13 unchanged sentences
Delays or lost revenue could be caused by other factors beyond our control, including late deliveries by vendors of components, or force majeure events.
−Removed: As an example of force majeure, a fire in November 2014 disrupted the operations at one of our contract manufacturers in Thailand.
+Added: As an example of force majeure, a fire many years ago disrupted the operations at one of our contract manufacturers in Thailand.
If we are required to identify alternative suppliers for any of our required components, qualification and pre-production periods could be lengthy and may cause an increase in component costs and delays in providing products to customers.
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Because of the lengthy sales cycle and the large size of certain customer orders, if orders forecasted for a specific customer are not realized or delayed, our operating results could be materially adversely affected.
+Added: Certain parts of our business are subject to customer concentrations.
+Added: Several of our acquired businesses historically have depended on relationships with one or a small number of customers or have a significant number of customers that are from particular industries.
+Added: Any disruption in their business with those customers, whether as a result of changes in demand for the customer’s services, adverse changes in the customer’s industry generally or other challenges in securing or renewing contracts, could have a material adverse impact on our business, results of operations, financial condition and prospects.
+Added: For example, we acquired Accelerated in fiscal 2018.
+Added: Although Accelerated has many customers, its business historically has been highly dependent on its relationship with a single telecommunications carrier customer.
+Added: We acquired Opengear in fiscal 2019.
+Added: Although Opengear has many customers, its business historically has been significantly concentrated on its relationships with a few large customers and focused on data centers.
+Added: We acquired Ventus in fiscal 2022.
+Added: Although Ventus has many customers, its business historically has been significantly concentrated on its relationships with fewer than twenty customers and it also serves a significant number of customers in the financial and gaming terminal industries.
+Added: Likewise, our combined SmartSense by Digi and Jolt offerings service a significant number of large customers in the retail pharmaceutical, medical facility and retail food industries.
+Added: Both Ventus and SmartSense by Digi / Jolt produce significant ARR.
+Added: Any disruption or difficulties in any of the industries these businesses serve could have an adverse impact on our business, results of operations (including, but not limited to, ARR), financial condition and prospects.
+Added: In addition, some larger customers may demand discounts and rebates.
+Added: As a result, our future revenue opportunities with these customers may be limited, and we may face pricing pressures, which in turn could adversely impact our operating margin and our profitability.
+Added: The loss of, reduction in, or pricing discounts associated with orders from key customers may significantly reduce our revenue and harm our business.
+Added: Furthermore, delays in payment and/or extended payment terms from larger customers could have a disproportionate and material negative impact on our cash flows and working capital to support our business operations.
+Added: We had one distributor customer of Digi's IoT Products & Services segment that represented 13 % of consolidated revenue for the twelve months ended September 30, 2025.
+Added: No customers represented over 10% of consolidated revenue for the twelve months ended September 30, 2024 or 2023.
Acquisitions could disrupt our business and seriously harm our financial condition.
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We could also be exposed to litigation as a result of any consummated or unconsummated acquisition.
−Removed: Certain parts of our business are subject to customer concentrations.
−Removed: Several of our acquired businesses historically have depended on relationships with one or a small number of customers or have a significant number of customers that are from particular industries.
−Removed: Any disruption in their business with those customers, whether as a result of changes in demand for the customer’s services, adverse changes in the customer’s industry generally or other challenges in securing or renewing contracts, could have a material adverse impact on our business, results of operations, financial condition and prospects.
−Removed: For example, we acquired Accelerated in fiscal 2018.
−Removed: Although Accelerated has many customers, its business historically has been highly dependent on its relationship with a single telecommunications carrier customer.
−Removed: We acquired Opengear in fiscal 2019.
−Removed: Although Opengear has many customers, its business historically has been significantly concentrated on its relationships with a few large customers.
−Removed: We acquired Ventus in fiscal 2022.
−Removed: Although Ventus has many customers, its business historically has been significantly concentrated on its relationships with fewer than twenty customers and it also serves a significant number of customers in the financial and gaming terminal industries.
−Removed: Likewise, our SmartSense by Digi business services a significant number of large customers in the retail pharmaceutical, medical facility and retail food industries.
−Removed: Both Ventus and SmartSense by Digi produce significant ARR.
−Removed: Any disruption or difficulties in any of the industries these businesses serve could have an adverse impact on our business, results of operations (including, but not limited to, ARR), financial condition and prospects.
−Removed: In addition, some larger customers may demand discounts and rebates.
−Removed: As a result, our future revenue opportunities with these customers may be limited, and we may face pricing pressures, which in turn could adversely impact our gross margin and our profitability.
