Titan Machinery Inc. 10-K

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The Consolidated Balance Sheets of the Company as of January 31, 2026 and 2025, and the related Consolidated Statements of Operations, Comprehensive Income, Stockholders' Equity, and Cash Flows for the years ended January 31, 2026, 2025 and 2024, and the notes thereto, have been audited by Deloitte & Touche LLP, an independent registered public accounting firm. INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Page Titan Machinery Inc.—Financial Statements Audited Consolidated Financial Statements Report of Independent Registered Public Accounting Firm (PCAOB ID No. 34 ) 45 Report of Independent Registered Public Accounting Firm 48 Consolidated Balance Sheets as of January 31, 2026 and 2025 49 Consolidated Statements of Operations for the fiscal years ended January 31, 2026, 2025 and 2024 50 Consolidated Statements of Comprehensive Income for the fiscal years ended January 31, 2026, 2025 and 2024 51 Consolidated Statements of Stockholders' Equity for the fiscal years ended January 31, 2026, 2025 and 2024 52 Consolidated Statements of Cash Flows for the fiscal years ended January 31, 2026, 2025 and 2024 53 Notes to Consolidated Financial Statements 53 44 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the stockholders and Board of Directors of Titan Machinery Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Titan Machinery Inc. and subsidiaries (the "Company") as of January 31, 2026, and 2025, the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows, for each of the three years in the period ended January 31, 2026, and the related notes and the schedule listed in the Index at Part IV, Item 15 (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of January 31, 2026, and 2025, and the results of its operations and its cash flows for each of the three years in the period ended January 31, 2026, in conformity with accounting principles generally accepted in the United States of America. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of January 31, 2026, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 31, 2026, expressed an unqualified opinion on the Company's internal control over financial reporting. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matters The critical audit matters communicated below are matters arising from the current-period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Inventories – Valuation of Used Equipment Inventories — Refer to Notes 1 and 5 to the financial statements Critical Audit Matter Description The Company’s used equipment inventories are stated at the lower of cost (specific identification) or net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The Company periodically subjects used equipment inventories to lower of cost or net realizable value assessments and adjusts carrying values when such values exceed estimated net realizable value. The Company estimates net realizable value using internal and third-party data that considers various factors including the age and condition of the equipment, hours of use, and market conditions. Given the significant judgments made by management to determine the net realizable value of used equipment inventories, performing audit procedures to evaluate these judgments to determine the valuation of used equipment inventories required a high degree of auditor judgment and an increased extent of effort. How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to management’s judgments regarding the valuation of used equipment inventories included the following, among others: 45 Table of Contents • We tested the effectiveness of controls over the valuation of used equipment inventories, including the reasonableness of various factors including the age and condition of the equipment, hours of use, and market conditions, used to determine the net realizable value of the equipment. • We tested the effectiveness of controls over the internal and external data used to determine the valuation of used equipment inventories. • We evaluated the reasonableness of management’s judgments utilized to determine the net realizable value of the used equipment inventories by: ◦ Evaluating the reasonableness and consistency of the methodology and assumptions used by management to determine the net realizable value. ◦ Testing the underlying determination of the net realizable value by obtaining documentation containing the age of the equipment, condition, and hours of use and comparing it to comparable internal and external data. ◦ Performing a retrospective lookback analysis of management’s process by comparing the actual selling prices of used equipment inventories units sold in the current year to the selling prices estimated by management for those units in the prior year, as applicable. Goodwill Impairment Assessment – Agriculture and Australia Reporting Units – Refer to Notes 1 and 7 to the financial statements Critical Audit Matter Description The Company’s annual evaluation of goodwill for impairment involved the comparison of the Agriculture and Australia reporting units’ fair value to their carrying value. The Company determined the fair value of each reporting unit using a combination of income and market approaches. The income approach is based on discounted cash flow models that use reporting unit estimates for forecasted future financial performance, including revenues, margins, operating expenses, capital expenditures, depreciation, amortization, tax and discount rates. The market approach is based on assumptions related to earnings before interest, taxes, depreciation, and amortization multiples or revenue multiples. As of January 31, 2026, the goodwill balance for the Agriculture reporting unit was $39.2 million, and the goodwill balance for the Australia reporting unit was $26.4 million. The fair value of the Agriculture and Australia reporting units exceeded their carrying values, and therefore, no impairment was recognized. Given the significant judgements made by management to estimate the fair value of the Agriculture and Australia reporting units and the differences between their fair value and carrying value, performing audit procedures to evaluate the reasonableness of management’s estimates and assumptions regarding forecasts of future equipment revenue, profit margins, long-term growth rate, discount rate, and the selection of EBITDA or revenue multiples required a high degree of auditor judgment and an increased extent of effort, including the need to involve fair value specialists. How the Critical Matter Was Addressed in the Audit Our audit procedures related to the forecasts of future equipment revenue, profit margins, long-term growth rate, discount rate, and EBITDA multiples for the Agriculture and Australia reporting units included the following, amount others: • We tested the effectiveness of controls over the evaluation of goodwill for impairment, including those over the underlying assumptions to forecast future equipment revenue, profit margins, long-term growth rate, the selection of the discount rate, and the selection of EBITDA multiples. • We evaluated management’s ability to accurately forecast future equipment revenues and profit margins by comparing actual results to management’s historical forecasts. • We evaluated the reasonableness of management’s forecasted equipment revenue and profit margins by comparing the forecasts to (1) historical results, (2) internal communications between management and the Board of Directors, and (3) information included in Company press releases as well as in analyst and industry reports. • We performed a sensitivity analysis of certain assumptions such as revenue, profit margins, long-term growth rate, and the discount rate to evaluate the potential change in the fair value resulting from changes in underlying assumptions. • With the assistance of our fair value specialists, we evaluated the valuation methodologies, the long-term growth rate and discount rate, including testing the underlying source information and the mathematical accuracy of the calculations, and developing a range of independent estimates and comparing those to the long-term growth rate and discount rate selected by management. 46 Table of Contents • With the assistance of our fair value specialists, we evaluated the EBITDA multiples used in estimating fair value, including testing the underlying source information and mathematical accuracy of the calculations, and comparing the multiples selected by management to its guideline companies and guideline transactions. /s/ DELOITTE & TOUCHE LLP Minneapolis, Minnesota March 31, 2026 We have served as the Company's auditor since 2013. 47 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholders and the Board of Directors of Titan Machinery Inc. Opinion on Internal Control over Financial Reporting We have audited the internal control over financial reporting of Titan Machinery Inc. and subsidiaries (the “Company”) as of January 31, 2026, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of January 31, 2026, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended January 31, 2026, of the Company and our report dated March 31, 2026, expressed an unqualified opinion on those financial statements. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ DELOITTE & TOUCHE LLP Minneapolis, Minnesota March 31, 2026 48 Table of Contents TITAN MACHINERY INC. CONSOLIDATED BALANCE SHEETS AS OF JANUARY 31, 2026 AND 2025 (in thousands, except per share data) January 31, 2026 January 31, 2025 Assets Current Assets Cash $ 28,164 $ 35,898 Receivables, net of allowance for expected credit losses 127,031 119,814 Inventories 903,085 1,108,672 Prepaid expenses and other 31,700 28,244 Total current assets 1,089,980 1,292,628 Noncurrent Assets Property and equipment, net of accumulated depreciation 360,983 379,690 Operating lease assets 47,197 27,935 Deferred income taxes 1,327 2,552 Goodwill 65,583 61,246 Intangible assets, net of accumulated amortization 51,233 48,306 Other 625 1,581 Total noncurrent assets 526,948 521,310 Total Assets $ 1,616,928 $ 1,813,938 Liabilities and Stockholders' Equity Current Liabilities Accounts payable $ 35,156 $ 37,166 Floorplan payable 553,754 755,698 Current maturities of long-term debt 21,410 10,920 Current maturities of operating leases 4,084 5,747 Deferred revenue 82,311 91,933 Accrued expenses and other 75,248 59,492 Total current liabilities 771,963 960,956 Long-Term Liabilities Long-term debt, less current maturities 158,565 157,767 Operating lease liabilities 46,050 25,588 Finance lease liabilities 42,140 44,894 Deferred income taxes 10,151 8,818 Other long-term liabilities 8,761 1,838 Total long-term liabilities 265,667 238,905 Commitments and Contingencies (Note 12) Stockholders' Equity Common stock, par value $ 0.00001 per share, 45,000,000 shares authorized; 23,363,865 shares issued and outstanding at January 31, 2026; 23,124,768 shares issued and outstanding at January 31, 2025 — — Additional paid-in-capital 266,905 262,097 Retained earnings 306,140 360,314 Accumulated other comprehensive income (loss) 6,253 ( 8,334 ) Total stockholders' equity 579,298 614,077 Total Liabilities and Stockholders' Equity $ 1,616,928 $ 1,813,938 See Notes to Consolidated Financial Statements 49 Table of Contents TITAN MACHINERY INC. CONSOLIDATED STATEMENTS OF OPERATIONS YEARS ENDED JANUARY 31, 2026, 2025 AND 2024 (in thousands, except per share data) 2026 2025 2024 Revenue Equipment $ 1,774,535 $ 2,050,298 $ 2,145,316 Parts 428,261 428,457 410,841 Service 177,910 180,107 157,315 Rental and other 46,401 43,260 44,973 Total Revenue 2,427,107 2,702,122 2,758,445 Cost of Revenue Equipment 1,645,205 1,912,803 1,864,558 Parts 295,746 294,233 279,921 Service 68,451 66,823 53,981 Rental and other 35,149 32,633 28,631 Total Cost of Revenue 2,044,551 2,306,492 2,227,091 Gross Profit 382,556 395,630 531,354 Operating Expenses 385,237 389,780 362,509 Impairment of Goodwill — 531 — Impairment of Intangible and Long-Lived Assets 2,291 1,311 — Restructuring Costs 1,741 — — (Loss) Income from Operations ( 6,713 ) 4,008 168,845 Other Income (Expense) Interest and other income (expense) 4,389 ( 4,178 ) 3,300 Floorplan interest expense ( 24,109 ) ( 34,710 ) ( 13,802 ) Other interest expense ( 18,974 ) ( 15,105 ) ( 7,303 ) (Loss) Income Before Income Taxes ( 45,407 ) ( 49,985 ) 151,040 Provision for (Benefit from) Income Taxes 8,767 ( 13,074 ) 38,599 Net (Loss) Income $ ( 54,174 ) $ ( 36,911 ) $ 112,441 (Loss) Earnings per Share: Basic $ ( 2.38 ) $ ( 1.63 ) $ 4.93 Diluted $ ( 2.38 ) $ ( 1.63 ) $ 4.93 Weighted Average Common Shares: Basic 22,748 22,606 22,493 Diluted 22,748 22,606 22,499 See Notes to Consolidated Financial Statements 50 Table of Contents TITAN MACHINERY INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME YEARS ENDED JANUARY 31, 2026, 2025 AND 2024 (in thousands) 2026 2025 2024 Net (Loss) Income $ ( 54,174 ) $ ( 36,911 ) $ 112,441 Other Comprehensive (Loss) Income Foreign currency translation adjustments 14,587 ( 10,094 ) 6,779 Comprehensive (Loss) Income $ ( 39,587 ) $ ( 47,005 ) $ 119,220 See Notes to Consolidated Financial Statements 51 Table of Contents TITAN MACHINERY INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY YEARS ENDED JANUARY 31, 2026, 2025 AND 2024 (in thousands) Common Stock Additional Paid-In Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Total Stockholders' Equity Shares Outstanding Amount BALANCE, JANUARY 31, 2023 22,698 $ — $ 256,541 $ 284,784 $ ( 5,019 ) $ 536,306 Common stock issued on grant of restricted stock, net of restricted stock forfeitures and restricted stock withheld for employee withholding tax 150 — ( 1,004 ) — — ( 1,004 ) Stock-based compensation expense — — 3,120 — — 3,120 Net income — — — 112,441 — 112,441 Other comprehensive loss — — — — 6,779 6,779 BALANCE, JANUARY 31, 2024 22,848 — 258,657 397,225 1,760 657,642 Common stock issued on grant of restricted stock, net of restricted stock forfeitures and restricted stock withheld for employee withholding tax 277 — ( 852 ) — — ( 852 ) Stock-based compensation expense — — 4,292 — — 4,292 Net income — — — ( 36,911 ) — ( 36,911 ) Other comprehensive loss — — — — ( 10,094 ) ( 10,094 ) BALANCE, JANUARY 31, 2025 23,125 — 262,097 360,314 ( 8,334 ) 614,077 Common stock issued on grant of restricted stock, net of restricted stock forfeitures and restricted stock withheld for employee withholding tax 239 — ( 760 ) — — ( 760 ) Stock-based compensation expense — — 5,568 — — 5,568 Net loss — — — ( 54,174 ) — ( 54,174 ) Other comprehensive income — — — — 14,587 14,587 BALANCE, JANUARY 31, 2026 23,364 $ — $ 266,905 $ 306,140 $ 6,253 $ 579,298 See Notes to Consolidated Financial Statements 52 Table of Contents TITAN MACHINERY INC. CONSOLIDATED STATEMENTS OF CASH FLOWS YEARS ENDED JANUARY 31, 2026, 2025 AND 2024 (in thousands) 2026 2025 2024 Operating Activities Net (loss) income $ ( 54,174 ) $ ( 36,911 ) $ 112,441 Adjustments to reconcile net income to net cash provided by operating activities Depreciation and amortization 37,565 38,601 31,479 Impairment of goodwill, intangible assets and long lived assets 2,291 1,842 — Deferred income taxes 2,558 ( 15,812 ) 2,910 Stock-based compensation expense 5,568 4,292 3,120 Noncash interest expense 985 1,069 292 Noncash lease expense 5,103 8,067 9,430 Sale-leaseback financing expense — 9,650 — (Gain) loss on extinguishment of debt — ( 3,585 ) — Other, net ( 7,638 ) 3,575 ( 2,811 ) Changes in assets and liabilities, net of effects of acquisitions Receivables ( 499 ) 28,804 ( 48,091 ) Prepaid expenses and