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Mar 29
Transcat Q4 2025 Earnings Report
Transcat reported Q4 results with strong revenue growth driven by its calibration services, despite a decline in net income and operating income.
Key Takeaways
Transcat's Q4 2025 performance showed growth in consolidated and service revenues, but net and operating income declined due to increased expenses from acquisitions and incentives.
Q4 revenue rose to $77.1 million, an 8.8% increase year-over-year.
Service segment revenue grew 11.3%, supported by acquisitions and automation productivity.
Adjusted EBITDA increased 9.1% to $12.7 million.
Net income declined 35.2% to $4.5 million due to higher operating expenses.
Transcat
Transcat
Transcat Revenue by Segment
Revenue by Segment
Service Revenue
CapyFin.comDistribution Revenue
CapyFin.com Forward Guidance
Transcat expects its resilient business model, regulatory-driven demand, and automation strategy to support long-term growth despite economic volatility.
Positive Outlook
- Continued automation expected to improve productivity and margins.
- Strategic acquisitions driving service revenue growth.
- Resilient demand from regulated industries like FDA, FAA, DoD.
- Strong balance sheet with low leverage supports growth.
- Recurring revenue base with Fortune 500 clients.
Challenges Ahead
- Economic volatility may exert pressure on revenue.
- Tariff-related uncertainty poses risks to operations.
- Service organic growth impacted by one less week in FY25.
- Distribution gross margin declined due to sales mix.
- Operating expenses increased from acquisitions and incentives.
Revenue & Expenses
Visualization of income flow from segment revenue to net income