|        |
|--------|
|        |  |  |
|   |   |   |

|                                            |
|--------------------------------------------|
|                                            |  |  |  |  |  |  |
|                                       |   | Digi International Reports Second Fiscal Quarter 2017 Results |   |   |
| Digi Smart SolutionsTM Group Launches |

|                                                     |
|-----------------------------------------------------|
|                                                     |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| GAAP Results from Continuing Operations             |
| (in thousands, except per share data)               |   | Q2 2017 |   | Q2 2016 |   | YTD 2017 |   | YTD 2016 |
| Total Revenue                                       |   | $ | 45,615 |  |   | $ | 50,162 |  |   | $ | 90,790 |  |   | $ | 100,421 |  |
| Gross Profit                                        |   | $ | 21,902 |  |   | $ | 24,742 |  |   | $ | 43,355 |  |   | $ | 49,099 |  |
| Gross Margin                                        |   | 48.0 | % |   | 49.3 | % |   | 47.7 | % |   | 48.9 | % |
| Operating Income                                    |   | $ | 1,512 |  |   | $ | 3,653 |  |   | $ | 3,934 |  |   | $ | 6,942 |  |
| Operating Income as % of Total Revenue              |   | 3.3 | % |   | 7.3 | % |   | 4.3 | % |   | 6.9 | % |
| Income from Continuing Operations                   |   | $ | 1,331 |  |   | $ | 2,226 |  |   | $ | 3,688 |  |   | $ | 5,357 |  |
| Income per Diluted Share from Continuing Operations |   | $ | 0.05 |  |   | $ | 0.09 |  |   | $ | 0.14 |  |   | $ | 0.21 |  |

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|                                                               |
|---------------------------------------------------------------|
|                                                               |  |  |  |  |
|                                                          |   |   |   |   |
| Digi International Reports Second Fiscal Quarter 2017 Results |

|                                                                                                                  |
|------------------------------------------------------------------------------------------------------------------|
|                                                                                                                  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Non-GAAP Results from Continuing Operations*                                                                     |
| (in thousands, except per share data)                                                                            |   | Q2 2017 |   | Q2 2016 |   | YTD 2017 |   | YTD 2016 |
| Adjusted Income from Continuing Operations                                                                       |   | $ | 1,340 |  |   | $ | 2,292 |  |   | $ | 3,593 |  |   | $ | 5,179 |  |
| Adjusted Income per Diluted Share from Continuing Operations                                                     |   | $ | 0.05 |  |   | $ | 0.09 |  |   | $ | 0.13 |  |   | $ | 0.20 |  |
|                                                                                                             |   |   |   |   |   |   |   |   |
| EBITDA from Continuing Operations                                                                                |   | $ | 2,758 |  |   | $ | 4,583 |  |   | $ | 6,755 |  |   | $ | 9,157 |  |
| EBITDA from Continuing Operations as % of Total Revenue                                                          |   | 6.0 | % |   | 9.1 | % |   | 7.4 | % |   | 9.1 | % |
| * Tables with detailed reconciliations to non-GAAP information are provided at the end of this earnings release. |

|                                        |
|----------------------------------------|
|                                        |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Revenue Detail QTD                     |
| (in thousands)                         |   | Q2 2017 |   | Q2 2016 |   | Change |   | % Change |
| Cellular routers and gateways          |   | $ | 11,448 |  |   | $ | 12,910 |  |   | $ | (1,462 | ) |   | (11.3 | ) |
| RF                                     |   | 7,961 |  |   | 7,879 |  |   | 82 |  |   | 1.0 |  |
| Embedded                               |   | 11,712 |  |   | 13,795 |  |   | (2,083 | ) |   | (15.1 | ) |
| Network                                |   | 10,645 |  |   | 14,148 |  |   | (3,503 | ) |   | (24.8 | ) |
| Total product revenue                  |   | 41,766 |  |   | 48,732 |  |   | (6,966 | ) |   | (14.3 | ) |
| Service                                |   | 3,849 |  |   | 1,430 |  |   | 2,419 |  |   | 169.2 |  |
| Total revenue                          |   | $ | 45,615 |  |   | $ | 50,162 |  |   | $ | (4,547 | ) |   | (9.1 | ) |
|                                   |   |   |   |   |   |   |   |   |
| North America, primarily United States |   | $ | 29,711 |  |   | $ | 33,332 |  |   | $ | (3,621 | ) |   | (10.9 | ) |
| Europe, Middle East and Africa         |   | 9,545 |  |   | 10,965 |  |   | (1,420 | ) |   | (13.0 | ) |
| Asia                                   |   | 5,370 |  |   | 5,025 |  |   | 345 |  |   | 6.9 |  |
| Latin America                          |   | 989 |  |   | 840 |  |   | 149 |  |   | 17.7 |  |
| Total revenue                          |   | $ | 45,615 |  |   | $ | 50,162 |  |   | $ | (4,547 | ) |   | (9.1 | ) |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Product revenue decreased by $7.0 million, or 14.3%, in the second fiscal quarter of 2017 compared to the second fiscal quarter of 2016.  All product categories declined, with the exception of RF which was flat with the same quarter a year ago.  Our decline in network product revenue was as expected as our customers decreased their support and maintenance of legacy hardwire network products.  Embedded and cellular product revenue also declined as we had large sales to significant customers in the prior fiscal year. |