other assets 6,169 1,471 615 Inventories 235,731 166,182 ( 476,389 ) Manufacturer floorplan payable ( 99,900 ) ( 82,724 ) 368,111 Deferred revenue ( 10,868 ) ( 25,573 ) ( 15,542 ) Accounts payable, accrued expenses and other and other long-term liabilities 14,561 ( 28,657 ) ( 17,845 ) Net Cash Provided by (Used for) Operating Activities 137,452 70,291 ( 32,280 ) Investing Activities Rental fleet purchases — — ( 10,812 ) Property and equipment purchases (excluding rental fleet) ( 22,357 ) ( 51,845 ) ( 51,549 ) Proceeds from sale of property and equipment 5,856 4,160 7,134 Acquisition consideration, net of cash acquired ( 19,796 ) ( 260 ) ( 107,548 ) Proceeds from sale of business 12,751 — — Other, net 837 199 ( 597 ) Net Cash Used for Investing Activities ( 22,709 ) ( 47,746 ) ( 163,372 ) Financing Activities Net change in non-manufacturer floorplan payable ( 126,817 ) ( 37,694 ) 183,148 Proceeds from long-term debt borrowings 25,337 37,292 19,599 Principal payments on long-term debt and finance leases ( 21,317 ) ( 18,500 ) ( 13,045 ) Payment of debt issuance costs ( 148 ) ( 3,864 ) ( 121 ) Other, net ( 760 ) ( 853 ) ( 1,004 ) Net Cash (Used for) Provided by Financing Activities ( 123,705 ) ( 23,619 ) 188,577 Effect of Exchange Rate Changes on Cash 1,228 ( 1,094 ) 1,228 Net Change in Cash ( 7,734 ) ( 2,168 ) ( 5,847 ) Cash at Beginning of Period 35,898 38,066 43,913 Cash at End of Period $ 28,164 $ 35,898 $ 38,066 Supplemental Disclosures of Cash Flow Information Cash paid during the period Income taxes, net of refunds $ ( 1,849 ) $ 6,564 $ 39,844 Interest $ 42,880 $ 48,289 $ 19,377 Supplemental Disclosures of Noncash Investing and Financing Activities Net change in property and equipment included in long-term debt, leases, accounts payable and accrued liabilities $ ( 1,977 ) $ 35,963 $ 17,911 Finance lease debt to acquire finance asset $ 4,838 $ 65,638 $ 2,471 Net transfer of assets from (to) property and equipment to (from) inventories $ ( 3,352 ) $ ( 6,765 ) $ ( 497 ) Asset transferred from property and equipment to held for sale $ 9,509 $ — $ — See Notes to Consolidated Financial Statements 53 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1 - BUSINESS ACTIVITY AND SIGNIFICANT ACCOUNTING POLICIES Nature of Business Titan Machinery Inc. and its subsidiaries (collectively, “Titan Machinery,” the “Company,” “we,” or us”) are engaged in the retail sale, service and rental of agricultural and construction machinery through its stores in the United States, Europe, and Australia. The Company's United States stores are located in Colorado, Idaho, Iowa, Kansas, Minnesota, Nebraska, North Dakota, South Dakota, Wisconsin and Wyoming, its European stores are located in Bulgaria, Germany, Romania, and Ukraine, and its Australian stores are located in New South Wales, South Australia, and Victoria. Seasonality The agricultural and construction equipment businesses are highly seasonal, which causes the Company's quarterly results and cash flows to fluctuate during the year. The Company's customers generally purchase and rent equipment in preparation for, or in conjunction with, their busy seasons, which for farmers are the planting and harvesting seasons, and for construction customers is dependent on weather seasons in their respective regions, which is typically the second and third quarters of the Company's fiscal year for much of its Construction footprint. The Company's parts and service revenues are also typically highest during its customers' busy seasons, due to the increased use of their equipment during this time, which generates the need for more parts and service work. However, weather conditions impact the timing of our customers' busy times, which may cause the Company's quarterly financial results to differ between fiscal years. In addition, the fourth quarter typically is a significant period for equipment sales in the United States because of our customers’ year-end tax planning considerations, the timing of dealer incentives and the increase in availability of funds from completed harvests and construction projects. Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant accounts, transactions and profits between the consolidated companies have been eliminated in consolidation. The Company's foreign subsidiaries have fiscal years ending on December 31 of each year, consistent with statutory reporting requirements in each of the respective foreign countries. The accounts of the Company's foreign subsidiaries are consolidated as of December 31 of each year. No events or transactions occurred related to these subsidiaries in January 2026 that would have materially affected the consolidated financial position, results of operations or cash flows. Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates, particularly related to realization of inventory, impairment of long-lived assets, goodwill, indefinite-lived intangible assets, collectability of receivables, and income taxes. Concentrations of Credit Risk The Company's sales are to agricultural and construction equipment customers principally in the U.S. states in which it has stores as well as in the European countries and Australian states in which its stores are located. The Company extends credit to its customers in the ordinary course of business and monitors its customers' financial condition to minimize its risks associated with trade receivables; however, the Company does not generally require collateral on trade receivables. The Company's cash balances are maintained in bank deposit accounts, which, at times, are in excess of federally insured limits. Concentrations in Operations The Company currently purchases new equipment, rental equipment and the related parts from a limited number of manufacturers. Although no change in suppliers is anticipated, the occurrence of such a change could cause a possible loss of sales and adversely affect operating results. The Company is the holder of authorized dealerships granted by CNH America, LLC and CNHI International SA (collectively referred to "CNH") whereby it has the right to act as an authorized dealer for the entity's equipment at specified locations. The dealership authorizations and floorplan payable facilities can be canceled by the respective entity if the Company does not observe certain established guidelines and covenants. 54 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) In addition, the Company believes that the following factors related to concentrations in suppliers, and in particular CNH, have a significant impact on its operating results: • CNH's product offerings, reputation and market share; • CNH's product prices and incentive and discount programs; • Supply of inventory from CNH and ability to match demand levels and delivery timelines; • CNH provides floorplan payable financing for the purchase of a substantial portion of the Company's inventory; and • CNH provides a significant percentage of the financing and lease financing used by the Company's customers to purchase CNH equipment from the Company. Revenue Recognition Revenues are recognized when control of the promised goods or services is transferred to the customer, in an amount that reflects the consideration the Company expects to collect in exchange for those goods or services. Shipping and handling costs are recorded as cost of revenue. Sales, value added and other taxes collected from the Company's customers concurrent with the Company's revenue activities are excluded from revenue. Equipment Revenue. Equipment revenue transactions include the sale of new and used agricultural and construction equipment. The Company satisfies its performance obligations and recognizes revenue at a point in time, upon delivery of the product. Once a product is delivered, the customer has physical possession of the asset, can direct the use of the asset, and has the significant risks and rewards of ownership of the asset. Equipment transactions often include both cash and non-cash consideration. Cash consideration is paid directly by the Company's customers or by third-party financial institutions financing the Company's customer transactions. Non-cash consideration is in the form of trade-in equipment assets. The Company assigns a value to trade-in assets by estimating a future selling price, which the Company estimates based on relevant internal and third-party data, less a gross profit amount to be realized at the time the trade-in asset is sold and an estimate of any reconditioning work required to ready the asset for sale. Both cash and non-cash consideration may be received prior to or after the Company's performance obligation is satisfied. Any consideration received prior to the satisfaction of the Company's performance obligation is recognized as deferred revenue. Receivables recognized for amounts not paid at the time our performance obligation is satisfied, including amounts due from third-party financial institutions, generally do not have established payment terms but are collected in relatively short time periods. Parts Revenue. We sell a broad range of maintenance and replacement parts for both equipment that we sell and other types of equipment. The Company satisfies its performance obligation and recognizes revenue at a point in time, upon delivery of the product to the customer. Once a product is delivered, the Company has a present right to payment, the customer has physical possession of the asset, can direct the use of the asset, and has the significant risks and rewards of ownership of the asset. In many cases, customers tender payment at the time of delivery. Balances not paid at the time of delivery are typically due in full within 30 days. Most parts are sold with a thirty-day right of return or exchange. Historically, parts returns have not been material. Parts revenue also includes the retail value of parts inventories consumed during the course of customer repair and maintenance services and services provided under manufacturer warranties. As further described below, we recognize revenue from these activities over time. Service Revenue. We provide repair and maintenance services, including repairs performed under manufacturer warranties, for our customer’s equipment. We recognize service and associated parts revenue of our repair and maintenance services over time as we transfer control of these goods and services over time. The Company recognizes revenue over time in the amount to which we have the right to invoice the customer, as such an amount corresponds to the value of our performance completed to date. Generally, the Company has the right to invoice the customer for labor hours incurred and parts inventories consumed during the performance of the service arrangement. Customer invoicing most often occurs at the conclusion of our repair and maintenance services. Accordingly, we recognize unbilled receivables for the amount of unbilled labor hours incurred and parts inventories consumed under our repair and maintenance arrangements. Upon customer invoicing, unbilled receivables are reclassified to receivables. In many cases, customers tender payment at the completion of our work and the creation of the invoice. Balances not paid at the time of invoicing are typically due in full within 30 days. 55 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Rental and Other Revenue. We rent equipment to our customers on a short-term basis for periods ranging from a few days to a few months. Rental revenue is recognized on a straight-line basis over the period of the related rental agreement. Revenue from rental equipment delivery and pick-up services is recognized when the service is performed. Other revenues primarily consist of fees charged in connection with short-haul equipment delivery and pick-up services, in which revenue is recognized at a point in time when the service is completed, and Global Positioning System ("GPS") signal subscriptions, in which revenue is recognized on a straight-line basis over the subscription period. Manufacturer Incentives and Discounts The Company receives various manufacturer incentives and discounts, which are based on a variety of factors. Discounts and incentives related to the purchase of inventory are recognized as a reduction of inventory prices and recognized as a reduction of cost of revenue when the related inventory is sold. Other incentives, reflecting reimbursement of qualifying expenses, are recognized as a reduction of the related expense when earned. Receivables and Credit Policy Trade accounts receivable due from customers are uncollateralized customer obligations due under normal trade terms requiring payment within 30 to 90 days from the invoice date. Balances unpaid after the due date based on trade terms are considered past due and begin to accrue interest. Payments of trade receivables are allocated to the specific invoices identified on the customer's remittance advice or, if unspecified, are applied to the earliest unpaid invoices. Trade accounts receivable due from manufacturers relate to warranty work, discount programs and incentive programs. Trade accounts receivable due from finance companies primarily consist of contracts in transit with finance companies and balances due from credit card companies. These receivables do not generally have established payment terms but are collected in relatively short time periods. Unbilled receivables primarily represent unbilled labor hours incurred and parts inventories consumed during the performance of service arrangements for our customers at the Company's retail rates. The carrying amount of trade receivables is reduced by a valuation allowance that reflects management's best estimate of the amounts that will not be collected. Management reviews aged receivable balances and estimates the portion, if any, of the balance that will not be collected. Account balances are charged off after all appropriate means of collection have been exhausted and the potential for recovery is considered remote. Inventories New and used equipment are stated at the lower of cost or net realizable value, determined for each piece of equipment (specific identification). Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The majority of our used equipment inventory is acquired through trade-ins from our customers and is initially measured and recognized based on the estimated future selling price of the equipment, less a gross profit amount to be realized when the trade-in asset is sold and an estimate of any reconditioning work required to ready the asset for sale. Subsequent to the initial recognition, all new and used equipment inventories are subject to lower of cost or net realizable value assessments. We estimate net realizable value using internal information, management judgment and third-party data that considers various factors including age and condition of equipment, hours of use and market conditions. Generally, used equipment prices are more volatile to changes in market conditions than prices for new equipment due to incentive programs that may be offered by manufacturers to assist in the sale of new equipment. Equipment inventory values are adjusted whenever the carrying amount exceeds the net realizable value. Parts inventories are valued at the lower of average cost or net realizable value. The Company estimates its lower of average cost or net realizable value adjustments on its parts inventories based on various factors including aging and sales of each type of parts inventory. Work in process represents costs incurred in the reconditioning and preparation for sale of our equipment inventories. 