Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and (2) has been subject to the filing requirements for the past 90 days:

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a small reporting company.  See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer [   ]                                                                                                                    Accelerated filer [ X ]

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the

Exchange Act).                                                                                                                                      Yes [   ]  No [X ]

The unaudited Condensed Consolidated Financial Statements include the accounts of Hurco Companies, Inc. and its consolidated subsidiaries.  As used in this report, and unless the context indicates otherwise, the terms “we”, “us”, “our” and similar language refer to Hurco Companies, Inc. and its consolidated subsidiaries. We design and produce computerized machine tools, interactive computer control systems and software for sale through our distribution network to the worldwide metal cutting market. We also provide software options, computer control upgrades, accessories and replacement parts for our products, as well as customer service and training support.

The condensed financial information as of JulyJanuary 31, 20082009 and for the three and nine months ended JulyJanuary 31, 20082009 and JulyJanuary 31, 20072008 is unaudited; however, in our opinion, the interim data includes all adjustments, consisting only of normal recurring adjustments, necessary for a fair statementto present fairly our consolidated financial position, results of our results for,operations, changes in shareholders’ equity and our financial positioncash flows at the end of the interim periods.  We suggest that you read these condensed consolidated financial statements in conjunction with the financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended October 31, 2007.2008.

At January 31, 2008, we made a reclassification in the Condensed Consolidated Balance Sheet and Condensed Consolidated Statement of Cash Flows to record investments in auction rate securities as Short-term Investments instead of Cash and Cash Equivalents, as previously reported.  This reclassification did not have any impact on our Condensed Consolidated Statement of Operations, cash provided by operating activities, total current assets, working capital, total assets or shareholders’ equity.  The following is a summary of the effects of this reclassification on our Condensed Consolidated Balance Sheet asAs of October 31, 2007 and the Condensed Consolidated Statement of Cash Flows as of January 31, 2008.

During the second quarter of fiscal 2008, we recorded an unrealized loss of $202,000, net of tax in Accumulated Other Comprehensive Loss reflecting adjustments to our auction rate securities to record whatas we havehad concluded isthere was a temporary decline in estimated fair value. We have deemed this impairment as temporary because the underlying reason for the impairment is primarily related to liquidity, as there has not been a change in credit risk of the investment since acquisition, the severity of the impairment is not significant compared to the total investment balance, and we do not currently expect to sell these investments for less than par value.  The estimated fair value of the auction rate securities.  In the first quarter of fiscal 2009, we sold all of our holdings of auction rate securities as of July 31, 2008 was $6.7 million compared toat par value and reversed our unrealized loss of $202,000, net of tax, in Accumulated Other Comprehensive Loss.  As a result, no gain or stated costloss was recognized in our statement of $7.0 million.  Atoperations for the endthree months ended January 31, 2009, on the sale of the third quarter, these securities had a weighted average tax exempt interestauction rate of approximately 3.6%.securities.

We enter into foreign currency forward exchange contracts periodically to hedge certain forecasted inter-company sales and forecasted inter-company and third party purchases denominated in foreign currencies (the Pound Sterling, Euro and New Taiwan Dollar).  The purpose of these instruments is to mitigate the risk that the U.S. Dollar net cash inflows and outflows resulting from sales and purchases denominated in foreign currencies will be adversely affected by changes in exchange rates.  These forward contracts have been designated as cash flow hedge instruments, and are recorded in the Condensed Consolidated Balance Sheets at fair value in Other CurrentDerivative Assets and Accrued Expenses.Derivative Liabilities.  Gains and losses resulting from changes in the fair value of these hedge contracts are deferred in Accumulated Other Comprehensive Loss and recognized as an adjustment to Cost of Sales in the period that the sale that is the subject of the related hedge contract is recognized, thereby providing an offsetting economic impact against the corresponding change in the U.S. Dollar value of the inter-company sale or purchase being hedged.

At JulyJanuary 31, 2008,2009, we had $3.1$3.3 million of losses,gains, net of tax, related to cash flow hedges deferred in Accumulated Other Comprehensive Loss, net of tax.  Of this amount, $1.6$2.8 million represents unrealized losses,gains, net of tax, related to future cash flow hedge instruments that remain subject to currency fluctuation risk.  These deferred lossesgains will be recorded as an adjustment to Cost of Sales in the periods through July 2009,January 2010, in which the sale that is the subject of the related hedge contract is recognized, as described above.  Net losses on cash flow hedge contracts, which we reclassified from Accumulated Other Comprehensive Loss to Cost of Sales in the quarter ended JulyJanuary 31, 2008,2009, were $978,000$555,000 compared to net losses of $337,000$800,000 for the same period in the prior year.