|         |                                                                                                                                                                                                                                                                                                                                                                                 |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Service revenue increased by $2.4 million, or 169.2%, in the second fiscal quarter of 2017 compared to the comparable quarter in fiscal 2016.  The increase was driven primarily by the growth of our Digi Smart Solutions business, which includes $1.5 million of incremental revenue from the acquisition of SMART Temps and FreshTemp in the second fiscal quarter of 2017. |

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|                                                               |
|---------------------------------------------------------------|
|                                                               |  |  |  |  |
|                                                          |   |   |   |   |
| Digi International Reports Second Fiscal Quarter 2017 Results |

|                                        |
|----------------------------------------|
|                                        |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Revenue Detail YTD                     |
| (in thousands)                         |   | Q2 2017 |   | Q2 2016 |   | Change |   | % Change |
| Cellular routers and gateways          |   | $ | 25,204 |  |   | $ | 25,070 |  |   | $ | 134 |  |   | 0.5 |  |
| RF                                     |   | 14,535 |  |   | 17,065 |  |   | (2,530 | ) |   | (14.8 | ) |
| Embedded                               |   | 23,553 |  |   | 26,923 |  |   | (3,370 | ) |   | (12.5 | ) |
| Network                                |   | 21,647 |  |   | 27,921 |  |   | (6,274 | ) |   | (22.5 | ) |
| Total hardware product revenue         |   | 84,939 |  |   | 96,979 |  |   | (12,040 | ) |   | (12.4 | ) |
| Service                                |   | 5,851 |  |   | 3,442 |  |   | 2,409 |  |   | 70.0 |  |
| Total revenue                          |   | $ | 90,790 |  |   | $ | 100,421 |  |   | $ | (9,631 | ) |   | (9.6 | ) |
|                                   |   |   |   |   |   |   |   |   |
| North America, primarily United States |   | $ | 59,373 |  |   | $ | 63,900 |  |   | $ | (4,527 | ) |   | (7.1 | ) |
| Europe, Middle East and Africa         |   | 19,356 |  |   | 21,982 |  |   | (2,626 | ) |   | (11.9 | ) |
| Asia                                   |   | 9,938 |  |   | 10,149 |  |   | (211 | ) |   | (2.1 | ) |
| Latin America                          |   | 2,123 |  |   | 4,390 |  |   | (2,267 | ) |   | (51.6 | ) |
| Total revenue                          |   | $ | 90,790 |  |   | $ | 100,421 |  |   | $ | (9,631 | ) |   | (9.6 | ) |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Hardware product revenue decreased by $12.0 million, or 12.4%, in the first six months of fiscal 2017 compared to the first six months of fiscal 2016.  This decrease occurred in all product categories, other than cellular routers and gateways which were flat with the first six months of the prior fiscal year.  Our decline in network product revenue was as expected as our customers decreased their support and maintenance of legacy hardwire network products.  Embedded and RF product revenue also declined as we had large sales to significant customers in the prior fiscal year. |

|         |                                                                                                                                                                                                                                                                                                                                                                                |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Service revenue increased by $2.4 million, or 70.0%, in the first six months of fiscal 2017 compared to the first six months of fiscal 2016.   This was driven primarily by the growth of our Digi Smart Solutions business.  Service revenue includes $1.5 million of incremental revenue from the acquisition of SMART Temps and FreshTemp in the first half of fiscal 2017. |