56 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Property and Equipment Property and equipment is carried at cost less accumulated depreciation and amortization. Depreciation and amortization are computed on a straight-line basis over the estimated useful life of each asset, as summarized below: Buildings and leasehold improvements Lesser of 15 - 39 years or lease term Machinery and equipment 3 - 15 years Furniture and fixtures 3 - 10 years Vehicles 5 - 10 years Rental fleet 3 - 10 years Depreciation for income tax reporting purposes is computed using accelerated methods. Goodwill Goodwill is recognized and initially measured as any excess of the acquisition-date consideration transferred in a business combination over the acquisition-date amounts recognized for the net identifiable assets acquired. Goodwill is not amortized but is tested for impairment annually, or more frequently if an event occurs or circumstances change that would more likely than not result in an impairment of goodwill. Impairment testing is performed at the reporting unit level. A reporting unit is defined as an operating segment or one level below an operating segment, referred to as a component. A component of an operating segment is a reporting unit if the component constitutes a business for which discrete financial information is available and segment management regularly reviews the operating results of that component. Evaluating goodwill for impairment involves the determination of the fair value of each reporting unit in which goodwill is recorded using a qualitative or quantitative analysis. If fair value is in excess of the carrying value, impairment is not indicated. If the carrying amount of a reporting unit is higher than its estimated fair value, the excess is recorded as an impairment expense. The Company performs its annual goodwill impairment test as of December 31st of each year. See Note 7, Intangible Assets and Goodwill , for details and results of the Company's impairment testing. Intangible Assets Intangible assets with a finite life consist of customer relationships and covenants not to compete, and are carried at cost less accumulated amortization. The Company amortizes the cost of identified intangible assets on a straight-line basis over the expected period of benefit, which generally range from five to ten years for customer relationships and the contractual term for covenants not to compete, which range from three to five years. Intangible assets with an indefinite life consist of distribution rights with manufacturers. Distribution rights are classified as an indefinite-lived intangible asset because the Company's distribution agreements continue indefinitely by their terms, or are routinely awarded or renewed without substantial cost or material modifications to the underlying agreements. Accordingly, the Company believes that its distribution rights intangible assets will contribute to its cash flows for an indefinite period, therefore the carrying amount of distribution rights is not amortized, but is tested for impairment annually, or more frequently upon the occurrence of certain events or when circumstances indicate that impairment may be present. The impairment test is a single-step assessment that identifies both the existence of impairment and the amount of impairment loss by comparing the estimated fair value of the asset to its carrying value, with any excess carrying value over the fair value being recognized as an impairment loss. The Company performs its annual impairment test as of December 31st of each year. See Note 7, Intangible Assets and Goodwill , for details and results of the Company's impairment testing. Impairment of Long-Lived Assets The Company's long-lived assets consist of its property and equipment. These assets are reviewed for potential impairment when events or circumstances indicate that the carrying value may not be recoverable. Recoverability is measured by comparing the estimated future undiscounted cash flows of such assets to their carrying values. If the estimated undiscounted cash flows exceed the carrying value, the carrying value is considered recoverable and no impairment recognition is required. However, if the sum of the undiscounted cash flows is less than the carrying value of the asset, the estimated fair value of the long-lived asset is compared to its carrying value and any amount by which the carrying value exceeds the fair value is recognized as an impairment charge. 57 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) When reviewing long-lived assets for impairment, we group long-lived assets with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. Long-lived assets deployed and used by individual store locations are reviewed for impairment at the individual store level. Other long-lived assets shared across stores within a segment or shared across segments are reviewed for impairment on a segment or consolidated level as appropriate. See Note 6, Property and Equipment , for details and results of the Company's impairment testing. Construction of Leased Assets and Sale-Leaseback Accounting The Company, from time to time, performs construction projects on its store locations, which are recorded as property and equipment in the consolidated balance sheet during the construction period. Upon completion, these assets are either placed in service, at which point the depreciation of the asset commences, or are part of a sale-leaseback transaction with a third-party buyer/lessor. In certain other situations, the Company enters into build-to-suit construction projects with third-party lessors. Under the applicable lease accounting rules, certain forms of lessee involvement in the construction of the leased asset deem the Company to be the owner of the leased asset during the construction period and requires capitalization of the lessor's total project costs on the consolidated balance sheet with the recognition of a corresponding financing obligation. Upon completion of a project for which the constructed assets are sold to a buyer/lessor or the completion of a capitalized build-to suit construction project, the Company performs a sale-leaseback analysis to determine if the asset and related financing obligation can be derecognized from the consolidated balance sheet. Certain provisions in a number of our lease agreements, primarily provisions regarding repurchase options, are deemed to be continuing involvement in the sold asset which precludes sale recognition. In such cases, the asset remains on the consolidated balance sheet under property and equipment and the proceeds received in the sale-leaseback transaction are recognized as a financing obligation within long-term debt in the consolidated balance sheet. Both the asset and the financing obligation are amortized over the lease term. In instances in which the Company has no continuing involvement in the sold asset, the criteria for sale recognition are met and the asset and any related financing obligation are derecognized from the consolidated balance sheet, and the lease is analyzed for proper accounting treatment as either an operating or finance lease. Derivative Instruments In the normal course of business, the Company is subject to risk from adverse fluctuations in foreign currency exchange rates. The Company may manage its market risk exposures through a program that includes the use of derivative instruments, primarily foreign exchange forward contracts. The Company's objective in managing its exposure to market risk is to minimize the impact on earnings, cash flows and the consolidated balance sheet. The Company does not use derivative instruments for trading or speculative purposes. All outstanding derivative instruments are recognized in the consolidated balance sheet at fair value. The effect on earnings from recognizing the fair value of the derivative instrument depends on its intended use, the hedge designation, and the effectiveness in offsetting the exposure of the underlying hedged item. Changes in fair values of instruments designated to reduce or eliminate fluctuations in the fair values of recognized assets and liabilities and unrecognized firm commitments are reported currently in earnings along with the change in the fair value of the hedged items. Changes in the fair value of derivative instruments that are not designated as hedging instruments or do not qualify for hedge accounting treatment are reported currently in earnings. Income Taxes The Company uses the asset and liability method to account for income taxes. Under this method, deferred tax assets and liabilities are recognized for the expected future tax consequences of differences between the carrying amounts of assets and liabilities and their respective tax bases. Deferred tax assets are reduced by a valuation allowance when it is more likely than not that a portion or all of the deferred tax assets will not be realized. Changes in valuation allowances are included in its provision for income taxes in the period of the change. Deferred tax assets and liabilities are netted by taxing jurisdiction and presented as either a net asset or liability position, as applicable, on the consolidated balance sheets. The Company recognizes the financial statement benefit of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured as the largest amount that has a greater than 50% likelihood of being realized. Changes in the recognition or measurement of such positions are reflected in its provision for income taxes in the period of the change. The Company's policy is to recognize interest and penalties related to income tax matters within its provision for income taxes. 58 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Advertising Costs Costs incurred for producing and distributing advertising are expensed as incurred. Advertising expense amounted to $ 2.5 million, $ 2.2 million and $ 3.1 million for the years ended January 31, 2026, 2025 and 2024, respectively. Stock-Based Compensation The Company accounts for stock-based compensation at the fair value of the related equity instrument over the applicable service or performance period . Comprehensive Income and Foreign Currency Matters For the Company, comprehensive income (loss) represents net income adjusted for foreign currency translation adjustments. For the Company's foreign subsidiaries in which their local currency is their functional currency, assets and liabilities are translated into U.S. dollars at the balance sheet date exchange rate. Income and expenses are translated at average exchange rates for the year. Foreign currency translation adjustments are recorded directly as other comprehensive income (loss), a component of stockholders' equity. For the Company's foreign subsidiaries in which the local currency is not the functional currency, prior to translation into U.S. dollars, amounts must first be remeasured from the local currency into the functional currency. Nonmonetary assets and liabilities are remeasured at historical exchange rates and monetary assets and liabilities are remeasured at the balance sheet date exchange rate. Income and expenses are remeasured at average exchange rates for the year. Foreign currency remeasurement adjustments are included in the statement of operations. The Company recognized, in interest and other income in its consolidated statements of operations, a net foreign currency transaction (loss) gain of $ 3.0 million, $( 4.0 ) million, and $ 1.0 million for the years ended January 31, 2026, 2025, and 2024 respectively. Business Combinations The Company accounts for business combinations by allocating the purchase price amongst the assets acquired, including identifiable intangible assets, and liabilities assumed based on the fair values of the acquired assets and assumed liabilities. The acquisition accounting is finalized during the measurement period, which may not exceed one year from the date of acquisition. During the measurement period the Company's accounting for the business combination transaction may be based on estimates due to various unknown factors present at the date of acquisition. Fair Value Measurements Fair value is defined as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. Three levels of inputs may be used to measure fair value: Level 1—Values derived from unadjusted quoted prices in active markets for identical assets and liabilities. Level 2—Values derived from observable inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets, or quoted prices for identical or similar assets in markets that are not active. Level 3—Values derived from unobservable inputs for which there is little or no market data available, thereby requiring the reporting entity to develop its own assumptions. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. Segment Reporting The Company operates its business in four reportable segments, the Agriculture, Construction, Europe and Australia segments. 59 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Accounting Guidance Not Yet Adopted In November 2024, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The amendments in ASU 2024-03 require public entities to disclose specified information about certain costs and expenses. Additionally, in January 2025, FASB issued ASU 2025-01, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date to clarify the effective date of ASU 2024-03. ASU 2024-03 is effective for annual periods beginning after December 15, 2026 and interim periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the provisions of the amendments and the impact on its future consolidated statements. Recently Adopted Accounting Guidance In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires additional income tax disclosures in the rate reconciliation table for federal, state and foreign income taxes, in addition to more details about the reconciling items in some categories when items meet a certain quantitative threshold. ASU 2023-09 is effective for annual periods beginning after December 15, 2024 with early adoption permitted. On January 31, 2026, the Company adopted ASU No. 2023-09 to our consolidated financial statements on a prospective basis, see Note 14, Income Taxes, for further detail. NOTE 2 - EARNINGS PER SHARE Earnings Per Share ("EPS") The Company uses the two-class method to calculate basic and diluted EPS. Unvested restricted stock awards are considered participating securities because they entitle holders to non-forfeitable rights to dividends during the vesting term. Under the two-class method, earnings of the Company are allocated between common stockholders and these participating securities based on the weighted-average number of shares of common stock and participating securities outstanding during the relevant period. Basic EPS is computed by dividing net income attributable to Titan Machinery Inc. common stockholders by the weighted-average number of shares of common stock outstanding during the relevant period. Diluted EPS is computed by dividing net income attributable to Titan Machinery Inc. common stockholders by the weighted-average number of shares of common stock outstanding after adjusting for potential dilution related to the conversion of all dilutive securities into common stock. All potentially dilutive securities were included in the computation of diluted EPS for years with net income. All anti-dilutive securities were excluded from the computation of diluted EPS. 60 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The following table sets forth the calculation of