We also enter into foreign currency forward exchange contracts to protect against the effects of foreign currency fluctuations on receivables and payables denominated in foreign currencies. These derivative instruments are not designated as hedges under Statement of Financial Accounting Standards No. 133, “Accounting Standards for Derivative Instruments and Hedging Activities,” and, as a result, changes in their fair value are reported currently as Other Expense (Income), Net in the Condensed Consolidated Statement of Operations consistent with the transaction gain or loss on the related foreign denominated receivable or payable and non-hedged foreign currency gains and losses.  We recorded net transaction lossesgains of $462,000$24,000 for the quarter ended JulyJanuary 31, 2008,2009, compared to net gainslosses of $17,000$368,000 for the same period in the prior year.

We are exposed to foreign currency exchange risk related to our investment in net assets in foreign countries.   To manage this risk, we entered into a forward contract on November 26, 2007 with a notional amount of €3.0 million.  We have designated this forward contract as a hedge of our net investment in Euro denominated assets.  We have selected the forward method under the guidance of the Derivatives Implementation Group Statement 133 Issue H8, “Foreign Currency Hedges: Measuring the Amount of Ineffectiveness in a Net Investment Hedge”. The forward method requires all changes in the fair value of the forward to be reported as a cumulative translation adjustment in Accumulated Other Comprehensive Loss, net of tax, in the same manner as the underlying hedged net assets. This forward contract matured on November 25, 2008 and we entered into a new forward contract for the same notional amount.  As of JulyJanuary 31, 2008,2009, we had a lossrealized gain of $123,000,$355,000 and an unrealized gain of $28,000, net of tax, recorded as a cumulative translation adjustmentadjustments in Accumulated Other Comprehensive Loss, net of tax, related to thethese forward contract.contracts.

In March 2008, we adopted the Hurco Companies, Inc. 2008 Equity Incentive Plan (the “2008 Plan”), which allows us to grant awards of stock options, Stock Appreciation Rights settled in stock (SARs), restricted shares, performance shares and performance units.  The 2008 Plan replaced the 1997 Stock Option and Incentive Plan (the “1997 Plan”) which expired in March 2007.  The Compensation Committee of the Board of Directors has authority to determine the officers, directors and key employees who will be granted awards; designate the number of shares subject to each award; determine the terms and conditions upon which awards will be granted; and prescribe the form and terms of award agreements.  We have granted stock options under both Plansplans which are currently outstanding.  No stock option may be exercised more than ten years after the date of grant or such shorter period as the Compensation Committee may determine at the date of grant.  The total number of shares of our common stock that may be issued as awards under the 2008 Plan is 750,000.  The market value of a share of our common stock, for purposes of the 2008 Plan, is the closing sale price as reported by the Nasdaq Global Select Market on the date in question or, if not a trading day, on the last preceding trading date.

During the first ninethree months of fiscal 2009, no options to purchase shares were exercised.   During the first three months of fiscal 2008, options to purchase 28,63125,000 shares were exercised under the 1997 Plan, resulting in cash proceeds of approximately $151,000 and an$54,000 with no additional tax benefit of approximately $36,000, compared to 43,200 shares exercised in the prior year period resulting in cash proceeds of $119,000 and an additional tax benefit of approximately $299,000.benefit.

Effective November 1, 2005, we adopted SFAS No. 123(R), “Share Based Payment,” using the modified prospective method, and began applying its provisions to all options granted, as well as, to the nonvested portion of previously granted options outstanding at that date.  Compensation expense is determined at the date of grant using the Black-Scholes valuation model.

During the first ninethree months of both fiscal 2009 and 2008, approximately $478,000$57,000 of stock-based compensation expense was recorded related to grants under the Plans compared to $422,000 for the same period in the prior year.plans.  As of JulyJanuary 31, 2008,2009, there was approximately $286,000$172,000 of total unrecognized stock-based compensation cost that we expect to recognize by the end of fiscal 2009.

The total intrinsic value of stock options exercised during the nine-monththree-month periods ended JulyJanuary 31, 20082009 and 20072008 was approximately $685,000$0 and $1.9 million,$900,000, respectively. The intrinsic value is calculated as the difference between the stock price as of JulyJanuary 31 and the exercise price of the stock option multiplied by the number of shares exercised.

