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

|                                         |
|-----------------------------------------|
|                                         |  |  |  |  |  |  |
|                                    |   | Digi International Reports First Fiscal Quarter 2017 Results |   |   |
| Revenue and Profitability Meet Guidance |

|         |                                                                                                      |
|---------|------------------------------------------------------------------------------------------------------|
| • | Revenue was $45.2 million compared to revenue for the first fiscal quarter of 2016 of $50.3 million. |

|         |                                                                                                                                                                             |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Income from continuing operations was $2.4 million, or $0.09 per diluted share, compared to $3.1 million, or $0.12 per diluted share, for the first fiscal quarter of 2016. |

|         |                                                                                                                                                                                                                                                                                                                                                                                    |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Net income was $2.4 million, or $0.09 per diluted share, compared to $6.5 million, or $0.25 per diluted share, for the first fiscal quarter of 2016.  Net income for the first fiscal quarter of 2016 included income from discontinued operations, after income taxes of $3.3 million, or $0.13 per diluted share, most of which resulted from the gain on sale of Etherios, Inc. |

|         |                                                                                                                                                                                                                                                                                                                                                                              |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | EBITDA from Continuing Operations (Earnings Before Interest, Taxes, Depreciation and Amortization) was $4.0 million, or 8.8% of total revenue, compared to $4.6 million, or 9.1% of total revenue, in the first fiscal quarter of 2016.  Please see Reconciliation of Income from Continuing Operations to EBITDA from Continuing Operations later in this earnings release. |

|         |                                                                                                                                                                                                                          |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Stock-based compensation expense was $1.2 million compared to $0.8 million in the first fiscal quarter of 2016.  Stock-based compensation is included in earnings before interest, taxes, depreciation and amortization. |

----

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

|                                                     |
|-----------------------------------------------------|
|                                                     |  |  |  |  |  |  |  |  |
| GAAP Results from Continuing Operations             |
| (in thousands, except per share data)               |   | Q1 2017 |   | Q1 2016 |
| Total Revenue                                       |   | $ | 45,175 |  |   | $ | 50,259 |  |
| Gross Profit                                        |   | $ | 21,453 |  |   | $ | 24,357 |  |
| Gross Margin                                        |   | 47.5 | % |   | 48.5 | % |
| Operating Income                                    |   | $ | 2,422 |  |   | $ | 3,289 |  |
| Operating Income as % of Total Revenue              |   | 5.4 | % |   | 6.5 | % |
| Income from Continuing Operations                   |   | $ | 2,357 |  |   | $ | 3,131 |  |
| Income per Diluted Share from Continuing Operations |   | $ | 0.09 |  |   | $ | 0.12 |  |

|                                                                                                                  |
|------------------------------------------------------------------------------------------------------------------|
|                                                                                                                  |  |  |  |  |  |  |  |  |
| Non-GAAP Results from Continuing Operations*                                                                     |
| (in thousands, except per share data)                                                                            |   | Q1 2017 |   | Q1 2016 |
| Adjusted Income from Continuing Operations                                                                       |   | $ | 2,253 |  |   | $ | 2,887 |  |
| Adjusted Income per Diluted Share from Continuing Operations                                                     |   | $ | 0.08 |  |   | $ | 0.11 |  |
|                                                                                                             |   |   |   |   |
| EBITDA from Continuing Operations                                                                                |   | $ | 3,997 |  |   | $ | 4,574 |  |
| EBITDA from Continuing Operations as % of Total Revenue                                                          |   | 8.8 | % |   | 9.1 | % |
| * Tables with detailed reconciliations to non-GAAP information are provided at the end of this earnings release. |

