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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Digi International Inc | NASDAQ:DGII | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
-2.09 | -6.80% | 28.63 | 28.46 | 28.80 | 30.75 | 28.23 | 30.67 | 17,472 | 14:47:32 |
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þ
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
|
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41-1532464
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(State or other jurisdiction of incorporation or organization)
|
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(I.R.S. Employer Identification Number)
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9350 Excelsior Blvd., Suite 700
|
|
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Hopkins, Minnesota
|
|
55343
|
(Address of principal executive offices)
|
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(Zip Code)
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Title of each class
|
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Trading Symbol
|
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Name of each exchange on which registered
|
Common Stock, par value $.01 per share
|
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DGII
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The Nasdaq Stock Market LLC
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Large accelerated filer
|
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o
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Accelerated filer
|
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þ
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Non-accelerated filer
|
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o
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Smaller reporting company
|
|
o
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Emerging growth company
|
|
o
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Page
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30,
|
|
Nine months ended June 30,
|
||||||||||||
|
2019
|
|
2018
(as adjusted)* |
|
2019
|
|
2018
(as adjusted)* |
||||||||
|
(in thousands, except per share data)
|
||||||||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Product
|
$
|
47,136
|
|
|
$
|
51,691
|
|
|
$
|
150,045
|
|
|
$
|
137,733
|
|
Services and solutions
|
14,030
|
|
|
10,581
|
|
|
39,198
|
|
|
24,042
|
|
||||
Total revenue
|
61,166
|
|
|
62,272
|
|
|
189,243
|
|
|
161,775
|
|
||||
Cost of sales:
|
|
|
|
|
|
|
|
||||||||
Cost of product
|
25,982
|
|
|
26,639
|
|
|
80,291
|
|
|
68,929
|
|
||||
Cost of services and solutions
|
6,137
|
|
|
5,244
|
|
|
18,328
|
|
|
12,287
|
|
||||
Amortization of intangibles
|
719
|
|
|
741
|
|
|
2,184
|
|
|
2,118
|
|
||||
Total cost of sales
|
32,838
|
|
|
32,624
|
|
|
100,803
|
|
|
83,334
|
|
||||
Gross profit
|
28,328
|
|
|
29,648
|
|
|
88,440
|
|
|
78,441
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Sales and marketing
|
11,392
|
|
|
11,595
|
|
|
34,583
|
|
|
32,530
|
|
||||
Research and development
|
8,584
|
|
|
8,205
|
|
|
27,671
|
|
|
24,573
|
|
||||
General and administrative
|
6,751
|
|
|
7,234
|
|
|
18,309
|
|
|
19,905
|
|
||||
Restructuring (reversal) charge
|
(20
|
)
|
|
190
|
|
|
(87
|
)
|
|
190
|
|
||||
Total operating expenses
|
26,707
|
|
|
27,224
