Yes, that is distribution. It is not widespread distribution, but it is distribution. When you give the binary to your customer, you are required to offer that customer the corresponding source and accompanying GPL rights to redistribute and modify them both. If a person receives a GPL work without source code (or an offer of source code) and accompanying GPL rights for the work, then a GPL violation has occurred.
Of course, you do not need to offer the source or GPL rights to any other people beyond the actual recipients of your distribution. Your distribution is directed to some set of people; it is to those people your distribution obligations apply. (This is exactly the same as public widespread distribution, but in that case the set of recipients can grow unbounded as new people get the software from you.)
Often, your customer has a business interest in not distributing the source further, so the legal obligation to grant them GPL rights does not present a business hardship for you anyway.
If the "customer" here is actually an employee of the same company as you, and transmitting the software is done as a transaction between agents of the same company (or of two companies with a subsidiary relationship), then distribution has not occurred, since the work never exited the perimeter of the corporation.
The GPLv3 makes two important exceptions, which likely don't apply here (since you use the word "customer"). If either applies, then your distribution (or "conveyance") does not require the normal grant of the GPL rights or source-sharing obligations. Those exceptions are:
- distribution to a contractor for the exclusive purpose of making modifications to the software
- distribution to an execution environment over which you have exclusive absolute control who runs the code exclusively for your benefit (e.g., a cloud services provider like Amazon)
In those cases, you do not need to offer your own work under the terms of the GPL, though you do need to comply with the GPL as it applies to modules that you didn't write.
The full text of this exception is:
You may convey covered works to others for the sole purpose of having them make modifications exclusively for you, or provide you with facilities for running those works, provided that you comply with the terms of this License in conveying all material for which you do not control copyright. Those thus making or running the covered works for you must do so exclusively on your behalf, under your direction and control, on terms that prohibit them from making any copies of your copyrighted material outside their relationship with you.
Conveying under any other circumstances is permitted solely under the conditions stated below.