Digi International ( (DGII) ) has released its Q1 earnings. Here is a breakdown of the information Digi International presented to its investors.
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Digi International Inc., a global leader in Internet of Things (IoT) products and solutions, focuses on providing critical communication infrastructures with high security and reliability. The company recently reported its financial results for the first fiscal quarter of 2025, showing strong performance despite a challenging industrial economy.
The first-quarter results revealed a slight revenue decline to $104 million, down 2% from the previous year, but a significant improvement in profitability with a net income of $10 million compared to a net loss in the prior year. The company reported a gross profit margin increase to 62%, a 440 basis point rise, and an impressive adjusted EBITDA growth of 10%. The Annualized Recurring Revenue (ARR) reached a record $120 million, an 11% increase, underscoring the success of Digi’s focus on IoT solutions that deliver return on investment.
Further financial highlights include a strong cash flow from operations of $30 million, which facilitated a reduction in outstanding debt to $95 million. The IoT Products & Services segment experienced a revenue decrease due to softened demand, but saw a 17% increase in ARR. Meanwhile, the IoT Solutions segment showed a revenue increase driven by recurring revenue growth, leading to a higher gross profit margin.
Looking ahead, Digi International remains optimistic about its future, aiming for ARR and adjusted EBITDA growth to $200 million over the next four years. The company plans to continue its strategic focus on acquisitions and maintaining a strong balance sheet, while navigating macroeconomic uncertainties and remaining adaptable in the expanding IoT market.