|
|
|
80,476
|
|
|
77,198
|
|
||||
Operating income
|
1,621
|
|
|
2,424
|
|
|
7,964
|
|
|
1,243
|
|
||||
Other income, net:
|
|
|
|
|
|
|
|
||||||||
Interest income
|
205
|
|
|
97
|
|
|
557
|
|
|
343
|
|
||||
Interest expense
|
—
|
|
|
(5
|
)
|
|
(94
|
)
|
|
(12
|
)
|
||||
Other (expense) income, net
|
(174
|
)
|
|
535
|
|
|
131
|
|
|
(37
|
)
|
||||
Total other income, net
|
31
|
|
|
627
|
|
|
594
|
|
|
294
|
|
||||
Income before income taxes
|
1,652
|
|
|
3,051
|
|
|
8,558
|
|
|
1,537
|
|
||||
Income tax expense
|
4
|
|
|
147
|
|
|
886
|
|
|
3,246
|
|
||||
Net income (loss)
|
$
|
1,648
|
|
|
$
|
2,904
|
|
|
$
|
7,672
|
|
|
$
|
(1,709
|
)
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) per common share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.06
|
|
|
$
|
0.11
|
|
|
$
|
0.28
|
|
|
$
|
(0.06
|
)
|
Diluted
|
$
|
0.06
|
|
|
$
|
0.10
|
|
|
$
|
0.27
|
|
|
$
|
(0.06
|
)
|
Weighted average common shares:
|
|
|
|
|
|
|
|
||||||||
Basic
|
28,072
|
|
|
27,177
|
|
|
27,816
|
|
|
27,002
|
|
||||
Diluted
|
28,589
|
|
|
27,764
|
|
|
28,414
|
|
|
27,002
|
|
|
Three months ended June 30,
|
|
Nine months ended June 30,
|
||||||||||||
|
2019
|
|
2018
(as adjusted)* |
|
2019
|
|
2018
(as adjusted)* |
||||||||
|
(in thousands)
|
||||||||||||||
Net income (loss)
|
$
|
1,648
|
|
|
$
|
2,904
|
|
|
$
|
7,672
|
|
|
$
|
(1,709
|
)
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustment
|
532
|
|
|
(3,116
|
)
|
|
(1,120
|
)
|
|
(1,058
|
)
|
||||
Change in net unrealized gain (loss) on investments
|
4
|
|
|
(1
|
)
|
|
18
|
|
|
(41
|
)
|
||||
Less income tax (expense) benefit
|
(1
|
)
|
|
1
|
|
|
(5
|
)
|
|
9
|
|
||||
Reclassification of realized loss on investments included in net income
(1)
|
—
|
|
|
—
|
|
|
—
|
|
|
31
|
|
||||
Less income tax benefit
(2)
|
—
|
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
||||
Other comprehensive income (loss), net of tax
|
535
|
|
|
(3,116
|
)
|
|
(1,107
|
)
|
|
(1,067
|
)
|
||||
Comprehensive income (loss)
|
$
|
2,183
|
|
|
$
|
(212
|
)
|
|
$
|
6,565
|
|
|
$
|
(2,776
|
)
|
|
June 30, 2019
|
|
September 30, 2018
(as adjusted)* |
||||
|
(in thousands, except share data)
|
||||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
84,094
|
|
|
$
|
58,014
|
|
Marketable securities
|
2,254
|
|
|
4,736
|
|
||
Accounts receivable, net
|
44,721
|
|
|
49,819
|
|
||
Inventories
|
41,796
|
|
|
41,644
|
|
||
Other current assets
|
5,057
|
|
|
2,613
|
|
||
Assets held for sale
|
—
|
|
|
5,220
|
|
||
Total current assets
|
177,922
|
|
|
162,046
|
|
||
Property, equipment and improvements, net
|
14,417
|
|
|
8,354
|
|
||
Intangible assets, net
|
32,791
|
|
|
39,320
|
|
||
Goodwill
|
153,952
|
|
|
154,535
|
|
||
Deferred tax assets
|
5,343
|
|
|
6,600
|
|
||
Other non-current assets
|
821
|
|
|
1,291
|
|
||
Total assets
|
$
|
385,246
|
|
|
$
|
372,146
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
15,460
|
|
|
$
|
12,911
|
|
Accrued compensation
|
5,105
|
|
|
8,190
|
|
||
Unearned revenue
|
5,031
|
|
|
3,177
|
|
||
Contingent consideration on acquired businesses
|
5,405
|
|
|
5,890
|
|
||
Other current liabilities
|
4,020
|
|
|
5,405
|
|
||
Total current liabilities
|
35,021
|
|
|
35,573
|
|
||
Income taxes payable
|
684
|
|
|
851
|
|
||
Deferred tax liabilities
|
273
|
|
|
334
|
|
||
Contingent consideration on acquired businesses
|
—
|
|
|