−Removed: The loss of, reduction in, or pricing discounts associated with orders from key customers may significantly reduce our revenue and harm our business.
−Removed: Furthermore, delays in payment and/or extended payment terms from larger customers could have a disproportionate and material negative impact on our cash flows and working capital to support our business operations.
From time to time, we are subject to claims and litigation regarding intellectual property rights or other claims pertaining to our business, which could seriously harm us and require us to incur significant costs.
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We also employ significant human and financial resources to develop and deploy these offerings.
−Removed: As we work to grow and scale these offerings, these investments have impacted previously and may impact adversely in the future our gross margins and profitability.
+Added: As we work to grow and scale these offerings, these investments have impacted previously and may impact adversely in the future our operating margins and profitability.
While we believe we have a strong foundation to compete, it is uncertain whether our strategies will attract the users or generate the revenue required to be successful.
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If we fail to manage our existing or future sales through distributors and resellers effectively, our business and operating results could be materially and adversely affected.
+Added: Potential new or incremental international tariffs could materially and adversely affect our business and results of operations.
+Added: Due to the global reach of our operations, changes in international trade policy could result in an adverse effect on our results of operations, financial condition and cash flows.
+Added: Additional or new tariffs imposed by various governments globally have the potential to disrupt existing supply chains and impose additional costs on our business.
+Added: Existing and future retaliatory trade actions imposed by other governments, as well as possible price increases we may elect to charge, could make our products more expensive for customers, and, in turn, could make our products less competitive.
+Added: Any existing or new, substantial tariff increases on imports within our supply chain or involving countries in which our contract manufacturers are located, should they be implemented and sustained for an extended period of time, could have a significant adverse effect on our business and our supply chain.
The businesses of our IoT Solutions segment are subject to the risks faced by businesses operating in emerging markets.
−Removed: SmartSense by Digi is operated in an emerging market where technology-based solutions to monitor the condition of perishable goods as well as the completion of employee tasks have not been used historically.
+Added: The combined SmartSense by Digi / Jolt product line is operated in an emerging market where technology-based solutions such as the monitoring of the condition of perishable goods as well as the completion of employee tasks have not been used historically.
Similarly, our Ventus business is operating in an evolving marketplace where the breadth of companies with collections of assets that require connectivity and general monitoring is evolving.
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Additional risks that relate to IoT Solutions, include, but are not limited to:
−Removed: • SmartSense by Digi offerings are deployed in part to help assure perishable goods are safely preserved.
+Added: • SmartSense by Digi / Jolt offerings are deployed in part to help assure perishable goods are safely preserved and that necessary operating tasks are completed timely.
Ventus's offering is deployed so that dispersed collections of critical, operational assets requiring network connectivity (such as ATMs, lottery terminals, etc.) are fully operational.
In each case, there is a potential risk of loss in the event of a malfunction or failure in our offerings.
−Removed: • SmartSense by Digi has a limited history with us in a marketplace that is relatively early in its development and has numerous competitors.
+Added: • The SmartSense by Digi / Jolt product line has a limited history with us in a marketplace that is relatively early in its development and has numerous competitors.
Although Ventus has a longer operating history and some of the marketplaces in which it operates are quite mature, new use cases continue to emerge as businesses increasingly rely on self-service devices in their operations with customers.
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In light of these risks and uncertainties, we may not be able to establish or maintain the market share of these businesses or take full advantage of businesses we may acquire in the future related to either of these businesses.
−Removed: There can be no assurance that we will recover our investments in SmartSense by Digi or Ventus or that we will realize ongoing and consistent profits from these businesses.
+Added: There can be no assurance that we will recover our investments in SmartSense by Digi / Jolt or Ventus or that we will realize ongoing and consistent profits from these businesses.
Also, there can be no assurance that diverting our management’s attention to these businesses will not have a material adverse effect on our other existing businesses, any of which may have a material adverse effect on our results of operations, financial condition and prospects.
−Removed: Our sales and operations globally face risks related to health epidemics or pandemics that could disrupt our operations and adversely impact our sales and operating results.
−Removed: Our business operations and financial results could be adversely affected by the effects of a widespread outbreak of contagious disease or other material adverse widespread public health development, such as the outbreak of the Covid-19 respiratory illness caused by a novel coronavirus first identified in Wuhan, Hubei Province, China in 2019.
−Removed: These effects could include the absence of one or more key employees or significant numbers or employees generally, disruptions or restrictions on our ability to maintain operations at one or more of our facilities, disruptions or restrictions to travel that is important to our operations, adverse impacts on our ability to distribute or deliver our products or services as well as temporary disruptions, restrictions or closures of the facilities of our suppliers or customers and their contract manufacturers.