basic and diluted EPS: Year Ended January 31, 2026 2025 2024 (in thousands, except per share data) Numerator Net (loss) income $ ( 54,174 ) $ ( 36,911 ) $ 112,441 Allocation to participating securities — — ( 1,519 ) Net (loss) income attributable to Titan Machinery Inc. common stockholders $ ( 54,174 ) $ ( 36,911 ) $ 110,922 Denominator Basic weighted-average common shares outstanding 22,748 22,606 22,493 Plus: incremental shares from assumed vesting of restricted stock units — — 6 Diluted weighted-average common shares outstanding 22,748 22,606 22,499 (Loss) Earnings per Share: Basic $ ( 2.38 ) $ ( 1.63 ) $ 4.93 Diluted $ ( 2.38 ) $ ( 1.63 ) $ 4.93 Anti-dilutive shares excluded from diluted weighted-average common shares outstanding: Stock options and restricted stock units 15 12 — 61 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) NOTE 3 - REVENUE The following tables present our revenue disaggregated by revenue source and segment for the years ended January 31, 2026, 2025 and 2024: Year Ended January 31, 2026 Agriculture Construction Europe Australia Total (in thousands) Equipment $ 1,135,501 $ 198,596 $ 303,916 $ 136,522 $ 1,774,535 Parts 286,927 50,752 58,984 31,598 428,261 Service 127,186 26,772 12,379 11,573 177,910 Other 4,160 1,709 1,391 832 8,092 Revenue from contracts with customers 1,553,774 277,829 376,670 180,525 2,388,798 Rental 4,040 33,200 1,069 — 38,309 Total revenues $ 1,557,814 $ 311,029 $ 377,739 $ 180,525 $ 2,427,107 Year Ended January 31, 2025 Agriculture Construction Europe Australia Total (in thousands) Equipment $ 1,462,204 $ 222,503 $ 188,296 $ 177,295 $ 2,050,298 Parts 288,968 48,768 58,712 32,009 428,457 Service 129,455 27,797 11,911 10,944 180,107 Other 4,044 1,892 783 867 7,586 Revenue from contracts with customers 1,884,671 300,960 259,702 221,115 2,666,448 Rental 3,757 30,614 1,303 — 35,674 Total revenues $ 1,888,428 $ 331,574 $ 261,005 $ 221,115 $ 2,702,122 Year Ended January 31, 2024 Agriculture Construction Europe Australia Total (in thousands) Equipment $ 1,624,010 $ 221,140 $ 245,423 $ 54,743 $ 2,145,316 Parts 293,554 51,019 54,356 11,912 410,841 Service 117,087 26,913 10,437 2,878 157,315 Other 5,180 1,998 760 276 8,214 Revenue from contracts with customers 2,039,831 301,070 310,976 69,809 2,721,686 Rental 4,432 31,393 934 — 36,759 Total revenues $ 2,044,263 $ 332,463 $ 311,910 $ 69,809 $ 2,758,445 Deferred revenue from contracts with customers totaled $ 82.1 million and $ 91.7 million as of January 31, 2026 and January 31, 2025, respectively. Our deferred revenue most often increases in the fourth quarter of each fiscal year, due to a higher level of customer down payments or prepayments. During the year ended January 31, 2026, the Company recognized substantially all of the revenue that was included in the deferred revenue balance as of January 31, 2025. The following is a summary of deferred revenue as of January 31, 2026 and January 31, 2025: January 31, 2026 January 31, 2025 (in thousands) Deferred revenue from contracts with customers $ 82,073 $ 91,729 Deferred revenue from rental and other contracts 238 204 $ 82,311 $ 91,933 62 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) No material amount of revenue was recognized during the year ended January 31, 2026 from performance obligations satisfied in previous periods. The Company has elected as a practical expedient to not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of service of one year or less, and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed. The contracts for which the practical expedient has been applied include (i) equipment revenue transactions, which do not have a stated contractual term, but are short-term in nature, and (ii) service revenue transactions, which also do not have a stated contractual term but are generally completed within 30 days and for such contracts we recognize revenue over time at the amount to which we have the right to invoice for services completed to date. NOTE 4 - RECEIVABLES The Company provides an allowance for expected credit losses on its nonrental receivables. To measure the expected credit losses, receivables have been grouped based on shared credit risk characteristics as shown in the table below. Trade and unbilled receivables from contracts with customers have credit risk and the allowance is determined by applying expected credit loss percentages to aging categories based on historical experience that are updated at least annually. The rates may also be adjusted to the extent future events are expected to differ from historical results. Given that the credit terms for these receivables are short-term, changes in credit loss percentages due to future events may not occur on a frequent basis. In addition, the allowance is adjusted based on information obtained by continued monitoring of individual customer credit. Trade receivables from finance companies, other receivables due from manufacturers, and other receivables have not historically resulted in any credit losses to the Company. These receivables are short-term in nature and deemed to be of good credit quality and have no need for any allowance for expected credit losses. Management continually monitors these receivables and should information be obtained that identifies potential credit risk, an adjustment to the allowance would be made if deemed appropriate. Trade and unbilled receivables from rental contracts are primarily in the United States and are specifically excluded from the accounting guidance in determining an allowance for expected losses. The Company provides an allowance for these receivables based on historical experience and using credit information obtained from continued monitoring of customer accounts. January 31, 2026 January 31, 2025 (in thousands) Trade and unbilled receivables from contracts with customers Trade receivables due from customers $ 55,078 $ 49,777 Unbilled receivables 24,179 24,584 Less allowance for expected credit losses ( 2,093 ) ( 1,994 ) 77,164 72,367 Short-term receivables due from finance companies 19,227 16,793 Trade and unbilled receivables from rental contracts Trade receivables 3,987 4,015 Unbilled receivables 928 580 Less allowance for expected credit losses ( 545 ) ( 578 ) 4,370 4,017 Other receivables Due from manufacturers 24,312 25,692 Other 1,958 945 26,270 26,637 Receivables, net of allowance for expected credit losses $ 127,031 $ 119,814 63 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Following is a summary of allowance for credit losses on trade and unbilled accounts receivable by segment: Agriculture Construction Europe Australia Total (in thousands) Balance at January 31, 2024 $ 164 $ 177 $ 2,638 $ 59 $ 3,038 Current expected credit loss provision 641 269 ( 146 ) 12 776 Write-offs charged against allowance ( 292 ) ( 369 ) ( 1,308 ) ( 39 ) ( 2,008 ) Credit loss recoveries collected 92 132 — 3 227 Foreign exchange impact — — ( 52 ) 13 ( 39 ) Balance at January 31, 2025 605 209 1,132 48 1,994 Current expected credit loss provision 213 106 208 73 600 Write-offs charged against allowance ( 309 ) ( 126 ) ( 197 ) ( 29 ) ( 661 ) Credit loss recoveries collected 6 10 — 4 20 Foreign exchange impact — — 134 6 140 Balance at January 31, 2026 $ 515 $ 199 $ 1,277 $ 102 $ 2,093 The following table presents impairment losses on receivables arising from sales contracts with customers and receivables arising from rental contracts: Year Ended January 31, 2026 2025 (in thousands) Impairment losses on: Receivables from sales contracts with customers $ 600 $ 781 Receivables from rental contracts 71 220 $ 671 $ 1,001 NOTE 5 - INVENTORIES January 31, 2026 January 31, 2025 (in thousands) New equipment $ 489,944 $ 611,916 Used equipment 235,217 313,867 Parts and attachments 173,794 177,719 Work in process 4,130 5,170 $ 903,085 $ 1,108,672 64 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) NOTE 6 - PROPERTY AND EQUIPMENT January 31, 2026 January 31, 2025 (in thousands) Rental fleet equipment $ 70,694 $ 76,447 Machinery and equipment 38,542 38,306 Vehicles 115,592 114,402 Furniture and fixtures 30,581 29,840 Land, buildings, and leasehold improvements 289,744 288,761 545,153 547,756 Less accumulated depreciation ( 184,170 ) ( 168,066 ) $ 360,983 $ 379,690 The Company includes depreciation expense related to its rental fleet and its trucking fleet, for hauling equipment, in Cost of Revenue, which was $ 8.8 million, $ 9.5 million, and $ 8.7 million for the years ended January 31, 2026, 2025 and 2024, respectively. All other depreciation expense is included in Operating Expenses, which totaled $ 24.7 million, $ 25.3 million, and $ 21.3 million for the years ended January 31, 2026, 2025 and 2024, respectively. The Company had assets related to sale-leaseback financing obligations and finance leases associated with real estate of store locations, which are included in the land, buildings and leasehold improvements balance above. Such assets had gross carrying values totaling $ 57.2 million and $ 53.0 million, and accumulated amortization balances totaling $ 8.3 million and $ 6.4 million, as of January 31, 2026 and 2025, respectively. In fiscal 2026, the Company reviews its long-lived assets for potential impairment whenever events or circumstances indicate that the carrying value of the long-lived asset (or asset groups) may not be recoverable. The Company performed the impairment analyses for these assets which have a combined carrying value of $141.1 million. The Company determined, based on changing expectations regarding the future use of certain long-lived assets, that the $21.3 million carrying value of these assets may not be fully recoverable. The Company performed an impairment assessment of these asset groups and as a result recognized an impairment charge of $2.1 million, of which $0.9 million was within the Agriculture segment, $0.1 million was within the Construction segment, $0.5 million was within the Europe segment and $0.5 million was within Shared Resources. The impairment charge is reflected in the Impairment of Intangibles and Long-Lived Assets amount in the Consolidated Statements of Operations. In fiscal 2025, the Company performed the impairment analyses for these assets which have a combined carrying value of $51.6 million. The Company determined, based on changing expectations regarding the future use of certain long-lived assets, that the $18.4 million carrying value of these assets may not be fully recoverable. The Company performed an impairment assessment of these asset groups and as a result recognized an impairment charge of $1.3 million, of which $0.2 million was within the Agriculture segment, $0.2 million was within the Construction segment and $0.9 million was within the Europe segment. The impairment charge is reflected in the Impairment of Intangibles and Long-Lived Assets amount in the Consolidated Statements of Operations. The Company did not have similar impairments in fiscal 2024. NOTE 7 - INTANGIBLE ASSETS AND GOODWILL Finite-Lived Intangible Assets The Company's finite-lived intangible assets consist of customer relationships and covenants not to compete. The following is a summary of intangible assets with finite lives as of as of January 31, 2026 and 2025: January 31, 2026 January 31, 2025 Cost Accumulated Amortization Net Cost Accumulated Amortization Net (in thousands) (in thousands) Covenants not to compete $ 805 $ ( 539 ) $ 266 $ 1,125 $ ( 642 ) $ 483 Customer relationships 11,738 ( 3,922 ) 7,816 11,137 ( 2,278 ) 8,859 $ 12,543 $ ( 4,461 ) $ 8,082 $ 12,262 $ ( 2,920 ) $ 9,342 65 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Intangible asset amortization expense was $ 1.8 million, $ 1.9 million and $ 0.7 million for the years ended January 31, 2026, 2025 and 2024, respectively. The covenants not to compete and customer relationships assets for the year ended January 31, 2026 have a weighted-average amortization period of 4.8 years and 6.9 years, respectively. The Company reviews its long-lived assets for potential impairment whenever events or circumstances indicate that the carrying value of the long-lived asset (or asset groups) may not be recoverable. In fiscal 2025, the Company performed an impairment assessment of these asset groups and as a result recognized an impairment charge of $0.1 million with respect to its German subsidiary's assets within the Europe segment, which is reflected in Impairment of Intangible and Long-Lived Assets in the Consolidated Statements of Operations. No impairment charges were recognized in fiscal 2026. As of January 31, 2026, future amortization expense is expected to be as follows: Fiscal years ending January 31, Amount (in thousands) 2027 $ 1,854 2028 1,737 2029 1,650 2030 1,623 2031 1,218 $ 8,082 Indefinite-Lived Intangible Assets The Company's indefinite-lived intangible assets consist of distribution rights assets. Changes in the carrying amount of distribution rights during the years ended January 31, 2026 and 2025 are as follows: Agriculture Construction Australia Total (in thousands) Balance, January 31, 2024 $ 18,154 $ 72 $ 22,842 $ 41,068 Foreign currency translation — — ( 2,104 ) ( 2,104 ) Balance, January 31, 2025 18,154 72 20,738 38,964 Arising from business combinations — — 2,546 2,546 Foreign currency translation — — 1,641 1,641 Balance, January 31, 2026 $ 18,154 $ 72 $ 24,925 $ 43,151 The Company performs at least an annual impairment testing of its indefinite-lived distribution rights intangible assets. Under the impairment test, the fair value of distribution rights intangible assets is estimated based on a multi-period excess earnings model, an income approach. This model allocates future estimated earnings of the store/complex amongst working capital, fixed assets and other intangible assets of the store/complex and any remaining earnings (the "excess earnings") are allocated to the distribution rights intangible assets. The earnings allocated to the distribution rights are then discounted to arrive at the present value of the future estimated excess earnings, which represents the estimated fair value of the distribution rights intangible asset. The discount rate applied reflects the Company's estimate of the weighted-average cost of capital of comparable companies plus an additional risk premium to reflect the additional risk inherent in the distribution right asset. The results of the Company's annual distribution rights impairment test for the year ended January 31, 2026, indicated no impairment. During the years ended January 31, 2026, 2025 and 2024, no impairment charges were recognized in association with indefinite-lived intangible assets. The Company had gross indefinite-lived intangible assets of $ 44.3 million and accumulated impairments of $1.1 million as of January 31, 2026. 