Return to Year-Over-Year Revenue Growth
Digi International returned to year-over-year revenue growth in Q3 2025, with annual recurring revenue (ARR) growing double digits for the third consecutive quarter, now representing approximately 30% of trailing 12-month revenues.
Record Adjusted EBITDA Margins
Adjusted EBITDA margins hit a record 25.6%, driven by improved profitability from ARR and favorable product mix.
Debt Reduction and Positive Cash Flow
The company retired $30 million in debt, reducing net debt to $20 million, and is on track to be net cash positive by the end of fiscal 2025. A 9% free cash flow yield underscores the efficiency of their business model.
Strong Demand in Key Segments
Increased demand was noted in the utility, water, mass transit, Edge, and data center segments, including growth in AI-related deployments.