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|                                                               |
|---------------------------------------------------------------|
|                                                               |  |  |  |  |
|                                                          |   |   |   |   |
| Digi International Reports Second Fiscal Quarter 2017 Results |

|         |                                                                                                                                                                                                                                                              |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Included in revenue performance for the year was a foreign currency translation decrease of $0.4 million when compared to the same period in the prior fiscal year, primarily caused by the weakening of the British Pound and Euro against the U.S. dollar. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Cash and cash equivalents and marketable securities balance, including long-term marketable securities, of $110.2 million, a decrease of $27.4 million from the end of fiscal 2016.  Digi completed two of its three acquisitions in the first half of fiscal 2017, for a total cash expenditure of $30.0 million (net of cash acquired of $0.5 million).  The other acquisition was completed in October 2015.  Please refer to the Condensed Consolidated Statements of Cash Flows for more information. |

|         |          |
|---------|----------|
| • | No debt. |

|         |                                                                                                                                                                                                                          |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | A large system integrator selected Digi’s WR44RR, rugged cellular router design for on-board rail vehicles, for CCTV control and retrofit of a major northeastern United States metropolitan commuter rail system. |

|         |                                                                                                                                                    |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------|
| • | The Digi WR44R was selected for communications of on-board vehicle fare collection for a Southeastern United States city-wide bus upgrade program. |

|         |                                                                                                                                                                                                                     |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | An industry leading manufacturer and installer of commercial and utility-grade build automation and HVAC applications selected Digi’s WR31 cellular router for their energy management system communications. |

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|                                                               |
|---------------------------------------------------------------|
|                                                               |  |  |  |  |
|                                                          |   |   |   |   |
| Digi International Reports Second Fiscal Quarter 2017 Results |

|         |                                                                                                                                                                     |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Digi’s Xbee Cellular was integrated into an energy controller for real-time data monitoring and consumption management for residential water heating systems. |

|         |                                                                                                                                                                                                                |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | A leading provider of moisture sensors, weather stations, and irrigation controllers integrated Digi’s Xbee Cellular for real time field data to make intelligent irrigation/water management decisions. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                        |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Rapid City Area Schools is a public school district serving Rapid City, South Dakota with 25 schools and is the largest public school district in South Dakota.  They have implemented the Digi SmartTemps solution for education to proactively monitor their walk in refrigeration units/milk coolers and storage rooms.  Rapid City area schools saved approximately $3,000 dollars the first week of installation. |

|         |                                                                                                                                                                                                                                                     |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Digi International was awarded a sole source contract from Lauderdale County School District in Lauderdale County, Mississippi.  The Digi SmartTemps solution for education was chosen to protect their school district comprised of eight schools. |

|         |                                                                                                                                                                                                                                                                                                     |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | The University of San Diego serves approximately 2,500 meals per day and has chosen the Digi SmartTemps for education solution to protect their 12 individual kitchens on campus.  The University of San Diego is ranked number 17 in the nation for Best Campus Food by the Princeton Review 2017. |

|                                                                                      |
|--------------------------------------------------------------------------------------|
|                                                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                                                 | Three months ended March 31, |   | Six months ended March 31, |
|                                                                                 | 2017 |   | 2016 |   | 2017 |   | 2016 |
| Income and income per diluted share from continuing operations                       | $ | 1,331 |  |   | $ | 0.05 |  |   | $ | 2,226 |  |   | $ | 0.09 |  |   | $ | 3,688 |  |   | $ | 0.14 |  |   | $ | 5,357 |  |   | $ | 0.21 |  |
| Restructuring reserve                                                                | — |  |   | — |  |   | 102 |  |   | NM |  |   | — |  |   | — |  |   | 753 |  |   | 0.03 |  |
| Tax effect from restructuring reserve                                                | — |  |   | — |  |   | (36 | ) |   | NM |  |   | — |  |   | — |  |   | (264 | ) |   | (0.01 | ) |
| Discrete tax expense (benefits)(1)                                                   | 9 |  |   | — |  |   | — |  |   | — |  |   | (95 | ) |   | — |  |   | (667 | ) |   | (0.03 | ) |
| Adjusted income and adjusted income per diluted share from continuing operations (2) | $ | 1,340 |  |   | $ | 0.05 |  |   | $ | 2,292 |  |   | $ | 0.09 |  |   | $ | 3,593 |  |   | $ | 0.13 |  |   | $ | 5,179 |  |   | $ | 0.20 |  |
| Diluted weighted average common shares                                               |   |   | 27,252 |  |   |   |   | 25,998 |  |   |   |   | 27,134 |  |   |   |   | 26,116 |  |