4,175
|
|
||
Other non-current liabilities
|
4,192
|
|
|
720
|
|
||
Total liabilities
|
40,170
|
|
|
41,653
|
|
||
Contingencies (see Note 13)
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, $.01 par value; 2,000,000 shares authorized; none issued and outstanding
|
—
|
|
|
—
|
|
||
Common stock, $.01 par value; 60,000,000 shares authorized; 34,510,607 and 33,812,838 shares issued
|
345
|
|
|
338
|
|
||
Additional paid-in capital
|
264,225
|
|
|
255,936
|
|
||
Retained earnings
|
159,633
|
|
|
151,961
|
|
||
Accumulated other comprehensive loss
|
(24,633
|
)
|
|
(23,526
|
)
|
||
Treasury stock, at cost, 6,386,324 and 6,385,336 shares
|
(54,494
|
)
|
|
(54,216
|
)
|
||
Total stockholders’ equity
|
345,076
|
|
|
330,493
|
|
||
Total liabilities and stockholders’ equity
|
$
|
385,246
|
|
|
$
|
372,146
|
|
|
Nine months ended June 30,
|
||||||
|
2019
|
|
2018
(as adjusted)* |
||||
|
(in thousands)
|
||||||
Operating activities:
|
|
|
|
||||
Net income (loss)
|
$
|
7,672
|
|
|
$
|
(1,709
|
)
|
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
|
|
|
|
||||
Depreciation of property, equipment and improvements
|
3,343
|
|
|
2,440
|
|
||
Amortization of intangible assets
|
6,669
|
|
|
6,866
|
|
||
Stock-based compensation
|
4,180
|
|
|
3,598
|
|
||
Deferred income tax provision
|
1,189
|
|
|
2,781
|
|
||
Gain on sale of property and equipment
|
(4,458
|
)
|
|
(8
|
)
|
||
Change in fair value of contingent consideration
|
1,188
|
|
|
333
|
|
||
Provision for bad debt and product returns
|
594
|
|
|
404
|
|
||
Provision for inventory obsolescence
|
1,350
|
|
|
1,550
|
|
||
Restructuring (reversal) charge
|
(87
|
)
|
|
190
|
|
||
Other
|
131
|
|
|
(58
|
)
|
||
Changes in operating assets and liabilities (net of acquisitions)
|
757
|
|
|
(25,231
|
)
|
||
Net cash provided by (used in) operating activities
|
22,528
|
|
|
(8,844
|
)
|
||
Investing activities:
|
|
|
|
||||
Proceeds from maturities and sales of marketable securities
|
2,500
|
|
|
29,752
|
|
||
Proceeds from sale of business
|
—
|
|
|
2,000
|
|
||
Acquisition of businesses, net of cash acquired
|
—
|
|
|
(56,588
|
)
|
||
Proceeds from sale of property and equipment
|
10,047
|
|
|
—
|
|
||
Purchase of property, equipment, improvements and certain other intangible assets
|
(8,600
|
)
|
|
(963
|
)
|
||
Net cash provided by (used in) investing activities
|
3,947
|
|
|
(25,799
|
)
|
||
Financing activities:
|
|
|
|
||||
Acquisition earn-out payments
|
(3,748
|
)
|
|
—
|
|
||
Proceeds from stock option plan transactions
|
4,054
|
|
|
3,871
|
|
||
Proceeds from employee stock purchase plan transactions
|
835
|
|
|
892
|
|
||
Purchases of common stock
|
(1,051
|
)
|
|
(730
|
)
|
||
Net cash provided by financing activities
|
90
|
|
|
4,033
|
|
||
Effect of exchange rate changes on cash and cash equivalents
|
(485
|
)
|
|
82
|
|
||
Net increase (decrease) in cash and cash equivalents
|
26,080
|
|
|
(30,528
|
)
|
||
Cash and cash equivalents, beginning of period
|
58,014
|
|
|
78,222
|
|
||
Cash and cash equivalents, end of period
|
$
|
84,094
|
|
|
$
|
47,694
|
|
|
|
|
|
||||
Supplemental schedule of non-cash investing and financing activities:
|
|
|
|
||||
Transfer of inventory to property, equipment and improvements
|
$
|
(921
|
)
|
|
$
|
(1,750
|
)
|
Liability related to acquisition of business
|
$
|
—
|
|
|
$
|
(2,300
|
