Digi International (DGII) 10-Q 5 May 23 2023 Q1 Quarterly report Financial data

Cover Page

Cover Page - shares	6 Months Ended
	Mar. 31, 2023	Apr. 27, 2023
Entity Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2023
Document Transition Report	false
Entity File Number	001-34033
Entity Registrant Name	DIGI INTERNATIONAL INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	41-1532464
Entity Address, Address Line One	9350 Excelsior Blvd.
Entity Address, Address Line Two	Suite 700
Entity Address, City or Town	Hopkins
Entity Address, State or Province	MN
Entity Address, Postal Zip Code	55343
City Area Code	952
Local Phone Number	912-3444
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		35,870,526
Entity Central Index Key	0000854775
Current Fiscal Year End Date	--09-30
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Amendment Flag	false
The Nasdaq Stock Market LLC
Entity Information [Line Items]
Title of 12(b) Security	Common Stock, par value $.01 per share
Trading Symbol	DGII
Security Exchange Name	NASDAQ

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022
Revenue:
Total Revenue	$ 111,144	$ 94,713	$ 220,450	$ 178,970
Cost of sales:
Amortization of intangibles	953	1,303	2,056	2,692
Total cost of sales	48,272	42,729	96,057	79,105
Gross Profit	62,872	51,984	124,393	99,865
Operating expenses:
Sales and marketing	20,341	17,776	39,447	33,095
Research and development	15,155	13,819	29,249	27,231
General and administrative	15,201	12,825	31,559	28,176
Total operating expenses	50,697	44,420	100,255	88,502
Operating income	12,175	7,564	24,138	11,363
Other expense, net:
Interest expense, net	(6,393)	(4,463)	(12,364)	(9,361)
Other expense, net	47	139	64	37
Total other expense, net	(6,346)	(4,324)	(12,300)	(9,324)
Income before income taxes	5,829	3,240	11,838	2,039
Income tax provision (benefit)	(70)	393	160	(1,995)
Net income	$ 5,899	$ 2,847	$ 11,678	$ 4,034
Basic net income per common share:
Net income, basic (USD per share)	$ 0.16	$ 0.08	$ 0.33	$ 0.12
Diluted net income per common share
Net income , diluted (USD per share)	$ 0.16	$ 0.08	$ 0.32	$ 0.11
Weighted average common shares:
Basic (shares)	35,791	35,015	35,698	34,785
Diluted (shares)	36,730	35,608	36,821	35,710
Product
Revenue:
Revenue	$ 83,819	$ 69,167	$ 165,574	$ 132,965
Cost of sales:
Cost of sales excluding amortization	40,218	34,483	79,830	63,722
Service
Revenue:
Revenue	27,325	25,546	54,876	46,005
Cost of sales:
Cost of sales excluding amortization	$ 7,101	$ 6,943	$ 14,171	$ 12,691

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022
Statement of Comprehensive Income [Abstract]
Net income	$ 5,899	$ 2,847	$ 11,678	$ 4,034
Other comprehensive (loss) income:
Foreign currency translation adjustment	178	52	1,467	(160)
Other comprehensive income (loss)	178	52	1,467	(160)
Comprehensive income	$ 6,077	$ 2,899	$ 13,145	$ 3,874

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Mar. 31, 2023	Sep. 30, 2022
Current assets:
Cash and cash equivalents	$ 31,660	$ 34,900
Accounts receivable, net	44,900	50,450
Inventories	83,065	73,223
Income taxes receivable	4,778	3,764
Other current assets	4,663	3,871
Total current assets	169,066	166,208
Property, equipment and improvements, net	29,812	27,594
Intangible assets, net	289,441	302,064
Goodwill	341,862	340,477
Operating lease right-of-use assets	14,179	15,299
Other non-current assets	3,388	2,253
Assets	847,748	853,895
Current liabilities:
Current portion of long-term debt	15,523	15,523
Accounts payable	20,725	32,373
Accrued compensation	12,150	14,576
Unearned revenue	22,576	19,803
Current portion of operating lease liabilities	3,346	3,196
Other current liabilities	9,449	11,036
Total current liabilities	83,769	96,507
Income taxes payable	1,749	2,441
Deferred tax liabilities	6,928	9,666
Long-term debt	214,062	222,448
Operating lease liabilities	15,519	16,978
Other non-current liabilities	5,542	4,342
Total liabilities	327,569	352,382
Commitments and Contingencies (see Note 13)
Preferred Stock, Shares Outstanding	0	0
Stockholders' equity:
Preferred stock, $.01 par value; 2,000,000 shares authorized; none issued and outstanding	$ 0	$ 0
Common stock, $.01 par value; 60,000,000 shares authorized; 42,324,578 and 41,950,732 shares issued	423	420
Additional paid-in capital	394,036	385,244
Retained earnings	211,753	200,075
Accumulated other comprehensive loss	(24,587)	(26,054)
Treasury stock, at cost, 6,463,818 and 6,412,812 shares	(61,446)	(58,172)
Total stockholders' equity	520,179	501,513
Total liabilities and stockholders' equity	$ 847,748	$ 853,895

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Mar. 31, 2023	Sep. 30, 2022
Statement of Financial Position [Abstract]
Preferred stock, par value (USD per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized	2,000,000	2,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (USD per share)	$ 0.01	$ 0.01
Common stock, shares authorized	60,000,000	60,000,000
Common stock, shares issued	42,324,578	41,950,732
Treasury stock, shares	6,463,818	6,412,812

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Operating activities:
Net income	$ 11,678	$ 4,034
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation of property, equipment and improvements	3,245	3,292
Amortization of intangible assets	13,702	16,098
Stock-based compensation	6,333	4,259
Deferred income tax provision	(2,739)	2,160
Other	107	437
Changes in operating assets and liabilities (net of acquisitions)	(22,719)	(18,522)
Net cash provided by operating activities	9,607	11,758
Investing activities:
Acquisition of business, net of cash acquired	0	(347,522)
Purchase of property, equipment, improvements and certain other intangible assets	(2,855)	(1,664)
Net cash used in investing activities	(2,855)	(349,186)
Financing activities:
Proceeds from long-term debt	0	350,000
Payments of Debt Issuance Costs	0	(13,443)
Payments on long-term debt	(9,375)	(109,369)
Proceeds from stock option plan transactions	1,672	5,598
Proceeds from employee stock purchase plan transactions	1,170	670
Taxes paid for net share settlement of share-based payment options and awards	(3,654)	(6,408)
Net cash provided by financing activities	(10,187)	227,048
Effect of exchange rate changes on cash and cash equivalents	195	(666)
Net (decrease) increase in cash and cash equivalents	(3,240)	(111,046)
Cash and cash equivalents, beginning of period	34,900	152,432
Cash and cash equivalents, end of period	31,660	41,386
Supplemental schedule of non-cash investing and financing activities
Interest Paid	14,381	6,570
Income Taxes Paid, Net	3,454	4,535
Transfer of inventory to property, equipment and improvements	(2,685)	(1,215)
Accrual for purchase of property, equipment, improvements and certain other intangible assets	$ (44)	$ (28)

Condensed Consolidated Statem_4

Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Treasury Stock	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive (Loss) Income
Beginning balance (in shares) at Sep. 30, 2021		40,653	6,391
Beginning balance at Sep. 30, 2021	$ 472,517	$ 407	$ (56,535)	$ 370,699	$ 180,692	$ (22,746)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	4,034				4,034
Other comprehensive (loss) income	(160)					(160)
Employee stock purchase plan issuances (in shares)			(37)
Employee stock purchase plan issuances	671		$ 334	337
Taxes paid for net share settlement of share-based payment awards (in shares)			93
Taxes paid for net share settlement of share-based payment awards	(6,408)		$ (2,109)	4,299
Issuance of stock under stock award plans (in shares)		872
Issuance of stock under stock award plans	5,591	$ 8		5,583
Stock-based compensation expense	4,259			4,259
Ending balance (in shares) at Mar. 31, 2022		41,525	6,447
Ending balance at Mar. 31, 2022	480,504	$ 415	$ (58,310)	376,579	184,726	(22,906)
Beginning balance (in shares) at Dec. 31, 2021		41,413	6,447
Beginning balance at Dec. 31, 2021	474,032	$ 414	$ (58,100)	372,797	181,879	(22,958)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	2,847				2,847
Other comprehensive (loss) income	52					52
Employee stock purchase plan issuances (in shares)			(19)
Employee stock purchase plan issuances	350		$ 173	177
Taxes paid for net share settlement of share-based payment awards (in shares)			19
Taxes paid for net share settlement of share-based payment awards	(383)		$ (383)
Issuance of stock under stock award plans (in shares)		112
Issuance of stock under stock award plans	1,364	$ 1		1,363
Stock-based compensation expense	2,242			2,242
Ending balance (in shares) at Mar. 31, 2022		41,525	6,447
Ending balance at Mar. 31, 2022	480,504	$ 415	$ (58,310)	376,579	184,726	(22,906)
Beginning balance (in shares) at Sep. 30, 2022		41,950	6,413
Beginning balance at Sep. 30, 2022	501,513	$ 420	$ (58,172)	385,244	200,075	(26,054)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	11,678				11,678
Other comprehensive (loss) income	1,467					1,467
Employee stock purchase plan issuances (in shares)			(40)
Employee stock purchase plan issuances	1,170		$ 380	790
Taxes paid for net share settlement of share-based payment awards (in shares)			91
Taxes paid for net share settlement of share-based payment awards	(3,654)		$ (3,654)	0
Issuance of stock under stock award plans (in shares)		375
Issuance of stock under stock award plans	1,672	$ 3		1,669
Stock-based compensation expense	6,333			6,333
Ending balance (in shares) at Mar. 31, 2023		42,325	6,464
Ending balance at Mar. 31, 2023	520,179	$ 423	$ (61,446)	394,036	211,753	(24,587)
Beginning balance (in shares) at Dec. 31, 2022		42,199	6,465
Beginning balance at Dec. 31, 2022	509,928	$ 422	$ (60,973)	389,390	205,854	(24,765)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	5,899				5,899
Other comprehensive (loss) income	178					178
Employee stock purchase plan issuances (in shares)			(20)
Employee stock purchase plan issuances	576		$ 194	382
Taxes paid for net share settlement of share-based payment awards (in shares)			19
Taxes paid for net share settlement of share-based payment awards	(667)		$ (667)
Issuance of stock under stock award plans (in shares)		126
Issuance of stock under stock award plans	800	$ 1		799
Stock-based compensation expense	3,465			3,465
Ending balance (in shares) at Mar. 31, 2023		42,325	6,464
Ending balance at Mar. 31, 2023	$ 520,179	$ 423	$ (61,446)	$ 394,036	$ 211,753	$ (24,587)