|                                        |
|----------------------------------------|
|                                        |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Revenue Detail YTD                     |
| (in thousands)                         |   | Q1 2017 |   | Q1 2016 |   | Change |   | % Change |
| Cellular routers and gateways          |   | $ | 13,756 |  |   | $ | 12,160 |  |   | $ | 1,596 |  |   | 13.1 |  |
| RF                                     |   | 6,574 |  |   | 9,186 |  |   | (2,612 | ) |   | (28.4 | ) |
| Embedded                               |   | 11,841 |  |   | 13,128 |  |   | (1,287 | ) |   | (9.8 | ) |
| Network                                |   | 11,002 |  |   | 13,773 |  |   | (2,771 | ) |   | (20.1 | ) |
| Total hardware product revenue         |   | 43,173 |  |   | 48,247 |  |   | (5,074 | ) |   | (10.5 | ) |
| Service                                |   | 2,002 |  |   | 2,012 |  |   | (10 | ) |   | (0.5 | ) |
| Total revenue                          |   | $ | 45,175 |  |   | $ | 50,259 |  |   | $ | (5,084 | ) |   | (10.1 | ) |
|                                   |   |   |   |   |   |   |   |   |
| North America, primarily United States |   | $ | 29,662 |  |   | $ | 30,568 |  |   | $ | (906 | ) |   | (3.0 | ) |
| Europe, Middle East and Africa         |   | 9,811 |  |   | 11,017 |  |   | (1,206 | ) |   | (10.9 | ) |
| Asia                                   |   | 4,568 |  |   | 5,124 |  |   | (556 | ) |   | (10.9 | ) |
| Latin America                          |   | 1,134 |  |   | 3,550 |  |   | (2,416 | ) |   | (68.1 | ) |
| Total revenue                          |   | $ | 45,175 |  |   | $ | 50,259 |  |   | $ | (5,084 | ) |   | (10.1 | ) |

|         |                                                                                                                                                                                                                                                                                                      |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Hardware product revenue decreased by $5.1 million, or 10.5%, in the first fiscal quarter of 2017 compared to the first fiscal quarter of 2016.  This decrease was driven primarily by RF, network and embedded products, partially offset by an increase in sales of cellular routers and gateways. |

|         |                                                                                       |
|---------|---------------------------------------------------------------------------------------|
| • | Service revenue was $2.0 million for both the first fiscal quarters of 2017 and 2016. |

|         |                                                                                                                                                                                                                                                                     |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Included in revenue performance for the year was a foreign currency translation decrease of $0.3 million when compared to the same period in the prior fiscal year and was primarily caused by the weakening of the British Pound and Euro against the U.S. dollar. |

----

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

|         |                                                                                                                                                                                                                                                                               |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Cash and cash equivalents and marketable securities balance, including long-term marketable securities, of $136.4 million, a decrease of $1.3 million from the end of fiscal 2016.  Please refer to the Condensed Consolidated Statements of Cash Flows for more information. |

|         |                                                                                                           |
|---------|-----------------------------------------------------------------------------------------------------------|
| • | Inventory of $24.3 million, a decrease of $1.9 million over the comparable balance at September 30, 2016. |

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

|         |                                                                           |
|---------|---------------------------------------------------------------------------|
| • | A current ratio of 10.8 to 1, compared to 8.2 to 1 at September 30, 2016. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Digi’s Cold Chain Solutions team successfully signed Love’s Travel Stops to a multi-year agreement to implement its food temperature and task management system. Love's Travel Stops has more than 400 locations in 40 states.  Love’s will implement Digi’s advanced technology-supported service to ensure that all their restaurants deliver the highest levels of food quality and safety to their customers.  In addition, Love’s will gain enterprise-wide insight and reporting, allowing them to implement best-practice processes and systems throughout all locations. |

|         |                                                                                                                                                                                                                                                   |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | SMART Temps has recently partnered with AMC Theatres to assist with streamlining their food safety HACCP initiatives.  SMART Temps will be monitoring 42 dine-in theatres for AMC, including their newly acquired theater group, Carmike’s. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | The Dallas Independent School District officially awarded SMART Temps as the sole vendor for a three year contract for temperature monitoring and notification systems used in coolers and freezers and delivery trucks.  The Dallas Independent School District has more than 227 school kitchens across the district.  The district is the second largest in the state of Texas and among the top 10 districts in the country as it relates to number of school sites. |

