Digi International(NASDAQ) DGII

Digi International Inc. helps businesses connect equipment to the internet. It makes hardware that keeps industrial machines and sensors talking. The company also provides software to monitor these remote systems.

Tools for a Connected World

• IoT Products and Services: Hardware like cellular routers and modules for machine-to-machine communication; represents 72.0% of revenue for the three-month period ended June 30, 2026.
• IoT Solutions: Integrated monitoring systems for tracking sensitive goods and tasks; contributes 28.0% of revenue for the three-month period ended June 30, 2026.
• Remote Management: Software platforms that allow businesses to control their connected devices from anywhere.
• SmartSense: Temperature monitoring sensors used to protect perishable food and medical supplies.

Strategic Growth and Acquisitions

• Acquired Jolt Software in Aug. 2025 to expand its industrial task management offerings.
• Purchased Particle Industries in Jan. 2026 to strengthen its integrated connectivity portfolio.
• Secured a $250 million revolving credit facility in Dec. 2025 to fund growth initiatives.
• Integrated new cloud monitoring technology to increase its base of subscription customers.

What Makes Digi Different?

Digi uses a dual strategy by combining physical hardware with recurring subscription software. This model helps provide critical data for machines while generating steady revenue from monitoring services.

Measuring the Recent Growth

• Revenue reached $139 million in the third quarter of fiscal 2026, up 29% year over year.
• Net income grew to $16 million in the three-month period ended June 30, 2026, up 54% year over year.
• Annualized recurring revenue reached $191 million as of June 30, 2026, up 52% year over year.
• Gross profit margin improved to 64.8% for the quarter ended June 30, 2026, an increase of 130 basis points.

The Business Evolution

Digi has moved from selling simple hardware to providing integrated Internet of Things solutions. Its focus on recurring software revenue helps balance its historical reliance on one-time equipment sales.