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

|                                                 |
|-------------------------------------------------|
|                                                 |  |  |  |  |  |  |
|                                            |   | Digi International Reports First Fiscal Quarter 2016 Results |   |   |
| Strong Profitability Complements Revenue Growth |

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|                                                              |
|--------------------------------------------------------------|
|                                                              |  |  |  |  |
|                                                         |   |   |   |   |
| Digi International Reports First Fiscal Quarter 2016 Results |

|                                                     |
|-----------------------------------------------------|
|                                                     |  |  |  |  |  |  |  |  |
| GAAP Results from Continuing Operations             |
| (in thousands, except per share data)               |   | Q1 2016 |   | Q1 2015 |
| Total Revenue                                       |   | $ | 50,259 |  |   | $ | 47,218 |  |
| Gross Profit                                        |   | $ | 24,357 |  |   | $ | 22,557 |  |
| Gross Margin                                        |   | 48.5 | % |   | 47.8 | % |
| Operating Income                                    |   | $ | 3,289 |  |   | $ | 464 |  |
| Operating Income as % of Total Revenue              |   | 6.6 | % |   | 1.0 | % |
| Income from Continuing Operations                   |   | $ | 3,131 |  |   | $ | 1,018 |  |
| Income per Diluted Share from Continuing Operations |   | $ | 0.12 |  |   | $ | 0.04 |  |

|                                                                                                                  |
|------------------------------------------------------------------------------------------------------------------|
|                                                                                                                  |  |  |  |  |  |  |  |  |
| Non-GAAP Results from Continuing Operations*                                                                     |
| (in thousands, except per share data)                                                                            |   | Q1 2016 |   | Q1 2015 |
| Adjusted Income from Continuing Operations                                                                       |   | $ | 2,887 |  |   | $ | 530 |  |
| Adjusted Income per Diluted Share from Continuing Operations                                                     |   | $ | 0.11 |  |   | $ | 0.02 |  |
|                                                                                                             |   |   |   |   |
| EBITDA from Continuing Operations                                                                                |   | $ | 4,574 |  |   | $ | 2,247 |  |
| EBITDA from Continuing Operations as % of Total Revenue                                                          |   | 9.1 | % |   | 4.8 | % |
| * Tables with detailed reconciliations to non-GAAP information are provided at the end of this earnings release. |

|                                        |
|----------------------------------------|
|                                        |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Revenue Detail QTD                     |
| (in thousands)                         |   | Q1 2016 |   | Q1 2015 |   | Change |   | % Change |
| Cellular routers and gateways          |   | $ | 12,160 |  |   | $ | 13,700 |  |   | $ | (1,540 | ) |   | (11.2 | ) |
| RF                                     |   | 9,186 |  |   | 7,147 |  |   | 2,039 |  |   | 28.5 |  |
| Embedded                               |   | 13,128 |  |   | 11,227 |  |   | 1,901 |  |   | 16.9 |  |
| Network                                |   | 13,773 |  |   | 12,859 |  |   | 914 |  |   | 7.1 |  |
| Total product revenue                  |   | 48,247 |  |   | 44,933 |  |   | 3,314 |  |   | 7.4 |  |
| Service                                |   | 2,012 |  |   | 2,285 |  |   | (273 | ) |   | (11.9 | ) |
| Total revenue                          |   | $ | 50,259 |  |   | $ | 47,218 |  |   | $ | 3,041 |  |   | 6.4 |  |
|                                   |   |   |   |   |   |   |   |   |
| North America, primarily United States |   | $ | 30,568 |  |   | $ | 29,208 |  |   | $ | 1,360 |  |   | 4.7 |  |
| Europe, Middle East and Africa         |   | 11,017 |  |   | 11,231 |  |   | (214 | ) |   | (1.9 | ) |
| Asia                                   |   | 5,124 |  |   | 5,403 |  |   | (279 | ) |   | (5.2 | ) |
| Latin America                          |   | 3,550 |  |   | 1,376 |  |   | 2,174 |  |   | 158.0 |  |
| Total revenue                          |   | $ | 50,259 |  |   | $ | 47,218 |  |   | $ | 3,041 |  |   | 6.4 |  |