Summarized information about outstanding stock options as of JulyJanuary 31, 2008,2009, that are already vested and those that we expect to vest, as well as stock options that are currently exercisable, is as follows:

Basic and diluted earnings per common share are based on the weighted average number of shares of our common stock outstanding.  Diluted earnings per common share give effect to outstanding stock options using the treasury method.  The dilutive number of shares for the three months ended JulyJanuary 31, 2009 and 2008 was 17,000 and 2007 was 25,000 and 61,000,32,000, respectively.

Accounts receivable are net of allowances for doubtful accounts of $588,000$984,000 as of JulyJanuary 31, 20082009 and $751,000$678,000 as of October 31, 2007.2008.

Inventories, priced at the lower of cost (first-in, first-out method) or market, are summarized below (in thousands):

We operate in a single segment: industrial automation systems. We design and produce interactive computer control systems and software and computerized machine tools for sale through our own distribution network to the worldwide metal-working market. We also provide software options, control upgrades, accessories and replacement parts for our products, as well as customer service and training support.

From time to time, our subsidiaries guarantee third party payment obligations in connection with the sale of certain machines to customers that use lease financing.  As of JulyJanuary 31, 2008,2009, we had 5955 outstanding third party guarantees totaling approximately $1.8$1.7 million. The terms of our subsidiaries’ guarantees are consistent with the underlying customer financing terms. Upon shipment, the customer has the risk of ownership, but does not obtain title until the machine lease is paid in full.  A retention of title clause allows us to recover the machine if the customer defaults on the lease. We believe that the proceeds obtained from liquidation of the machine would cover any payments required by the guarantee.

We provide warranties on our products with respect to defects in material and workmanship. The terms of these warranties are generally one year for machines and shorter periods for service parts.  We recognize a reserve with respect to this obligation at the time of product sale, with subsequent warranty claims recorded against the reserve. The amount of the warranty reserve is determined based on historical trend experience and any known warranty issues that could cause future warranty costs to differ from historical experience. A reconciliation of the changes in our warranty reserve is as follows (in thousands):

We are party to aan unsecured domestic credit agreement that provides us with a $30.0 million unsecured revolving credit facility as well as an agreement for an uncommitted demandand a separate letter of credit facility in the amount of 100.0 million New Taiwan Dollars.  We are also party to a Taiwan revolving credit agreement of 100.0 million New Taiwan Dollars, which is an uncommitted demand credit facility. In the event the Taiwan facility is not available, the Taiwan letter of credit facility from the domestic credit agreement would enable us to provide credit enhancement to a replacement lender in Taiwan. We are also party tohave a £1.0 million revolving credit agreementfacility in the United Kingdom. 

The domestic and U.K. agreementsfacilities mature on December 7, 2012.

Borrowings under the domestic agreementfacility may be used for general corporate purposes and will bear interest at a LIBOR-based rate or an alternate base rate, plus, in each case, plus an applicable margin determined by reference to the ratio of the interest-bearing debt and obligations and the undrawn face amount of all letters of credit outstanding, on a consolidated basis, to consolidated EBITDA.  The domestic agreementfacility contains customary affirmative and negative covenants and events of default for an unsecured commercial bank credit facility, including, among other things, limitations on consolidations, mergers and sales of assets. The financial covenants contained in the domestic agreement are a minimum quarterlyrolling four quarter consolidated net income covenant and a covenant establishing a maximum ratio of consolidated total indebtedness to total indebtedness and net worth.

We accruerecognize accrued interest and penalties related to unrecognized tax benefits as a componentcomponents of our income tax provision.  We believe there is substantial support for taking these tax benefits and therefore have estimated no tax penalties.  As of JulyJanuary 31, 2008, we had approximately $72,000 of accrued interest, which did not include2009, the federal tax benefitgross amount of interest deductions.  accrued and reported in other liabilities was approximately $93,000.

We file U.S. federal and/or state income tax returns as well as tax returns in U.S. federal jurisdiction and various state, local andone or more foreign jurisdictions.  The statute of limitationlimitations will expire between July 2009 and July 2010 with respect to unrecognized tax benefits related to FIN 48.

Hurco Companies, Inc. is an industrial technology company operating in a single segment.  We design and produce computerized machine tools, featuring our proprietary computer control systems and software, for sale through our own distribution network to the worldwide metal cutting market.  We also provide software options, control upgrades, accessories and replacement parts for our products, as well as customer service and training support.