−Removed: Any of the above absences, disruptions or restrictions could impact our sales and operating results negatively.
−Removed: If these absences, disruptions or restrictions are significant and material it is possible our business continuity could be jeopardized.
−Removed: Depending on the location of any such disruption or restriction, there may not be a solution that will be easy to implement in a timely manner or without significant expense.
−Removed: In addition, any significant outbreak of contagious diseases could materially and adversely affect the economies and financial markets of many countries or the entire world, resulting in an economic downturn that could affect demand for our products, likely impact our operating results and restrain our access to capital from lenders or other sources.
Technology and Cybersecurity Risks
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We also rely on cloud-based technologies for our solutions, as well as our internal systems.
−Removed: As we continue to direct a substantial portion of our sales and development efforts toward broader based solutions, such as SmartSense by Digi, the Digi
−Removed: Remote Manager and Ventus offerings, we expect to store, convey and potentially process significant amounts of data produced by devices.
+Added: As we continue to direct a substantial portion of our sales and development efforts toward broader based solutions, such as SmartSense by Digi / Jolt, the Digi Remote Manager and Ventus offerings, we expect to store, convey and potentially process significant amounts of data produced by devices.
We have completed a number of acquisitions in recent years and have inherited a range of different systems that store, convey and potentially process data and, in some cases, we may be delayed or choose not to integrate these systems into similar systems used in other parts of our business.
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As regulations take effect or evolve it is possible we may encounter issues being fully compliant with these legal standards which could result in material adverse effects on our business.
−Removed: Issues related to the of artificial intelligence may result in regulatory or legal action, damage our reputation, or harm our business.
+Added: Issues related to the use of artificial intelligence may result in regulatory or legal action, damage our reputation, or harm our business.
We use tools and processes that incorporate artificial intelligence (“AI”) in various business processes.
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Product delivery times may be extended due to the distances involved or events beyond our control, requiring more lead time in ordering.
−Removed: In addition, ocean freight delays may occur as a result of labor problems, weather delays, expediting orders for third parties, customs issues, geopolitical tensions, or other events beyond our control.
+Added: In addition, ocean freight delays may
+Added: occur as a result of labor problems, weather delays, expediting orders for third parties, customs issues, geopolitical tensions, or other events beyond our control.
Any extended delay in receipt of the component parts could eliminate anticipated cost savings and have a material adverse effect on our customer relationships and profitability.
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Sanctions against and actions of the Russian government resulting from the war in Ukraine may be adverse to suppliers who we rely upon.
−Removed: The conflict in the Middle East may cause shipping disruptions and increased transport costs that could have a material adverse effect on our ability to obtain components from our foreign suppliers and our financial results.
−Removed: Finally, the introduction of new regulations by governments may also impact the availability, delivery or certain components or our ability
−Removed: to use certain components because of, among other potential reasons, the materials those components may contain or the location of the supplier of the component or certain materials contained in the component.
+Added: Tensions in the Middle East, in light of ongoing conflicts in the region since the October 7, 2023 attack on Israel may cause shipping disruptions and increased transport costs that could have a material adverse effect on our ability to obtain components from our foreign suppliers and our financial results.
+Added: Finally, the introduction of new regulations by governments may also impact the availability, delivery or certain components or our ability to use certain components because of, among other potential reasons, the materials those components may contain or the location of the supplier of the component or certain materials contained in the component.
We face risks associated with our international operations that could impair our ability to grow our revenue abroad as well as our overall financial condition.
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Additionally, it is probable that new competitors or new alliances among existing competitors could emerge and rapidly acquire significant market share.
−Removed: Our dependence on new product development and the rapid technological change that characterizes our industry make us susceptible to loss of market share resulting from competitors’ product introductions and enhancements, service capabilities and similar risks as well as from regulatory changes.
+Added: Our dependence on new product development, rapid technological change, competitors’ product introductions and enhancements, and regulatory changes make us susceptible to potential fluctuations in demand or loss of market share for our products.
Our industry is characterized by rapidly changing technologies, evolving industry standards, frequent new product introductions, short product life cycles in certain instances and rapidly changing customer requirements.
−Removed: The introduction of products and enhancements embodying new technologies that can disrupt one or more markets in which we compete and the emergence of new industry standards or regulations impacting our industry can render existing products obsolete or unmarketable.
+Added: One example of new technology that could impact the markets in which we sell products and customer requirements could be the introduction of artificial intelligence features into products or solutions offerings.
+Added: The introduction of products and enhancements embodying new technologies, whether via competitors’ products or just changes in markets where we sell products because of other changes in technology more generally, can disrupt one or more markets in which we compete.