Basis of Presentation of Unaudi

Basis of Presentation of Unaudited Interim Condensed Consolidated Financial Statements and Significant Accounting Policies	6 Months Ended
	Mar. 31, 2023
Accounting Policies [Abstract]
BASIS OF PRESENTATION OF UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND SIGNIFICANTACCOUNTING POLICIES	BASIS OF PRESENTATION OF UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The unaudited condensed consolidated financial statements of Digi International Inc. ("we", "us", "our", "Digi" or "the Company") have been prepared in accordance with the rules and regulations of the United States Securities and Exchange Commission applicable to interim financial statements. While these financial statements reflect all normal recurring adjustments that are, in the opinion of management, necessary for fair presentation of the results of the interim period, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles ("GAAP") for complete financial statements. These financial statements should be read in conjunction with the financial statement disclosures in Part I, Item 1 of our Annual Report on Form 10-K for the year ended September 30, 2022 (the "2022 Financial Statements"). We use the same accounting policies in preparing quarterly and annual financial statements. The quarterly results of operations are not necessarily indicative of the results to be expected for the full year.

Accounting Changes and Error Co

Accounting Changes and Error Corrections	6 Months Ended
	Mar. 31, 2023
Accounting Changes and Error Corrections [Abstract]
Error Correction	RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS Our condensed consolidated statement of cash flows for the six months ended March 31, 2022 has been restated for errors made with regard to the cash flow classification of debt issuance costs and debt issuance cost amortization. Immaterial Correction of Prior Period Financial Statements Subsequent to the issuance of the Company's financial statements for the quarter ended March 31, 2022, the Company made certain corrections in the condensed consolidated statements of cash flows related to the debt issuance costs associated with our second and third amended and restated credit agreement entered into in November and December 2021, respectively. We corrected $13.4 million of debt issuance cost previously recorded within changes in operating assets and liabilities (net of acquisitions) within the operating activities and correctly presented the cash outflows as payments of debt issuance costs within financing activities. We also corrected $2.3 million of amortization of debt issuance costs previously included in payments on long-term debt within financing activities and changes in operating assets and liabilities (net of acquisitions) within operating activities to amortization within operating activities. There was no impact to the condensed consolidated balance sheets, condensed consolidated statements of operations or condensed consolidated statements of comprehensive income as a result of these corrections. The Company determined that this restatement was not material to the condensed consolidated financial statements.

Earnings Per Share

Earnings Per Share	6 Months Ended
	Mar. 31, 2023
Earnings Per Share [Abstract]
EARNINGS PER SHARE	EARNINGS PER SHARE The following table is a reconciliation of the numerators and denominators in the net income per common share calculations (in thousands, except per common share data): Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Numerator: Net income $ 5,899 $ 2,847 $ 11,678 $ 4,034 Denominator: Denominator for basic net income per common share — weighted average shares outstanding 35,791 35,015 35,698 34,785 Effect of dilutive securities: Stock options and restricted stock units 939 593 1,123 925 Denominator for diluted net income per common share — adjusted weighted average shares 36,730 35,608 36,821 35,710 Net income per common share, basic $ 0.16 $ 0.08 $ 0.33 $ 0.12 Net income per common share, diluted $ 0.16 $ 0.08 $ 0.32 $ 0.11

Selected Balance Sheet Data

Selected Balance Sheet Data	6 Months Ended
	Mar. 31, 2023
Selected Balance Sheet Data [Abstract]
SELECTED BALANCE SHEET DATA	SELECTED BALANCE SHEET DATA The following table shows selected balance sheet data (in thousands): March 31, September 30, Accounts receivable, net: Accounts receivable $ 53,571 $ 58,967 Less allowance for credit losses 3,004 3,285 Less reserve for future credit returns and pricing adjustments 5,667 5,232 Accounts receivable, net $ 44,900 $ 50,450 Inventories: Raw materials $ 33,362 $ 39,189 Work in process 76 592 Finished goods 49,627 33,442 Inventories $ 83,065 $ 73,223

Fair Value Measurements

Fair Value Measurements	6 Months Ended
	Mar. 31, 2023
Fair Value Disclosures [Abstract]
FAIR VALUE MEASUREMENTS	FAIR VALUE MEASUREMENTS Financial assets and liabilities are classified in the following fair value hierarchy based on the lowest level input that is significant to the fair value measurement: Level 1 (unadjusted quoted prices in active markets for identical assets or liabilities); Level 2 (observable market inputs, other than quoted prices included in Level 1); and Level 3 (unobservable inputs that cannot be corroborated by observable market data). There were no assets or liabilities that are measured at fair value on a recurring basis as of March 31, 2023 or September 30, 2022. 5. FAIR VALUE MEASUREMENTS (CONTINUED) The following table presents a reconciliation of the contingent consideration liability measured at fair value on a recurring basis using significant unobservable inputs (Level 3) (in thousands): Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Fair value at beginning of period $ — $ 6,200 $ — $ 6,200 Change in fair value of contingent consideration — — — — Fair value at end of period $ — $ 6,200 $ — $ 6,200 In connection with our acquisition of Haxiot, Inc. ("Haxiot") in March 2021, we agreed to make contingent earn-out payments, based upon certain revenue thresholds. The fair value of the remaining liability for contingent consideration for the acquisition of Haxiot was $0.0 million at March 31, 2023 and September 30, 2022. In connection with our acquisition of Ctek, Inc. ("Ctek") in July 2021, we agreed to make contingent earn-out payments, based upon certain revenue thresholds. The fair value of the remaining liability for contingent consideration for the acquisition of Ctek was $0.0 million at March 31, 2023 and September 30, 2022. The change in fair value of contingent consideration reflects our estimates of the probabilities of achieving the relevant targets and is discounted based on our estimated discount rate. The fair value of the contingent consideration at March 31, 2023 is based on the probability of achieving the specified revenue thresholds for Ctek. As of March 31, 2023, contingent consideration associated with Ctek remains subject to future performance through December 31, 2023.

Goodwill and Other Identifiable

Goodwill and Other Identifiable Intangible Assets, Net	6 Months Ended
	Mar. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
GOODWILL AND OTHER IDENTIFIABLE INTANGIBLE ASSETS, NET	GOODWILL AND OTHER INTANGIBLE ASSETS, NET Amortizable intangible assets were (in thousands): March 31, 2023 September 30, 2022 Gross Accum. Net Gross Accum. Net Purchased and core technology $ 85,037 $ (57,931) $ 27,106 $ 85,016 $ (55,854) $ 29,162 License agreements 112 (112) — 112 (112) — Patents and trademarks 39,802 (18,804) 20,998 39,711 (17,666) 22,045 Customer relationships 309,222 (67,885) 241,337 309,212 (58,355) 250,857 Non-compete agreements 600 (600) — 600 (600) — Order backlog 1,000 (1,000) — 1,000 (1,000) — Total $ 435,773 $ (146,332) $ 289,441 $ 435,651 $ (133,587) $ 302,064 Amortization expense was $6.2 million and $7.0 million for the three months ended March 31, 2023 and 2022. Amortization expense was $12.7 million and $13.4 million for the six months ended March 31, 2023 and 2022, respectively. Amortization expense is recorded on our condensed consolidated statements of operations within cost of sales and in general and administrative expense. Estimated amortization expense related to intangible assets for the remainder of fiscal 2023 and the five succeeding fiscal years is (in thousands): 2023 (six months) $ 13,317 2024 25,227 2025 21,771 2026 20,593 2027 20,593 2028 20,411 6. GOODWILL AND OTHER INTANGIBLE ASSETS, NET (CONTINUED) The changes in the carrying amount of goodwill by reportable segments are (in thousands): Three months ended March 31, 2023 IoT IoT Total Balance on September 30, 2022 $ 172,931 $ 167,546 $ 340,477 Foreign currency translation adjustment 1,269 116 1,385 Balance on March 31, 2023 $ 174,200 $ 167,662 $ 341,862 Goodwill represents the excess of cost over the fair value of net identifiable assets acquired. Goodwill is quantitatively tested for impairment on an annual basis as of June 30, or more frequently if events or circumstances occur which could indicate impairment. We continue to have two reportable segments, our IoT Products & Services segment and our IoT Solutions segment (see Note 8 ). Our IoT Products & Services business is structured to include four reporting units under the IoT Products & Services segment, each with a reporting manager: Cellular Routers, Console Servers, OEM Solutions and Infrastructure Management. Following our acquisition of Ventus in November 2021, we have two reporting units within our IoT Solutions segment: SmartSense and Ventus. Each of these segments was tested individually for impairment during our annual impairment test completed in the third fiscal quarter of fiscal 2022. Assumptions and estimates to determine fair values under the income and market approaches are complex and often subjective. They can be affected by a variety of factors. These include external factors such as industry and economic trends. They also include internal factors such as changes in our business strategy and our internal forecasts. Changes in circumstances or a potential event could negatively affect the estimated fair values. If our future operating results do not meet current forecasts or if we experience a sustained decline in our market capitalization that is determined to be indicative of a reduction in fair value of one or more of our reporting units, we may be required to record future impairment charges for goodwill. Results of our Fiscal 2022 Annual Impairment Test As of June 30, 2022, we had a total of $32.7 million of goodwill for the Enterprise Routers reporting unit, $57.1 million of goodwill for the Console Servers reporting unit, $63.7 million of goodwill for the OEM Solutions reporting unit, $20.4 million of goodwill for the Infrastructure Management reporting unit, $49.5 million of goodwill for the SmartSense reporting unit and $118.3 million of goodwill for the Ventus reporting unit. At June 30, 2022, the fair value of goodwill exceeded the carrying value for all six reporting units. SmartSense and Ventus fair values exceeded carrying values by less than 10%. Implied fair value for each reporting unit was calculated on a standalone basis using a weighted combination of the income approach and market approach. The implied fair values of each reporting unit were added together along with our unallocated assets to get an indicated value of total equity to which a range of indicated value of total equity was derived. This range was compared to the total market capitalization of $852.0 million as of June 30, 2022. This implied a range of control (deficit)/ premiums of (5.6)% to 7.9%. This range of control premiums fell below the control premiums observed in the last five years in the communications equipment industry. As a result, the market capitalization reconciliation analysis proved support for the reasonableness of the fair values estimated for each individual reporting unit.

