Grainger (GWW) for industrial and scientific measurement tools.

Thermo Fisher Scientific (TMO), but focused on the sale and precision calibration of test and measurement instruments.

• Calibration Services: Transcat provides accredited calibration, repair, and related services for a wide array of test and measurement instruments across various industries.
• Test and Measurement Instrument Sales: Transcat distributes and sells new and used test and measurement equipment from leading manufacturers to industrial and commercial customers.
• Test and Measurement Instrument Rental: Transcat offers rental solutions for a diverse inventory of test and measurement instruments, providing flexible access to specialized equipment for short-term needs.

Transcat (TRNS) Major Customers

Transcat (TRNS) primarily sells to other companies (B2B) rather than individuals. The company provides calibration services and distributes test and measurement equipment to a diverse range of industries. While Transcat typically does not disclose individual customer names due to the breadth of its client base and the lack of a single customer accounting for a significant portion of its revenue (e.g., 10% or more), it serves a wide array of companies across various sectors.

The major categories of companies Transcat serves include:

• Aerospace & Defense Companies: Providing calibration services and equipment essential for precision in manufacturing, testing, and maintenance within the aviation, space, and defense sectors.
• Life Sciences Companies: Serving pharmaceutical, biotechnology, and medical device manufacturers with critical calibration for regulatory compliance and quality control of their instruments and processes.
• Industrial Manufacturing Companies: Supporting a broad spectrum of manufacturing industries, including automotive, general industrial, and heavy equipment, with calibration and test tools for production, quality assurance, and R&D.
• Electronics & Semiconductor Companies: Supplying equipment and services for research, development, and production of electronic components and devices.
• Utilities & Energy Companies: Assisting power generation, transmission, and alternative energy companies with the calibration of instruments used in operations and maintenance.

Lee D. Rudow, President & CEO

Mr. Rudow joined Transcat in November 2011 as Chief Operating Officer, was appointed President in September 2012, and assumed the role of Chief Executive Officer on July 1, 2013. He is set to retire as CEO in March 2026 and will transition into an advisory role. Prior to joining Transcat, he served as Vice President for SIMCO Electronics, Inc. from 2008 to 2011. From 2006 to 2008, he held the position of President and Chief Executive Officer of Davis Calibration, Inc. and its predecessor, Davis Inotek Corp., from 1996 to 2006. He also served as President of Davis Instruments Corp. from 1986 to 1996. Mr. Rudow has experience working with startups, private equity-funded, and large industrial companies within the industry.

Thomas L. Barbato, Senior Vice President of Finance, Chief Financial Officer and Treasurer

Mr. Barbato currently serves as Transcat's Chief Financial Officer and Treasurer. He brings over 20 years of corporate finance experience in electronics and manufacturing services companies. Previously, he was the Chief Financial Officer of IEC Electronics Corp. and held various positions at Xerox, including Vice President of Finance.

Michael W. West, Chief Operating Officer

Mr. West was promoted to Chief Operating Officer in April 2024. He has been a key executive at Transcat for the past 10 years, demonstrating a deep understanding of the company's history, current state, and future plans. Mr. West has been instrumental in executing service productivity enhancement initiatives, integrating acquired businesses, and leading the rapidly growing pipette and rental businesses.

Kristina Johnston, Principal Accounting Officer

Ms. Johnston was appointed as Transcat's Principal Accounting Officer effective September 10, 2025, having served as the company's controller since June 2025. Prior to joining Transcat, she served as Chief Financial Officer of Vintage Wine Estates, Inc. from March 2022 to December 2025, focusing on public company reporting, finance processes, budgeting, and forecasting. Before that, Ms. Johnston was Vice President, Finance Lead at Constellation Brands, Inc. from 2018 to 2022, and held various accounting and finance leadership roles over 17 years.

James M. Jenkins, J.D., General Counsel and Vice President of Corporate Development

Mr. Jenkins joined Transcat as General Counsel and Vice President of Corporate Development on September 14, 2020. In this role, he leads the company's acquisition strategy to grow both core and ancillary businesses, in addition to his corporate counsel responsibilities. Prior to Transcat, Mr. Jenkins was a partner with Harter Secrest & Emery LLP, where he headed their Securities practice area and served as Partner in Charge of the firm's New York City office. He has represented a wide range of clients in corporate governance, mergers and acquisitions, and general corporate and securities law matters, and served as Transcat's outside general counsel since 2001.

The key risks to Transcat's (TRNS) business are primarily related to its aggressive growth strategy, technological disruption, and operational legal challenges.