)
|
Accrual for purchase of property, equipment, improvements and certain other intangible assets
|
$
|
(7
|
)
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
|
Other
|
|
Total
|
||||||||||||||
|
|
Common Stock
|
|
Treasury Stock
|
|
Paid-In
|
|
Retained
|
|
Comprehensive
|
|
Stockholders’
|
||||||||||||||||||
(in thousands)
|
|
Shares
|
|
Par Value
|
|
Shares
|
|
Value
|
|
Capital
|
|
Earnings*
|
|
Loss
|
|
Equity
|
||||||||||||||
Balances, September 30, 2017
|
|
33,008
|
|
|
$
|
330
|
|
|
6,437
|
|
|
$
|
(54,533
|
)
|
|
$
|
245,528
|
|
|
$
|
150,363
|
|
|
$
|
(22,659
|
)
|
|
$
|
319,029
|
|
Cumulative-effect adjustment from adoption of ASU 2016-09
|
|
|
|
|
|
|
|
|
|
52
|
|
|
(33
|
)
|
|
|
|
19
|
|
|||||||||||
Net loss
|
|
|
|
|
|
|
|
|
|
|
|
(1,709
|
)
|
|
|
|
(1,709
|
)
|
||||||||||||
Other comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,067
|
)
|
|
(1,067
|
)
|
||||||||||||
Employee stock purchase plan issuances
|
|
|
|
|
|
(106
|
)
|
|
897
|
|
|
(5
|
)
|
|
|
|
|
|
892
|
|
||||||||||
Repurchase of common stock
|
|
|
|
|
|
73
|
|
|
(730
|
)
|
|
|
|
|
|
|
|
(730
|
)
|
|||||||||||
Issuance of stock under stock award plans
|
|
638
|
|
|
7
|
|
|
|
|
|
|
3,864
|
|
|
|
|
|
|
3,871
|
|
||||||||||
Stock-based compensation expense
|
|
|
|
|
|
|
|
|
|
3,598
|
|
|
|
|
|
|
3,598
|
|
||||||||||||
Balances, June 30, 2018
|
|
33,646
|
|
|
$
|
337
|
|
|
6,404
|
|
|
$
|
(54,366
|
)
|
|
$
|
253,037
|
|
|
$
|
148,621
|
|
|
$
|
(23,726
|
)
|
|
$
|
323,903
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balances, September 30, 2018
|
|
33,813
|
|
|
$
|
338
|
|
|
6,385
|
|
|
$
|
(54,216
|
)
|
|
$
|
255,936
|
|
|
$
|
151,961
|
|
|
$
|
(23,526
|
)
|
|
$
|
330,493
|
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
7,672
|
|
|
|
|
7,672
|
|
||||||||||||
Other comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,107
|
)
|
|
(1,107
|
)
|
||||||||||||
Employee stock purchase plan issuances
|
|
|
|
|
|
(91
|
)
|
|
773
|
|
|
62
|
|
|
|
|
|
|
835
|
|
||||||||||
Repurchase of common stock
|
|
|
|
|
|
92
|
|
|
(1,051
|
)
|
|
|
|
|
|
|
|
(1,051
|
)
|
|||||||||||
Issuance of stock under stock award plans
|
|
698
|
|
|
7
|
|
|
|
|
|
|
4,047
|
|
|
|
|
|
|
4,054
|
|
||||||||||
Stock-based compensation expense
|
|
|
|
|
|
|
|
|
|
4,180
|
|
|
|
|
|
|
4,180
|
|
||||||||||||
Balances, June 30, 2019
|
|
34,511
|
|
|
$
|
345
|
|
|
6,386
|
|
|
$
|
(54,494
|
)
|
|
$
|
264,225
|
|
|
$
|
159,633
|
|
|
$
|
(24,633
|
)
|
|
$
|
345,076
|
|
•
|
Identification of the contract, or contracts with a customer;
|
•
|
Identification of the performance obligations in the contract;
|
•
|
Determination of the transaction price;
|
•
|
Allocation of the transaction price to the performance obligations in the contract; and
|
•
|
Recognition of revenue when or as we satisfy the performance obligations.
|
•
|
We have not disclosed the remaining transaction price for reporting periods prior to the first quarter of fiscal 2019.
|
•
|
For completed contracts that have variable consideration, we will use the as-invoiced amount for all of our time and materials contracts and contracts relating to Digi Remote Manager
®
in instances where the contracts do not include free service.
|
•
|
We will expense incremental costs of obtaining a contract when incurred if the amortization period of the asset is one year or less.