66 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Goodwill Changes in the carrying amount of goodwill during the years ended January 31, 2026 and 2025 are as follows: Agriculture Europe Australia Total (in thousands) Balance, January 31, 2024 $ 37,820 $ 474 $ 25,811 $ 64,105 Arising from business combinations — 70 — 70 Foreign currency translation — ( 13 ) ( 2,385 ) ( 2,398 ) Impairment — ( 531 ) — ( 531 ) Balance, January 31, 2025 37,820 — 23,426 61,246 Arising from business combinations 1,400 — 1,112 2,512 Foreign currency translation — — 1,825 1,825 Balance, January 31, 2026 $ 39,220 $ — $ 26,363 $ 65,583 The Company performs at least an annual impairment testing of goodwill as of December 31st of each year. Under the quantitative impairment test, the fair value of the reporting units were estimated using an income and market approach. The income approach is based on discounted cash flow models that use estimates for forecasts of future operating performance for the reporting units. These forecasts include estimates of revenues, margins, operating expenses, capital expenditures, depreciation, amortization, tax and discount rates. Projected future cash flows are then discounted to a present value employing a discount rate that properly accounts for the estimated risk-adjusted weighted-average cost of capital relevant to each reporting unit. The market approach is based on assumptions related to earnings before interest, taxes, depreciation, and amortization multiples or revenue multiples. These estimates are developed as part of our planning process based on assumed growth rates, along with historical data and various internal estimates. Due to ongoing losses, an interim test was completed in the second quarter of fiscal 2025, for our German reporting unit. The results of the Company's impairment test for the German reporting unit indicated that the estimated fair value of the reporting unit was less than the carrying value. The implied fair value of the goodwill associated with the reporting unit approximated zero, thus requiring a full impairment charge of the goodwill carrying value of the reporting unit. As such, a goodwill impairment charge of $0.5 million was recognized, which is included in Impairment of Goodwill in the Consolidated Statement of Operations. The impairment charge arose as the result of lowered expectations of the future financial performance of this reporting unit, which was impacted by the current year operating performance and challenging industry conditions. This removed all remaining goodwill in our Europe segment. The annual impairment testing of the Agriculture and Australia reporting units exceeded their carrying values, therefore there were no impairments in these two reporting units. During the years ended January 31, 2026 and 2025, the Company did not recognize any Goodwill impairment charges. The gross goodwill balance was $ 67.6 million and $ 63.2 million as of January 31, 2026 and 2025, respectively. The accumulated goodwill impairment loss was $ 2.0 million as of January 31, 2026 and 2025 , within the Europe segment. NOTE 8 - FLOORPLAN PAYABLE/LINES OF CREDIT Floorplan payable balances reflect amounts owed to manufacturers for equipment inventory purchases and amounts outstanding under our various floorplan line of credit facilities. In the consolidated statements of cash flows, the Company reports cash flows associated with manufacturer floorplan financing as operating cash flows and cash flows associated with non-manufacturer floorplan financing as financing cash flows. As of January 31, 2026, the Company had floorplan lines of credit totaling $ 1.5 billion, which is primarily comprised of three significant floorplan lines of credit: (i) a $ 875.0 million credit facility with CNH which includes $75.0 million revolver line, (ii) a $500.0 million credit facility with a group of banks (the "Bank Syndicate") which includes $ 110.0 million revolver line, and (iii) a $ 70.0 million credit facility with DLL Finance LLC (“DLL Finance”). 67 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) CNH Floorplan Payable Line of Credit As of January 31, 2026, the Company had an $ 875.0 million credit facility with CNH, of which $ 650.0 million is available for U.S. domestic financing which includes $75.0 million revolver line, $150.0 million is available for Australian financing, and $ 75.0 million is available for European financing. The U.S. domestic financing facility offers financing for new and used equipment inventories. Available borrowings under this credit facility are reduced by outstanding floorplan payable balances and other acquisition-related financing arrangements with CNH. This credit facility charges interest at the prime rate plus or minus an agreed upon percentage, but not less than zero, for the financing of new and used equipment inventories and rental fleet assets. CNH offers periods of reduced interest rates and interest-free periods. Repayment terms vary, but generally payments are made from sales proceeds or rental revenue generated from the related inventories or rental fleet assets. Balances under the outstanding CNH U.S. domestic credit facility are secured by the inventory or rental fleet purchased with the floorplan proceeds. The European financing facility offers financing for new equipment inventories. Available borrowings under this credit facility are reduced by outstanding floorplan payable balances. Amounts outstanding are generally due approximately 75 days after the date of invoice by CNH. Generally, no interest is charged on outstanding balances. However, in certain international markets the Company receives extended terms from CNH similar to what we receive domestically with reduced interest and interest free periods. Amounts outstanding under European financing facility are secured by the inventory purchased with the floorplan proceeds. The Australian financing facility offers financing for new and used equipment inventories. Available borrowings under the credit facility are reduced by outstanding floorplan payable balances. CNH offers periods of reduced interest rates and interest-free periods. Repayment terms vary, but generally payments are made from sales proceeds. The credit facility charges interest at the CNH prime rate plus or minus an agreed upon spread, but not less than zero, for the financing of new and used equipment inventories and rental fleet assets. Amounts outstanding under the Australian financing facility are secured by the inventory purchased with the floorplan proceeds. The CNH credit facility contains financial covenants that impose a maximum level of adjusted debt to tangible net worth of 3.50 :1.00 and minimum fixed charge coverage ratio of 1.10 :1.00. The credit facility also contains various restrictive covenants that require prior consent of CNH if the Company desires to engage in any acquisition of, consolidation or merger with, any other business entity in which the Company is not the surviving company; create subsidiaries; move any collateral outside of the U.S.; or sell, rent, lease or otherwise dispose or transfer any of the collateral, other than in the ordinary course of business. CNH's consent is also required for the acquisition of any CNH dealership. In addition, the CNH credit facility restricts the Company's ability to incur any liens upon any substantial part of the assets. The credit facility automatically renews on August 31st of each year unless earlier terminated by either party. In fiscal year 2025, the Company received various letters from CNH Capital America LLC that waived the Consolidated Fixed Charge Coverage Ratio covenant for the period January 31, 2025 through January 31, 2026. In March 2026, the waiver was extended for the period February 1, 2026 through January 31, 2027. As of January 31, 2026, the Company was in compliance with the adjusted debt to tangible net worth and due to the waiver of the fixed charge coverage ratio, that covenant was not applicable. 68 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Bank Syndicate Credit Agreement - Floorplan Payable and Working Capital Lines of Credit On May 17, 2024, the Company entered into a Fourth Amended and Restated Credit Agreement (the "Bank Syndicate Agreement") with a group of banks, which replaced the previous Third Amended and Restated Credit Agreement (the "Prior Credit Facility") the Company had entered into in April 2020. As of January 31, 2026, the Company had a $500.0 million credit facility, consisting of a $ 390.0 million floorplan facility (the "Floorplan Loan") and a $ 110.0 million operating line (the "Revolver Loan"). The amounts available under the Bank Syndicate Agreement are subject to borrowing base calculations and reduced by outstanding standby letters of credit and certain reserves. The Bank Syndicate Agreement includes a variable interest rate on outstanding balances, charges a 0.25 % non-usage fee on the average monthly unused amount, and requires monthly payments of accrued interest. The default loan type is a Secured Overnight Financing Rate ("SOFR") Rate Loan and only if the Company actively selects a Base Rate Loan would the Base Rate Loan be used. For the U.S. borrowings under the Bank Syndicate Agreement, the Company elects at the time of any advance to choose a Base Rate Loan or a SOFR Rate Loan. The SOFR Rate is based upon one-month, three-month or six-month SOFR plus an adjustment ( 0.11 % for one-month term; 0.26 % for three-month term; and 0.43 % for six-month term), as chosen by the Company, but in no event shall the SOFR Rate be less than zero. The Base Rate is the greater of (a) the prime rate of interest announced, from time to time, by Bank of America; (b) the Federal Funds Rate plus 0.50%, or (c) one-month SOFR plus 1.0%, but in no event shall the Base Rate be less than zero. The effective interest rate on the Company’s borrowings is then calculated by adding an applicable margin to the SOFR Rate or Base Rate. The applicable margin is determined based on excess availability as determined under the Bank Syndicate Agreement and ranges from 0.75 % to 1.25 % for Base Rate Loans and 1.75 % to 2.25 % for SOFR Rate Loans. The applicable margins for the U.S. loans under the Bank Syndicate Agreement are 0.25% higher than the margins under the Prior Credit Facility. For the Australian borrowings under the Bank Syndicate Agreement, the Company elects at the time of the advance to choose an Australian Base Rate Loan or an Australian Bill Rate Loan. The Australian Bill Rate is based on the Bank Bill Swap Reference Bid Rate with an equivalent term of the loan, but in no event shall the Australian Bill Rate be less than zero. The Australian Base Rate is the sum of 1% plus the interbank overnight cash rate calculated by the Reserve Bank of Australia (but in no event shall the Australian cash rate be less than zero). The effective interest rate on the Australian’s borrowings is then calculated by adding an applicable margin to the Australian Bill Rate or the Australian Base Rate. The applicable margin is determined based on excess availability as determined under the Credit Agreement and ranges from 1.75 % to 2.25 %. The Bank Syndicate Agreement does not obligate the Company to maintain financial covenants, except in the event that excess availability (each as defined in the Bank Syndicate Agreement) is less than 15% of the lower of the borrowing base or the size of the maximum credit line, at which point the Company is required to maintain a fixed charge coverage ratio of at least 1.10 :1.00. Based on our excess availability and cash collateral, we were not subject to the fixed charge coverage ratio as of January 31, 2026. The Bank Syndicate Agreement includes various restrictions on the Company and its subsidiaries' activities, including, under certain conditions, limitations on the Company’s ability to make certain cash payments including for cash dividends and stock repurchases, issuance of equity instruments, acquisitions and divestitures, and entering into new indebtedness transactions. As of January 31, 2026, under these provisions of the Bank Syndicate Agreement, the Company did not have any unrestricted dividend availability. The Bank Syndicate Agreement matures on May 17, 2029. The Floorplan Loan is used to finance equipment inventory purchases. Amounts outstanding are recorded as floorplan payables, within current liabilities on the consolidated balance sheets, as the Company intends to repay amounts borrowed within one year. The Revolver Loan is used to finance rental fleet equipment and for general working capital requirements of the Company. Amounts outstanding are typically recorded as long-term debt, within long-term liabilities on the consolidated balance sheets, as the Company does not have the obligation to repay amounts borrowed within one year. As of January 31, 2026 and 2025, the Company did not have a need to utilize the revolver loan as the balance was zero for both periods. 69 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) DLL Finance Floorplan Payable Line of Credit As of January 31, 2026, the Company had a $ 70.0 million credit facility with DLL Finance, of which $ 47.3 million, $ 10.0 million and $12.7 million is available for domestic, European and Australian financing, respectively. The DLL Finance credit facility may be used to purchase or refinance new and used equipment inventory. Amounts outstanding for domestic financing bear interest on outstanding balances of one-month SOFR plus 2.37 % spread. Amounts outstanding for European financing bear interest on outstanding balances of three-month EURIBOR plus an applicable margin of 2.10 % to 2.50 %. Amounts outstanding for Australian financing bear interest on outstanding balances of DLL Base Rate plus 1.59% spread. DLL Finance offers periods of reduced interest rates and interest-free terms for domestic and interest-free terms for Australia financing. The credit facility allows for increase, decrease or termination of the facility by DLL Finance in its sole discretion at any time. The credit facility contains financial covenants that impose a maximum level of adjusted debt to tangible net worth ratio 3.50:1.00 and a minimum fixed charge coverage ratio of 1.10 :1.00. The credit facility also requires the Company to obtain prior consent from DLL Finance if the Company desires to engage in any acquisition meeting certain financial thresholds. The balances outstanding with DLL Finance are secured by the inventory or rental fleet purchased with the floorplan proceeds. Repayment terms vary by individual notes, but generally payments are made from sales proceeds or rental revenue from the related inventories or rental fleet assets. The Company received various letters from DLL Finance LLC that waived the Minimum Consolidated Fixed Charge Coverage Ratio covenant for the period January 31, 2025 through January 31, 2026. As of January 31, 2026, the Company was in compliance with the adjusted debt to tangible net worth ratio and due to the waiver of the fixed charge coverage ratio, that covenant was not applicable. Other Lines of Credit The Company’s other lines of credit include various floorplan and working capital lines of credit primarily offered by non-manufacturer financing entities. Interest charged on outstanding borrowings are generally variable rates, such as EURIBOR and BBSY and include interest margins. Outstanding balances are generally secured by inventory and other current assets. In most cases these lines of credit have a one-year maturity, with an annual review process to extend the maturity date for an additional one-year period. Summary of Outstanding Amounts As of January 31, 2026 and 2025, the Company’s outstanding balance of floorplan payables and lines of credit consisted of the following: January 31, 2026 January 31, 2025 (in thousands) CNH $ 448,942 $ 520,927 Bank Syndicate Agreement 25,545 127,154 DLL Finance 32,280 37,859 Other outstanding balances with manufacturers and non-manufacturers 46,987 69,758 $ 553,754 $ 755,698 As of January 31, 2026, the interest-bearing floorplan payables carried a variable interest rate with a range of 3.83 % to 8.50% compared to a range of 4.06 % to 9.15% as of January 31, 2025. As of January 31, 2026 and 2025, $ 266.8 million and $ 302.4 million, respectively, of outstanding floorplan payables were non-interest bearing. NOTE 9 - ACCRUED EXPENSES & OTHER January 31, 2026 