Indebtedness

Indebtedness	6 Months Ended
	Mar. 31, 2023
Debt Disclosure [Abstract]
INDEBTEDNESS	INDEBTEDNESS On November 1, 2021, we entered into a second amended and restated credit agreement with BMO Harris Bank N.A. ("BMO"). This agreement provides us with a senior secured credit facility (the "Credit Facility") consisting of a $350 million term loan B secured loan (the “Term Loan Facility”) and a $35 million revolving credit facility (the “Revolving Loan Facility”) with an uncommitted option to increase incremental loans under the Credit Facility, subject to an incremental cap. The Revolving Loan Facility includes a $10 million letter of credit subfacility and $10 million swingline subfacility. Digi may use proceeds of the Revolving Loan Facility in the future for general corporate purposes. This loan replaced our syndicated senior secured credit agreement with BMO that was entered into on March 15, 2021 and replaced the remaining balance of our revolver with this new term loan. This prior agreement provided us with a committed credit facility ("Prior Credit Facility") consisting of a $200 million revolving loan. On December 22, 2021, Digi entered into a third amended and restated credit agreement with BMO. Digi refinanced the Term Loan Facility and Revolving Loan Facility under its existing credit agreement entered into on November 1, 2021, but did not receive any additional proceeds from nor modify the amounts of any facilities or subfacilities contained within that credit agreement. 7. INDEBTEDNESS (CONTINUED) Following the December amendment, borrowings under the Term Loan Facility bear interest at a rate per annum equal to LIBOR with a floor of 0.50% for an interest period of one, three or six months as selected by Digi, reset at the end of the selected interest period (or a replacement benchmark rate if LIBOR is no longer available) plus 5.00% or a base rate plus 4.00%. The base rate is determined by reference to the highest of BMO’s prime rate, the Federal Funds Effective Rate plus 0.50%, or the one-month LIBOR for U.S. dollars plus 1.00%. The applicable margin for loans under the Revolving Credit Facility is in a range of 4.00% to 3.75% for LIBOR loans and 3.00% to 2.75% for base rate loans, depending on Digi’s consolidated leverage ratio. In addition to paying interest on the outstanding balance under the Credit Facility, we are required to pay a commitment fee on the non-utilized commitments thereunder, which is also reported in interest expense. Digi elected an interest period of one month for the months of December 2021 through April 2022 and a period of six months effective May 1, 2022. Following the expiration of the election on October 31, 2022, Digi elected an interest period of one month, effective on November 1, 2022 and has elected the same periods each subsequent month. Our weighted average interest rate at March 31, 2023 was 8.62%. The debt issuance costs and remaining balance under the Prior Credit Facility totaled $2.3 million at November 1, 2021. Of this amount $1.9 million was written off and included in interest expense upon the entry into the new amendment and $0.4 million is being amortized over the term of the amended loan and reported in interest expense. Digi incurred an additional $11.7 million and $1.7 million in debt issuance costs relating to the November 1, 2021 and December 22, 2021 amendments, respectively. These amounts are being amortized over the term of the amended loan and reported in interest expense. The Term Loan is payable in quarterly installments, with the balance remaining due on November 2, 2028. The Revolving Loan is due in a lump sum payment at maturity on November 2, 2028, if any amounts are drawn. The fair value of the Term Loan and Revolving Loan approximated carrying value at March 31, 2023. Digi made early payments against the term loan of $0.6 million and $61.3 million in six months ended March 31, 2023 and 2022, respectively. The following table is a summary of our long-term indebtedness at March 31, 2023 and September 30, 2022 (in thousands): Balance on March 31, 2023 Balance on September 30, 2022 Term loan $ 240,625 $ 250,000 Less unamortized issuance costs (11,040) (12,029) Less current maturities of long-term debt (15,523) (15,523) Total long-term debt, net of current portion $ 214,062 $ 222,448 The following table is a summary of future maturities of our aggregate long-term debt at March 31, 2023 (in thousands): Fiscal year Amount 2023 (six months) $ 8,750 2024 17,500 2025 17,500 2026 17,500 2027 17,500 2028 161,875 Total long-term debt $ 240,625 Covenants and Security Interest The agreements governing the Revolving Loan Facility contain a number of covenants. Among other provisions, these covenants require us to maintain a certain financial ratio (net leverage ratio and minimum fixed charge ratio). At March 31, 2023, we had no amounts drawn on the Revolving Loan Facility. Amounts borrowed under the Credit Facility are secured by substantially all of our assets.

Segment Information

Segment Information	6 Months Ended
	Mar. 31, 2023
Segment Reporting [Abstract]
SEGMENT INFORMATION	SEGMENT INFORMATION We have two reportable segments: IoT Products & Services and IoT Solutions. Our IoT Products & Services business is structured to include four operating segments, each with a segment manager. These four operating segments are: • Cellular Routers - box devices (fully enclosed) that provide connectivity typically in a place where the device can be plugged in exclusively using cellular communications. • Console Servers - similar to cellular routers except they are exclusively for edge computing installations and data center applications (also exclusively using cellular communications). • OEM Solutions - Original Equipment Manufacturers ("OEM") will be a chip, rather than a boxed device. This can come in the form of a stand-alone module or from a systems-on-module ("SOM"). While cellular connectivity is used, other communication protocols can be used such as Zigbee, Bluetooth or Radio-Frequency ("RF") based on application. • Infrastructure Management - includes battery operated, cellular enabled connect sensors as well as other types of console server applications that are more Digi Accelerated Linux ("DAL") based than Console Servers. This operating segment has some products that do not use cellular communications, but a large part of this segment does use cellular communications. Following the acquisition of Ventus on November 1, 2021, IoT Solutions is now comprised of two operating segments: • SmartSense - offers wireless temperature and other condition-based monitoring services for perishable goods such as food or medicine, as well as employee task management services. • Ventus - provides Managed Network-as-a-Service ("MNaaS") solutions that simplify the complexity of enterprise wide area network ("WAN") connectivity via wireless and fixed line solutions. The operating segments included in each reportable segment have similar qualitative and quantitative factors, which allow us to aggregate them under each reportable segment. The qualitative factors include similar nature of products and services, production process, type or class of customers and methods used to distribute the products. The quantitative factors include similar operating margins. Our CEO is our Chief Operating Decision Maker and reviews and makes business decisions using consolidated information including operating income and gross profit. Summary operating results for each of our segments were (in thousands): Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Revenue IoT Products & Services $ 85,893 $ 71,370 $ 170,235 $ 137,114 IoT Solutions 25,251 23,343 50,215 41,856 Total revenue $ 111,144 $ 94,713 $ 220,450 $ 178,970 Gross Profit IoT Products & Services $ 47,117 $ 38,461 $ 93,138 $ 74,136 IoT Solutions 15,755 13,523 31,255 25,729 Total gross profit $ 62,872 $ 51,984 $ 124,393 $ 99,865 Operating Income (Loss) IoT Products & Services $ 12,965 $ 9,049 $ 25,648 $ 13,165 IoT Solutions (790) (1,485) (1,510) (1,802) Total operating income $ 12,175 $ 7,564 $ 24,138 $ 11,363 Depreciation and Amortization IoT Products & Services $ 3,046 $ 3,533 $ 6,338 $ 7,162 IoT Solutions 4,800 5,251 9,620 9,484 Total depreciation and amortization $ 7,846 $ 8,784 $ 15,958 $ 16,646 8. SEGMENT INFORMATION (CONTINUED) Total expended for property, plant and equipment was (in thousands): Six months ended March 31, 2023 2022 IoT Products & Services $ 2,260 $ 1,664 IoT Solutions* 508 — Total expended for property, plant and equipment $ 2,768 $ 1,664 * Excluded from this amount is $2,685 and $1,215 of transfers of inventory to property plant and equipment for subscriber assets for the six months ended March 31, 2023 and 2022, respectively. Total assets for each of our segments were (in thousands): March 31, September 30, IoT Products & Services $ 390,753 $ 390,128 IoT Solutions 425,335 428,867 Unallocated* 31,660 34,900 Total assets $ 847,748 $ 853,895 *Unallocated consists of cash and cash equivalents.

Revenue

Revenue	6 Months Ended
	Mar. 31, 2023
Revenue from Contract with Customer [Abstract]
REVENUE	REVENUE Revenue Disaggregation The following table summarizes our revenue by geographic location of our customers (in thousands): Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 North America, primarily the United States $ 77,809 $ 73,790 $ 161,274 $ 140,033 Europe, Middle East & Africa 20,414 14,715 36,291 24,874 Rest of world 12,921 6,208 22,885 14,063 Total revenue $ 111,144 $ 94,713 $ 220,450 $ 178,970 The following table summarizes our revenue by the timing of revenue recognition (in thousands): Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Transferred at a point in time $ 87,088 $ 72,656 $ 172,574 $ 139,191 Transferred over time 24,056 22,057 47,876 39,779 Total revenue $ 111,144 $ 94,713 $ 220,450 $ 178,970 Contract Balances Contract Related Assets Our contract related assets consist of subscriber assets, which are equipment that we provide to customers pursuant to subscription-based contracts. In these cases, we retain the ownership of the equipment that the customer uses and charge them subscription fees to receive our end-to-end solutions. The total net book value of subscriber assets of $17.3 million and $16.5 million as of March 31, 2023 and September 30, 2022, respectively, are included in property, equipment and improvements, net. Depreciation expense for these subscriber assets, which is included in cost of sales, was $0.9 million and $1.1 million for the three months ended March 31, 2023 and 2022, respectively. Depreciation expense for these subscriber assets $1.8 million and $1.9 million for the six months ended March 31, 2023 and 2022, respectively. We depreciate the cost of this equipment over its useful life. 9. REVENUE (CONTINUED) Contract Assets Contract assets at Digi consist of products and services that have been fulfilled, but for which revenue has not yet been recognized. Our contract asset balances were immaterial as of March 31, 2023 and September 30, 2022. Contract Liabilities The timing of revenue recognition may differ from the timing of invoicing to customers. Customers are invoiced for subscription services on a monthly, quarterly or annual basis. Contract liabilities consist of unearned revenue related to annual or multi-year contracts for subscription services and related implementation fees, as well as product sales that have been invoiced, but not yet fulfilled. Our contract liabilities were $25.7 million and $24.8 million at March 31, 2023 and 2022, respectively. Of the $23.0 million and $24.3 million balances as of December 31, 2022 and 2021, Digi recognized $5.9 million and $5.0 million as revenue in the three months ended March 31, 2023 and 2022, respectively. Of the $21.6 million and $15.5 million balances as of September 30, 2022 and 2021, Digi recognized $10.6 million and $10.0 million as revenue in the six months ended March 31, 2023 and 2022, respectively. Remaining Transaction Price As of March 31, 2023, we had approximately $106.5 million of remaining performance obligations on contracts with an original duration of one year or more. We expect to recognize revenue on approximately $54.6 million of remaining performance obligations over the next 12 months. Revenue from the remaining performance obligations we expect to recognize over a range of two

