Digi 1Q adj. EBITDA EUR194.5M, +14% v/y

Digi International (Nasdaq: DGII) reported adjusted EBITDA of EUR194.5 million for the first quarter of fiscal 2026, representing a 14% year-over-year increase. The company's second fiscal quarter results, which ended on March 31, 2026, showed strong performance across both its IoT Product & Services and IoT Solutions segments. Total revenue for the quarter reached $131 million, up 25% compared to the same period in 2025.

The IoT Product & Services segment generated $94 million in revenue, a 20% increase year-over-year, driven by organic growth and the integration of Jolt and Particle. ARR for this segment reached $57 million at the end of the quarter, up 104% from the prior year. The IoT Solutions segment reported $37 million in revenue, a 39% increase, primarily due to the Jolt acquisition. ARR for this segment was $127 million, a 34% increase from the second fiscal quarter of 2025.

Digi's gross profit margin improved to 64.0%, up 190 basis points year-over-year. Operating margin remained stable at 13.1%, and net income increased by 8% to $11 million. Adjusted net income rose 33% to $24 million, with adjusted net income per diluted share increasing by 29% to $0.62.

The company's cash flow from operations reached $41 million, reflecting strong capital efficiency and supporting its acquisition strategy. Digi's updated guidance for fiscal 2026 includes 25% ARR growth, 20-22% revenue growth, and 23-26% adjusted EBITDA growth compared to fiscal 2025.