|     |                                                                                                                                                             |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | Discrete tax benefits include reversals of tax reserves due to the expiration of statutes of limitation, and extended research and development tax credits. |

|     |                                                                                  |
|-----|----------------------------------------------------------------------------------|
| (2) | Adjusted income per diluted share may not add due to the use of rounded numbers. |

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|                                                               |
|---------------------------------------------------------------|
|                                                               |  |  |  |  |
|                                                          |   |   |   |   |
| Digi International Reports Second Fiscal Quarter 2017 Results |

|                                       |
|---------------------------------------|
|                                       |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                  | Three months ended March 31, |   | Six months ended March 31, |
|                                  | 2017 |   | 2016 |   | 2017 |   | 2016 |
|                                  |   |   | % of totalrevenue |   |   |   | % of totalrevenue |   |   |   | % of totalrevenue |   |   |   | % of totalrevenue |
| Total revenue                         | $ | 45,615 |  |   | 100.0 | % |   | $ | 50,162 |  |   | 100.0 | % |   | $ | 90,790 |  |   | 100.0 | % |   | $ | 100,421 |  |   | 100.0 | % |
|                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income from continuing operations (1) | $ | 1,331 |  |   |   |   | $ | 2,226 |  |   |   |   | $ | 3,688 |  |   |   |   | $ | 5,357 |  |   |   |
| Interest income, net                  | (110 | ) |   |   |   | (12 | ) |   |   |   | (236 | ) |   |   |   | (112 | ) |   |   |
| Income tax provision                  | 148 |  |   |   |   | 1,155 |  |   |   |   | 913 |  |   |   |   | 1,536 |  |   |   |
| Depreciation and amortization         | 1,389 |  |   |   |   | 1,214 |  |   |   |   | 2,390 |  |   |   |   | 2,376 |  |   |   |
| EBITDA from continuing operations     | $ | 2,758 |  |   | 6.0 | % |   | $ | 4,583 |  |   | 9.1 | % |   | $ | 6,755 |  |   | 7.4 | % |   | $ | 9,157 |  |   | 9.1 | % |

|     |                                                                                                                                                                                                                                                                                                             |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | Stock-based compensation of $1.1 million and $0.9 million for the three months ended March 31, 2017 and 2016, respectively, and stock-based compensation of $2.3 million and $1.7 million for the six months ended March 31, 2017 and 2016, respectively, is included in income from continuing operations. |

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|                                                               |
|---------------------------------------------------------------|
|                                                               |  |  |  |  |
|                                                          |   |   |   |   |
| Digi International Reports Second Fiscal Quarter 2017 Results |

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|                                                               |  |  |  |  |
|                                                          |   |   |   |   |
| Digi International Reports Second Fiscal Quarter 2017 Results |

|                                                              |
|--------------------------------------------------------------|
|                                                              |  |  |
| Mike Goergen                                                 |   |   |
| Senior Vice President, Chief Financial Officer and Treasurer |   |   |
| Digi International                                           |   |   |
| 952-912-3737                                                 |   |   |
| Email:  mike.goergen@digi.com                                |   |   |
|                                                         |   |   |