+Added: In addition, the emergence of new or changed industry standards or regulations impacting our industry can also cause demand for our products to fluctuate or render our products obsolete or unmarketable.
Our future success will depend on our ability to enhance our existing products, to introduce new products to meet changing customer requirements and emerging technologies as well as potential regulatory changes, and to demonstrate the performance advantages and cost-effectiveness of our products over competing products.
+Added: This could be impacted not only by the features we offer in our products, but also by our ability to operate efficiently relative to those with whom we compete.
+Added: For instance, if competitors with more resources than us are able to deploy efficiency enhancements into their operations more quickly than us (whether via significant investments in artificial intelligence or otherwise) they may be better positioned than us to more quickly enhance existing products or introduce new products that meet customer requirements or market demands.
Failure by us to modify our products to support new alternative technologies or failure to achieve widespread customer acceptance of such modified products could cause us to lose market share and cause our revenue to decline.
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There can be no assurance that we will not experience difficulties that could delay or prevent the successful development, introduction, and marketing of these products or product enhancements, or that our new products and product enhancements will meet the requirements of the marketplace adequately and achieve any significant or sustainable degree of market acceptance in existing or additional markets.
+Added: Further, demand for products can fluctuate because of changes in technology generally which could also impact our sales of products.
In addition, the future introductions or announcements of products by us or one of our competitors embodying new technologies or changes in industry standards or regulations or customer requirements could render our then-existing products obsolete or unmarketable.
This risk may become more pronounced as new competitors emerge in markets where we sell our products, especially if these competitors have more resources than us to develop and market new products and technologies and provide related services.
−Removed: There can be no assurance that the introduction or announcement of new product offerings by us or one or more of our competitors will not cause customers to defer their purchase of our existing products, which could cause our revenue to decline.
+Added: There can be no assurance that the introduction or announcement of new technologies into markets where we sell products or the introduction or announcement of product offerings by us or one or
+Added: more of our competitors will not cause customers to defer their purchase of our existing products, which could cause our revenue to decline.
Our failure to compete successfully in our highly competitive market could result in reduced prices and loss of market share.
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Competition may also intensify, or we may no longer be able to compete effectively in the markets in which we compete.
−Removed: Strategic Risks
−Removed: We intend to continue to devote significant resources to our research and development, which, if not successful, could cause a decline in our revenue and harm our business.
−Removed: We intend to continue to devote significant resources to research and development in the coming years to enhance our existing product offerings and develop additional product offerings.
−Removed: For fiscal 2024, 2023, and 2022, respectively, our research and development expenses were 14.2%, 13.2% and 14.2% of our revenue.
−Removed: If we are unable to enhance existing products and develop new products, applications and services as a result of our research and development efforts, if we encounter delays in deploying these enhanced or new products, applications and services, or if the products, applications and services we enhance or develop are not successful, our business could be harmed.
−Removed: Even if we enhance existing products and develop new products, applications and services that are accepted by our target markets, the net revenue from these products, applications and services may not be sufficient to justify our investment in research and development.
−Removed: Many of our products, applications and services have been developed through a combination of internally developed technologies and acquired technologies.
−Removed: Our ability to continue to develop products, applications and services could be partially dependent on finding and acquiring new technologies in the marketplace.
−Removed: Even if we identify new technologies that we believe would be complementary to our internally developed technologies, we may not be successful in obtaining those technologies or integrating them effectively with our existing technologies.
−Removed: Our ability to grow our business is dependent in part on strategic relationships we develop and maintain with third parties as well as our ability to integrate and assure use of our products and services in coordination with the products and services of certain strategic partners in a commercially acceptable manner.
−Removed: We believe that our ability to increase our sales depends in part on maintaining and strengthening relationships with parties such as telecommunications carriers, systems integrators, enterprise application providers, component providers and other strategic technology companies.
−Removed: Once a relationship is established, we likely will dedicate significant time and resources to it in an effort to advance our business interests and there is no assurance any strategic relationship will generate enough revenue to offset the significant resources we use to advance the relationship.
−Removed: Parties with whom we establish strategic relationships also work with companies that compete with us.
−Removed: We have limited, if any, control as to whether these parties devote adequate resources to promoting, selling, and implementing our products.
−Removed: Further, new or emerging technologies, technological trends or changes in customer requirements may result in certain companies with whom we maintain strategic relationships de-emphasizing their dealings with us or becoming potential competitors in the future.
−Removed: We also have limited, if any, control as to other business activities of these parties and we could experience reputational harm because of our association with such parties if they fail to execute on business initiatives, are accused of breaking the law or otherwise suffer reputational harm for other reasons.