----

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

|                                                                                      |
|--------------------------------------------------------------------------------------|
|                                                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                                                 | Three months ended December 31, |
|                                                                                 | 2016 |   | 2015 |
| Income and income per diluted share from continuing operations                       | $ | 2,357 |  |   | $ | 0.09 |  |   | $ | 3,131 |  |   | $ | 0.12 |  |
| Restructuring reserve                                                                | — |  |   | — |  |   | 651 |  |   | 0.02 |  |
| Tax effect from restructuring reserve                                                | — |  |   | — |  |   | (228 | ) |   | (0.01 | ) |
| Discrete tax benefits (1)                                                            | (104 | ) |   | — |  |   | (667 | ) |   | (0.03 | ) |
| Adjusted income and adjusted income per diluted share from continuing operations (2) | $ | 2,253 |  |   | $ | 0.08 |  |   | $ | 2,887 |  |   | $ | 0.11 |  |
| Diluted weighted average common shares                                               |   |   | 26,972 |  |   |   |   | 26,171 |  |

|     |                                                                                                                                                             |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (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. |

|                                       |
|---------------------------------------|
|                                       |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                  | Three months ended December 31, |
|                                  | 2016 |   | 2015 |
|                                  |   |   | % of totalrevenue |   |   |   | % of totalrevenue |
| Total revenue                         | $ | 45,175 |  |   | 100.0 | % |   | $ | 50,259 |  |   | 100.0 | % |
|                                  |   |   |   |   |   |   |   |
| Income from continuing operations (1) | $ | 2,357 |  |   |   |   | $ | 3,131 |  |   |   |
| Interest income, net                  | (126 | ) |   |   |   | (100 | ) |   |   |
| Income tax provision                  | 765 |  |   |   |   | 381 |  |   |   |
| Depreciation and amortization         | 1,001 |  |   |   |   | 1,162 |  |   |   |
| EBITDA from continuing operations     | $ | 3,997 |  |   | 8.8 | % |   | $ | 4,574 |  |   | 9.1 | % |

|     |                                                                                                                                                                                  |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | Stock-based compensation of $1.2 million and $0.8 million for the three months ended December 31, 2016 and 2015, respectively, is included in income from continuing operations. |

----

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

----

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

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

----

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

|                                                         |
|---------------------------------------------------------|
|                                                         |  |  |  |  |  |  |  |
|                                                    | Three months endedDecember 31, |
|                                                    | 2016 |   | 2015 |
| Revenue:                                                |   |   |   |
| Hardware product                                        | $ | 43,173 |  |   | $ | 48,247 |  |
| Service                                                 | 2,002 |  |   | 2,012 |  |
| Total revenue                                           | 45,175 |  |   | 50,259 |  |
| Cost of sales:                                          |   |   |   |
| Cost of hardware product                                | 22,438 |  |   | 24,710 |  |
| Cost of service                                         | 1,284 |  |   | 1,192 |  |
| Total cost of sales                                     | 23,722 |  |   | 25,902 |  |
| Gross profit                                            | 21,453 |  |   | 24,357 |  |
| Operating expenses:                                     |   |   |   |
| Sales and marketing                                     | 8,322 |  |   | 8,518 |  |
| Research and development                                | 6,905 |  |   | 7,838 |  |
| General and administrative                              | 3,804 |  |   | 4,061 |  |
| Restructuring charge, net                               | — |  |   | 651 |  |
| Total operating expenses                                | 19,031 |  |   | 21,068 |  |
| Operating income                                        | 2,422 |  |   | 3,289 |  |
| Other income, net:                                      |   |   |   |
| Interest income, net                                    | 126 |  |   | 100 |  |
| Other income, net                                       | 574 |  |   | 123 |  |
| Total other income, net                                 | 700 |  |   | 223 |  |
| Income from continuing operations, before income taxes  | 3,122 |  |   | 3,512 |  |
| Income tax provision                                    | 765 |  |   | 381 |  |
| Income from continuing operations                       | 2,357 |  |   | 3,131 |  |
| Income from discontinued operations, after income taxes | — |  |   | 3,319 |  |
| Net income                                              | $ | 2,357 |  |   | $ | 6,450 |  |
|                                                    |   |   |   |
| Basic net income per common share:                      |   |   |   |
| Continuing operations                                   | $ | 0.09 |  |   | $ | 0.12 |  |
| Discontinued operations                                 | $ | — |  |   | $ | 0.13 |  |
| Net income                                              | $ | 0.09 |  |   | $ | 0.25 |  |
| Diluted net income per common share:                    |   |   |   |
| Continuing operations                                   | $ | 0.09 |  |   | $ | 0.12 |  |
| Discontinued operations                                 | $ | — |  |   | $ | 0.13 |  |
| Net income                                              | $ | 0.09 |  |   | $ | 0.25 |  |
| Weighted average common shares:                         |   |   |   |
| Basic                                                   | 26,175 |  |   | 25,331 |  |
| Diluted                                                 | 26,972 |  |   | 26,171 |  |