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|                                                              |
|--------------------------------------------------------------|
|                                                              |  |  |  |  |
|                                                         |   |   |   |   |
| Digi International Reports First Fiscal Quarter 2016 Results |

|         |                                                                                                                                                                                                                                                                                                                                                                                                        |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Product revenue increased by $3.3 million, or 7.4%, in the first fiscal quarter of 2016 compared to the first fiscal quarter of 2015.  This increase was driven primarily by RF and embedded products.  Network revenue, which is primarily comprised of mature products, increased by $0.9 million, or 7.1%.  These increases were partially offset by the decrease in cellular routers and gateways. |

|         |                                                                                                                                                                                    |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Service revenue decreased by $0.3 million, or 11.9%, in the first fiscal quarter of 2016 compared to the comparable quarter in fiscal 2015, primarily in wireless design services. |

|         |                                                                                                                                                                                                                                                                                       |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Revenue growth in the quarter was partially offset by the foreign translation from local currencies to the U.S. dollar, which resulted in a decrease of $0.7 million when compared to the same period in the prior fiscal year and was primarily caused by the weakening of the Euro. |

|         |                                                                                                                                                                                                                                                                                                                                |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Our cash and cash equivalents and marketable securities balance, including long-term marketable securities, was $113.9 million at December 31, 2015, an increase of $8.1 million over the comparable balance at September 30, 2015.  Please refer to the Condensed Consolidated Statements of Cash Flows for more information. |

|         |                                                              |
|---------|--------------------------------------------------------------|
| • | We had no debt on the balance sheet as of December 31, 2015. |

|         |                                                                                                  |
|---------|--------------------------------------------------------------------------------------------------|
| • | At December 31, 2015, our current ratio was 9.0 to 1 compared to 6.9 to 1 at September 30, 2015. |

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|                                                              |
|--------------------------------------------------------------|
|                                                              |  |  |  |  |
|                                                         |   |   |   |   |
| Digi International Reports First Fiscal Quarter 2016 Results |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | SkoolLive, the first nationwide, on-campus digital network, has selected the Digi TransPort® WR11 to replace VZW USB cellular in its SkoolLive kiosks. The network is available nationwide to qualifying middle and high schools. SkoolLive’s nationwide network of kiosks are located in high traffic locations on participating school campuses.  The kiosks are wall mounted and used for school messaging and interactive ad delivery.  The interactive ability allows advertisers to engage directly with students - conduct surveys, determine product preferences and instantly send promo codes, discount coupons or website links.  There is absolutely no cost to schools wishing to join the network and ad revenues are shared with the schools. SkoolLive has already signed multi-year, exclusive marketing and advertising agreements with more than 1,250 schools representing an audience in excess of 2.2 million students. SkoolLive is currently retrofitting its deployed kiosks with the WR11 units and will include the WR11 router with all future installations. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Q-Star Technology, the manufacturer of the FlashCAM crime deterrent system, creates security systems that help reduce and solve problems of illegal dumping, vandalism, metal theft and other nuisance crimes. Q-Star utilizes Digi's long range 900 MHz OEM RF Module, the XBee-PRO® 900HP, in a remote sensor to detect activity and send notifications that trigger remote management such as recording and/or taking photos and a remote flash. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | PowerOwners, a team with deep expertise in solar development and asset management, automation engineering, industrial design and manufacturing, and data management, developed the DenoTM Smart Sensor. The sensor measures sunlight and temperature to simulate an energy benchmark--the DenowattTM. The Deno Smart Sensor utilizes a Digi XBee-PRO® 900HP RF module to communicate. The sensor sends its data to an Ethernet gateway built using a Digi/Rabbit SBC - BL4S100. Digi Device Cloud gathers the data from multiple Deno’s and uses analytics that PowerOwners created to generate the data of interest for the commercial solar company. |

|         |                                                                                                                                                                                                                                                                                                                                |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | A leading electric and steam service provider has elected to replace existing cellular routers with Digi TransPort® WR21 enterprise routers and Digi Remote Manager within its steam distribution unit. The WR21 is expected to better withstand rugged environments, which was a top consideration in product selection. |

|                                                                                  |
|----------------------------------------------------------------------------------|
|                                                                                  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                                             | Three months ended December 31, |
|                                                                             | 2015 |   | 2014 |
| Income and income per diluted share from continuing operations                   | $ | 3,131 |  |   | $ | 0.12 |  |   | $ | 1,018 |  |   | $ | 0.04 |  |
| Restructuring reserve, net of taxes                                              | 423 |  |   | 0.02 |  |   | — |  |   | NM |  |
| Discrete tax benefits (1)                                                        | (667 | ) |   | (0.03 | ) |   | (488 | ) |   | (0.02 | ) |
| Adjusted income and adjusted income per diluted share from continuing operations | $ | 2,887 |  |   | $ | 0.11 |  |   | $ | 530 |  |   | $ | 0.02 |  |
| Diluted weighted average common shares                                           |   |   | 26,171 |  |   |   |   | 24,150 |  |

|     |                                                                                                                                                    |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | Discrete tax benefits include extended research and development tax credits and expiration of statute of limitations in various tax jurisdictions. |