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|                                                               |
|---------------------------------------------------------------|
|                                                               |  |  |  |  |
|                                                          |   |   |   |   |
| Digi International Reports Second Fiscal Quarter 2017 Results |

|                                                                |
|----------------------------------------------------------------|
|                                                                |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                           | Three months endedMarch 31, |   | Six months endedMarch 31, |
|                                                           | 2017 |   | 2016 |   | 2017 |   | 2016 |
| Revenue:                                                       |   |   |   |   |   |   |   |
| Hardware product                                               | $ | 41,766 |  |   | $ | 48,732 |  |   | $ | 84,939 |  |   | $ | 96,979 |  |
| Service                                                        | 3,849 |  |   | 1,430 |  |   | 5,851 |  |   | 3,442 |  |
| Total revenue                                                  | 45,615 |  |   | 50,162 |  |   | 90,790 |  |   | 100,421 |  |
| Cost of sales:                                                 |   |   |   |   |   |   |   |
| Cost of hardware product                                       | 21,489 |  |   | 24,283 |  |   | 43,927 |  |   | 48,993 |  |
| Cost of service                                                | 2,224 |  |   | 1,137 |  |   | 3,508 |  |   | 2,329 |  |
| Total cost of sales                                            | 23,713 |  |   | 25,420 |  |   | 47,435 |  |   | 51,322 |  |
| Gross profit                                                   | 21,902 |  |   | 24,742 |  |   | 43,355 |  |   | 49,099 |  |
| Operating expenses:                                            |   |   |   |   |   |   |   |
| Sales and marketing                                            | 8,731 |  |   | 8,165 |  |   | 17,053 |  |   | 16,683 |  |
| Research and development                                       | 6,979 |  |   | 7,757 |  |   | 13,884 |  |   | 15,595 |  |
| General and administrative                                     | 4,680 |  |   | 5,065 |  |   | 8,484 |  |   | 9,126 |  |
| Restructuring charge, net                                      | — |  |   | 102 |  |   | — |  |   | 753 |  |
| Total operating expenses                                       | 20,390 |  |   | 21,089 |  |   | 39,421 |  |   | 42,157 |  |
| Operating income                                               | 1,512 |  |   | 3,653 |  |   | 3,934 |  |   | 6,942 |  |
| Other (expense) income, net:                                   |   |   |   |   |   |   |   |
| Interest income, net                                           | 110 |  |   | 12 |  |   | 236 |  |   | 112 |  |
| Other (expense) income, net                                    | (143 | ) |   | (284 | ) |   | 431 |  |   | (161 | ) |
| Total other (expense) income, net                              | (33 | ) |   | (272 | ) |   | 667 |  |   | (49 | ) |
| Income from continuing operations, before income taxes         | 1,479 |  |   | 3,381 |  |   | 4,601 |  |   | 6,893 |  |
| Income tax provision                                           | 148 |  |   | 1,155 |  |   | 913 |  |   | 1,536 |  |
| Income from continuing operations                              | 1,331 |  |   | 2,226 |  |   | 3,688 |  |   | 5,357 |  |
| (Loss) income from discontinued operations, after income taxes | — |  |   | (89 | ) |   | — |  |   | 3,230 |  |
| Net income                                                     | $ | 1,331 |  |   | $ | 2,137 |  |   | $ | 3,688 |  |   | $ | 8,587 |  |
|                                                           |   |   |   |   |   |   |   |
| Basic net income per common share:                             |   |   |   |   |   |   |   |
| Continuing operations                                          | $ | 0.05 |  |   | $ | 0.09 |  |   | $ | 0.14 |  |   | $ | 0.21 |  |
| Discontinued operations                                        | $ | — |  |   | $ | — |  |   | $ | — |  |   | $ | 0.13 |  |
| Net income (1)                                                 | $ | 0.05 |  |   | $ | 0.08 |  |   | $ | 0.14 |  |   | $ | 0.34 |  |
| Diluted net income per common share:                           |   |   |   |   |   |   |   |
| Continuing operations                                          | $ | 0.05 |  |   | $ | 0.09 |  |   | $ | 0.14 |  |   | $ | 0.21 |  |
| Discontinued operations                                        | $ | — |  |   | $ | — |  |   | $ | — |  |   | $ | 0.12 |  |
| Net income                                                     | $ | 0.05 |  |   | $ | 0.08 |  |   | $ | 0.14 |  |   | $ | 0.33 |  |
| Weighted average common shares:                                |   |   |   |   |   |   |   |
| Basic                                                          | 26,477 |  |   | 25,820 |  |   | 26,324 |  |   | 25,574 |  |
| Diluted                                                        | 27,252 |  |   | 25,998 |  |   | 27,134 |  |   | 26,116 |  |

