# Digi International: ARR Growth and Margin Pressures

> Digi International hits record revenue and ARR targets but faces margin pressures from acquisitions and supply chains.
- Title: Digi International: ARR Growth and Margin Pressures | Shortify
- Summary: Digi International hits record revenue and ARR targets but faces margin pressures from acquisitions and supply chains.
- Keywords: arr, dgii, hardware, iot, Alphastreet - Earnings Decoded. Market Intelligence Delivered
- Source: Alphastreet - Earnings Decoded. Market Intelligence Delivered — https://news.alphastreet.com/digi-international-dgii-arr-acceleration-and-record-revenue-mask-near-term-margin-pressures-and-acquisition-risk
- Author: Newsdesk
- Published: 2026-11-12T19:14:30+00:00
- Read time: 1 min
- Topics: arr, dgii, hardware, iot
## Q4 FY2026 Results
Digi International reported $143 million revenue, a 25% year-over-year increase, and a new quarterly record.
## Full-Year FY2026 Performance
Full-year revenue reached $535 million with 24% year-over-year growth and $197 million ARR on track for $200 million by fiscal 2027.
## IoT Segment Growth
IoT products and services expanded nearly 30% year-over-year with a 320 basis-point margin improvement.
## Acquisition Impact
Pending $130 million acquisition of Disruptive Technologies expected to close by November 30, 2026, targets wireless sensing and European building automation markets.
## Margin Pressures
Supply chain pressures and elevated memory component costs threaten gross margins despite improved operating leverage.
## FY2027 Guidance
Fiscal 2027 guidance calls for 10, 15% revenue growth and at least 15% ARR growth, a deceleration from FY2026’s 24% expansion.
## Key takeaway

Digi International achieved $535 million revenue and $197 million ARR for Q4 FY2026, but near-term margin pressures from Disruptive Technologies integration and supply chain costs threaten profitability.