Income Taxes

Income Taxes	6 Months Ended
	Mar. 31, 2023
Income Tax Disclosure [Abstract]
Income Tax Disclosure [Text Block]	INCOME TAXES Our income tax expense was $0.2 million for the six months ended March 31, 2023. Included in this expense was a net tax benefit discretely related to the six months ended March 31, 2023 of $1.7 million. This benefit primarily was the result of excess tax benefits recognized on stock compensation. Our effective tax rate will vary based on a variety of factors. These factors include our overall profitability, the geographical mix of income before taxes and related statutory tax rate in each jurisdiction, and tax items discretely related to the period, such as settlements of audits. We may record other benefits or expenses in the future that are specific to a particular quarter such as expiration of statutes of limitation, the completion of tax audits, or legislation that is enacted in both U.S. and foreign jurisdictions. A reconciliation of the beginning and ending amount of unrecognized tax benefits is (in thousands): Unrecognized tax benefits as of September 30, 2022 $ 3,316 Decreases related to: Expiration of statute of limitations (649) Unrecognized tax benefits as of March 31, 2023 $ 2,667 The total amount of unrecognized tax benefits at March 31, 2023 that, if recognized, would affect our effective tax rate was $2.6 million, after considering the impact of interest and deferred benefit items. We expect that the total amount of unrecognized tax benefits will decrease by approximately $0.3 million over the next 12 months.

Product Warranty Obligation

Product Warranty Obligation	6 Months Ended
	Mar. 31, 2023
Product Warranties Disclosures [Abstract]
PRODUCT WARRANTY OBLIGATION	PRODUCT WARRANTY OBLIGATION The following tables summarize the activity associated with the product warranty accrual (in thousands) and is included on our condensed consolidated balance sheets within other current liabilities: Balance at Warranties Settlements Balance at Period December 31 issued made March 31 Three months ended March 31, 2023 $ 922 $ 78 $ (164) $ 836 Three months ended March 31, 2022 $ 658 $ 124 $ (92) $ 690 Balance at Warranties Settlements Balance at Period September 30 issued made March 31 Six months ended March 31, 2023 $ 886 $ 168 $ (218) $ 836 Six months ended March 31, 2022 $ 707 $ 195 $ (212) $ 690

Leases

Leases	6 Months Ended
	Mar. 31, 2023
Leases [Abstract]
LEASES	LEASES All of our leases are operating leases and primarily consist of leases for office space. For any lease with an initial term in excess of 12 months, the related lease assets and lease liabilities are recognized on the condensed consolidated balance sheets as either operating or financing leases at the inception of an agreement where it is determined that a lease exists. We have lease agreements that contain both lease and non-lease components. We have elected to combine lease and non-lease components for all classes of assets. Leases with an expected term of 12 months or less are not recorded on the condensed consolidated balance sheets. Instead we recognize lease expense for these leases on a straight-line basis over the lease term. Operating lease assets represent the right to use an underlying asset for the lease term and operating lease liabilities represent the obligation to make lease payments. These assets and liabilities are recognized based on the present value of future payments over the lease term at the commencement date. We generally use a collateralized incremental borrowing rate based on information available at the commencement date, including the lease term, in determining the present value of future payments. When determining our right-of-use assets, we generally do not include options to extend or terminate the lease unless it is reasonably certain that the option will be exercised. Our leases typically require payment of real estate taxes and common area maintenance and insurance. These components comprise the majority of our variable lease cost and are excluded from the present value of our lease obligations. Fixed payments may contain predetermined fixed rent escalations. We recognize the related rent expense on a straight-line basis from the commencement date to the end of the lease term. The following table shows the supplemental balance sheet information related to our leases (in thousands): Balance Sheet Location March 31, 2023 September 30, 2022 Assets Operating leases Operating lease right-of-use assets $ 14,179 $ 15,299 Total lease assets $ 14,179 $ 15,299 Liabilities Operating leases Current portion of operating lease liabilities $ 3,346 $ 3,196 Operating leases Operating lease liabilities 15,519 16,978 Total lease liabilities $ 18,865 $ 20,174 12. LEASES (CONTINUED) The following were the components of our lease cost which is recorded in both cost of goods sold and selling, general and administrative expense (in thousands): Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Operating lease cost $ 867 $ 945 $ 1,771 $ 1,882 Variable lease cost 343 268 652 541 Short-term lease cost 18 28 43 56 Total lease cost $ 1,228 $ 1,241 $ 2,466 $ 2,479 In November 2021, Digi acquired $0.9 million in right of-use assets and assumed $0.9 million in lease liabilities from the acquisition of Ventus that are included in the balances at March 31, 2022. Digi acquired $0.2 million in right-of-use assets in exchange for new operating lease liabilities in the three and six months ended March 31, 2023. At March 31, 2023, the weighted average remaining lease term of our operating leases was 6.9 years and the weighted average discount rate for these leases was 4.5%. The table below reconciles the undiscounted cash flows for each of the first five years as well as all the remaining years to the operating lease liabilities recorded on the condensed consolidated balance sheet as of March 31, 2023 (in thousands): Fiscal year Amount 2023 (six months) $ 2,033 2024 3,954 2025 3,501 2026 3,122 2027 2,043 2028 1,898 Thereafter 5,705 Total future undiscounted lease payments 22,256 Less imputed interest (3,391) Total reported lease liability $ 18,865

Contingencies

Contingencies	6 Months Ended
	Mar. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	COMMITMENTS AND CONTINGENCIES We lease certain of our buildings and equipment under non-cancelable lease agreements. Please refer to Note 12 to our condensed consolidated financial statements for additional information.

Stock-Based Compensation

Stock-Based Compensation	6 Months Ended
	Mar. 31, 2023
Share-Based Payment Arrangement [Abstract]
STOCK-BASED COMPENSATION	STOCK-BASED COMPENSATIONStock-based awards granted in the first fiscal quarter of 2023 were granted under the amended and restated 2021 Omnibus Incentive Plan (the "2021 Plan"). Such awards made in the first quarter of fiscal 2022 were granted under the 2021 Plan before it was amended and restated at our annual meeting in January, 2022. Shares subject to awards under the 2021 Plan or any prior plans that are forfeited, canceled, returned to us for failure to satisfy vesting requirements, settled in cash or otherwise terminated without payment also will be available for grant under the 2021 Plan. The authority to grant options under the 2021 Plan and set other terms and conditions rests with the Compensation Committee of the Board of Directors. 14. STOCK-BASED COMPENSATION (CONTINUED) As of March 31, 2023, there were approximately 2,340,956 shares available for future grants under the 2021 Plan. Cash received from the exercise of stock options was $1.7 million and $5.6 million for the six months ended March 31, 2023 and 2022, respectively. Our equity plans and corresponding forms of award agreements generally have provisions allowing employees to elect to satisfy tax withholding obligations through the delivery of shares. When employees make this election, we retain a portion of shares issuable under the award. Tax withholding obligations are otherwise fulfilled by the employee paying cash to us for the withholding. During the six months ended March 31, 2023 and 2022, our employees forfeited 90,985 shares and 630,181 shares, respectively, in order to satisfy respective withholding tax obligations of $3.7 million and $6.4 million, respectively. We sponsor an Employee Stock Purchase Plan as amended and restated as of December 10, 2019, October 29, 2013, December 4, 2009 and November 27, 2006 (the "ESPP"), covering all domestic employees with at least 90 days of continuous service and who are customarily employed at least 20 hours per week. The ESPP allows eligible participants the right to purchase common stock on a quarterly basis at the lower of 85% of the market price at the beginning or end of each three-month offering period. The most recent amendments to the ESPP, ratified by our stockholders on January 29, 2020, increased the total number of shares that may be purchased under the ESPP to 3,425,000. ESPP contributions by employees were $1.2 million and $0.7 million for the six months ended March 31, 2023 and 2022, respectively. Pursuant to the ESPP, 39,979 and 36,987 common shares were issued to employees during the six months ended March 31, 2023 and 2022, respectively. Shares are issued under the ESPP from treasury stock. As of March 31, 2023, 512,869 common shares were available for future issuances under the ESPP. The following table shows stock-based compensation expense that is included in the consolidated results of operations (in thousands): Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Cost of sales $ 161 $ 131 $ 303 $ 217 Sales and marketing 1,072 678 1,923 1,168 Research and development 469 317 917 639 General and administrative 1,763 1,116 3,190 2,235 Stock-based compensation before income taxes 3,465 2,242 6,333 4,259 Income tax benefit (737) (470) (1,336) (900) Stock-based compensation after income taxes $ 2,728 $ 1,772 $ 4,997 $ 3,359 Stock Options The following table summarizes our stock option activity (in thousands, except per common share amounts): Options Outstanding Weighted Average Exercise Price Weighted Average Contractual Term (in years) Aggregate Intrinsic Value (1) Balance on September 30, 2022 1,790 $17.29 Granted 66 40.67 Exercised (114) 15.24 Forfeited / Canceled (34) 20.69 Balance on March 31, 2023 1,708 $18.23 4.5 $ 15,189 Exercisable on March 31, 2023 1,012 $15.60 3.6 $ 11,090 (1) The aggregate intrinsic value represents the total pre-tax intrinsic value, based on our closing stock price of $33.68 as of March 31, 2023, which would have been received by the option holders had all option holders exercised their options as of that date. 14. STOCK-BASED COMPENSATION (CONTINUED) The intrinsic value of an option is the amount by which the fair value of the underlying stock exceeds its exercise price. The total intrinsic value of all options exercised during the six months ended March 31, 2023 and 2022 was $2.6 million and $13.9 million, respectively. The following table shows the weighted average fair value, which was determined based upon the fair value of each option on the grant date utilizing the Black-Scholes option-pricing model and the related assumptions: Six months ended March 31, 2023 2022 Weighted average per option grant date fair value $19.92 $10.23 Assumptions used for option grants: Risk free interest rate minimum 3.77% - 3.98% 1.25% - 1.82% Expected term 6.00 years 6.00 years Expected volatility minimum 46% 45% - 46% Weighted average volatility 46% 46% Expected dividend yield — — The fair value of each option award granted during the periods presented was estimated using the Black-Scholes option valuation model that uses the assumptions noted in the above table. Expected volatilities are based on the historical volatility of our stock. We use historical data to estimate option exercise and employee termination information within the valuation model. The expected term of options granted is derived from the vesting period and historical information and represents the period of time that options granted are expected to be outstanding. The risk-free rate used is the zero-coupon U.S. Treasury bond rate in effect at the time of the grant whose maturity equals the expected term of the option. As of March 31, 2023, the total unrecognized compensation cost related to non-vested stock options was $6.5 million and the related weighted average period over which it is expected to be recognized is approximately 1.9 years. Non-vested Stock Units The following table presents a summary of our non-vested restricted stock units and performance stock units as of March 31, 2023 and changes during the six months then ended (in thousands, except per common share amounts): RSUs PSUs Number of Awards Weighted Average Grant Date Fair Value Number of Awards Weighted Average Grant Date Fair Value Nonvested on September 30, 2022 742 $ 19.14 27 $ 22.69 Granted 440 40.41 113 40.66 Vested (258) 17.42 (5) 22.93 Canceled (32) 26.51 — — Nonvested on March 31, 2023 892 $ 29.86 135 $ 37.72