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|                                                               |
|---------------------------------------------------------------|
|                                                               |  |  |  |  |
|                                                          |   |   |   |   |
| Digi International Reports Second Fiscal Quarter 2017 Results |

|                                                                             |
|-----------------------------------------------------------------------------|
|                                                                             |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                                        | Three months endedMarch 31, |   | Six months endedMarch 31, |
|                                                                        | 2017 |   | 2016 |   | 2017 |   | 2016 |
| Net income                                                                  | $ | 1,331 |  |   | $ | 2,137 |  |   | $ | 3,688 |  |   | $ | 8,587 |  |
| Other comprehensive income (loss), net of tax:                              |   |   |   |   |   |   |   |
| Foreign currency translation adjustment                                     | 1,277 |  |   | 1,421 |  |   | (2,478 | ) |   | (446 | ) |
| Change in net unrealized gain (loss) on investments                         | 14 |  |   | 106 |  |   | (10 | ) |   | 43 |  |
| Less income tax (expense) benefit                                           | (5 | ) |   | (39 | ) |   | 4 |  |   | (16 | ) |
| Reclassification of realized gain on investments included in net income (1) | — |  |   | — |  |   | — |  |   | (7 | ) |
| Less income tax provision (2)                                               | — |  |   | — |  |   | — |  |   | 3 |  |
| Other comprehensive income (loss), net of tax                               | 1,286 |  |   | 1,488 |  |   | (2,484 | ) |   | (423 | ) |
| Comprehensive income                                                        | $ | 2,617 |  |   | $ | 3,625 |  |   | $ | 1,204 |  |   | $ | 8,164 |  |

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|                                                               |
|---------------------------------------------------------------|
|                                                               |  |  |  |  |
|                                                          |   |   |   |   |
| Digi International Reports Second Fiscal Quarter 2017 Results |

|                                                  |
|--------------------------------------------------|
|                                                  |  |  |  |  |  |  |  |
|                                             | March 31,2017 |   | September 30, 2016 |
| ASSETS                                           |   |   |   |
| Current assets:                                  |   |   |   |
| Cash and cash equivalents                        | $ | 71,895 |  |   | $ | 75,727 |  |
| Marketable securities                            | 36,081 |  |   | 58,382 |  |
| Accounts receivable, net                         | 28,720 |  |   | 28,685 |  |
| Inventories                                      | 30,519 |  |   | 26,276 |  |
| Receivable from sale of business                 | 1,978 |  |   | 2,997 |  |
| Other                                            | 4,399 |  |   | 3,578 |  |
| Total current assets                             | 173,592 |  |   | 195,645 |  |
| Marketable securities, long-term                 | 2,262 |  |   | 3,541 |  |
| Property, equipment and improvements, net        | 13,613 |  |   | 14,041 |  |
| Identifiable intangible assets, net              | 13,164 |  |   | 4,041 |  |
| Goodwill                                         | 129,921 |  |   | 109,448 |  |
| Deferred tax assets                              | 6,974 |  |   | 7,295 |  |
| Non-current receivable from sale of business     | — |  |   | 1,959 |  |
| Other                                            | 153 |  |   | 196 |  |
| Total assets                                     | $ | 339,679 |  |   | $ | 336,166 |  |
| LIABILITIES AND STOCKHOLDERS’ EQUITY       |   |   |   |
| Current liabilities:                             |   |   |   |
| Accounts payable                                 | $ | 10,754 |  |   | $ | 8,569 |  |
| Income taxes payable                             | 131 |  |   | 167 |  |
| Accrued compensation                             | 4,198 |  |   | 10,787 |  |
| Accrued professional fees                        | 1,134 |  |   | 753 |  |
| Unearned revenue                                 | 1,636 |  |   | 361 |  |
| Contingent consideration on acquired businesses  | 1,234 |  |   | 513 |  |
| Other                                            | 2,703 |  |   | 2,658 |  |
| Total current liabilities                        | 21,790 |  |   | 23,808 |  |
| Income taxes payable                             | 1,380 |  |   | 1,490 |  |
| Deferred tax liabilities                         | 532 |  |   | 616 |  |
| Contingent consideration on acquired businesses  | 8,834 |  |   | 9,447 |  |
| Other non-current liabilities                    | 740 |  |   | 776 |  |
| Total liabilities                                | 33,276 |  |   | 36,137 |  |
|                                             |   |   |   |
| Total stockholders’ equity                 | 306,403 |  |   | 300,029 |  |
| Total liabilities and stockholders’ equity | $ | 339,679 |  |   | $ | 336,166 |  |