|
|
|
Three months ended June 30, 2018
|
||||||||||
(in thousands, except per common share data)
|
|
As Reported
|
|
Impact of Adoption
|
|
As Adjusted
|
||||||
Revenue:
|
|
|
|
|
|
|
||||||
Product
|
|
$
|
51,691
|
|
|
$
|
—
|
|
|
$
|
51,691
|
|
Services and solutions
|
|
11,025
|
|
|
(444
|
)
|
|
10,581
|
|
|||
Total revenue
|
|
62,716
|
|
|
(444
|
)
|
|
62,272
|
|
|||
Cost of sales:
|
|
|
|
|
|
|
||||||
Cost of product
|
|
26,639
|
|
|
—
|
|
|
26,639
|
|
|||
Cost of services and solutions
|
|
6,007
|
|
|
(763
|
)
|
|
5,244
|
|
|||
Amortization of intangibles
|
|
741
|
|
|
—
|
|
|
741
|
|
|||
Total cost of sales
|
|
33,387
|
|
|
(763
|
)
|
|
32,624
|
|
|||
Gross profit
|
|
29,329
|
|
|
319
|
|
|
29,648
|
|
|||
Operating expenses
|
|
27,292
|
|
|
(68
|
)
|
|
27,224
|
|
|||
Operating income
|
|
$
|
2,037
|
|
|
$
|
387
|
|
|
$
|
2,424
|
|
Net income
|
|
$
|
2,621
|
|
|
$
|
283
|
|
|
$
|
2,904
|
|
Diluted income per share
|
|
$
|
0.09
|
|
|
$
|
0.01
|
|
|
$
|
0.10
|
|
|
|
Nine months ended June 30, 2018
|
||||||||||
(in thousands, except per common share data)
|
|
As Reported
|
|
Impact of Adoption
|
|
As Adjusted
|
||||||
Revenue:
|
|
|
|
|
|
|
||||||
Product
|
|
$
|
137,733
|
|
|
$
|
—
|
|
|
$
|
137,733
|
|
Services and solutions
|
|
24,971
|
|
|
(929
|
)
|
|
24,042
|
|
|||
Total revenue
|
|
162,704
|
|
|
(929
|
)
|
|
161,775
|
|
|||
Cost of sales:
|
|
|
|
|
|
|
||||||
Cost of product
|
|
68,929
|
|
|
—
|
|
|
68,929
|
|
|||
Cost of services and solutions
|
|
13,737
|
|
|
(1,450
|
)
|
|
12,287
|
|
|||
Amortization of intangibles
|
|
2,118
|
|
|
—
|
|
|
2,118
|
|
|||
Total cost of sales
|
|
84,784
|
|
|
(1,450
|
)
|
|
83,334
|
|
|||
Gross profit
|
|
77,920
|
|
|
521
|
|
|
78,441
|
|
|||
Operating expenses
|
|
77,503
|
|
|
(305
|
)
|
|
77,198
|
|
|||
Operating income
|
|
$
|
417
|
|
|
$
|
826
|
|
|
$
|
1,243
|
|
Net loss
|
|
$
|
(2,305
|
)
|
|
$
|
596
|
|
|
$
|
(1,709
|
)
|
Diluted loss per share
|
|
$
|
(0.09
|
)
|
|
$
|
0.02
|
|
|
$
|
(0.06
|
)
|
|
|
September 30, 2018
|
||||||||||
(in thousands)
|
|
As Reported
|
|
Impact of Adoption
|
|
As Adjusted
|
||||||
Accounts receivable, net
|
|
$
|
50,817
|
|
|
$
|
(998
|
)
|
|
$
|
49,819
|
|
Property, equipment and improvements, net
|
|
$
|
6,270
|
|
|
$
|
2,084
|
|
|
$
|
8,354
|
|
Deferred tax assets
|
|
$
|
6,665
|
|
|
$
|
(65
|
)
|
|
$
|
6,600
|
|
Unearned revenue current
|
|
$
|
2,579
|
|
|
$
|
598
|
|
|
$
|
3,177
|
|
Other non-current liabilities
|
|
$
|
510
|
|
|
$
|
210
|
|
|
$
|
720
|
|
Retained earnings
|
|
$
|
151,748
|
|
|
$
|
213
|
|
|
$
|
151,961
|
|
|
Three months ended June 30,
|
|
Nine months ended June 30,
|
||||||||||||
|
2019
|
|
2018
(as adjusted)* |
|
2019
|
|
2018
(as adjusted)* |
||||||||
Numerator:
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
$
|
1,648
|
|
|
$
|
2,904
|
|
|
$
|
7,672
|
|
|
$
|
(1,709
|
)
|
|
|
|
|
|
|
|
|
||||||||
Denominator:
|
|
|
|
|
|
|
|
||||||||
Denominator for basic net income (loss) per common share — weighted average shares outstanding
|
28,072
|
|
|
27,177
|
|
|
27,816
|
|
|
27,002
|
|
||||