Earnings Per Share (Tables)

Earnings Per Share (Tables)	6 Months Ended
	Mar. 31, 2023
Earnings Per Share [Abstract]
Schedule of Calculation of Numerator and Denominator in Earnings Per Share	The following table is a reconciliation of the numerators and denominators in the net income per common share calculations (in thousands, except per common share data): Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Numerator: Net income $ 5,899 $ 2,847 $ 11,678 $ 4,034 Denominator: Denominator for basic net income per common share — weighted average shares outstanding 35,791 35,015 35,698 34,785 Effect of dilutive securities: Stock options and restricted stock units 939 593 1,123 925 Denominator for diluted net income per common share — adjusted weighted average shares 36,730 35,608 36,821 35,710 Net income per common share, basic $ 0.16 $ 0.08 $ 0.33 $ 0.12 Net income per common share, diluted $ 0.16 $ 0.08 $ 0.32 $ 0.11

Selected Balance Sheet Data (Ta

Selected Balance Sheet Data (Tables)	6 Months Ended
	Mar. 31, 2023
Selected Balance Sheet Data [Abstract]
Schedule of Selected Balance Sheet Data	The following table shows selected balance sheet data (in thousands): March 31, September 30, Accounts receivable, net: Accounts receivable $ 53,571 $ 58,967 Less allowance for credit losses 3,004 3,285 Less reserve for future credit returns and pricing adjustments 5,667 5,232 Accounts receivable, net $ 44,900 $ 50,450 Inventories: Raw materials $ 33,362 $ 39,189 Work in process 76 592 Finished goods 49,627 33,442 Inventories $ 83,065 $ 73,223

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	6 Months Ended
	Mar. 31, 2023
Fair Value Disclosures [Abstract]
Fair Value of Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation	The following table presents a reconciliation of the contingent consideration liability measured at fair value on a recurring basis using significant unobservable inputs (Level 3) (in thousands): Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Fair value at beginning of period $ — $ 6,200 $ — $ 6,200 Change in fair value of contingent consideration — — — — Fair value at end of period $ — $ 6,200 $ — $ 6,200

Goodwill and Other Identifiab_2

Goodwill and Other Identifiable Intangible Assets, Net (Tables)	6 Months Ended
	Mar. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of Amortizable Intangible Assets	Amortizable intangible assets were (in thousands): March 31, 2023 September 30, 2022 Gross Accum. Net Gross Accum. Net Purchased and core technology $ 85,037 $ (57,931) $ 27,106 $ 85,016 $ (55,854) $ 29,162 License agreements 112 (112) — 112 (112) — Patents and trademarks 39,802 (18,804) 20,998 39,711 (17,666) 22,045 Customer relationships 309,222 (67,885) 241,337 309,212 (58,355) 250,857 Non-compete agreements 600 (600) — 600 (600) — Order backlog 1,000 (1,000) — 1,000 (1,000) — Total $ 435,773 $ (146,332) $ 289,441 $ 435,651 $ (133,587) $ 302,064
Schedule of Estimated Future Amortization Expense Related to Intangible Assets	Estimated amortization expense related to intangible assets for the remainder of fiscal 2023 and the five succeeding fiscal years is (in thousands): 2023 (six months) $ 13,317 2024 25,227 2025 21,771 2026 20,593 2027 20,593 2028 20,411
Schedule of Changes in Carrying Amount of Goodwill	The changes in the carrying amount of goodwill by reportable segments are (in thousands): Three months ended March 31, 2023 IoT IoT Total Balance on September 30, 2022 $ 172,931 $ 167,546 $ 340,477 Foreign currency translation adjustment 1,269 116 1,385 Balance on March 31, 2023 $ 174,200 $ 167,662 $ 341,862

Indebtedness (Tables)

Indebtedness (Tables)	6 Months Ended
	Mar. 31, 2023
Debt Disclosure [Abstract]
Schedule of Debt [Table Text Block]	The following table is a summary of our long-term indebtedness at March 31, 2023 and September 30, 2022 (in thousands): Balance on March 31, 2023 Balance on September 30, 2022 Term loan $ 240,625 $ 250,000 Less unamortized issuance costs (11,040) (12,029) Less current maturities of long-term debt (15,523) (15,523) Total long-term debt, net of current portion $ 214,062 $ 222,448
Schedule of Maturities of Long-term Debt [Table Text Block]	The following table is a summary of future maturities of our aggregate long-term debt at March 31, 2023 (in thousands): Fiscal year Amount 2023 (six months) $ 8,750 2024 17,500 2025 17,500 2026 17,500 2027 17,500 2028 161,875 Total long-term debt $ 240,625

Segment Information (Tables)

Segment Information (Tables)	6 Months Ended
	Mar. 31, 2023
Segment Reporting [Abstract]
Schedule of Segment Reporting Information, by Segment	Summary operating results for each of our segments were (in thousands): Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Revenue IoT Products & Services $ 85,893 $ 71,370 $ 170,235 $ 137,114 IoT Solutions 25,251 23,343 50,215 41,856 Total revenue $ 111,144 $ 94,713 $ 220,450 $ 178,970 Gross Profit IoT Products & Services $ 47,117 $ 38,461 $ 93,138 $ 74,136 IoT Solutions 15,755 13,523 31,255 25,729 Total gross profit $ 62,872 $ 51,984 $ 124,393 $ 99,865 Operating Income (Loss) IoT Products & Services $ 12,965 $ 9,049 $ 25,648 $ 13,165 IoT Solutions (790) (1,485) (1,510) (1,802) Total operating income $ 12,175 $ 7,564 $ 24,138 $ 11,363 Depreciation and Amortization IoT Products & Services $ 3,046 $ 3,533 $ 6,338 $ 7,162 IoT Solutions 4,800 5,251 9,620 9,484 Total depreciation and amortization $ 7,846 $ 8,784 $ 15,958 $ 16,646
Payments to Acquire Property, Plant and Equipment by Segment	Total expended for property, plant and equipment was (in thousands): Six months ended March 31, 2023 2022 IoT Products & Services $ 2,260 $ 1,664 IoT Solutions* 508 — Total expended for property, plant and equipment $ 2,768 $ 1,664 * Excluded from this amount is $2,685 and $1,215 of transfers of inventory to property plant and equipment for subscriber assets for the six months ended March 31, 2023 and 2022, respectively.
Reconciliation of Assets from Segment to Consolidated	Total assets for each of our segments were (in thousands): March 31, September 30, IoT Products & Services $ 390,753 $ 390,128 IoT Solutions 425,335 428,867 Unallocated* 31,660 34,900 Total assets $ 847,748 $ 853,895 *Unallocated consists of cash and cash equivalents.