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|---------------------------------------------------------------|
|                                                               |  |  |  |  |
|                                                          |   |   |   |   |
| Digi International Reports Second Fiscal Quarter 2017 Results |

|                                                                                                            |
|------------------------------------------------------------------------------------------------------------|
|                                                                                                            |  |  |  |  |  |  |  |
|                                                                                                       | Six months ended March 31, |
|                                                                                                       | 2017 |   | 2016 |
| Operating activities:                                                                                      |   |   |   |
| Net income                                                                                                 | $ | 3,688 |  |   | $ | 8,587 |  |
| Adjustments to reconcile net income to net cash (used in) provided by operating activities:                |   |   |   |
| Depreciation of property, equipment and improvements                                                       | 1,449 |  |   | 1,405 |  |
| Amortization of identifiable intangible assets                                                             | 941 |  |   | 1,001 |  |
| Stock-based compensation                                                                                   | 2,328 |  |   | 1,719 |  |
| Excess tax benefits from stock-based compensation                                                          | (315 | ) |   | (202 | ) |
| Deferred income tax provision                                                                              | 242 |  |   | 1,397 |  |
| Gain on sale of business                                                                                   | — |  |   | (2,870 | ) |
| Change in fair value of contingent consideration                                                           | (684 | ) |   | 123 |  |
| Bad debt/product return provision                                                                          | 296 |  |   | 168 |  |
| Inventory obsolescence                                                                                     | 600 |  |   | 834 |  |
| Restructuring charges                                                                                      | — |  |   | 753 |  |
| Other                                                                                                      | 51 |  |   | 59 |  |
| Changes in operating assets and liabilities (net of acquisitions)                                          | (9,473 | ) |   | (1,486 | ) |
| Net cash (used in) provided by operating activities                                                        | (877 | ) |   | 11,488 |  |
| Investing activities:                                                                                      |   |   |   |
| Purchase of marketable securities                                                                          | (33,470 | ) |   | (22,056 | ) |
| Proceeds from maturities and sales of marketable securities                                                | 57,039 |  |   | 27,509 |  |
| Proceeds from sale of Etherios                                                                             | 3,000 |  |   | 2,849 |  |
| Acquisition of businesses, net of cash acquired                                                            | (29,994 | ) |   | (2,860 | ) |
| Purchase of property, equipment, improvements and certain other identifiable intangible assets             | (984 | ) |   | (1,209 | ) |
| Net cash provided by (used in) investing activities                                                        | (4,409 | ) |   | 4,233 |  |
| Financing activities:                                                                                      |   |   |   |
| Acquisition earn-out payments                                                                              | (518 | ) |   | — |  |
| Excess tax benefits from stock-based compensation                                                          | 315 |  |   | 202 |  |
| Proceeds from stock option plan transactions                                                               | 3,246 |  |   | 6,267 |  |
| Proceeds from employee stock purchase plan transactions                                                    | 479 |  |   | 494 |  |
| Purchases of common stock                                                                                  | (587 | ) |   | (503 | ) |
| Net cash provided by financing activities                                                                  | 2,935 |  |   | 6,460 |  |
| Effect of exchange rate changes on cash and cash equivalents                                               | (1,481 | ) |   | 71 |  |
| Net (decrease) increase in cash and cash equivalents                                                       | (3,832 | ) |   | 22,252 |  |
| Cash and cash equivalents, beginning of period                                                             | 75,727 |  |   | 45,018 |  |
| Cash and cash equivalents, end of period                                                                   | $ | 71,895 |  |   | $ | 67,270 |  |
|                                                                                                       |   |   |   |
| Supplemental schedule of non-cash investing and financing activities:                                      |   |   |   |
| Receivable related to sale of Etherios                                                                     | $ | — |  |   | $ | 4,906 |  |
| Liability related to acquisition of businesses                                                             | $ | (1,310 | ) |   | $ | (10,550 | ) |
| Accrual for purchase of property, equipment, improvements and certain other identifiable intangible assets | $ | (66 | ) |   | $ | — |  |