−Removed: All of these factors could materially and adversely impact our business and results of operations.
−Removed: In some cases, we expect the establishment of a strategic relationship with a third party to result in integrations of our products or services with those of other parties.
−Removed: Identifying appropriate parties for these relationships as well as negotiating and documenting business agreements with them requires significant time and resources.
−Removed: We expect these agreements typically to be non-exclusive and not to prohibit the other party from working with our competitors or offering competing services.
−Removed: Once the relationship is established, we may encounter difficulties in combining our products and services in a commercially acceptable manner.
−Removed: We expect this dynamic, where our ability to generate sales is dependent on our products and services interacting with those sold by third parties, may become more common in the future.
−Removed: There can be no guarantee in any particular instance that we will be successful in making our products interact with those of other parties in a commercially acceptable manner and, even if we do, we cannot guarantee that the resulting products and services will be marketed effectively or sold via the relationship.
−Removed: Our failure to anticipate or manage product transitions effectively could have a material adverse effect on our revenue and profitability.
−Removed: From time to time, we or our competitors may announce new or enhanced products that may replace or shorten the life cycles of our existing products.
−Removed: Announcements of currently planned or other new or enhanced products may cause customers to defer or stop purchasing our products until these products become available.
−Removed: Furthermore, the introduction of new or enhanced products because of customer requirement, regulation or otherwise may require us to manage the transition from older product inventories and ensure that adequate supplies of new or enhanced products can be delivered to meet customer demand.
−Removed: Our failure to anticipate the revenue declines associated with older products or manage transitions from older products effectively could result in inventory obsolescence and also have a material adverse effect on our revenue and profitability.
−Removed: We are dependent on third parties to manufacture our products which could have adverse impacts on our business if such manufacturers encounter operating restraints or if we do not properly forecast customer demand.
−Removed: We are reliant on third parties to manufacture our products in countries such as Mexico, Thailand, Taiwan and China.
−Removed: The ability of these manufacturers to provide us with the timely provision of finished products is subject to a number of disruptions beyond their control such as, among others:
−Removed: the availability of components from suppliers, labor shortages, energy shortages such as those from time to time encountered in China, changes in government regulations, tensions with foreign governments or other factors.
−Removed: If we do not properly forecast customer demands for products any lengthening in lead times or disruptions in service could result in lost revenues and adversely impact our business, results of operation, financial condition and prospects.
−Removed: The loss of key personnel could prevent us from executing our business strategy.
−Removed: Our business and prospects depend to a significant degree upon the continuing contributions of our executive officers and key technical and other personnel.
−Removed: Competition for such personnel is intense, and in the current environment of large numbers of workers leaving their current employment for new opportunities, there can be no assurance that we will be successful in
−Removed: retaining qualified personnel.
−Removed: Failure to attract and retain key personnel could result in our failure to execute our business strategy.
Risks Related to Economic and Market Conditions
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Any downturn could have a material adverse impact on our business, results of operations, financial condition and prospects.
−Removed: Our gross margins may be subject to decline.
−Removed: Our gross margins may be subject to declines which could decrease our overall profitability and impact our financial performance adversely.
−Removed: Some of the hardware products we sell are approaching the end of their product life cycles.
−Removed: These mature hardware products have sold historically at higher gross margins than our other product and service offerings.
−Removed: We expect this general trend of declining sales for many of our mature products to continue and the pace of the decline may accelerate.
−Removed: In addition, rising prices for goods and services due to inflation along with ongoing cost pressures in our industry create downward pressure on the prices at which we and other manufacturers may be able to sell hardware products.
−Removed: We have indicated that we would be willing to realize lower levels of gross margins from customers in return for long-term, binding purchase commitments.
−Removed: If this strategy were successful, it could apply downward pressure on our gross margins.
−Removed: Part of our strategy is to sell software applications and IoT solutions such as SmartSense by Digi, Ventus offerings and hardware bundled with services on a subscription basis.
−Removed: These sales may provide recurring revenues at relatively high gross margins, but these types of offerings are still in the earlier stages of adoption by customers.
−Removed: As such, their sales growth is not necessarily predictable or assured.
−Removed: Our gross margins therefore may be subject to decline unless we can implement cost reduction initiatives effectively to offset the impact of these factors.
Our revenue may be subject to fluctuations based on the level of significant large project-based purchases.
−Removed: No single customer has represented more than 10% of our revenue in any of the last three fiscal years.
−Removed: However, many of our customers make significant one-time hardware purchases for large projects that are not repeated.
+Added: Many of our customers make significant one-time hardware purchases for large projects that are not repeated.