Effect of dilutive securities:
|
|
|
|
|
|
|
|
||||||||
Stock options and restricted stock units
|
517
|
|
|
587
|
|
|
598
|
|
|
—
|
|
||||
Denominator for diluted net income (loss) per common share — adjusted weighted average shares
|
28,589
|
|
|
27,764
|
|
|
28,414
|
|
|
27,002
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Net income (loss) per common share, basic
|
$
|
0.06
|
|
|
$
|
0.11
|
|
|
$
|
0.28
|
|
|
$
|
(0.06
|
)
|
Net income (loss) per common share, diluted
|
$
|
0.06
|
|
|
$
|
0.10
|
|
|
$
|
0.27
|
|
|
$
|
(0.06
|
)
|
|
June 30,
2019 |
|
September 30, 2018
(as adjusted)* |
||||
Accounts receivable, net:
|
|
|
|
||||
Accounts receivable
|
$
|
48,747
|
|
|
$
|
53,164
|
|
Less allowance for doubtful accounts
|
1,349
|
|
|
785
|
|
||
Less reserve for future returns and pricing adjustments
|
2,677
|
|
|
2,560
|
|
||
Accounts receivable, net
|
$
|
44,721
|
|
|
$
|
49,819
|
|
Inventories:
|
|
|
|
||||
Raw materials
|
$
|
15,494
|
|
|
$
|
22,047
|
|
Work in process
|
649
|
|
|
525
|
|
||
Finished goods
|
25,653
|
|
|
19,072
|
|
||
Inventories
|
$
|
41,796
|
|
|
$
|
41,644
|
|
|
Amortized
Cost (1)
|
|
Unrealized
Gains
|
|
Unrealized
Losses
|
|
Fair Value (1)
|
||||||||
Current marketable securities:
|
|
|
|
|
|
|
|
||||||||
Certificates of deposit
|
$
|
2,255
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
2,254
|
|
Total marketable securities
|
$
|
2,255
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
2,254
|
|
(1)
|
Included in amortized cost and fair value is purchased and accrued interest of
$6
.
|
|
Amortized
Cost (1)
|
|
Unrealized
Gains
|
|
Unrealized
Losses
|
|
Fair Value (1)
|
||||||||
Current marketable securities:
|
|
|
|
|
|
|
|
||||||||
Certificates of deposit
|
$
|
4,756
|
|
|
$
|
—
|
|
|
$
|
(20
|
)
|
|
$
|
4,736
|
|
Total marketable securities
|
$
|
4,756
|
|
|
$
|
—
|
|
|
$
|
(20
|
)
|
|
$
|
4,736
|
|
(1)
|
Included in amortized cost and fair value is purchased and accrued interest of
$6
.
|
|
June 30, 2019
|
||||||||||||||
|
Less than 12 Months
|
|
More than 12 Months
|
||||||||||||
|
Fair Value
|
|
Unrealized Losses
|
|
Fair Value
|
|
Unrealized Losses
|
||||||||
Certificates of deposit
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,254
|
|
|
$
|
(1
|
)
|
Total
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,254
|
|
|
$
|
(1
|
)
|
|
September 30, 2018
|
||||||||||||||
|
Less than 12 Months
|
|
More than 12 Months
|
||||||||||||
|
Fair Value
|
|
Unrealized Losses
|
|
Fair Value
|
|
Unrealized Losses
|
||||||||
Certificates of deposit
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,736
|
|
|
$
|
(20
|
)
|
Total
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,736
|
|
|
$
|
(20
|
)
|
|
Total Fair
Value at
|
|
Fair Value Measurements Using
Inputs Considered as
|
||||||||||||
|
June 30, 2019
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Money market
|
$
|
20,302
|
|
|
$
|
20,302
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Certificates of deposit
|
2,254
|
|
|
—
|
|
|
2,254
|
|
|
—
|
|
||||
Total assets measured at fair value