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|                                                              |
|--------------------------------------------------------------|
|                                                              |  |  |  |  |
|                                                         |   |   |   |   |
| Digi International Reports First Fiscal Quarter 2016 Results |

|                                   |
|-----------------------------------|
|                                   |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                              | Three months ended December 31, |
|                              | 2015 |   | 2014 |
|                              |   |   | % of totalrevenue |   |   |   | % of totalrevenue |
| Total revenue                     | $ | 50,259 |  |   | 100.0 | % |   | $ | 47,218 |  |   | 100.0 | % |
|                              |   |   |   |   |   |   |   |
| Income from continuing operations | $ | 3,131 |  |   |   |   | $ | 1,018 |  |   |   |
| Interest income, net              | (100 | ) |   |   |   | (38 | ) |   |   |
| Income tax provision (benefit)    | 381 |  |   |   |   | (128 | ) |   |   |
| Depreciation and amortization     | 1,162 |  |   |   |   | 1,395 |  |   |   |
| EBITDA from continuing operations | $ | 4,574 |  |   | 9.1 | % |   | $ | 2,247 |  |   | 4.8 | % |

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|                                                              |
|--------------------------------------------------------------|
|                                                              |  |  |  |  |
|                                                         |   |   |   |   |
| Digi International Reports First Fiscal Quarter 2016 Results |

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|                                                              |  |  |  |  |
|                                                         |   |   |   |   |
| Digi International Reports First Fiscal Quarter 2016 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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|                                                              |
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|                                                              |  |  |  |  |
|                                                         |   |   |   |   |
| Digi International Reports First Fiscal Quarter 2016 Results |

|                                                                |
|----------------------------------------------------------------|
|                                                                |  |  |  |  |  |  |  |
|                                                           | Three months endedDecember 31, |
|                                                           | 2015 |   | 2014 |
| Revenue:                                                       |   |   |   |
| Hardware product                                               | $ | 48,247 |  |   | $ | 44,933 |  |
| Service                                                        | 2,012 |  |   | 2,285 |  |
| Total revenue                                                  | 50,259 |  |   | 47,218 |  |
| Cost of sales:                                                 |   |   |   |
| Cost of hardware product                                       | 24,710 |  |   | 23,112 |  |
| Cost of service                                                | 1,192 |  |   | 1,549 |  |
| Total cost of sales                                            | 25,902 |  |   | 24,661 |  |
| Gross profit                                                   | 24,357 |  |   | 22,557 |  |
| Operating expenses:                                            |   |   |   |
| Sales and marketing                                            | 8,518 |  |   | 10,235 |  |
| Research and development                                       | 7,838 |  |   | 7,083 |  |
| General and administrative                                     | 4,061 |  |   | 4,775 |  |
| Restructuring charges, net                                     | 651 |  |   | — |  |
| Total operating expenses                                       | 21,068 |  |   | 22,093 |  |
| Operating income                                               | 3,289 |  |   | 464 |  |
| Other income, net:                                             |   |   |   |
| Interest income, net                                           | 100 |  |   | 38 |  |
| Other income, net                                              | 123 |  |   | 388 |  |
| Total other income, net                                        | 223 |  |   | 426 |  |
| Income from continuing operations, before income taxes         | 3,512 |  |   | 890 |  |
| Income tax provision (benefit)                                 | 381 |  |   | (128 | ) |
| Income from continuing operations                              | 3,131 |  |   | 1,018 |  |
| Income (loss) from discontinued operations, after income taxes | 3,319 |  |   | (1,357 | ) |
| Net income (loss)                                              | $ | 6,450 |  |   | $ | (339 | ) |
|                                                           |   |   |   |
| Basic net income (loss) per common share:                      |   |   |   |
| Continuing operations                                          | $ | 0.12 |  |   | $ | 0.04 |  |
| Discontinued operations                                        | $ | 0.13 |  |   | $ | (0.06 | ) |
| Net income (loss)                                              | $ | 0.25 |  |   | $ | (0.01 | ) |
| Diluted net income (loss) per common share:                    |   |   |   |
| Continuing operations                                          | $ | 0.12 |  |   | $ | 0.04 |  |
| Discontinued operations                                        | $ | 0.13 |  |   | $ | (0.06 | ) |
| Net income (loss)                                              | $ | 0.25 |  |   | $ | (0.01 | ) |
| Weighted average common shares:                                |   |   |   |
| Basic                                                          | 25,331 |  |   | 24,150 |  |
| Diluted                                                        | 26,171 |  |   | 24,150 |  |