As a result, our revenue may be subject to significant fluctuations based on whether we are able to close significant project-based sales opportunities.
−Removed: In addition, in our SmartSense by Digi and Ventus businesses certain customers have outsized deployments relative to other customers.
+Added: In addition, in our SmartSense by Digi / Jolt and Ventus product lines certain customers have outsized deployments relative to other customers.
It is possible we will see revenue fluctuations in these businesses based upon the scale of new deployments in different financial periods.
Our failure to complete one or a series of significant sales opportunities in a particular fiscal period could have a material adverse effect on our revenue for that period.
+Added: Our operating margins may be subject to decline.
+Added: Our operating margins may be subject to declines which could decrease our overall profitability and impact our financial performance adversely.
+Added: Some of the hardware products we sell are approaching the end of their product life cycles.
+Added: These mature hardware products have sold historically at higher operating margins than our other product and service offerings.
+Added: We expect this general trend of declining sales for many of our mature products to continue and the pace of the decline may accelerate.
+Added: In addition, rising prices for goods and services due to inflation along with ongoing cost pressures in our industry create downward pressure on the prices at which we and other manufacturers may be able to sell hardware products.
+Added: We have indicated that we would be willing to realize lower levels of operating margins from customers in return for long-term, binding purchase commitments.
+Added: If this strategy were successful, it could apply downward pressure on our operating margins.
+Added: Part of our strategy is to sell software applications and IoT solutions such as SmartSense by Digi / Jolt, Ventus offerings and hardware bundled with services on a subscription basis.
+Added: These sales may provide recurring revenues at relatively high operating margins, but these types of offerings are still in the earlier stages of adoption by customers.
+Added: As such, their sales growth is not necessarily predictable or assured.
+Added: Our operating margins therefore may be subject to decline unless we can implement cost reduction initiatives effectively to offset the impact of these factors.
Some of our products are sold into mature markets, which could limit our ability to continue to generate revenue from these products.
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The results of an audit could have a material effect on our consolidated financial position, results of operations, or cash flows in the period or periods for which that determination is made.
+Added: Strategic Risks
+Added: Our ability to grow our business is dependent in part on strategic relationships we develop and maintain with third parties as well as our ability to integrate and assure use of our products and services in coordination with the products and services of certain strategic partners in a commercially acceptable manner.
+Added: We believe that our ability to increase our sales depends in part on maintaining and strengthening relationships with parties such as telecommunications carriers, systems integrators, enterprise application providers, component providers and other strategic technology companies.
+Added: Once a relationship is established, we likely will dedicate significant time and resources to it in an effort to advance our business interests and there is no assurance any strategic relationship will generate enough revenue to offset the significant resources we use to advance the relationship.
+Added: Parties with whom we establish strategic relationships also work with companies that compete with us.
+Added: We have limited, if any, control as to whether these parties devote adequate resources to promoting, selling, and implementing our products.
+Added: Further, new or emerging technologies, technological trends or changes in customer requirements may result in certain companies with whom we maintain strategic relationships de-emphasizing their dealings with us or becoming potential competitors in the future.
+Added: We also have limited, if any, control as to other business activities of these parties and we could experience reputational harm because of our association with such parties if they fail to execute on business initiatives, are accused of breaking the law or otherwise suffer reputational harm for other reasons.
+Added: All of these factors could materially and adversely impact our business and results of operations.
+Added: In some cases, we expect the establishment of a strategic relationship with a third party to result in integrations of our products or services with those of other parties.
+Added: Identifying appropriate parties for these relationships as well as negotiating and documenting business agreements with them requires significant time and resources.
+Added: We expect these agreements typically to be non-exclusive and not to prohibit the other party from working with our competitors or offering competing services.
+Added: Once the relationship is established, we may encounter difficulties in combining our products and services in a commercially acceptable manner.
+Added: We expect this dynamic, where our ability to generate sales is dependent on our products and services interacting with those sold by third parties, may become more common in the future.
+Added: There can be no guarantee in any particular instance that we will be successful in making our products interact with those of other parties in a commercially acceptable manner and, even if we do, we cannot guarantee that the resulting products and services will be marketed effectively or sold via the relationship.
+Added: The loss of key personnel could prevent us from executing our business strategy.
+Added: Our business and prospects depend to a significant degree upon the continuing contributions of our executive officers and key technical and other personnel.
+Added: Competition for such personnel is intense, and in the current environment of large numbers of workers leaving their current employment for new opportunities, there can be no assurance that we will be successful in retaining qualified personnel.
+Added: Failure to attract and retain key personnel could result in our failure to execute our business strategy.