----

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

|                                                                             |
|-----------------------------------------------------------------------------|
|                                                                             |  |  |  |  |  |  |  |
|                                                                        | Three months endedDecember 31, |
|                                                                        | 2016 |   | 2015 |
| Net income                                                                  | $ | 2,357 |  |   | $ | 6,450 |  |
| Other comprehensive loss, net of tax:                                       |   |   |   |
| Foreign currency translation adjustment                                     | (3,755 | ) |   | (1,867 | ) |
| Change in net unrealized loss on investments                                | (24 | ) |   | (63 | ) |
| Less income tax benefit                                                     | 9 |  |   | 23 |  |
| Reclassification of realized gain on investments included in net income (1) | — |  |   | (7 | ) |
| Less income tax provision (2)                                               | — |  |   | 3 |  |
| Other comprehensive loss, net of tax                                        | (3,770 | ) |   | (1,911 | ) |
| Comprehensive (loss) income                                                 | $ | (1,413 | ) |   | $ | 4,539 |  |

----

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

|                                                  |
|--------------------------------------------------|
|                                                  |  |  |  |  |  |  |  |
|                                             | December 31,2016 |   | September 30, 2016 |
| ASSETS                                           |   |   |   |
| Current assets:                                  |   |   |   |
| Cash and cash equivalents                        | $ | 81,142 |  |   | $ | 75,727 |  |
| Marketable securities                            | 51,939 |  |   | 58,382 |  |
| Accounts receivable, net                         | 28,005 |  |   | 28,685 |  |
| Inventories                                      | 24,338 |  |   | 26,276 |  |
| Receivable from sale of business                 | 1,968 |  |   | 2,997 |  |
| Other                                            | 4,623 |  |   | 3,578 |  |
| Total current assets                             | 192,015 |  |   | 195,645 |  |
| Marketable securities, long-term                 | 3,275 |  |   | 3,541 |  |
| Property, equipment and improvements, net        | 13,983 |  |   | 14,041 |  |
| Identifiable intangible assets, net              | 4,299 |  |   | 4,041 |  |
| Goodwill                                         | 111,116 |  |   | 109,448 |  |
| Deferred tax assets                              | 6,644 |  |   | 7,295 |  |
| Non-current receivable from sale of business     | — |  |   | 1,959 |  |
| Other                                            | 147 |  |   | 196 |  |
| Total assets                                     | $ | 331,479 |  |   | $ | 336,166 |  |
| LIABILITIES AND STOCKHOLDERS’ EQUITY       |   |   |   |
| Current liabilities:                             |   |   |   |
| Accounts payable                                 | $ | 7,924 |  |   | $ | 8,569 |  |
| Income taxes payable                             | 163 |  |   | 167 |  |
| Accrued compensation                             | 3,968 |  |   | 10,787 |  |
| Accrued warranty                                 | 1,025 |  |   | 1,033 |  |
| Contingent consideration on acquired business    | 1,841 |  |   | 513 |  |
| Other                                            | 2,861 |  |   | 2,739 |  |
| Total current liabilities                        | 17,782 |  |   | 23,808 |  |
| Income taxes payable                             | 1,367 |  |   | 1,490 |  |
| Deferred tax liabilities                         | 575 |  |   | 616 |  |
| Contingent consideration on acquired businesses  | 8,819 |  |   | 9,447 |  |
| Other non-current liabilities                    | 828 |  |   | 776 |  |
| Total liabilities                                | 29,371 |  |   | 36,137 |  |
|                                             |   |   |   |
| Total stockholders’ equity                 | 302,108 |  |   | 300,029 |  |
| Total liabilities and stockholders’ equity | $ | 331,479 |  |   | $ | 336,166 |  |