January 31, 2025 (in thousands) Compensation $ 39,425 $ 32,882 Sales, payroll, real estate and value added taxes 8,196 7,175 Insurance 5,787 5,613 Other 21,840 13,822 $ 75,248 $ 59,492 70 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) NOTE 10 - LONG-TERM DEBT The following is a summary of long-term debt: Year Ended January 31, Description Maturity Dates Interest Rates 2026 2025 (in thousands) Mortgage loans, secured Various through May 2039 2.1 % to 7.3 % $ 142,356 $ 129,604 Sale-leaseback financing obligations December 2028 to December 2030 6.1 % to 6.2 % 9,561 9,804 Vehicle loans, secured Various through February 2031 2.1 % to 7.6 % 25,290 27,198 Other October 2026 to September 2028 5.8% to 6.7 % 2,768 2,081 Total debt 179,975 168,687 Less: current maturities ( 21,410 ) ( 10,920 ) Long-term debt, net $ 158,565 $ 157,767 Long-term debt maturities are as follows: Years Ending January 31, Amounts (in thousands) 2027 $ 21,410 2028 17,190 2029 32,889 2030 43,099 2031 30,424 Thereafter 34,963 $ 179,975 NOTE 11 - DERIVATIVE INSTRUMENTS The Company holds derivative instruments for the purpose of minimizing exposure to fluctuations in foreign currency exchange rates to which the Company is exposed in the normal course of its operations. Derivative Instruments Not Designated as Hedging Instruments The Company periodically uses foreign currency forward contracts to hedge the effects of fluctuations in exchange rates on outstanding intercompany loans. The Company does not formally designate and document such derivative instruments as hedging instruments; however, the instruments are an effective economic hedge of the underlying foreign currency exposure. Both the gain or loss on the derivative instrument and the offsetting gain or loss on the underlying intercompany loan are recognized in earnings immediately, thereby eliminating or reducing the impact of foreign currency exchange rate fluctuations on net income. The Company's foreign currency forward contracts generally have one to three-month maturities. The notional value of outstanding foreign currency contracts was $29.6 million and $46.1 million as of January 31, 2026 and 2025, respectively. As of January 31, 2026, and 2025, the fair value of the Company's outstanding derivative instruments was not material. Derivative instruments recognized as assets are recorded in Prepaid expenses and other in the consolidated balance sheets, and derivative instruments recognized as liabilities are recorded in Accrued expenses and other in the consolidated balance sheets. 71 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The following table sets forth the gains and (losses) recognized in income related to the Company’s derivative instruments for the years ended January 31, 2026, 2025 and 2024. Year Ended January 31, 2026 2025 2024 (in thousands) Derivatives Not Designated as Hedging Instruments: Foreign currency contracts (a) $ ( 4,420 ) $ 2,662 $ ( 960 ) Total Derivatives $ ( 4,420 ) $ 2,662 $ ( 960 ) (a) Amounts are included in Interest and other income in the consolidated statements of operations . NOTE 12 - CONTINGENCIES Guarantees The Company has provided residual value guarantees to CNH Capital in connection with certain customer leasing arrangements with CNH Capital. The Company, as guarantor, may be required to provide payment to CNH Capital at the termination of the lease agreement if the customer fails to exercise the purchase option under the leasing agreement and the proceeds CNH Capital receives upon disposition of the leased asset are less than the purchase option price as stipulated in the lease agreement. As of January 31, 2026, the maximum amount of residual value guarantees was approximately $ 27.0 million and the lease agreements have termination dates ranging from 2026 to 2032. As of January 31, 2026, the Company has recognized a liability of approximately $ 6.2 million based on its estimates of the likelihood and amount of residual value guarantees that will become payable at the termination dates of the underlying leasing agreements discounted at a rate of interest to reflect the risk inherent in the liability. As of January 31, 2026, the Company has recorded a current liability, recognized in Accrued expenses and other in the consolidated balance sheets, of $ 0.1 million, and a long-term liability, recognized in Other long-term liabilities in the consolidated balance sheets, of $ 6.1 million. As of January 31, 2026, the Company had $ 2.9 million of guarantees on customer financing with CNH Capital. In the event that the customer defaulted on the payments owed to CNH Capital, the Company as the guarantor would be required to make those payments and any accelerated indebtedness to CNH Capital. Upon such payment, the Company would be entitled to enforce normal creditor rights against the customer including collection action for monetary damages or re-possession of the collateral if CNH Capital has a perfected security interest. No liabilities associated with these guarantees are included in the consolidated balance sheets as of January 31, 2026 as the Company deems the probability of being required to make such payments to be remote. Litigation The Company is engaged in proceedings incidental to the normal course of business. Due to their nature, such legal proceedings involve inherent uncertainties, including but not limited to, court rulings, negotiations between affected parties and governmental intervention. Based upon the information available to the Company and discussions with legal counsel, it is the Company's opinion that the outcome of the various legal actions and claims that are incidental to its business will not have a material impact on the financial position, results of operations or cash flows. Such matters, however, are subject to many uncertainties, and the outcome of any matter is not predictable with assurance. The Company has been named a co-defendant in a court case filed in Colorado district court arising out of an accident that occurred during the transportation of a piece of Titan Machinery owned equipment by an independent third-party contractor motor carrier. A reasonable estimate of the possible loss or range of loss cannot be made at this time. Management believes the range of reasonable possible losses, net of insurance recoveries, will not have a material effect on our results of operations or financial condition. Insurance The Company has insurance policies with varying deductibility levels for property and casualty losses and is insured for losses in excess of these deductibles on a per claim and aggregate basis. The Company is primarily self-insured for health care claims for eligible participating employees. The Company has stop-loss coverage to limit its exposure to significant claims on a per claim and annual aggregate basis. The Company determines its liabilities for claims, including incurred but not reported losses, based on all relevant information, including actuarial estimates of claim liabilities. 72 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Other Matters The Company is the lessee under many real estate leases, in which it agrees to indemnify the lessor from certain liabilities arising as a result of the use of the leased premises, including environmental liabilities. Additionally, from time to time, the Company enters into agreements with third parties in connection with the sale of assets in which it agrees to indemnify the purchaser from certain liabilities or costs arising in connection with the assets. Also, in the ordinary course of business in connection with purchases or sales of goods and services, the Company enters into agreements that may contain indemnification provisions. In the event that an indemnification claim is asserted, the Company's liability would be limited by the terms of the applicable agreement. See additional information on operating lease commitments in Note 13, Leases . NOTE 13 - LEASES As Lessee The Company, as lessee, leases certain of its dealership locations, office space, equipment and vehicles under operating and financing classified leasing arrangements. The Company has elected to not record leases with a lease term at commencement of 12 months or less on the consolidated balance sheet; such leases are expensed on a straight-line basis over the lease term. Many real estate lease agreements require the Company to pay the real estate taxes on the properties during the lease term and require that the Company maintains property insurance on each of the leased premises. Such payments are deemed to be variable lease payments, as the amounts may change during the term of the lease. Certain leases include renewal options that can extend the lease term for periods of one to ten years. Most real estate leases grant the Company a right of first refusal or other options to purchase the real estate, generally at fair market value, either during the lease term or at its conclusion. In most cases, the Company has not included these renewal and purchase options within the measurement of the right-of-use lease asset and lease liability. Most often the Company cannot readily determine the interest rate implicit in the lease and thus applies its incremental borrowing rate to capitalize the right-of-use asset and lease liability. We estimate our incremental borrowing rate by incorporating considerations of lease term, asset class and lease currency and geographical market. Our lease agreements do not contain any material non-lease components, residual value guarantees or material restrictive covenants. The Company subleases a small number of real estate assets to third parties, primarily dealership locations for which we have ceased operations. All sublease arrangements are classified as operating leases. The components of lease expense were as follows: Year Ended January 31, Classification 2026 2025 2024 (in thousands) Finance lease cost: Amortization of leased assets Operating expenses $ 2,214 $ 1,804 $ 679 Interest on lease liabilities Other interest expense 3,699 2,419 172 Operating lease cost Operating expenses and rental and other cost of revenue 5,103 8,067 13,356 Variable lease cost Operating expenses 1,864 1,864 1,885 Sublease income Interest and other income ( 360 ) ( 570 ) ( 2,395 ) $ 12,520 $ 13,584 $ 13,697 73 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Right-of-use lease assets and lease liabilities consist of the following: Classification January 31, 2026 January 31, 2025 (in thousands) Assets Operating lease assets Operating lease assets $ 47,197 $ 27,935 Financing lease assets (a) Property and equipment, net of accumulated depreciation 46,869 44,233 Total leased assets $ 94,066 $ 72,168 Liabilities Current Operating Current operating lease liabilities $ 4,084 $ 5,747 Financing Accrued expenses and other 7,166 1,684 Noncurrent Operating Operating lease liabilities 46,050 25,588 Financing Finance lease liabilities 42,140 44,894 Total lease liabilities $ 99,440 $ 77,913 (a) Finance lease assets are recorded net of accumulated amortization of $ 3.6 million and $ 2.0 million as of January 31, 2026 and 2025, respectively. Maturities of lease liabilities as of January 31, 2026 are as follows: Operating Finance Leases Leases Total Fiscal Year Ending January 31, (in thousands) 2027 $ 7,357 $ 10,377 $ 17,734 2028 6,657 9,316 15,973 2029 6,284 23,963 30,247 2030 6,003 9,206 15,209 2031 5,661 3,703 9,364 Thereafter 46,966 1,784 48,750 Total lease payments 78,928 58,349 137,277 Less: Interest 28,794 9,043 37,837 Present value of lease liabilities $ 50,134 $ 49,306 $ 99,440 The weighted-average lease term and discount rate as of January 31, 2026 and 2025 are as follows: January 31, 2026 January 31, 2025 Weighted-average remaining lease term (years): Operating leases 12.5 7.8 Financing leases 2.5 3.5 Weighted-average discount rate: Operating leases 7.7 % 6.7 % Financing leases 7.9 % 7.8 % 74 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Other lease information is as follows: Year Ended January 31, 2026 2025 2024 (in thousands) Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 4,992 $ 8,899 $ 12,561 Operating cash flow from finance leases 3,699 2,419 172 Financing cash flows from finance leases 2,049 1,622 596 Operating lease assets obtained in exchange for new operating lease liabilities 9,676 1,893 16,006 Finance lease assets obtained in exchange for new finance lease liabilities 4,838 66,705 113 As Lessor The Company rents equipment to customers, primarily in the Construction segment, on a short-term basis. Our rental arrangements generally do not include minimum, noncancellable periods as the lessee is entitled to cancel the arrangement at any time. Most often, our rental arrangements extend for periods ranging from a few days to a few months. We maintain a fleet of dedicated rental assets within our Construction segment and, within all segments, may also provide short-term rentals of certain equipment inventory assets. Certain rental arrangements may include rent-to-purchase options whereby customers are given a period of time to exercise an option to purchase the related equipment at an established price with any rental payments paid applied to reduce the purchase price. All of the Company's leasing arrangements as lessor are classified as operating leases. Rental revenue is recognized on a straight-line basis over the rental period. Rental revenue includes amounts charged for loss and damage insurance on rented equipment. In most cases, our rental arrangements include non-lease components, including delivery and pick-up services. The Company accounts for these non-lease components separate from the rental arrangement and recognizes the revenue associated with these components when the service is performed. The Company has elected to exclude from rental revenue all sales, value added and other taxes collected from our customers concurrent with our rental activities. Rental billings most often occur on a monthly basis and may be billed in advance or in arrears, thus creating unbilled rental receivables or deferred rental revenue amounts. The Company manages the residual value risk of its rented assets by (i) monitoring the quality, aging and anticipated retail market value of our rental fleet assets to determine the optimal period to remove an asset from the rental fleet, (ii) maintaining the quality of our assets through on-site parts and service support and (iii) requiring physical damage insurance of our lessee customers. We primarily dispose of our rental assets through the sale of the asset by our retail sales force. Revenue generated from leasing activities is disclosed, by segment, in Note 3, Revenue . The following is the balance of our dedicated rental fleet assets of our Construction segment as of January 31, 2026 and 2025, respectively: January 31, 2026 January 31, 2025 (in thousands) Rental fleet equipment $ 70,694 $ 76,447 Less accumulated depreciation ( 25,020 ) ( 26,327 ) $ 45,674 $ 50,120 75 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) NOTE 14 - INCOME TAXES The components of (loss) income before income taxes for the years ended January 31, 2026, 2025 and 2024 consist of the following: 2026 2025 2024 (in thousands) U.S. $ ( 56,674 ) $ ( 48,981 ) $ 130,438 Foreign 11,267 ( 1,004 ) 20,602 Total $ ( 45,407 ) $ ( 49,985 ) $ 151,040 The provision for (benefit from) income taxes charged to income for the years ended January 31, 2026, 2025 and 2024 consists of the following: 2026 2025 2024 (in thousands) Current Federal $ 2,278 $ 1,127 $ 24,074 State ( 460 ) 93 7,020 Foreign 4,391 1,518 4,595 Total current taxes 6,209 2,738 35,689 Deferred Federal 1,572 ( 11,303 ) 2,280 State 2,561 ( 2,213 ) 266 Foreign ( 1,575 ) ( 2,296 ) 364 Total deferred taxes 2,558 ( 15,812 ) 2,910 Total $ 8,767 $ ( 13,074 ) $ 38,599 76 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The following table reconciles the income tax provision with the amount calculated using the 21.0% U.S. federal statutory rate applied to pretax income, reflecting the adoption of ASU 2023-09 (amounts in thousands): Year Ended January 31, 2026 Amount Percentage U.S. Federal Statutory Tax Rate $ ( 9,536 ) 21.0 % State and Local Income Taxes State and Local Tax (a) ( 3,517 ) 7.7 Changes in Valuation Allowances 4,735 ( 10.4 ) Foreign Tax Effects Luxembourg Tax Rate Differential ( 709 ) 1.6 Changes in Valuation Allowances 5,995 ( 13.2 ) Impairment of Investment ( 4,308 ) 9.5 Other ( 99 ) 0.2 Ukraine Changes in Valuation Allowances ( 616 ) 1.4 Other 8 — Other Foreign Jurisdictions Other 178 ( 0.4 ) Changes in Valuation Allowances 13,112 ( 28.9 ) Nontaxable or Nondeductible Items 364 ( 0.8 ) Changes in Unrecognized Tax Benefits 2,754 ( 6.1 ) Other 406 ( 0.9 ) Effective Tax Rate $ 8,767 ( 19.3 ) % (a) State taxes in Minnesota, Iowa, Nebraska and North Dakota made up the majority (greater than 50 percent) of the tax effect in this category. 