Our strategy is to design and manufacture a comprehensive lineThe primary drivers of computerized machine tools that incorporatesthe sustained growth we experienced until the first quarter of fiscal 2009 resulted from the improved worldwide demand for our proprietary, interactive computer control technology and sell those machine tools on a global basis. We designproducts, the increasing acceptance of our technology to enhance the machine tool user's productivity through ease of operation and higher levels of machine performance (speed, accuracy and surface finish quality). We use an open software architecture that permits our computer control systems and software to be produced using standard PC hardware. We have emphasized a “user-friendly” design that employs both interactive conversational and graphical programming software. Each year since 2002, we have expanded our product offering to meet customer needs, which has led us to design and manufacture more complex machining centers with advanced capabilities.  We utilize a disciplined approach to strategically enter new geographic markets, as appropriate.  Our introduction of new, technologically advanced products, combined with our expansion into new markets, has resulted in our significant growth over the last several years.  In addition to this strong organic growth, our recent performance and current financial strength also provide us with the capability to pursue opportunistic acquisitions that are consistent with our strategic focus to expand our product line and enter new markets.our success in selling and manufacturing outside of the United States.

Our computerized metal cuttingThe market for machine tools are manufacturedis an international market.  We have both significant foreign sales and foreign manufacturing operations.  During fiscal 2008, more than 75% of our revenues were attributable to customers located abroad.  The percentage of revenues attributable to customers located abroad decreased during the first quarter of fiscal 2009 to approximately 66%, due in Taiwanpart to our specifications by our wholly owned subsidiary, Hurco Manufacturing Limited (HML),deterioration of the European and by an affiliated contract manufacturer.Asian markets for machine tool products as well as the effect of a stronger U.S. Dollar when translating foreign sales to U.S. Dollars for financial reporting purposes.  We sell our products through more than 170100 independent agents and distributors in countries throughout North America, Europe and Asia.  We also have our own direct sales and service organizations in Canada, England, France, Germany, Italy, Singapore and China.

Our sales to foreign customers are denominated, and paid,payments by those customers are made in the prevailing currencies—primarily the Euro and Pound Sterling—prevailing in the markets where sold.  Ourcountries in which those customers are located, and our product costs are incurred and paid primarily in the New Taiwan Dollar and the U.S. Dollar.  Changes in currency exchange rates may have a material effect on our operating results and consolidated balance sheets as reported under U.S. Generally Accepted Accounting Principles.  For example, when a foreign currency increases in value relative to the U.S. Dollar, sales made (and expenses incurred) in that currency, when translated to U.S. Dollars for reporting in our financial statements, are higher than would be the case when that currency has a lower value relative to the U.S. Dollar.  In our comparison of period-to-period results, we discuss not only the increases or decreases in those results as reported in our financial statements (which reflect translation to U.S. Dollars at exchange rates prevailing exchange rates)during the period covered by those financial statements), but also the effect that changes in exchange rates had on those results.

Our high levels of foreign manufacturing and sales also subject us to cash flow risks due to fluctuating currency exchange rates.  We seek to mitigate those risks through the use of various derivative instruments – principally foreign currency forward exchange contracts.

Our financial results forWe believe that the third quarterabsence of fiscal 2008 reflect increased revenuesoutstanding debt and operating income comparedour cash position provide us with the capability to weather the corresponding period of the prior year because of strong demand in European markets and targeted expansion into the Asia Pacific region, which offset a marked decrease in demand in the North American region.  The third quarter results also reflect the benefit of a weaker U.S. Dollar when translating foreign sales for financial reporting purposes.current global economic crisis.

The following tables set forth net sales (in thousands) by geographic region and product category for the thirdfirst quarter of 20082009 and 2007:2008:

Unit shipments forSales were down sharply across all regions due to the third quarter increased in Europeaneconomic disruption that has had an adverse effect on all markets around the world.  In addition to declining volume and Asia Pacific markets by 9% and 54%, respectively over the third quarter of fiscal 2007.  The effects of a weaker U.S. Dollar when translating foreign sales into U.S. Dollars for financial reporting purposes had a favorable impact of currency translation, approximately 14% on15% of the year-over-year increasesales decline was attributable to a drop in both the European and Asia Pacific markets. Sales in North America reflected continued market weakness throughout the United States due to customer concerns over unfavorable economic conditions. Unit shipments for the third quarter decreased in North America by 29% compared to the same periodsales of VMX machines in the prior year, but the decrease was partially offset by a more favorableEurope sales mix of larger machines.region.

Sales of computerized machine tools during the thirdfirst quarter of fiscal 2008 increased 19% over2009 decreased 56% from the corresponding period in fiscal 2007.2008. The year-over-year increasedecrease was driven primarily attributableby a deterioration of 32% in overall shipments. The remaining change is due to increased unit shipments in European and Asia Pacific markets and the favorable impact of a weaker U.S. Dollar when translating foreign sales into U.S. Dollars for financial reporting purposes.