Digi International ( (DGII) ) has released its Q3 earnings. Here is a breakdown of the information Digi International presented to its investors.
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Digi International Inc., a prominent player in the Internet of Things (IoT) sector, specializes in providing connectivity products, services, and solutions for creating and managing critical communication infrastructures. The company is known for its secure and reliable offerings that cater to demanding environments.
In its third fiscal quarter of 2025, Digi International reported a revenue of $108 million, marking a 2% increase from the previous year. The company also achieved a record end-of-quarter Annualized Recurring Revenue (ARR) of $126 million, reflecting a 12% growth. Notably, Digi raised its fiscal year 2025 guidance, indicating a positive outlook for the remainder of the year.
Key financial highlights from the quarter include a gross profit margin of 63.5%, a net income of $10 million, and an adjusted EBITDA of $28 million, which represents an 11% increase. The company also successfully reduced its outstanding debt to $40.1 million and reported a cash flow from operations of $24 million. Segment-wise, the IoT Solutions segment saw a revenue increase driven by growth in SmartSense and Ventus, while the IoT Product & Services segment maintained steady revenue with a significant increase in ARR.
Digi International’s management remains optimistic about the future, aiming for $200 million in ARR and Adjusted EBITDA by the end of fiscal 2028. The company plans to focus on strategic acquisitions and maintaining strong demand for its solutions, despite the evolving global geopolitical landscape. With a commitment to delivering high-value solutions and achieving measurable ROI for customers, Digi is well-positioned for continued growth.
Looking ahead, Digi International anticipates a stable revenue outlook for the fourth fiscal quarter of 2025, with projected revenue between $106 million and $110 million. The company expects adjusted EBITDA growth of 7-8% year over year, reflecting improved profitability and enhanced cash flow expectations, while maintaining a net cash positive position by the fiscal year’s end.