77 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The following table provides the disclosures required before adopting ASU 2023-09 and reconciles our effective tax rate with the U.S. Federal tax rate: 2025 2024 U.S. statutory rate 21.0 % 21.0 % Foreign statutory rates 2.0 ( 0.9 ) State taxes on income net of federal tax benefit 4.5 4.4 Valuation allowances 2.4 0.6 Debt forgiveness income - Ukraine ( 5.8 ) — All other, net 2.1 0.5 26.2 % 25.6 % Deferred tax assets and liabilities consist of the following as of January 31, 2026 and 2025: 2026 2025 (in thousands) Deferred tax assets: Right of use lease liability $ 24,266 $ 18,992 Net operating losses 14,188 5,946 Interest 13,966 9,343 Inventory allowances 7,458 6,398 Accrued liabilities and other 8,339 5,821 Stock-based compensation 1,352 1,053 Receivables 474 478 Other 2,754 — Total deferred tax assets 72,797 48,031 Valuation allowances ( 29,867 ) ( 6,267 ) Deferred tax assets, net of valuation allowances $ 42,930 $ 41,764 Deferred tax liabilities: Property and equipment $ ( 15,687 ) $ ( 19,830 ) Right of use lease asset ( 22,622 ) ( 17,401 ) Intangible assets ( 12,685 ) ( 10,799 ) Other ( 760 ) — Total deferred tax liabilities $ ( 51,754 ) $ ( 48,030 ) Net deferred tax asset (liability) $ ( 8,824 ) $ ( 6,266 ) As of January 31, 2026, the Company has recorded $ 77.5 million of net operating loss carryforwards within certain of its domestic and foreign jurisdictions. The net operating loss carryforward within domestic jurisdictions is $17.3 million with unlimited carryforward periods and $15.2 million that expire at various dates between the Company's fiscal years 2035 and 2046. The net operating carryforward within foreign jurisdictions is $ 15.2 million with unlimited carryforward periods and $29.8 million that expire at various dates between the Company's fiscal years 2037 and 2042. During the fiscal year ended January 31, 2026, the Company concluded, based upon all available evidence, it was more likely than not that a valuation allowance for U.S. federal and state deferred tax assets was warranted. In total, the Company recognized a valuation allowance of $17.8 million as of January 31, 2026 on U.S. deferred tax assets. These amounts are recorded as an additional provision for income taxes and negatively impacted the effective tax rate. The recognition of the 78 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) valuation allowance for the Company's U.S. deferred tax assets was based cumulative historical losses that resulted in uncertainty regarding the Company's ability to realize these assets. The valuation allowance may be reversed in future periods if financial performance improves and the realization of U.S. deferred tax assets becomes more likely than not. During the fiscal year ended January 31, 2026, the Company concluded, based upon all available evidence, it was more likely than not that it would have sufficient future taxable income to realize the deferred tax assets of its Ukrainian subsidiary. As a result, the Company released the $0.6 million valuation allowance and recognized a corresponding benefit from income taxes in the consolidated statement of operations for the year ended January 31, 2026. The Company's conclusion regarding the realizability of such deferred tax assets was based on recent profitable operations in Ukraine resulting in a cumulative profit over the three-year period ending January 31, 2026, our projections of future profitability in Ukraine and the unlimited carryforward period of net operating losses in Ukraine. In assessing the Company's other foreign deferred tax assets as of January 31, 2026 and 2025, the Company concluded that a full valuation allowance on the Company's German and Luxembourg subsidiaries continued to be warranted based on the presence of historical losses and the Company’s expected future sources of taxable income. The Company has recorded valuation allowances of $12.1 million and $6.3 million for the international entities as of January 31, 2026 and 2025, respectively. In fiscal 2026, the Company had a $5.7 million increase in valuation allowance primarily due the change in the net operating loss in Luxembourg. As of January 31, 2026, the Company has unrecognized tax benefits of $5.7 million. If recognized, the entire $5.7 million of unrecognized tax benefits would affect the Company's effective tax rate. The Company recognizes interest and penalties accrued related to unrecognized tax benefits in tax expense, during the years ended January 31, 2026 the company recognized $0.1 million of interest in tax expense. For the year ended January 31, 2025, the Company did not have accumulated interest and penalties. The Company had no unrecognized tax benefits as of January 31, 2024. A reconciliation of the beginning and ending balances of unrecognized tax benefits is as follows: Year ended January 31, 2026 2025 (in thousands) Unrecognized tax benefits - February 1 $ 2,995 $ — Gross increases - tax positions in prior period — — Gross decreases - tax positions in prior period — — Gross increases - tax positions in current period 2,703 2,995 Lapse of statute of limitations — — Unrecognized tax benefits - January 31 $ 5,698 $ 2,995 The Company files income tax returns in the U.S. federal jurisdiction and various states and foreign countries. It is no longer subject to income tax examinations by U.S. federal tax authorities for fiscal years ended prior to January 31, 2023 and state tax authorities for fiscal years ended prior to January 31, 2022. Certain foreign jurisdictions are subject to income tax examinations for the calendar year periods ranging between 2019 and 2025, depending on the jurisdiction of the entity. The Company has determined it is indefinitely reinvested in certain foreign jurisdictions. In these jurisdictions, no additional taxes have been recorded as it is not practical to estimate the amount that may be payable if such earnings were repatriated. Additionally, the Company is not indefinitely reinvested in other foreign jurisdictions. There have been no deferred taxes recorded in these jurisdictions. 79 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Cash paid for income taxes, net of refunds is presented in the following table: Year Ended January 31, 2026 (in thousands) U.S Federal $ ( 1,907 ) State: Iowa $ ( 309 ) Nebraska ( 209 ) North Dakota ( 255 ) Other ( 84 ) State Total $ (857) Foreign: Australia 228 Bulgaria ( 100 ) Romania 483 Ukraine 303 Other 1 Foreign Total $ 915 Total Cash Paid for Income Taxes (Net of Refunds) $ ( 1,849 ) NOTE 15 - CAPITAL STRUCTURE The Company's certificate of incorporation provides it with the authority to issue 50,000,000 shares of $ 0.00001 par value stock, consisting of 45,000,000 shares of common stock and 5,000,000 shares classified as undesignated. NOTE 16 - STOCK-BASED COMPENSATION Stock-Based Compensation Plans The Company has one stock-based compensation plan, the Second Amended and Restated Titan Machinery Inc. 2014 Equity Incentive Plan (the "2014 Equity Incentive Plan"), to provide incentive compensation to participants for services that have been or will be performed for continuing as employees or members of the Board of Directors of the Company. Under the 2014 Equity Incentive Plan, which has been approved by the stockholders of the Company, the Company may grant stock-based awards for up to a maximum number of shares of common stock set forth in the 2014 Equity Incentive Plan under specified forms of equity award types. Shares issued for stock-based awards consist of authorized but unissued shares. As of January 31, 2026, the Company had 743,341 shares authorized and available for future equity awards under the 2014 Equity Incentive Plan. Compensation cost arising from stock-based compensation and charged to operations was $ 5.9 million, $ 4.4 million and $ 3.3 million for the years ended January 31, 2026, 2025 and 2024, respectively. The related income tax benefit (net) was $ 1.2 million, $ 1.1 million and $ 1.1 million for the years ended January 31, 2026, 2025 and 2024, respectively. Restricted Stock Awards ("RSAs") The Company grants RSAs as part of its long-term incentive compensation to employees and members of the Board of Directors of the Company. The fair value of these awards is determined based on the closing market price of the Company's 80 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) stock on the date of grant. The RSAs primarily vest over a period of approximately four years for employees and over one year for members of the Board of Directors. The Company recognizes compensation expense ratably over the vesting period of the award. The restricted common stock underlying these awards are deemed issued and outstanding upon grant and carry the same voting and dividend rights of unrestricted outstanding common stock, provided that any dividends paid are subject to a right of forfeiture until the underlying RSA has vested. The following table summarizes RSA activity for the year ended January 31, 2026: Shares Weighted Average Grant Date Fair Value (in thousands) Nonvested at January 31, 2025 493 $ 21.63 Granted 290 18.51 Forfeited ( 194 ) 22.27 Vested ( 10 ) 20.02 Nonvested at January 31, 2026 579 $ 19.88 The weighted-average grant date fair value of RSAs granted was $ 18.51 , $ 18.22 and $ 26.48 during the years ended January 31, 2026, 2025 and 2024, respectively. The total fair value of RSAs vested was $ 3.4 million, $ 3.4 million and $ 3.7 million during the years ended January 31, 2026, 2025 and 2024, respectively. As of January 31, 2026, there was $ 7.4 million of unrecognized compensation cost related to nonvested RSAs that is expected to be recognized over a weighted-average period of 2.1 years. Restricted Stock Units ("RSUs") The Company grants RSUs as part of its long-term incentive compensation to certain employees of the Company in our European operations. The fair value of these awards is determined based on the closing market price of the Company's common stock on the date of grant. The RSUs primarily vest over a period of approximately four years. The Company recognizes compensation expense ratably over the vesting period of the award. The common stock underlying these awards are not deemed issued or outstanding upon grant, and do not carry any voting or dividend rights. The following table summarizes RSU activity for the year ended January 31, 2026: Shares Weighted Average Grant Date Fair Value (in thousands) Nonvested at January 31, 2025 12 $ 22.82 Granted 6 18.51 Vested ( 3 ) 28.24 Nonvested at January 31, 2026 15 $ 20.16 The weighted-average grant date fair value of RSUs granted was $ 18.51 , $ 18.20 , and $ 26.47 for the fiscal years ended January 31, 2026, 2025, and 2024, respectively. As of January 31, 2026, there was $ 0.2 million of unrecognized compensation cost related to nonvested RSUs that is expected to be recognized over a weighted-average period of 2.3 years. Long-Term Cash Incentive Awards The Company grants long-term cash incentive awards as part of its long-term incentive compensation to certain international employees of the Company. The awards vest over a period of approximately four years and entitle the award recipient to a cash payment on the vesting date equal to the number of vested shares multiplied by the stock price of the Company on the date of vesting. These awards are liability-classified share-based payment awards in which fair value of the award is remeasured at each period until the liability is settled. Fair value of these awards is determined based on the closing price of the Company's stock as of the end of each reporting period. Changes in the fair value of the liability are recognized as compensation cost over the requisite service period. The percentage of the fair value that is accrued as compensation cost at the end of each period is equal to the percentage of the requisite service that has been rendered at that date. 81 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The following table summarizes activity for long-term cash incentive awards for the year ended January 31, 2026: Shares Weighted Average Grant Date Fair Value (in thousands) Nonvested at January 31, 2025 48 $ 21.50 Granted 24 18.51 Forfeited ( 1 ) 21.00 Vested ( 15 ) 23.28 Nonvested at January 31, 2026 56 $ 19.68 The weighted-average grant date fair value of long-term cash incentive awards granted was $ 18.51 during the year ended January 31, 2026. As of January 31, 2026, based on the Company's stock price on that day, there was $ 0.4 million of unrecognized compensation cost related to nonvested awards that is expected to be recognized over a weighted-average period of 1.3 years. NOTE 17 - ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The following is a summary of the changes in accumulated other comprehensive income (loss), by component, for the fiscal years ended January 31, 2026, 2025 and 2024: Foreign Currency Translation Adjustment Net Investment Hedging Instruments, Unrealized Gain Total Accumulated Other Comprehensive Income (Loss) (in thousands) Balance, January 31, 2023 $ ( 7,730 ) $ 2,711 $ ( 5,019 ) Total other comprehensive income 6,779 — 6,779 Balance, January 31, 2024 ( 951 ) 2,711 1,760 Total other comprehensive loss ( 10,094 ) — ( 10,094 ) Balance, January 31, 2025 ( 11,045 ) 2,711 ( 8,334 ) Total other comprehensive income 14,587 — 14,587 Balance, January 31, 2026 $ 3,542 $ 2,711 $ 6,253 Income taxes are not provided for foreign currency translation adjustments arising from permanent investments in international subsidiaries. NOTE 18 - EMPLOYEE BENEFIT PLANS The Company has a 401(k) profit-sharing plan ("401(k) Plan") for all U.S. employees at least 19 years of age. The Company matches 50% of the first 8% of the participating employee's contribution. In addition, the Company may make a discretionary contribution to the 401(k) Plan as determined by the Board of Directors, with a maximum amount equal to the amount allowed under applicable IRS regulations. The Company recognized expense for contributions made to the 401(k) Plan totaling $ 8.9 million, $ 8.6 million and $ 7.0 million for the years ended January 31, 2026, 2025 and 2024, respectively. All amounts contributed during these years reflected matching contributions, as no discretionary contributions