Transcat | 10-Q: FY2026 Q2 Revenue Beats Estimate at USD 82.27 M

Revenue: As of FY2026 Q2, the actual value is USD 82.27 M, beating the estimate of USD 79.51 M.

EPS: As of FY2026 Q2, the actual value is USD 0.14, missing the estimate of USD 0.242.

EBIT: As of FY2026 Q2, the actual value is USD 4.769 M.

Service Segment

• Revenue: $52,836,000 for the second quarter of 2025, up from $44,083,000 in the same period of 2024, representing a 19.9% increase.
• Cost of Revenue: $35,843,000 for the second quarter of 2025, up from $29,492,000 in the same period of 2024.
• Gross Profit: $16,993,000 for the second quarter of 2025, up from $14,591,000 in the same period of 2024, with a gross margin of 32.2%.
• Operating Income: $920,000 for the second quarter of 2025, down from $3,704,000 in the same period of 2024.

Distribution Segment

• Revenue: $29,436,000 for the second quarter of 2025, up from $23,743,000 in the same period of 2024, representing a 24.0% increase.
• Cost of Revenue: $19,667,000 for the second quarter of 2025, up from $17,128,000 in the same period of 2024.
• Gross Profit: $9,769,000 for the second quarter of 2025, up from $6,615,000 in the same period of 2024, with a gross margin of 33.2%.
• Operating Income: $2,585,000 for the second quarter of 2025, up from $31,000 in the same period of 2024.

Cash Flow

• Operating Cash Flow: $16,504,000 for the six months ended September 27, 2025, compared to $15,759,000 for the same period in 2024.
• Investing Activities: Net cash used was -$91,556,000 for the six months ended September 27, 2025, compared to -$7,958,000 for the same period in 2024, primarily due to business acquisitions.
• Financing Activities: Net cash provided was $79,194,000 for the six months ended September 27, 2025, compared to -$3,346,000 for the same period in 2024.

Future Outlook and Strategy

• Core Business Focus: The company expects continued service revenue growth, benefiting from a larger presence in the New England and Midwest markets, and improving Service organic revenue. They anticipate a return to single-digit Service organic revenue growth in the second half of fiscal 2026.
• Acquisitions: Acquisitions remain a cornerstone of the growth strategy, with recent acquisitions of Essco Calibration and Martin Calibration expanding capabilities and geographic reach.
• Financial Projections: The company expects its income tax rate to range between 30% and 32% for the full fiscal year 2026.