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|                                                              |
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|                                                              |  |  |  |  |
|                                                         |   |   |   |   |
| Digi International Reports First Fiscal Quarter 2016 Results |

|                                                                             |
|-----------------------------------------------------------------------------|
|                                                                             |  |  |  |  |  |  |  |
|                                                                        | Three months endedDecember 31, |
|                                                                        | 2015 |   | 2014 |
| Net income (loss)                                                           | $ | 6,450 |  |   | $ | (339 | ) |
| Other comprehensive loss, net of tax:                                       |   |   |   |
| Foreign currency translation adjustment                                     | (1,867 | ) |   | (2,373 | ) |
| Change in net unrealized loss on investments                                | (63 | ) |   | (29 | ) |
| Less income tax benefit                                                     | 23 |  |   | 11 |  |
| Reclassification of realized gain on investments included in net income (1) | (7 | ) |   | — |  |
| Less income tax provision (2)                                               | 3 |  |   | — |  |
| Other comprehensive loss, net of tax                                        | (1,911 | ) |   | (2,391 | ) |
| Comprehensive income (loss)                                                 | $ | 4,539 |  |   | $ | (2,730 | ) |

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|                                                              |
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|                                                              |  |  |  |  |
|                                                         |   |   |   |   |
| Digi International Reports First Fiscal Quarter 2016 Results |

|                                                           |
|-----------------------------------------------------------|
|                                                           |  |  |  |  |  |  |  |
|                                                      | December 31,2015 |   | September 30, 2015 |
| ASSETS                                                    |   |   |   |
| Current assets:                                           |   |   |   |
| Cash and cash equivalents                                 | $ | 52,190 |  |   | $ | 45,018 |  |
| Marketable securities                                     | 50,202 |  |   | 47,191 |  |
| Accounts receivable, net                                  | 24,931 |  |   | 27,788 |  |
| Inventories                                               | 30,115 |  |   | 31,877 |  |
| Deferred tax assets                                       | — |  |   | 3,252 |  |
| Receivable from sale of business                          | 2,952 |  |   | — |  |
| Other                                                     | 4,734 |  |   | 3,435 |  |
| Current assets of discontinued operations                 | — |  |   | 1,624 |  |
| Total current assets                                      | 165,124 |  |   | 160,185 |  |
| Marketable securities, long-term                          | 11,524 |  |   | 13,626 |  |
| Property, equipment and improvements, net                 | 14,156 |  |   | 14,339 |  |
| Identifiable intangible assets, net                       | 5,061 |  |   | 2,648 |  |
| Goodwill                                                  | 110,244 |  |   | 100,183 |  |
| Deferred tax assets                                       | 7,927 |  |   | 6,255 |  |
| Non-current receivable from sale of business              | 1,930 |  |   | — |  |
| Other                                                     | 300 |  |   | 250 |  |
| Non-current assets of discontinued operations             | — |  |   | 2,874 |  |
| Total assets                                              | $ | 316,266 |  |   | $ | 300,360 |  |
| LIABILITIES AND STOCKHOLDERS’ EQUITY                |   |   |   |
| Current liabilities:                                      |   |   |   |
| Accounts payable                                          | $ | 6,904 |  |   | $ | 6,673 |  |
| Income taxes payable                                      | 151 |  |   | 828 |  |
| Accrued compensation                                      | 5,248 |  |   | 10,156 |  |
| Accrued warranty                                          | 968 |  |   | 1,014 |  |
| Contingent consideration on acquired business             | 833 |  |   | — |  |
| Other                                                     | 4,201 |  |   | 3,037 |  |
| Current liabilities of discontinued operations            | — |  |   | 1,481 |  |
| Total current liabilities                                 | 18,305 |  |   | 23,189 |  |
| Income taxes payable                                      | 1,349 |  |   | 1,546 |  |
| Deferred tax liabilities                                  | 720 |  |   | 135 |  |
| Non-current contingent consideration on acquired business | 9,567 |  |   | — |  |
| Other non-current liabilities                             | 809 |  |   | 457 |  |
| Non-current liabilities of discontinued operations        | — |  |   | 95 |  |
| Total liabilities                                         | 30,750 |  |   | 25,422 |  |
|                                                      |   |   |   |
| Total stockholders’ equity                          | 285,516 |  |   | 274,938 |  |
| Total liabilities and stockholders’ equity          | $ | 316,266 |  |   | $ | 300,360 |  |