were made by the Company to the 401(k) Plan. NOTE 19 - BUSINESS COMBINATIONS Fiscal 2026 On May 15, 2025, the Company acquired certain assets of Farmers Implement and Irrigation, Inc. (“Farmers Implement”). This acquired New Holland agriculture dealership consists of one agriculture equipment store in Brookings, South Dakota. This acquisition occurred within the Company’s Agriculture segment. The total consideration transferred for the acquired business was $13.4 million paid in cash, which included the real estate. In connection with the acquisition, the Company acquired from CNH and certain other manufacturers equipment and parts inventory previously owned by Farmers Implement. Upon acquiring such inventories, the Company was offered floorplan financing by the respective manufacturers. In total, the Company acquired inventory and recognized a corresponding financing 82 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) liability of $7.0 million. The recognition of these inventories and the associated financing liabilities are not included as part of the accounting for the business combination. On October 1, 2025, the Company acquired Bellevue Machinery within its Australia segment. This acquired New Holland agriculture dealership complex consists of two locations in the cities of Swan Hill and Warracknabeal, in the State of Victoria. Immediately upon acquisition, these locations were merged into the locations already owned by the Company in the same cities. This acquisition now allows the Company to sell the CaseIH and New Holland brands at six of the Company’s 15 locations in Australia. The total consideration transferred for the acquired business was $6.4 million paid in cash, which included the real estate. These acquisitions are not considered material to the overall consolidated financial statements during the year ended January 31, 2026 and have been included in the Consolidated Financial Statements from the date of the acquisitions. Fiscal 2025 The Company acquired Gose Landtechnik e.K. on March 1, 2024, which consists of one location in Germany and is included in the Europe segment. This acquisition is not considered material to the overall consolidated financial statements during the year ended January 31, 2025 and has been included in the Consolidated Financial Statements from the date of the acquisition. NOTE 20 - FAIR VALUE OF FINANCIAL INSTRUMENTS As of January 31, 2026 and 2025, the fair value of the Company's foreign currency contracts, which are either assets or liabilities measured at fair value on a recurring basis, was not material. These foreign currency contracts were valued using a discounted cash flow analysis, an income approach, utilizing readily observable market data as inputs, which is classified as a Level 2 fair value measurement. The Company also estimated the fair value of long-lived assets to be approximately zero in certain instances when no future cash flows were assumed to be generated from the use of such assets and the expected sales values were deemed to be nominal. All such fair value measurements were based on unobservable inputs and thus are Level 3 fair value inputs. The Company also has financial instruments that are not recorded at fair value in the consolidated balance sheets, including cash, receivables, payables, and long-term debt. The carrying amounts of these financial instruments approximated their fair values as of January 31, 2026 and January 31, 2025. Approximate fair value of these financial instruments was estimated based on Level 2 fair value inputs. The estimated fair value of the Company's Level 2 long-term debt, which is provided for disclosure purposes only, is as follows: January 31, 2026 January 31, 2025 (in thousands) Carrying amount $ 170,414 $ 158,883 Fair value $ 157,764 $ 145,010 NOTE 21 - BUSINESS SEGMENT AND GEOGRAPHIC INFORMATION The Company has four reportable and operating segments: Agriculture, Construction, Europe and Australia. This segmentation aligns with the results of operations presented to the Company's chief operating decision maker ("CODM") in reviewing the Company to make decisions regarding the allocation of resources, to assess the Company's operating performance and to make strategic decisions. The Company identifies the CODM to be the Company's Chief Executive Officer. The Company's segments are determined based on management structure, which is organized based on types of products sold and geographic areas, as described in the following paragraphs. The performance measure used to evaluate segment performance and allocate resources across segments is segment income (loss) before taxes. Corporate unallocated expenses are centrally managed costs and are therefore excluded from this profit measure to provide transparency of our segment operating results. Our CODM considers variances of actual performance to our annual operating plan and periodic forecasts when making decisions. The Company's Agriculture segment sells, services, and rents machinery, and related parts and attachments, for uses ranging from large-scale farming to home and garden use in North America. This segment also includes ancillary sales and services related to agricultural activities and products such as equipment transportation, GPS signal subscriptions and finance and insurance products. 83 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The Company's Construction segment sells, services, and rents machinery, and related parts and attachments, for uses ranging from heavy construction to light industrial machinery use to customers in North America. This segment also includes ancillary sales and services related to construction activities such as equipment transportation, GPS signal subscriptions and finance and insurance products. The Company’s Europe segment sells, services, and rents machinery, and related parts and attachments, for uses ranging from large-scale farming and construction to home and garden use to customers in Eastern Europe and Germany. Similar to the Agriculture segment, this segment also includes ancillary sales and services related to agricultural activities and products such as equipment transportation, GPS signal subscriptions and finance and insurance products. The Company’s Australia segment sells, services, and rents machinery, and related parts and attachments, for uses ranging from large-scale farming and construction to home and garden use to customers in Southeastern Australia. This segment also includes ancillary sales and services related to agricultural activities and products such as equipment transportation, GPS signal subscriptions and finance and insurance products. The Company retains various unallocated income/(expense) items and assets at the general corporate level, which the Company refers to as "Shared Resources" in the table below. Shared Resource assets primarily consist of cash and property and equipment. Revenue between segments is immaterial. Net sales and long-lived assets, by geographic area were as follows: Revenue Year Ended January 31, 2026 2025 2024 (in thousands) United States $ 1,868,843 $ 2,220,002 $ 2,376,726 Australia 180,525 221,115 69,809 Other international countries 377,739 261,005 311,910 $ 2,427,107 $ 2,702,122 $ 2,758,445 Long-lived assets Year Ended January 31, 2026 2025 (in thousands) United States $ 365,986 $ 363,672 Australia 27,833 24,512 Other international countries 14,965 20,323 $ 408,784 $ 408,507 84 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Certain financial information for each of the Company's business segments is set forth below. Year Ended January 31, 2026 (in thousands) Agriculture Construction Europe Australia Total Revenue Equipment $ 1,135,501 $ 198,596 $ 303,916 $ 136,522 $ 1,774,535 Parts 286,927 50,752 58,984 31,598 428,261 Service 127,186 26,772 12,379 11,573 177,910 Rental and other 8,200 34,909 2,460 832 46,401 $ 1,557,814 $ 311,029 $ 377,739 $ 180,525 $ 2,427,107 Cost of Revenue Equipment $ 1,076,555 $ 181,574 $ 263,901 $ 123,175 Parts 193,560 36,281 43,892 22,013 Service 48,834 8,902 6,779 3,936 Rental and other 7,398 25,074 1,670 1,007 Operating expense 239,299 58,041 49,202 30,396 Impairment Charge (1) 941 114 693 — Restructuring Costs (2) — — 1,741 — Floorplan interest expense 15,055 4,372 2,507 1,949 Intercompany loan waiver income (3) — — ( 10,280 ) — Other segment expense (income), net (4) 5,029 4,816 2,447 1,969 Segment (loss) income before taxes $ ( 28,857 ) $ ( 8,145 ) $ 15,187 $ ( 3,920 ) $ (25,735) Shared resources unallocated expense (3) ( 19,672 ) Loss before taxes $ ( 45,407 ) Depreciation and amortization $ 16,977 $ 10,625 $ 3,577 $ 3,451 Total Segment Assets (5) $ 916,988 $ 229,079 $ 214,823 $ 227,659 $ 1,588,549 Shared Resources Assets 28,379 Total Assets $ 1,616,928 Total Segment Capital Expenditures $ 5,544 $ 6,492 $ 2,801 $ 1,781 $ 16,618 Shared Resources Assets Capital Expenditures 5,739 Total Capital Expenditures $ 22,357 (1) Impairment charge related to long-lived assets. (2) Restructuring costs related to Germany divestiture. (3) Europe segment balance includes a waiver of $10.3 million related to intercompany loan, with a corresponding offset recorded in Shared Resources and eliminated in consolidation. (4) Balance consists of other interest income (expense) and foreign currency. (5) Agriculture and Construction cash balances are held at Shared Resources. 85 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Year Ended January 31, 2025 (in thousands) Agriculture Construction Europe Australia Total Revenue Equipment $ 1,462,204 $ 222,503 $ 188,296 $ 177,295 $ 2,050,298 Parts 288,968 48,768 58,712 32,009 428,457 Service 129,455 27,797 11,911 10,944 180,107 Rental and other 7,801 32,506 2,086 867 43,260 $ 1,888,428 $ 331,574 $ 261,005 $ 221,115 $ 2,702,122 Cost of Revenue Equipment $ 1,395,384 $ 197,354 $ 162,581 $ 157,484 Parts 194,917 34,681 43,346 21,289 Service 47,840 8,613 6,446 3,924 Rental and other 7,522 22,624 1,351 1,136 Operating expense 254,858 61,517 42,739 30,363 Impairment Charge (1) 201 168 1,473 — Floorplan interest expense 21,384 5,462 4,159 2,172 Sale-leaseback financing expense 5,139 4,511 — — Other segment expense (income), net (2) 962 3,294 2,804 1,859 Segment (loss) income before taxes $ (39,779) $ (6,650) $ (3,894) $ 2,888 $ (47,435) Shared resources unallocated expense ( 2,550 ) Loss before taxes $ (49,985) Depreciation and amortization $ 14,022 $ 10,518 $ 3,670 $ 3,623 Total Segment Assets (3) $ 1,060,180 $ 252,471 $ 248,282 $ 192,331 $ 1,753,264 Shared Resources Assets 60,674 Total Assets $ 1,813,938 Total Segment Capital Expenditures $ 41,874 $ 10,076 $ 4,100 $ 3,190 $ 59,240 Shared Resources Assets Capital Expenditures ( 7,395 ) Total Capital Expenditures $ 51,845 (1) Impairment charge related to goodwill, intangible and long-lived assets. (2) Balance consists of other interest income (expense) and foreign currency. (3) Agriculture and Construction cash balances are held at Shared Resources. 86 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Year Ended January 31, 2024 (in thousands) Agriculture Construction Europe Australia Total Revenue Equipment $ 1,624,010 $ 221,140 $ 245,423 $ 54,743 $ 2,145,316 Parts 293,554 51,019 54,356 11,912 410,841 Service 117,087 26,913 10,437 2,878 157,315 Rental and other 9,612 33,391 1,694 276 44,973 $ 2,044,263 $ 332,463 $ 311,910 $ 69,809 $ 2,758,445 Cost of Revenue Equipment $ 1,425,414 $ 186,815 $ 204,056 $ 48,273 Parts 197,026 35,850 39,107 7,938 Service 39,930 7,480 5,447 1,124 Rental and other 6,592 20,628 1,085 326 Operating expense 246,514 60,151 42,749 7,147 Floorplan interest expense 8,281 1,816 1,651 406 Other segment expense (income), net (1) ( 564 ) 1,378 1,328 481 Segment income before taxes $ 121,070 $ 18,345 $ 16,487 $ 4,114 $ 160,016 Shared resources unallocated expense ( 8,976 ) Income before taxes $ 151,040 Depreciation and amortization $ 12,244 $ 9,676 $ 3,290 $ 938 Total Segment Assets (2) $ 1,183,367 $ 257,142 $ 280,354 $ 225,421 $ 1,946,284 Shared Resources Assets 45,977 Total Assets $ 1,992,261 Total Segment Capital Expenditures $ 38,734 $ 12,050 $ 6,764 $ 529 $ 58,077 Shared Resources Assets Capital Expenditures 4,284 Total Capital Expenditures $ 62,361 (1) Balance consists of other interest income (expense) and foreign currency. (2) Agriculture and Construction cash balances are held at Shared Resources. 87 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) NOTE 22 - GERMANY LIQUIDATION AND REALIGNMENT COSTS In November 2026, to better align the Company's cost structure and business in certain markets, the Company signed definitive agreements to divest its CNH distribution rights in Germany through two separate asset sale transactions with the existing New Holland dealers in the region. These transactions support CNH’s dual-brand strategy and align with the Company’s ongoing focus to enhance returns on invested capital. Store liquidation and realignment costs for 2026 were as follows: 2026 (in thousands) Operating lease asset impairment (1) $ 209 Employee termination benefits (2) 1,741 Impairment of fixed assets, net of gains on asset disposition (1) 483 Inventory cost adjustments (3) 4,764 $ 7,197 (1) Recognized in Impairment of Intangibles and Long-Lives Assets in the consolidated statement of operations. (2) Recognized in Restructuring Costs in the consolidated statement of operations. (3) Recognized in Cost of Revenue - Equipment and Cost of Revenue - Parts in the consolidated statement of operations. A reconciliation of the beginning and ending exit cost liability balance, which is included in accrued expenses and other in the consolidated balance sheets, as follows: Amount (in thousands) Balance, January 31, 2025 $ — Exit costs incurred and charged to expense Employee termination benefits 1,741 Balance, January 31, 2026 $ 1,741 88 Table of Contents TITAN MACHINERY INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) NOTE 23 - HELD FOR SALE As of January 31, 2026, certain European assets related to the Company's Germany liquidation met the criteria to be classified as held for sale. The Company is working to sell these disposal groups during the year ended January 31, 2027. In addition, the Company has $6.1 million of property and equipment unrelated to the aforementioned disposal groups, which is included in the vehicle and land, building, and leasehold improvements line items of the table below. Assets classified as held for sale are included within prepaid expenses and other on the consolidated balance sheets. The assets which are held for sale related to the aforementioned disposal groups are presented in the following table: January 31, 2026 January 31, 2025 (in thousands) Assets Held For Sale Inventory New equipment $ 1,395 $ — Parts 961 — Total inventories 2,356 — Property and equipment Machinery and equipment 296 — Vehicle 3,206 — Furniture and fixtures 315 — Land, buildings, and leasehold improvements 8,965 3,013 Total property and equipment 12,782 3,013 Total assets held for sale $ 15,138 $ 3,013 89 Table of Contents Schedule II—Valuation and Qualifying Accounts and Reserves Titan Machinery Inc. Classification Beginning Balance Additions Charged to Expenses Deductions for Write-offs, Net of Recoveries Foreign Currency Translation Adjustments Ending Balance (in thousands) Valuation reserve deduction from receivables: Year Ended January 31, 2026 $ 2,572 $ 678 $ ( 757 ) $ 144 $ 2,637 Year Ended January 31, 2025 3,503 1,001 ( 1,890 ) ( 42 ) 2,572 Year Ended January 31, 2024 3,440 928 ( 922 ) 57 3,503 90 Table of Contents ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None.