You need to analyze your libraries - from the main page, hover over each library then click the 3-dot button > select Analyze.
This should force the server to fetch all required codecs as it scans your media.
An additional note - remember transcoding uses about 500MB of tmp space per session that is transcoding. Check Settings > Transcoder > Show Advanced > Transcoder temporary directory.
Ensure this location has adequate space to use for the transcoder. I have this location using an 8 GB ramdisk (tmpfs) which holds ~16 sessions or so.
Potentially related => Conversion failed. A required codec could not be found or failed to install. - A bad update??