+Added: We are dependent on third parties to manufacture our products which could have adverse impacts on our business if such manufacturers encounter operating restraints or if we do not properly forecast customer demand.
+Added: We are reliant on third parties to manufacture our products in countries such as Mexico, Thailand, Taiwan and China.
+Added: The ability of these manufacturers to provide us with the timely provision of finished products is subject to a number of disruptions beyond their control such as, among others:
+Added: the availability of components from suppliers, labor shortages, energy shortages such as those from time to time encountered in China, changes in government regulations, tensions with foreign governments or other factors.
+Added: If we do not properly forecast customer demands for products any lengthening in lead times or disruptions in service could result in lost revenues and adversely impact our business, results of operation, financial condition and prospects.
+Added: Our failure to anticipate or manage product transitions effectively could have a material adverse effect on our revenue and profitability.
+Added: From time to time, we or our competitors may announce new or enhanced products that may replace or shorten the life cycles of our existing products.
+Added: Announcements of currently planned or other new or enhanced products may cause customers to defer or stop purchasing our products until these products become available.
+Added: Furthermore, the introduction of new or enhanced products because of customer requirement, regulation or otherwise may require us to manage the transition from older product inventories and ensure that adequate supplies of new or enhanced products can be delivered to meet customer demand.
+Added: Our failure to anticipate the revenue declines associated with older products or manage transitions from older products effectively could result in inventory obsolescence and also have a material adverse effect on our revenue and profitability.
+Added: We intend to continue to devote significant resources to our research and development, which, if not successful, could cause a decline in our revenue and harm our business.
+Added: We intend to continue to devote significant resources to research and development in the coming years to enhance our existing product offerings and develop additional product offerings.
+Added: For fiscal 2025, 2024, and 2023, respectively, our research and development expenses were 14.8%, 14.2% and 13.2% of our revenue.
+Added: If we are unable to enhance existing products and develop new products, applications and services as a result of our research and development efforts, if we encounter delays in deploying these enhanced or new products, applications and services, or if the products, applications and services we enhance or develop are not successful, our business could be harmed.
+Added: Even if we enhance existing products and develop new products, applications and services that are accepted by our target markets, the net revenue from these products, applications and services may not be sufficient to justify our investment in research and development.
+Added: Many of our products, applications and services have been developed through a combination of internally developed technologies and acquired technologies.
+Added: Our ability to continue to develop products, applications and services could be partially dependent on finding and acquiring new technologies in the marketplace.
+Added: Even if we identify new technologies that we believe would be complementary to our internally developed technologies, we may not be successful in obtaining those technologies or integrating them effectively with our existing technologies.
Risks Relating to Our Industry
2 unchanged sentences
Our financial condition could be impacted if our wireless carriers increase the prices of their services or suffer operational or technical failures.
+Added: In addition, certain Digi products operate on radio bands licensed by the Federal Communications Commission ("FCC"), and any changes to these band configurations or licensing rules could affect product functionality, marketability, or regulatory compliance that could materially affect our business and financial results in an adverse manner.
Natural disasters, wars and other events beyond our control could impact our supply chain and customers negatively resulting in an adverse impact to our revenue and profitability.
−Removed: Certain of our components and other materials used in producing our products are from regions susceptible to natural disasters or other events beyond our control, such as the Covid-19 pandemic that was highly disruptive to businesses during the last few years or the ongoing wars in Ukraine and the Middle East.
+Added: Certain of our components and other materials used in producing our products are from regions susceptible to natural disasters or other events beyond our control, such as the Covid-19 pandemic that was highly disruptive to businesses during the last few years or the wars in Ukraine and the Middle East.
These and other events beyond our control can adversely impact our supply chains and our business.
27 unchanged sentences
This loss would be recorded in our consolidated statements of operations, which could materially adversely impact our consolidated results of operations and financial condition.
+Added: Government Regulation and Political Risks
+Added: Our inability to obtain the appropriate telecommunications carrier certifications or approvals from governmental regulatory bodies as well as reconfiguration of communications protocols such as radio bands could impede our ability to grow revenue in our wireless products.
+Added: The sale of our wireless products in certain geographical markets is sometimes dependent on the ability to gain telecommunications carrier certifications and/or approvals by certain governmental bodies.
+Added: Failure to obtain these approvals, or
+Added: delays in receiving the approvals, could impact our ability to enter our targeted markets or to compete effectively or at all in these markets and could have an adverse impact on our business and prospects.
+Added: Certain products rely on the current configuration of radio bands by FCC or other governmental regulatory bodies could require the redesign of existing and future products, which could have an adverse impact on our business.
+Added: Our failure to comply effectively with the requirements of applicable environmental, data privacy and security legislation and regulation could have a material adverse effect on our revenue and profitability.
