 2026. There have been no material changes from the risk factors as previously discussed in our Annual Report on Form 10-K for the fiscal year ended January 31, 2026.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our interim unaudited Condensed Consolidated Financial Statements and related notes included in Item 11, “Financial Statements” of Part I of this Quarterly Report on Form 10-Q, and the audited consolidated financial statements and related notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in Item 8 and Item 7, respectively, of our Annual Report on Form 10-K for the fiscal year ended January 31, 2026.

The U.S. federal government has imposed significant tariffs on imports from a broad range of countries. In response, some countries have enacted or are expected to enact retaliatory tariffs on U.S. exports. Although the overall impact of these trade measures on the Company remains uncertain, we recognize the possibility of increases in the wholesale prices that we pay for our equipment and parts inventory. Higher wholesale prices could compress our margins if we are unable to fully pass on these cost increases to our retail customers. Additionally, retaliatory tariffs may negatively affect U.S. agricultural exports, which could have downstream effects on our core customer base in the farming sector. Some analysts have also cautioned that prolonged disruptions to global trade could increase the risk of broader macroeconomic challenges, including the possibility of a recession.

For the firstsecond quarter of fiscal 2027, our net loss was $12.6$9.2 million, or a loss of $0.55$0.40 per diluted share, compared to a fiscal 2026 firstsecond quarter net loss of $13.2$6.0 million, or a loss of $0.58$0.26 per diluted share. Significant factors impacting the quarterly comparisons were:

•Revenue in the firstsecond quarter of fiscal 2027 decreased by 12.1%9.2% compared to the firstsecond quarter of fiscal 2026. The revenue decrease was led by softening of demand for equipment purchases due to a decline in farmer profitability over the past few years, which is expected to remaincontinue challengedthrough inthe 2026.remainder of fiscal 2027.

•Gross profit margin increased to 17.1%18.6% for the firstsecond quarter of fiscal 2027, as compared to 15.3%17.1% for the firstsecond quarter of fiscal 2026. The increase was primarily related to an equipment gross profit margin increase from 6.8%6.6% in the firstsecond quarter of fiscal 2026 to 7.8%8.5% in the firstsecond quarter of fiscal 2027 and a change in sales mix, with a greater proportion of revenue earned from our higher margin parts and service business during the firstsecond quarter of fiscal 2027 as compared to the same period last year.

•Floorplan interest expense decreased by $3.0$3.1 million in the firstsecond quarter of fiscal 2027 as compared to the same period in fiscal 2026. The decrease is primarily due to lower interest-bearing inventory levels subject to interest.levels.

The results presented below include the operating results of each acquisition made during these periods, from the date of acquisition, as well as the operating results of any stores closed or divested during these periods, up to the date of the store closure. The period-to-period comparisons included below are not necessarily indicative of future results. Segment information is provided later in the discussion and analysis of our results of operations. Additional information regarding our segments is included in Note 17, Business Segment and Geographic Information, to our Condensed Consolidated Financial Statements in Item 11, “Financial Statements,” of Part I of this Quarterly Report on Form 10-Q.

Comparative financial data for each of our four sources of revenue are expressed below.below for the periods indicated:

Three Months Ended AprilJuly 30,31, 2026 Compared to Three Months Ended AprilJuly 30,31, 2025

Total revenue for the firstsecond quarter of fiscal 2027 decreased by 12.1%,9.2%, or $72.0$50.0 million, compared to the same period last year. The decrease was primarily attributable to challenging industry conditions, including sustained lower agricultural commodity prices and projected total crop receipts, which negatively impacted customer sentiment.

Gross profit for the firstsecond quarter of fiscal 2027 decreased 1.8%,1.3%, or $1.7$1.2 million, compared to the same period last year. Gross profit margin increased to 17.1%18.6% in the current quarter compared to 15.3%17.1% in the prior year quarter. The increase in gross profit margin was primarily related to an equipment gross profit margin increase from 6.8%6.6% in the firstsecond quarter of fiscal 2026 to 7.8%8.5% in the firstsecond quarter of fiscal 2027 and a change in sales mix, with a greater proportion of revenue earned from higher margin parts and service business during the firstsecond quarter of fiscal 2027 as compared to the same period last year.

Our Company-wide absorption rate was 74.0%76.5% for the firstsecond quarter of fiscal 2027 compared to 75.5%83.1% during the same period last year. The decrease in our absorption rate was primarily due to lower gross profit in the firstsecond quarter of fiscal 2027 compared to the same period last year.