----

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

|                                                                                                            |
|------------------------------------------------------------------------------------------------------------|
|                                                                                                            |  |  |  |  |  |  |  |
|                                                                                                       | Three months ended December 31, |
|                                                                                                       | 2016 |   | 2015 |
| Operating activities:                                                                                      |   |   |   |
| Net income                                                                                                 | $ | 2,357 |  |   | $ | 6,450 |  |
| Adjustments to reconcile net income to net cash (used in) provided by operating activities:                |   |   |   |
| Depreciation of property, equipment and improvements                                                       | 656 |  |   | 724 |  |
| Amortization of identifiable intangible assets                                                             | 345 |  |   | 468 |  |
| Stock-based compensation                                                                                   | 1,173 |  |   | 816 |  |
| Excess tax benefits from stock-based compensation                                                          | (183 | ) |   | (190 | ) |
| Deferred income tax provision                                                                              | 619 |  |   | 1,300 |  |
| Gain on sale of business                                                                                   | — |  |   | (2,912 | ) |
| Change in fair value of contingent consideration                                                           | (82 | ) |   | — |  |
| Bad debt/product return provision                                                                          | 264 |  |   | 168 |  |
| Inventory obsolescence                                                                                     | 450 |  |   | 409 |  |
| Restructuring charges                                                                                      | — |  |   | 651 |  |
| Other                                                                                                      | (12 | ) |   | 40 |  |
| Changes in operating assets and liabilities                                                                | (7,622 | ) |   | (4,369 | ) |
| Net cash (used in) provided by operating activities                                                        | (2,035 | ) |   | 3,555 |  |
| Investing activities:                                                                                      |   |   |   |
| Purchase of marketable securities                                                                          | (25,470 | ) |   | (8,079 | ) |
| Proceeds from maturities of marketable securities                                                          | 32,155 |  |   | 7,106 |  |
| Proceeds from sale of Etherios                                                                             | 3,000 |  |   | 2,866 |  |
| Acquisition of business, net of cash acquired                                                              | (1,690 | ) |   | (2,860 | ) |
| Purchase of property, equipment, improvements and certain other identifiable intangible assets             | (554 | ) |   | (545 | ) |
| Net cash provided by (used in) investing activities                                                        | 7,441 |  |   | (1,512 | ) |
| Financing activities:                                                                                      |   |   |   |
| Acquisition earn-out payments                                                                              | (518 | ) |   | — |  |
| Excess tax benefits from stock-based compensation                                                          | 183 |  |   | 190 |  |
| Proceeds from stock option plan transactions                                                               | 2,787 |  |   | 5,752 |  |
| Proceeds from employee stock purchase plan transactions                                                    | 297 |  |   | 301 |  |
| Purchases of common stock                                                                                  | (390 | ) |   | (403 | ) |
| Net cash provided by financing activities                                                                  | 2,359 |  |   | 5,840 |  |
| Effect of exchange rate changes on cash and cash equivalents                                               | (2,350 | ) |   | (711 | ) |
| Net increase in cash and cash equivalents                                                                  | 5,415 |  |   | 7,172 |  |
| Cash and cash equivalents, beginning of period                                                             | 75,727 |  |   | 45,018 |  |
| Cash and cash equivalents, end of period                                                                   | $ | 81,142 |  |   | $ | 52,190 |  |
|                                                                                                       |   |   |   |
| Supplemental schedule of non-cash investing and financing activities:                                      |   |   |   |
| Receivable related to sale of Etherios                                                                     | $ | — |  |   | $ | 5,015 |  |
| Liability related to acquisition of business                                                               | $ | (1,300 | ) |   | $ | (10,550 | ) |
| Accrual for purchase of property, equipment, improvements and certain other identifiable intangible assets | $ | (105 | ) |   | $ | — |  |