Tennant Co. (TNC) used a September 23 small-cap virtual conference to outline its accelerating robotics strategy, projecting autonomous mobile robot revenue of $250 million by 2028 as customers shift from pilot programs to full fleet deployments.
CEO Dave Huml described the clean-floor services market as a roughly $9 billion total addressable market, with about $4 billion in the Americas, $3 billion in EMEA, and the balance in Asia Pacific. Tennant holds an estimated 14% global combined share—roughly 25% in the Americas, 10% in EMEA, and a single-digit presence in Asia Pacific. Even counting the two largest rivals, Nilfisk and Kärcher, the “big three” collectively account for less than half of the market.
Robotics revenue hit $85 million in full-year 2025 and jumped to $57 million in the first half of 2026, up 56% year over year. Tennant guided for $130 million to $145 million in robotics revenue for the full year and plans to launch 10 new robotic products over the next two years. The company also formed TNC Robotics as a dedicated venture in late 2025, partnering with Brain Corp on exclusive navigation software.
On the financial side, Tennant reported a gross margin of 39.5% in the second quarter, up from 38.1% in the first. Gross margin over the trailing twelve months came in at 38.77%. Management set a normalized gross margin target of 41% to 42%, expecting the fourth quarter to exit above the 40% to 41% range. ERP system transition costs were approximately $10 million in the first half, with about $2 million expected as a tail in the third quarter following the system’s November 2025 go-live.
Orders rose 7% in Q2 and are up double digits year to date. Industrial backlog is expected to shrink by roughly $27 million in the second half, bringing total backlog just under $100 million.
Huml noted that the buying conversation around robotics is evolving. “Customers are moving from pilot programs to full fleet deployments, which changes the buying discussion from ‘will it work?’ to ‘how do I ensure ROI?’” he said.
On capital allocation, Tennant outlined an organic top-line growth target of 3% to 5%, annual EBITDA margin expansion of 50 to 100 basis points, and free-cash-flow conversion approaching 100%. The company budgets $20 million to $25 million annually in capital spending and has reserved about $150 million over a three-year horizon for M&A. Debt leverage is targeted to remain between 1x and 2x. R&D spending runs roughly 3.5% of sales.
Tennant repurchased $60 million of stock in the first quarter during a share-price dip. Its dividend has been raised for 33 consecutive years, with a current yield of 1.86%.
Product updates included deliveries of the X16 SWEEP unit, a launch of the X2 ROVR targeting smaller store formats, and Clean 2.0 software featuring SelfPath AI capability. Supply-chain risks around LiDAR sensors, high-definition cameras, and Nvidia chips for 2027–2028 scaling have been mitigated through inventory hedging and supplier management.