Our operating expenses in the firstsecond quarter of fiscal 2027 decreasedincreased 2.1% as1.5% compared to the same period last year. Operating expenses as a percentage of revenue increased to 18.1%19.0% in the firstsecond quarter of fiscal 2027 from 16.2%17.0% in the firstsecond quarter of fiscal 2026. The increase in operating expenses as a percentage of total revenue was due to lower revenue primarily related to the challenging agricultural industry conditions.

In the firstsecond quarter of fiscal 2026,2027, we recognized $0.3$0.6 million in impairment expense related to long-lived assetsassets, inof ourwhich $0.4 million was within the Europe segment and $0.2 million was within the Agriculture segment.

Interest and other income (expense) for the firstsecond quarter of fiscal 2027 increaseddecreased by approximately $1.8$1.5 million as compared to the same period last year, primarily due to foreign currency fluctuations in the quarter.

Floorplan interest expense decreased in the firstsecond quarter of fiscal 2027 compared to the same period last year due to lower interest-bearing inventory levels subject to interest.levels.

Provision (Benefit) for Income Taxes

Our effective tax rate was 1.1%0.1% and 23.6%27.1% for the three months ended AprilJuly 30,31, 20262026, and 2025, respectively. The effective tax rate is subject to variation due to the impact of several items, mainly the mix of domestic and foreign income and the impact of the recognition of valuation allowance on our domestic and foreign deferred tax assets. In the three months ended April 30, 2026, we recorded a valuation allowance of $0.7 million on our Australian subsidiary due to the presence of historical losses and the Company’s expected future sources of taxable income.

Agriculture segment revenue for the firstsecond quarter of fiscal 2027 decreased 10.4%10.3% compared to the same period last year. This decrease in revenue was primarily due to a decrease in equipment revenue resulting from challenging industry conditions, such as sustained lower agricultural commodity prices and total crop receipts, which continue to negatively impact customer sentiment. Changes in actual or anticipated crop receipts and farmer profitability generally have a direct correlation with the retail demand for equipment.

Agriculture segment loss before income taxes for the firstsecond quarter of fiscal 2027 was $6.2$3.3 million compared to $12.8$12.3 million for the firstsecond quarter of fiscal 2026. The improvement in segment results was driven by an improved inventory position, which helped to generate higher equipment gross profit margins as well as a decrease in floorplan interest expense.

Construction segment revenue for the firstsecond quarter of fiscal 2027 decreasedincreased 6.5%9.2% compared to the same period last year. The decreaseincrease in revenue was primarily driven by the timing of equipment deliveries.

Our Construction segment lossincome before income taxes was $0.6$0.4 million for the firstsecond quarter of fiscal 2027 compared to $4.2loss before income taxes $1.2 million in the firstsecond quarter of fiscal 2026. The improvement in segment results was driven by an improved inventory position, which helped to generate higher equipment gross profit margins as well as a decrease in floorplan interest expense. The dollar utilization of our rental fleet increased from 20.1%22.4% in the firstsecond quarter of fiscal 2026 to 23.5%25.6% in the firstsecond quarter of fiscal 2027.

Europe segment revenue for the firstsecond quarter of fiscal 2027 decreased 35.6%32.6% compared to the same period last year. The decrease in revenue was primarily due to lower equipment demand compared to prior year period, which prior year period demand had been driven by a strong response to European Union stimulus programs in Romania. The wind-down of our German business, which was primarily completed in the first quarter of fiscal 2027, also contributed to the decrease in segment revenue for the second quarter of fiscal 2027 in comparison to the second quarter of fiscal 2026.

Our Europe segment loss before income taxes was $0.9$1.3 million for the firstsecond quarter of fiscal 2027 compared to income before income taxes of $4.7$5.1 million in the firstsecond quarter of fiscal 2026. The decrease in segment results was primarily the result of a decrease in equipment sales.

Australia segment revenue for the firstsecond quarter of fiscal 2027 increased 14.3%35.5% compared to the same period last year. The current year results include additional revenue related to the acquisition of Bellevue Machinery, completed in October 2025.2025, as well as favorable foreign currency impacts from a strengthening Australian Dollar.

Our Australia segment loss before income taxes was $1.8$3.4 million for the firstsecond quarter of fiscal 2027 compared to $0.6$2.1 million in the firstsecond quarter of fiscal 2026. The decrease in segment results was primarily the result of softer equipment margins compared to the same period last year.

We incur centralized expenses/income at our general corporate level, which we refer to as “Shared Resources,” and then allocate most of these net expenses to our segments. Since these allocations are set early in the year, unallocated balances may occur. Shared Resources loss before income taxes was $3.0$1.5 million for the firstsecond quarter of fiscal 2027 compared to $4.5income before income taxes $2.2 million for the same period last year.