Revenue (Tables)

Revenue (Tables)	6 Months Ended
	Mar. 31, 2023
Revenue from Contract with Customer [Abstract]
Disaggregation of Revenue	The following table summarizes our revenue by geographic location of our customers (in thousands): Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 North America, primarily the United States $ 77,809 $ 73,790 $ 161,274 $ 140,033 Europe, Middle East & Africa 20,414 14,715 36,291 24,874 Rest of world 12,921 6,208 22,885 14,063 Total revenue $ 111,144 $ 94,713 $ 220,450 $ 178,970 The following table summarizes our revenue by the timing of revenue recognition (in thousands): Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Transferred at a point in time $ 87,088 $ 72,656 $ 172,574 $ 139,191 Transferred over time 24,056 22,057 47,876 39,779 Total revenue $ 111,144 $ 94,713 $ 220,450 $ 178,970

Income Taxes (Tables)

Income Taxes (Tables)	6 Months Ended
	Mar. 31, 2023
Income Tax Disclosure [Abstract]
Schedule of Unrecognized Tax Benefits	A reconciliation of the beginning and ending amount of unrecognized tax benefits is (in thousands): Unrecognized tax benefits as of September 30, 2022 $ 3,316 Decreases related to: Expiration of statute of limitations (649) Unrecognized tax benefits as of March 31, 2023 $ 2,667

Product Warranty Obligation (Ta

Product Warranty Obligation (Tables)	6 Months Ended
	Mar. 31, 2023
Product Warranties Disclosures [Abstract]
Schedule of Product Warranty Accrual	The following tables summarize the activity associated with the product warranty accrual (in thousands) and is included on our condensed consolidated balance sheets within other current liabilities: Balance at Warranties Settlements Balance at Period December 31 issued made March 31 Three months ended March 31, 2023 $ 922 $ 78 $ (164) $ 836 Three months ended March 31, 2022 $ 658 $ 124 $ (92) $ 690 Balance at Warranties Settlements Balance at Period September 30 issued made March 31 Six months ended March 31, 2023 $ 886 $ 168 $ (218) $ 836 Six months ended March 31, 2022 $ 707 $ 195 $ (212) $ 690

Leases (Tables)

Leases (Tables)	6 Months Ended
	Mar. 31, 2023
Leases [Abstract]
Supplemental Balance Sheet Information	The following table shows the supplemental balance sheet information related to our leases (in thousands): Balance Sheet Location March 31, 2023 September 30, 2022 Assets Operating leases Operating lease right-of-use assets $ 14,179 $ 15,299 Total lease assets $ 14,179 $ 15,299 Liabilities Operating leases Current portion of operating lease liabilities $ 3,346 $ 3,196 Operating leases Operating lease liabilities 15,519 16,978 Total lease liabilities $ 18,865 $ 20,174
Components of Lease Cost	The following were the components of our lease cost which is recorded in both cost of goods sold and selling, general and administrative expense (in thousands): Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Operating lease cost $ 867 $ 945 $ 1,771 $ 1,882 Variable lease cost 343 268 652 541 Short-term lease cost 18 28 43 56 Total lease cost $ 1,228 $ 1,241 $ 2,466 $ 2,479
Supplemental Disclosures Leases	In November 2021, Digi acquired $0.9 million in right of-use assets and assumed $0.9 million in lease liabilities from the acquisition of Ventus that are included in the balances at March 31, 2022. Digi acquired $0.2 million in right-of-use assets in exchange for new operating lease liabilities in the three and six months ended March 31, 2023.At March 31, 2023, the weighted average remaining lease term of our operating leases was 6.9 years and the weighted average discount rate for these leases was 4.5%.
Operating Lease Liability Maturity	The table below reconciles the undiscounted cash flows for each of the first five years as well as all the remaining years to the operating lease liabilities recorded on the condensed consolidated balance sheet as of March 31, 2023 (in thousands): Fiscal year Amount 2023 (six months) $ 2,033 2024 3,954 2025 3,501 2026 3,122 2027 2,043 2028 1,898 Thereafter 5,705 Total future undiscounted lease payments 22,256 Less imputed interest (3,391) Total reported lease liability $ 18,865

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	6 Months Ended
	Mar. 31, 2023
Share-Based Payment Arrangement [Abstract]
Schedule of Stock-Based Compensation Expense	The following table shows stock-based compensation expense that is included in the consolidated results of operations (in thousands): Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Cost of sales $ 161 $ 131 $ 303 $ 217 Sales and marketing 1,072 678 1,923 1,168 Research and development 469 317 917 639 General and administrative 1,763 1,116 3,190 2,235 Stock-based compensation before income taxes 3,465 2,242 6,333 4,259 Income tax benefit (737) (470) (1,336) (900) Stock-based compensation after income taxes $ 2,728 $ 1,772 $ 4,997 $ 3,359
Schedule of Stock Option Activity	The following table summarizes our stock option activity (in thousands, except per common share amounts): Options Outstanding Weighted Average Exercise Price Weighted Average Contractual Term (in years) Aggregate Intrinsic Value (1) Balance on September 30, 2022 1,790 $17.29 Granted 66 40.67 Exercised (114) 15.24 Forfeited / Canceled (34) 20.69 Balance on March 31, 2023 1,708 $18.23 4.5 $ 15,189 Exercisable on March 31, 2023 1,012 $15.60 3.6 $ 11,090 (1) The aggregate intrinsic value represents the total pre-tax intrinsic value, based on our closing stock price of $33.68 as of March 31, 2023, which would have been received by the option holders had all option holders exercised their options as of that date. 14. STOCK-BASED COMPENSATION (CONTINUED) The intrinsic value of an option is the amount by which the fair value of the underlying stock exceeds its exercise price. The total intrinsic value of all options exercised during the six months ended March 31, 2023 and 2022 was $2.6 million and $13.9 million, respectively.
Schedule of Valuation Assumptions	The following table shows the weighted average fair value, which was determined based upon the fair value of each option on the grant date utilizing the Black-Scholes option-pricing model and the related assumptions: Six months ended March 31, 2023 2022 Weighted average per option grant date fair value $19.92 $10.23 Assumptions used for option grants: Risk free interest rate minimum 3.77% - 3.98% 1.25% - 1.82% Expected term 6.00 years 6.00 years Expected volatility minimum 46% 45% - 46% Weighted average volatility 46% 46% Expected dividend yield — —
Schedule of Nonvested Restricted Stock Units	The following table presents a summary of our non-vested restricted stock units and performance stock units as of March 31, 2023 and changes during the six months then ended (in thousands, except per common share amounts): RSUs PSUs Number of Awards Weighted Average Grant Date Fair Value Number of Awards Weighted Average Grant Date Fair Value Nonvested on September 30, 2022 742 $ 19.14 27 $ 22.69 Granted 440 40.41 113 40.66 Vested (258) 17.42 (5) 22.93 Canceled (32) 26.51 — — Nonvested on March 31, 2023 892 $ 29.86 135 $ 37.72

Accounting Changes and Error _2

Accounting Changes and Error Corrections (Details) - Revision of Prior Period, Error Correction, Adjustment $ in Thousands	6 Months Ended
	Mar. 31, 2022 USD ($)
Reclassification [Line Items]
Debt Issuance Costs	$ 13,400
Amortization of Debt Issuance Costs	$ 2,300

Earnings Per Share (Details)

Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022
Numerator:
Net income	$ 5,899	$ 2,847	$ 11,678	$ 4,034
Denominator:
Denominator for basic net income per common share — weighted average shares outstanding	35,791,000	35,015,000	35,698,000	34,785,000
Effect of dilutive securities:
Stock options and restricted stock units	939,000	593,000	1,123,000	925,000
Denominator for diluted net income per common share — adjusted weighted average shares	36,730,000	35,608,000	36,821,000	35,710,000
Basic net income per common share:
Net income, basic (USD per share)	$ 0.16	$ 0.08	$ 0.33	$ 0.12
Diluted net income per common share
Net income , diluted (USD per share)	$ 0.16	$ 0.08	$ 0.32	$ 0.11
Potentially dilutive securities excluded from computation of earnings per share	609,017	1,129,393	416,307	735,611

Selected Balance Sheet Data (De

Selected Balance Sheet Data (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Sep. 30, 2022
Accounts receivable, net:
Accounts receivable	$ 53,571	$ 58,967
Less allowance for credit losses	3,004	3,285
Less reserve for future credit returns and pricing adjustments	5,667	5,232
Accounts receivable, net	44,900	50,450
Inventories:
Raw materials	33,362	39,189
Work in process	76	592
Finished goods	49,627	33,442
Inventories	$ 83,065	$ 73,223

Fair Value Measurements (Financ

Fair Value Measurements (Financial Assets and Liabilities) (Details) - Fair Value, Inputs, Level 3 - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022	Sep. 30, 2022	Mar. 31, 2022	Dec. 31, 2021	Sep. 30, 2021
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration fair value	$ 0	$ 0	$ 0	$ 6,200	$ 6,200	$ 6,200
Total liabilities measured at fair value	$ 0		$ 0

Fair Value Measurements (Reconc

Fair Value Measurements (Reconciliation of Liability) (Details) - Fair Value, Inputs, Level 3 - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Fair value at beginning of period	$ 0	$ 6,200	$ 0	$ 6,200
Change in fair value of contingent consideration	0	0	0	0
Fair value at end of period	0	$ 6,200	0	$ 6,200
Contingent Consideration | Estimate of Fair Value Measurement | Fair Value, Measurements, Recurring | Ctek, Inc. ("Ctek")
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Fair value at beginning of period			0
Fair value at end of period	0		0
Contingent Consideration | Estimate of Fair Value Measurement | Fair Value, Measurements, Recurring | Haxiot
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Fair value at beginning of period			0
Fair value at end of period	$ 0		$ 0

Fair Value Measurements (Detail

Fair Value Measurements (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022	Sep. 30, 2022	Mar. 31, 2022	Dec. 31, 2021	Sep. 30, 2021
Fair Value Inputs, Liabilities, Quantitative Information [Line Items]
Goodwill	$ 341,862		$ 340,477
Fair Value, Inputs, Level 3
Fair Value Inputs, Liabilities, Quantitative Information [Line Items]
Contingent consideration fair value	0	$ 0	0	$ 6,200	$ 6,200	$ 6,200
Total liabilities measured at fair value	0		0
Estimate of Fair Value Measurement | Haxiot | Contingent Consideration | Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3
Fair Value Inputs, Liabilities, Quantitative Information [Line Items]
Contingent consideration fair value	0		0
Estimate of Fair Value Measurement | Ctek, Inc. ("Ctek") | Contingent Consideration | Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3
Fair Value Inputs, Liabilities, Quantitative Information [Line Items]
Contingent consideration fair value	$ 0		$ 0

Goodwill and Other Identifiab_3

Goodwill and Other Identifiable Intangible Assets, Net (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022	Sep. 30, 2022
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	$ 435,773		$ 435,773		$ 435,651
Accumulated amortization	(146,332)		(146,332)		(133,587)
Net	289,441		289,441		302,064
Amortization expense			13,702	$ 16,098
Goodwill	341,862		341,862		340,477
Purchased and Core Technology
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	85,037		85,037		85,016
Accumulated amortization	(57,931)		(57,931)		(55,854)
Net	27,106		27,106		29,162
License Agreements
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	112		112		112
Accumulated amortization	(112)		(112)		(112)
Net	0		0		0
Patents and Trademarks
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	39,802		39,802		39,711
Accumulated amortization	(18,804)		(18,804)		(17,666)
Net	20,998		20,998		22,045
Customer Relationships
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	309,222		309,222		309,212
Accumulated amortization	(67,885)		(67,885)		(58,355)
Net	241,337		241,337		250,857
Non-compete Agreements
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	600		600		600
Accumulated amortization	(600)		(600)		(600)
Net	0		0		0
Order backlog
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	1,000		1,000		1,000
Accumulated amortization	(1,000)		(1,000)		(1,000)
Net	0		0		$ 0
Cost of Sales and General and Administrative Expense
Finite-Lived Intangible Assets [Line Items]
Amortization expense	$ 6,200	$ 7,000	$ 12,700	$ 13,400