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|                                                              |
|--------------------------------------------------------------|
|                                                              |  |  |  |  |
|                                                         |   |   |   |   |
| Digi International Reports First Fiscal Quarter 2016 Results |

|                                                                                                                |
|----------------------------------------------------------------------------------------------------------------|
|                                                                                                                |  |  |  |  |  |  |  |
|                                                                                                           | Three months ended December 31, |
|                                                                                                           | 2015 |   | 2014 |
| Operating activities:                                                                                          |   |   |   |
| Net income (loss)                                                                                              | $ | 6,450 |  |   | $ | (339 | ) |
| Adjustments to reconcile net income (loss) to net cash provided by operating activities:                       |   |   |   |
| Depreciation of property, equipment and improvements                                                           | 724 |  |   | 752 |  |
| Amortization of identifiable intangible assets                                                                 | 468 |  |   | 770 |  |
| Stock-based compensation                                                                                       | 816 |  |   | 1,184 |  |
| Excess tax benefits from stock-based compensation                                                              | (190 | ) |   | — |  |
| Deferred income tax provision                                                                                  | 1,300 |  |   | 412 |  |
| Gain on sale of business                                                                                       | (3,392 | ) |   | — |  |
| Bad debt/product return provision                                                                              | 168 |  |   | 30 |  |
| Inventory obsolescence                                                                                         | 409 |  |   | 230 |  |
| Restructuring charges, net                                                                                     | 651 |  |   | — |  |
| Other                                                                                                          | 40 |  |   | (6 | ) |
| Changes in operating assets and liabilities                                                                    | (3,889 | ) |   | 2,310 |  |
| Net cash provided by operating activities                                                                      | 3,555 |  |   | 5,343 |  |
| Investing activities:                                                                                          |   |   |   |
| Purchase of marketable securities                                                                              | (8,079 | ) |   | (12,135 | ) |
| Proceeds from maturities of marketable securities                                                              | 7,106 |  |   | 9,321 |  |
| Proceeds from sale of business                                                                                 | 2,866 |  |   | — |  |
| Acquisition of business, net of cash acquired                                                                  | (2,860 | ) |   | — |  |
| Purchase of property, equipment, improvements and certain     other intangible assets | (545 | ) |   | (1,469 | ) |
| Net cash used in investing activities                                                                          | (1,512 | ) |   | (4,283 | ) |
| Financing activities:                                                                                          |   |   |   |
| Excess tax benefits from stock-based compensation                                                              | 190 |  |   | — |  |
| Proceeds from stock option plan transactions                                                                   | 5,752 |  |   | 9 |  |
| Proceeds from employee stock purchase plan transactions                                                        | 301 |  |   | 261 |  |
| Purchases of common stock                                                                                      | (403 | ) |   | (2,257 | ) |
| Net cash provided by (used in) financing activities                                                            | 5,840 |  |   | (1,987 | ) |
| Effect of exchange rate changes on cash and cash equivalents                                                   | (711 | ) |   | (1,520 | ) |
| Net increase (decrease) in cash and cash equivalents                                                           | 7,172 |  |   | (2,447 | ) |
| Cash and cash equivalents, beginning of period                                                                 | 45,018 |  |   | 47,490 |  |
| Cash and cash equivalents, end of period                                                                       | $ | 52,190 |  |   | $ | 45,043 |  |
|                                                                                                           |   |   |   |
| Supplemental schedule of non-cash investing activities:                                                        |   |   |   |
| Receivable related to sale of business                                                                         | $ | 5,015 |  |   | $ | — |  |
| Contingent consideration on acquired business                                                                  | $ | (10,550 | ) |   | $ | — |  |