Digi International Q3 revenue beats estimates on increased demand, acquisition contributions
DGII•What drove the quarter
- Organic growth and acquisitions - Revenue growth was driven by increased customer demand and contributions from the Particle and Jolt acquisitions.
- Recurring revenue expansion - Growth in ARR was primarily attributed to acquisitions and a larger subscription base across remote management platforms and support services.
- Operating expense efficiencies - Margin improvement resulted from lower inventory-related costs and operating expenses rising more slowly than revenue.
Outlook raised for fiscal 2026
Digi International raised its fiscal 2026 ARR growth guidance to at least 27%, versus a prior 25%.
The company now estimates fiscal 2026 revenue at $529 million to $533 million, up from a prior range of $520 million to $527 million.
It also expects fiscal 2026 adjusted EBITDA of $146 million to $147.5 million, up from a prior $129 million to $133 million.
Q3 revenue and EPS beat estimates
US IoT solutions provider Digi International said fiscal third-quarter revenue rose 29%, beating analyst expectations, while adjusted EPS for fiscal Q3 rose 47%, also beating analyst expectations.
The company said organic demand and acquisitions were the main drivers of growth.