Goodwill and Other Identifiab_4

Goodwill and Other Identifiable Intangible Assets, Net (Additional Information) (Details) $ in Thousands	6 Months Ended
	Mar. 31, 2023 USD ($) segment	Sep. 30, 2022 USD ($)
Goodwill [Line Items]
Number of Reportable Segments | segment	2
Goodwill	$ 341,862	$ 340,477
Market Capitalization		852,000
Enterprise Routers
Goodwill [Line Items]
Goodwill		32,700
Console Servers
Goodwill [Line Items]
Goodwill		57,100
OEM Solutions
Goodwill [Line Items]
Goodwill		63,700
Infrastructure Mgmt.
Goodwill [Line Items]
Goodwill		20,400
SmartSense
Goodwill [Line Items]
Goodwill		49,500
Ventus
Goodwill [Line Items]
Goodwill		118,300
IoT Products & Services Segment
Goodwill [Line Items]
Goodwill	174,200	172,931
IoT Solutions Segment
Goodwill [Line Items]
Goodwill	$ 167,662	$ 167,546
Control Premium | Minimum
Goodwill [Line Items]
Goodwill Valuation Implied Control Premium		(5.60%)
Control Premium | Maximum
Goodwill [Line Items]
Goodwill Valuation Implied Control Premium		7.90%

Goodwill and Other Identifiab_5

Goodwill and Other Identifiable Intangible Assets, Net (Amortization Expense) (Details) $ in Thousands	Mar. 31, 2023 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
2023 (six months)	$ 13,317
2024	25,227
2025	21,771
2026	20,593
2027	20,593
2028	$ 20,411

Goodwill and Other Identifiab_6

Goodwill and Other Identifiable Intangible Assets, Net (Goodwill Rollforward) (Details) $ in Thousands	6 Months Ended
	Mar. 31, 2023 USD ($)
Goodwill [Roll Forward]
Beginning balance	$ 340,477
Foreign currency translation adjustment	1,385
Ending balance	341,862
IoT Products & Services Segment
Goodwill [Roll Forward]
Beginning balance	172,931
Foreign currency translation adjustment	1,269
Ending balance	174,200
IoT Solutions Segment
Goodwill [Roll Forward]
Beginning balance	167,546
Foreign currency translation adjustment	116
Ending balance	$ 167,662

Indebtedness - Narrative (Detai

Indebtedness - Narrative (Details) - USD ($) $ in Thousands		6 Months Ended
	Nov. 01, 2021	Mar. 31, 2023	Mar. 31, 2022	Nov. 02, 2021	Mar. 15, 2021
Line of Credit Facility [Line Items]
Weighted average interest rate on debt		8.62%
Payment for Debt Extinguishment or Debt Prepayment Cost		$ 600	$ 61,300
Prior Credit Facility
Line of Credit Facility [Line Items]
Debt issuance costs	$ 2,300			$ 400
Amortization of Debt Issuance Costs	1,900
November 1, 2021 Credit Agreement
Line of Credit Facility [Line Items]
Debt issuance costs	11,700
December 22, 2021 Credit Agreement
Line of Credit Facility [Line Items]
Debt issuance costs	1,700
Term loan
Line of Credit Facility [Line Items]
Revolving loan maximum borrowing capacity	350,000
Term loan | LIBOR
Line of Credit Facility [Line Items]
Debt instrument, margin spread on LIBOR Rate		5%
Term loan | Base Rate
Line of Credit Facility [Line Items]
Debt instrument, margin spread on LIBOR Rate		4%
Term loan | Base Rate | Federal Funds Rate
Line of Credit Facility [Line Items]
Debt instrument, margin spread on LIBOR Rate		0.50%
Term loan | Base Rate | LIBOR
Line of Credit Facility [Line Items]
Debt instrument, margin spread on LIBOR Rate		1%
Term loan | Base Rate | Minimum
Line of Credit Facility [Line Items]
Debt Instrument, Interest Rate, Basis for Effective Rate		0.50
Revolving loan
Line of Credit Facility [Line Items]
Revolving loan maximum borrowing capacity	35,000				$ 200,000
Revolving loan | LIBOR | Minimum
Line of Credit Facility [Line Items]
Debt instrument, margin spread on LIBOR Rate		3.75%
Revolving loan | LIBOR | Maximum
Line of Credit Facility [Line Items]
Debt instrument, margin spread on LIBOR Rate		4%
Revolving loan | Base Rate | Minimum
Line of Credit Facility [Line Items]
Debt instrument, margin spread on LIBOR Rate		2.75%
Revolving loan | Base Rate | Maximum
Line of Credit Facility [Line Items]
Debt instrument, margin spread on LIBOR Rate		3%
Letter of Credit
Line of Credit Facility [Line Items]
Revolving loan maximum borrowing capacity	10,000
Swingline Credit Facility
Line of Credit Facility [Line Items]
Revolving loan maximum borrowing capacity	$ 10,000

Indebtedness - Schedule of Long

Indebtedness - Schedule of Long-Term Debt (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Sep. 30, 2022	Nov. 01, 2021	Mar. 15, 2021
Debt Instrument [Line Items]
Total loans	$ 240,625
Less unamortized issuance costs	(11,040)	$ (12,029)
Less current maturities of long-term debt	(15,523)	(15,523)
Total long-term debt, net of current portion	214,062	222,448
Revolving loan
Debt Instrument [Line Items]
Revolving loan maximum borrowing capacity			$ 35,000	$ 200,000
Term loan
Debt Instrument [Line Items]
Total loans	$ 240,625	$ 250,000
Revolving loan maximum borrowing capacity			$ 350,000

Indebtedness - Schedule of Matu

Indebtedness - Schedule of Maturities of Long-term Debt (Details) $ in Thousands	Mar. 31, 2023 USD ($)
Debt Disclosure [Abstract]
2023 (six months)	$ 8,750
2024	17,500
2025	17,500
2026	17,500
2027	17,500
2028	161,875
Total long-term debt	$ 240,625

Segment Information (Details)

Segment Information (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023 USD ($)	Mar. 31, 2022 USD ($)	Mar. 31, 2023 USD ($) numberOfOperatingSegments segment	Mar. 31, 2022 USD ($)
Segment Reporting Information [Line Items]
Number of Reportable Segments | segment			2
Total Revenue	$ 111,144	$ 94,713	$ 220,450	$ 178,970
Gross Profit	62,872	51,984	124,393	99,865
Operating income (loss)	12,175	7,564	24,138	11,363
Depreciation and amortization	7,846	8,784	$ 15,958	16,646
IoT Products & Services Segment
Segment Reporting Information [Line Items]
Number of Operating Segments | numberOfOperatingSegments			4
Total Revenue	85,893	71,370	$ 170,235	137,114
Gross Profit	47,117	38,461	93,138	74,136
Operating income (loss)	12,965	9,049	25,648	13,165
Depreciation and amortization	3,046	3,533	$ 6,338	7,162
IoT Solutions Segment
Segment Reporting Information [Line Items]
Number of Operating Segments | numberOfOperatingSegments			2
Total Revenue	25,251	23,343	$ 50,215	41,856
Gross Profit	15,755	13,523	31,255	25,729
Operating income (loss)	(790)	(1,485)	(1,510)	(1,802)
Depreciation and amortization	$ 4,800	$ 5,251	$ 9,620	$ 9,484

Segment Information Expended fo

Segment Information Expended for Property, Plant and Equipment (Details) - USD ($) $ in Thousands		6 Months Ended
		Mar. 31, 2023	Mar. 31, 2022
Segment Reporting Information [Line Items]
Inventory Transfer To Property, Plant And Equipment		$ 2,685	$ 1,215
Property, Plant and Equipment, Additions		2,768	1,664
IoT Products & Services Segment
Segment Reporting Information [Line Items]
Property, Plant and Equipment, Additions		2,260	1,664
IoT Solutions Segment
Segment Reporting Information [Line Items]
Property, Plant and Equipment, Additions	[1]	$ 508	$ 0
[1]* Excluded from this amount is $2,685 and $1,215 of transfers of inventory to property plant and equipment for subscriber assets for the six months ended March 31, 2023 and 2022, respectively.

Segment Information Total Asset

Segment Information Total Assets (Details) - USD ($) $ in Thousands		Mar. 31, 2023	Sep. 30, 2022
Segment Reporting, Asset Reconciling Item [Line Items]
Assets		$ 847,748	$ 853,895
IoT Products & Services Segment
Segment Reporting, Asset Reconciling Item [Line Items]
Assets		390,753	390,128
IoT Solutions Segment
Segment Reporting, Asset Reconciling Item [Line Items]
Assets		425,335	428,867
Unallocated
Segment Reporting, Asset Reconciling Item [Line Items]
Assets	[1]	$ 31,660	$ 34,900
[1]Unallocated consists of cash and cash equivalents.