+Added: Production, sale and marketing of products and services in certain states and countries may subject us to environmental, data privacy and security regulations.
+Added: For example, the European Union has issued two directives relating to chemical substances in electronic products.
+Added: The Waste Electrical and Electronic Equipment Directive makes producers of certain electrical and electronic equipment financially responsible for collection, reuse, recycling, treatment and disposal of equipment placed in the European Union market.
+Added: The Restrictions of Hazardous Substances Directive bans the use of certain hazardous materials in electric and electrical equipment which are put on the market in the European Union.
+Added: In addition, data privacy and security regulations have been enacted by both foreign governments and certain states in the US, such as GDPR and CCPA.
+Added: In the future, various governments may adopt further environmental, data privacy and security compliance programs or other rules or regulations that may impact our business operations .
+Added: If we fail to comply with these regulations, we may not be able to sell our products and services in jurisdictions where these regulations apply or subject us to fines or penalties, which could have a material adverse effect on our revenue and profitability.
Risks Related to Our Intellectual Property
10 unchanged sentences
Our failure to adequately protect our proprietary rights could have a material adverse effect on our competitive position and our business.
−Removed: Government and Political Risks
−Removed: Our inability to obtain the appropriate telecommunications carrier certifications or approvals from governmental regulatory bodies as well as reconfiguration of communications protocols such as radio bands could impede our ability to grow revenue in our wireless products.
−Removed: The sale of our wireless products in certain geographical markets is sometimes dependent on the ability to gain telecommunications carrier certifications and/or approvals by certain governmental bodies.
−Removed: Failure to obtain these approvals, or delays in receiving the approvals, could impact our ability to enter our targeted markets or to compete effectively or at all in these markets and could have an adverse impact on our business and prospects.
−Removed: Certain products rely on the current configuration of radio bands by FCC or other governmental regulatory bodies could require the redsign of existing and future products, which could have an adverse impact on our business.
−Removed: Our failure to comply effectively with the requirements of applicable environmental, data privacy and security legislation and regulation could have a material adverse effect on our revenue and profitability.
−Removed: Production, sale and marketing of products and services in certain states and countries may subject us to environmental, data privacy and security regulations.
−Removed: For example, the European Union has issued two directives relating to chemical substances in electronic products.
−Removed: The Waste Electrical and Electronic Equipment Directive makes producers of certain electrical and electronic equipment financially responsible for collection, reuse, recycling, treatment and disposal of equipment placed in the European Union market.
−Removed: The Restrictions of Hazardous Substances Directive bans the use of certain hazardous materials in electric and electrical equipment which are put on the market in the European Union.
−Removed: In addition, data privacy and security regulations have been enacted by both foreign governments and certain states in the US, such as GDPR and CCPA.
−Removed: In the future, various governments may adopt further environmental, data privacy and security compliance programs or other rules or regulations that may impact our business operations .
−Removed: If we fail to comply with these regulations, we may not be able to sell our
−Removed: products and services in jurisdictions where these regulations apply or subject us to fines or penalties, which could have a material adverse effect on our revenue and profitability.
Risks Related to Our Common Stock
9 unchanged sentences
There exist certain mechanisms under the Delaware General Corporation Law and our charter documents that may delay, defer or prevent a change of control.
−Removed: For instance, under Delaware law, we are prohibited from engaging in certain business combinations with interested stockholders for a period of three years after the date of the transaction in which the person became an interested stockholder unless certain requirements are met, and majority stockholder approval is required for certain business combination transactions with interested parties.
+Added: For instance, under Delaware law, we are prohibited from engaging in certain business
+Added: combinations with interested stockholders for a period of three years after the date of the transaction in which the person became an interested stockholder unless certain requirements are met, and majority stockholder approval is required for certain business combination transactions with interested parties.
Our Certificate of Incorporation contains a "fair price" provision requiring majority stockholder approval for certain business combination transactions with interested parties, and this provision may not be changed without the vote of at least 80% of the outstanding shares of our voting stock.
14 unchanged sentences
Our market value is dependent upon certain factors, including continued future growth of our products, services and solutions.
−Removed: If such growth does not materialize or our forecasts are not met (including forecasts established at the time of acquisition), our profits could be significantly reduced, and our market value may decline, which
−Removed: could result in an impairment of our goodwill.
+Added: If such growth does not materialize or our forecasts are not met (including forecasts established at the time of acquisition), our profits could be significantly reduced, and our market value may decline, which could result in an impairment of our goodwill.
As discussed in other risk factors, there could be circumstances beyond our control that could exacerbate the conditions that would lead to such an impairment.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.