1. Acquisition Integration and Associated Debt: Transcat's primary strategic risk is the integration of its business acquisitions. The company has completed several acquisitions in fiscal years 2023 and 2024, with a robust pipeline for future deals. Failure to accurately assess and successfully integrate these acquisitions could lead to lower revenues, unanticipated operating expenses, reduced profitability, and dilution. For instance, the company's credit facility leverage ratio significantly increased from 0.78x in March 2025 to 2.26x by September 2025 to fund these deals, limiting near-term debt capacity for future mergers and acquisitions. This aggressive roll-up strategy has put pressure on the bottom line, with a sharp decline in net income to $1.3 million in Q2 FY2026 due to integration expenses. Additionally, Transcat's profit margins (3.8%) are lower than the previous year (6.6%), and its EBIT declined by 15% over the last year, making debt management more challenging.
2. Disruption from Automation and OEM Technologies: Advances in automation and self-calibrating technologies pose a threat to Transcat's recurring revenue streams. These technological shifts could reduce the demand for outsourced calibration services by allowing customers to perform more in-house calibration, thereby pressuring Transcat's margins, shrinking its addressable market, and potentially constraining long-term earnings growth.
3. Litigation and Legal Liabilities: Transcat faces inherent intermittent legal challenges stemming from its operations, including customer complaints, employee disputes, or contractual disagreements. These legal issues carry the potential for substantial judgments or settlements that could materially affect the company's financial stability and operational focus, especially if claims exceed liability insurance coverage or fall outside policy protections.

The emergence and increasing adoption of smart, self-calibrating, and IoT-enabled instrumentation combined with advanced predictive maintenance systems. As industrial equipment increasingly integrates these capabilities, the demand for traditional, routine manual external calibration services, which constitute a significant portion of Transcat's core business, could gradually decrease or shift in nature. This trend could lead to reduced volume in standard calibration work and compel Transcat to significantly adapt its service offerings, potentially moving towards more complex validation, verification, or specialized support for these advanced, integrated systems.

Transcat (TRNS) operates in two primary market segments: Calibration Services and Distribution of Test and Measurement Instruments.

Calibration Services

The global calibration services market demonstrates significant size and growth. In 2024, its estimated size ranged from approximately USD 6.2 billion to USD 7.77 billion. Projections indicate continued expansion, with the market anticipated to reach between USD 9.2 billion by 2033 and USD 13.26 billion by 2032, exhibiting Compound Annual Growth Rates (CAGRs) ranging from 4.5% to 6.91% during respective forecast periods.

Specifically for North America, Transcat itself estimated the addressable calibration services market at $1.6 billion in a 2021 investor presentation. More recent data indicates the United States calibration services sector is expected to be worth US$2.6 billion by 2031, growing at a CAGR of 4.7% from 2024 to 2031.

Distribution of Test and Measurement Instruments

The global market for test and measurement equipment, which includes the distribution of instruments, was valued between approximately USD 34.11 billion and USD 39.08 billion in 2024. This market is forecasted to grow, with estimates suggesting it will reach between USD 43.95 billion by 2030 and USD 56.42 billion by 2032, with CAGRs ranging from 3.9% to 5.8% over various forecast periods.

Within the broader test and measurement equipment industry, calibration services alone constituted a substantial portion, accounting for 58.1% of the revenue share in 2024.

Expected Drivers of Future Revenue Growth for Transcat (TRNS)

• Strategic Acquisitions: Transcat consistently emphasizes the role of strategic acquisitions in driving both its Service and consolidated revenue growth. Recent acquisitions, such as Martin Calibration and Essco Calibration, have significantly contributed to the company's performance, and management indicates a continued robust acquisition pipeline.
• Organic Growth in Service Segment: The company projects a return to high single-digit organic service revenue growth in the latter half of fiscal year 2026. This growth is bolstered by an expanding geographic presence, specifically in the Midwest and New England, and sustained demand within its core calibration business.
• Expansion of Distribution Segment, particularly Rentals: The Distribution segment has demonstrated strong revenue increases, with a notable contribution from the higher-margin rental channel due to robust demand.
• Investments in Technology and AI: Transcat is strategically investing in artificial intelligence (AI) and data management initiatives. These investments are aimed at enhancing sales, optimizing operations, and improving customer retention, which are expected to contribute to future revenue growth.

Share Repurchases

• Transcat repurchased $3.6 million in shares during fiscal year 2025 to cover employee tax withholding obligations related to share awards.
• In fiscal year 2024, the company repurchased $4.9 million for the same purpose.
• The company's credit facility allows for future share repurchases of up to $10.0 million in any single fiscal year, with an aggregate limit of $25.0 million.

Share Issuance

• The number of shares outstanding increased by 3.27% between fiscal year 2024 and fiscal year 2025.
• As of October 31, 2025, the number of shares outstanding was 9,328,412.
• The acquisition of Martin Calibration in fiscal year 2025 was partially funded by the issuance of stock.

Outbound Investments

• In December 2024 (fiscal year 2025), Transcat acquired Martin Calibration, Inc. for $79 million ($69 million cash, remainder in stock), which was the largest acquisition in the company's history, expanding its geographic presence and capabilities.
• During fiscal year 2025, Transcat also acquired Becnel Rental Tools, LLC for $50 million, enhancing its rental offerings.
• Prior to November 2025, Essco Calibration, a high-end electronics calibration provider, was acquired for approximately $85.6 million, adding $5.6 million in revenue.

Capital Expenditures

• Capital expenditures were $13.2 million in fiscal year 2025 and $13.3 million in fiscal year 2024.
• For fiscal year 2026, expected net capital expenditures are projected to be in the range of $14 million to $16 million.
• The primary focus of these expenditures remains on expanding service capabilities, acquiring rental pool assets, and investing in technology and future growth projects.