|
$
|
22,556
|
|
|
$
|
20,302
|
|
|
$
|
2,254
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Contingent consideration on acquired businesses
|
$
|
5,405
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,405
|
|
Total liabilities measured at fair value
|
$
|
5,405
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,405
|
|
|
Total Fair
Value at
|
|
Fair Value Measurements Using
Inputs Considered as
|
||||||||||||
|
September 30, 2018
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Money market
|
$
|
24,318
|
|
|
$
|
24,318
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Certificates of deposit
|
4,736
|
|
|
—
|
|
|
4,736
|
|
|
—
|
|
||||
Total assets measured at fair value
|
$
|
29,054
|
|
|
$
|
24,318
|
|
|
$
|
4,736
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Contingent consideration on acquired businesses
|
$
|
10,065
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
10,065
|
|
Total liabilities measured at fair value
|
$
|
10,065
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
10,065
|
|
|
Three months ended June 30,
|
|
Nine months ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Fair value at beginning of period
|
$
|
8,527
|
|
|
$
|
8,263
|
|
|
$
|
10,065
|
|
|
$
|
6,388
|
|
Purchase price contingent consideration
|
—
|
|
|
—
|
|
|
—
|
|
|
2,300
|
|
||||
Contingent consideration payments
|
(3,500
|
)
|
|
—
|
|
|
(5,848
|
)
|
|
—
|
|
||||
Change in fair value of contingent consideration
|
378
|
|
|
758
|
|
|
1,188
|
|
|
333
|
|
||||
Fair value at end of period
|
$
|
5,405
|
|
|
$
|
9,021
|
|
|
$
|
5,405
|
|
|
$
|
9,021
|
|
|
June 30, 2019
|
|
September 30, 2018
|
||||||||||||||||||||
|
Gross
carrying
amount
|
|
Accum.
amort.
|
|
Net
|
|
Gross
carrying
amount
|
|
Accum.
amort.
|
|
Net
|
||||||||||||
Purchased and core technology
|
$
|
57,888
|
|
|
$
|
(50,455
|
)
|
|
$
|
7,433
|
|
|
$
|
58,102
|
|
|
$
|
(48,693
|
)
|
|
$
|
9,409
|
|
License agreements
|
102
|
|
|
(67
|
)
|
|
35
|
|
|
102
|
|
|
(46
|
)
|
|
56
|
|
||||||
Patents and trademarks
|
14,552
|
|
|
(11,725
|
)
|
|
2,827
|
|
|
15,701
|
|
|
(12,242
|
)
|
|
3,459
|
|
||||||
Customer relationships
|
46,457
|
|
|
(24,261
|
)
|
|
22,196
|
|
|
46,605
|
|
|
(21,049
|
)
|
|
25,556
|
|
||||||
Non-compete agreements
|
600
|
|
|
(300
|
)
|
|
300
|
|
|
600
|
|
|
(210
|
)
|
|
390
|
|
||||||
Order backlog
|
1,800
|
|
|
(1,800
|
)
|
|
—
|
|
|
1,800
|
|
|
(1,350
|
)
|
|
450
|
|
||||||
Total
|
$
|
121,399
|
|
|
$
|
(88,608
|
)
|
|
$
|
32,791
|
|
|
$
|
122,910
|
|
|
$
|
(83,590
|
)
|
|
$
|
39,320
|
|
|
Nine months ended June 30,
|
||||||||||
|
IoT
Products and Services
|
|
IoT
Solutions
|
|
Total
|
||||||
Beginning balance, October 1
|
$
|
104,358
|
|
|
$
|
50,177
|
|
|
$
|
154,535
|
|
Foreign currency translation adjustment
|
(404
|
)
|
|
(179
|
)
|
|
(583
|
)
|
|||
Ending balance, June 30
|
$
|
103,954
|
|
|
$
|
49,998
|
|
|
$
|
153,952
|
|
|
|
Three months ended June 30,
|
|
Nine months ended June 30,
|
||||||||||||
|
|
2019
|
|
2018
(as adjusted)* |
|
2019
|
|
2018
(as adjusted)* |
||||||||
Revenue
|
|
|
|
|