Revenue - Disaggregation of Rev

Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022
Unearned Revenue (Details)
Total Revenue	$ 111,144	$ 94,713	$ 220,450	$ 178,970
North America, primarily the United States
Unearned Revenue (Details)
Total Revenue	77,809	73,790	161,274	140,033
Europe, Middle East & Africa
Unearned Revenue (Details)
Total Revenue	20,414	14,715	36,291	24,874
Rest of world
Unearned Revenue (Details)
Total Revenue	12,921	6,208	22,885	14,063
Transferred at a point in time
Unearned Revenue (Details)
Total Revenue	87,088	72,656	172,574	139,191
Transferred over time
Unearned Revenue (Details)
Total Revenue	$ 24,056	$ 22,057	$ 47,876	$ 39,779

Revenue - Additional Informatio

Revenue - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022	Sep. 30, 2022
Unearned Revenue (Details)
Amortization	$ 0.9	$ 1.1	$ 1.8	$ 1.9
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-04-01
Unearned Revenue (Details)
Remaining performance obligation, period	12 months		12 months
Equipment
Unearned Revenue (Details)
Contract assets	$ 17.3		$ 17.3		$ 16.5

Revenue - Unearned Revenue (Det

Revenue - Unearned Revenue (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022	Sep. 30, 2022	Dec. 31, 2021	Sep. 30, 2021
Unearned Revenue (Details)
Unearned Revenue	$ 25.7	$ 24.8	$ 25.7	$ 24.8	$ 23	$ 21.6	$ 24.3	$ 15.5
Contract with Customer, Liability, Revenue Recognized	$ 5.9	$ 5	$ 10.6	$ 10

Revenue - Performance Obligatio

Revenue - Performance Obligations (Details) $ in Millions	Mar. 31, 2023 USD ($)
Revenue from Contract with Customer [Abstract]
Remaining performance obligation	$ 106.5
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-04-01
Revenue from Contract with Customer [Abstract]
Remaining performance obligation	$ 54.6
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation, period	12 months
Minimum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-04-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation, period	2 years
Maximum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-04-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation, period	5 years

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022
Income Tax Disclosure [Abstract]
Income tax provision (benefit)	$ (70)	$ 393	$ 160	$ (1,995)
Income tax benefit specific to the period			$ 1,700

Income Taxes (Unrecognized Tax

Income Taxes (Unrecognized Tax Benefits) (Details) $ in Thousands	6 Months Ended
	Mar. 31, 2023 USD ($)
Unrecognized tax benefits that would impact effective tax rate	$ 2,600
Income tax benefit specific to the period	1,700
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
Unrecognized tax benefits, beginning balance	3,316
Decreases related to expiration of statute of limitations	(649)
Unrecognized tax benefits, ending balance	2,667
Maximum
Unrecognized tax benefits that would decrease next twelve months	$ 300

Product Warranty Obligation (De

Product Warranty Obligation (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022
Standard Product Warranty Accrual [Roll Forward]
Beginning balance	$ 922	$ 658	$ 886	$ 707
Warranties issued	78	124	168	195
Settlements made	(164)	(92)	(218)	(212)
Ending balance	$ 836	$ 690	$ 836	$ 690

Leases - Supplemental Balance S

Leases - Supplemental Balance Sheet (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Sep. 30, 2022
Assets and Liabilities, Lessee [Abstract]
Operating lease other non-current asset	$ 14,179	$ 15,299
Total lease assets	14,179	15,299
Operating lease other current liabilities	3,346	3,196
Operating lease other non-current liability	15,519	16,978
Total lease liabilities	$ 18,865	$ 20,174

Leases - Lease Cost (Details)

Leases - Lease Cost (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022
Lease, Cost [Abstract]
Operating lease cost	$ 867	$ 945	$ 1,771	$ 1,882
Variable lease cost	343	268	652	541
Short-term Lease, Cost	18	28	43	56
Total lease cost	$ 1,228	$ 1,241	$ 2,466	$ 2,479

Leases - Other Information (Det

Leases - Other Information (Details) - USD ($) $ in Thousands	6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Right Of Use Asset Obtained In Exchange for Lease Liability [Abstract]
Business Combination, Recognized Identifiable Asset Acquired and Liability Assumed, Lease Obligation		$ 900
Weighted average remaining lease term [Abstract]
Weighted average remaining lease term- operating leases	6 years 10 months 24 days
Weighted Average Discount Rate Leases [Abstract]
Weighted average discount rate - operating leases	4.50%
Lease Obligation Incurred	$ 200

Leases - Maturity of Operating

Leases - Maturity of Operating Lease Liability (Details) $ in Thousands	Mar. 31, 2023 USD ($)
Lessee, Operating Lease, Liability, to be Paid [Abstract]
2023 (six months)	$ 2,033
2024	3,954
2025	3,501
2026	3,122
2027	2,043
2028	1,898
Thereafter	5,705
Total future undiscounted lease payments	22,256
Less imputed interest	(3,391)
Total reported lease liability	$ 18,865

Stock-Based Compensation (Detai

Stock-Based Compensation (Details) - USD ($) $ in Thousands	6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Jan. 29, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Proceeds from Stock Options Exercised	$ 1,672	$ 5,598
Share-based Payment Arrangement, Shares Withheld for Tax Withholding Obligation	90,985	630,181
Tax withholding for share-based compensation	$ 3,700	$ 6,400
Total intrinsic value of all options exercised	2,600	13,900
Proceeds from employee stock purchase plan transactions	1,170	670
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Proceeds from Stock Options Exercised	1,700	$ 5,600
Total unrecognized compensation cost nonvested awards	$ 6,500
Weighted average period, unrecognized compensation cost, nonvested awards	1 year 10 months 24 days
Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total unrecognized compensation cost nonvested restricted stock units	$ 27,900
Weighted average period, unrecognized compensation cost, nonvested awards	2 years 3 months 18 days
The Purchase Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares authorized			3,425,000
Share-based Compensation Arrangement by Share-based Payment Award, Number of Continuous Days of Service	90 days
Share-based Compensation Arrangement by Share-based Payment Award, Number of Hours Per Week Employed	20 hours
Share-based Compensation Arrangement by Share-based Payment Award, Purchase Price of Common Stock, Percent	85%
Common shares issued to employees	39,979	36,987
Shares available for future issuance	512,869
Proceeds from employee stock purchase plan transactions	$ 1,200	$ 700
The 2021 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares available for future grants	2,340,956

Stock-Based Compensation (Stock

Stock-Based Compensation (Stock-Based Compensation Expense) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023	Mar. 31, 2022
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation before income taxes	$ 3,465	$ 2,242	$ 6,333	$ 4,259
Income tax benefit	(737)	(470)	(1,336)	(900)
Stock-based compensation after income taxes	2,728	1,772	4,997	3,359
Cost of Sales
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation before income taxes	161	131	303	217
Sales and Marketing
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation before income taxes	1,072	678	1,923	1,168
Research and Development
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation before income taxes	469	317	917	639
General and Administrative
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation before income taxes	$ 1,763	$ 1,116	$ 3,190	$ 2,235

Stock-Based Compensation (Optio

Stock-Based Compensation (Options and Common Shares Reserved for Grant) (Details) - Stock Options $ / shares in Units, shares in Thousands, $ in Thousands	6 Months Ended
	Mar. 31, 2023 USD ($) $ / shares shares
Options Outstanding [Roll Forward]
Options Outstanding, Beginning Balance (in shares) | shares	1,790
Options Outstanding, Granted (in shares) | shares	66
Options Outstanding, Exercised (in shares) | shares	(114)
Options Outstanding, Forfeited / Canceled (in shares) | shares	(34)
Options Outstanding, Ending Balance (in shares) | shares	1,708
Options Outstanding, Exercisable (in shares) | shares	1,012
Weighted Average Exercise Price [Roll Forward]
Weighted Average Exercise Price, Beginning Balance	$ 17.29
Weighted Average Exercise Price, Granted	40.67
Weighted Average Exercise Price, Exercised	15.24
Weighted Average Exercise Price, Forfeited / Canceled	20.69
Weighted Average Exercise Price, Ending Balance	18.23
Weighted Average Exercise Price, Exercisable	$ 15.60
Weighted Average Remaining Contractual Term [Abstract]
Weighted Average Remaining Contractual Term, Outstanding	4 years 6 months
Weighted Average Remaining Contractual Term, Exercisable	3 years 7 months 6 days
Aggregate Intrinsic Value, Outstanding | $	$ 15,189	[1]
Aggregate Intrinsic Value, Exercisable | $	$ 11,090	[1]
Closing Stock Price	$ 33.68
[1]The aggregate intrinsic value represents the total pre-tax intrinsic value, based on our closing stock price of $33.68 as of March 31, 2023, which would have been received by the option holders had all option holders exercised their options as of that date. 14. STOCK-BASED COMPENSATION (CONTINUED)The intrinsic value of an option is the amount by which the fair value of the underlying stock exceeds its exercise price.

Stock-Based Compensation (Fair

Stock-Based Compensation (Fair Value Assumptions) (Details) - Stock Options - $ / shares	6 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average per option grant date fair value	$ 19.92	$ 10.23
Assumptions Used For Options Grants [Abstract]
Risk free interest rate, minimum	3.77%	1.25%
Risk free interest rate, maximum	3.98%	1.82%
Expected term	6 years	6 years
Expected volatility rate	46%
Weighted average volatility	46%	46%
Expected dividend yield	0%	0%
Minimum
Assumptions Used For Options Grants [Abstract]
Expected volatility rate		45%
Maximum
Assumptions Used For Options Grants [Abstract]
Expected volatility rate		46%

Stock-Based Compensation (Non-V

Stock-Based Compensation (Non-Vested Options) (Details) shares in Thousands	6 Months Ended
	Mar. 31, 2023 $ / shares shares
Restricted Stock Units
Nonvested Number of Restricted Stock Units [Roll Forward]
Number of Restricted Stock Units, Beginning Balance | shares	742
Number of Restricted Stock Units, Granted | shares	440
Number of Restricted Stock Units, Vested | shares	(258)
Number of Restricted Stock Units, Canceled | shares	(32)
Number of Restricted Stock Units, Ending Balance | shares	892
Nonvested Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share [Roll Forward]
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Beginning Balance | $ / shares	$ 19.14
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Granted | $ / shares	40.41
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Vested | $ / shares	17.42
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Canceled | $ / shares	26.51
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Ending Balance | $ / shares	$ 29.86
Performance Shares
Nonvested Number of Restricted Stock Units [Roll Forward]
Number of Restricted Stock Units, Beginning Balance | shares	27
Number of Restricted Stock Units, Granted | shares	113
Number of Restricted Stock Units, Vested | shares	(5)
Number of Restricted Stock Units, Canceled | shares	0
Number of Restricted Stock Units, Ending Balance | shares	135
Nonvested Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share [Roll Forward]
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Beginning Balance | $ / shares	$ 22.69
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Granted | $ / shares	40.66
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Vested | $ / shares	22.93
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Canceled | $ / shares	0
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Ending Balance | $ / shares	$ 37.72