|
|
|
|
||||||||
IoT Products & Services
|
|
$
|
50,510
|
|
|
$
|
54,406
|
|
|
$
|
159,843
|
|
|
$
|
145,111
|
|
IoT Solutions
|
|
10,656
|
|
|
7,866
|
|
|
29,400
|
|
|
16,664
|
|
||||
Total revenue
|
|
$
|
61,166
|
|
|
$
|
62,272
|
|
|
$
|
189,243
|
|
|
$
|
161,775
|
|
Operating income (loss)
|
|
|
|
|
|
|
|
|
||||||||
IoT Products & Services
|
|
$
|
3,117
|
|
|
$
|
4,544
|
|
|
$
|
13,969
|
|
|
$
|
10,497
|
|
IoT Solutions
|
|
(1,496
|
)
|
|
(2,120
|
)
|
|
(6,005
|
)
|
|
(9,254
|
)
|
||||
Total operating income
|
|
$
|
1,621
|
|
|
$
|
2,424
|
|
|
$
|
7,964
|
|
|
$
|
1,243
|
|
Depreciation and amortization
|
|
|
|
|
|
|
|
|
||||||||
IoT Products & Services
|
|
$
|
1,391
|
|
|
$
|
1,754
|
|
|
$
|
4,711
|
|
|
$
|
4,332
|
|
IoT Solutions
|
|
1,795
|
|
|
1,719
|
|
|
5,301
|
|
|
4,974
|
|
||||
Total depreciation and amortization
|
|
$
|
3,186
|
|
|
$
|
3,473
|
|
|
$
|
10,012
|
|
|
$
|
9,306
|
|
|
|
Nine months ended June 30,
|
||||||
|
|
2019
|
|
2018
|
||||
Expended for property, equipment and improvements
|
|
|
|
|
||||
IoT Products & Services
|
|
$
|
8,212
|
|
|
$
|
963
|
|
IoT Solutions*
|
|
388
|
|
|
—
|
|
||
Total expended for property, plant and equipment
|
|
$
|
8,600
|
|
|
$
|
963
|
|
|
|
June 30, 2019
|
|
|
September 30, 2018
(as adjusted)* |
|||
Assets
|
|
|
|
|
||||
IoT Products & Services
|
|
$
|
204,069
|
|
|
$
|
209,574
|
|
IoT Solutions
|
|
94,828
|
|
|
99,822
|
|
||
Unallocated**
|
|
86,349
|
|
|
62,750
|
|
||
Total assets
|
|
$
|
385,246
|
|
|
$
|
372,146
|
|
|
Three months ended June 30,
|
|
Nine months ended June 30,
|
||||||||||||
($ in thousands)
|
2019
|
|
2018
(as adjusted)* |
|
2019
|
|
2018
(as adjusted)* |
||||||||
North America, primarily the United States
|
$
|
43,604
|
|
|
$
|
44,740
|
|
|
$
|
138,808
|
|
|
$
|
113,246
|
|
Europe, Middle East & Africa
|
9,582
|
|
|
10,216
|
|
|
30,450
|
|
|
29,876
|
|
||||
Rest of world
|
7,980
|
|
|
7,316
|
|
|
19,985
|
|
|
18,653
|
|
||||
Total revenue
|
$
|
61,166
|
|
|
$
|
62,272
|
|
|
$
|
189,243
|
|
|
$
|
161,775
|
|
|
Three months ended June 30,
|
|
Nine months ended June 30,
|
||||||||||||
($ in thousands)
|
2019
|
|
2018
(as adjusted)* |
|
2019
|
|
2018
(as adjusted)* |
||||||||
IoT Products & Services Segment
|
|
|
|
|
|
|
|
||||||||
Product
|
$
|
47,136
|
|
|
$
|
51,691
|
|
|
$
|
150,045
|
|
|
$
|
137,733
|
|
Services
|
3,374
|
|
|
2,715
|
|
|
9,798
|
|
|
7,378
|
|
||||
Total IoT Products & Services Segment
|
50,510
|
|
|
54,406
|
|
|
159,843
|
|
|
145,111
|
|
||||
IoT Solutions Segment
|
|
|
|
|
|
|
|
||||||||
Solutions
|
10,656
|
|
|
7,866
|
|
|
29,400
|
|
|
16,664
|
|
||||
Total Revenue
|
$
|
61,166
|
|
|
$
|
62,272
|
|
|
$
|
189,243
|
|
|
$
|
161,775
|
|
|
|
Nine months ended
June 30, |
||
($ in thousands)
|
|
2019
|
||
Unearned revenue, beginning of period*
|
|
$
|
3,933
|
|
Billings
|
|
18,908
|
|
|
Revenue recognized
|
|
(17,370
|
)
|
|
Unearned revenue, end of period
|
|
$
|
5,471
|
|
Unrecognized tax benefits as of September 30, 2018
|
$
|
1,561
|
|
Decreases related to:
|
|
||
Prior year income tax positions
|
(34
|
)
|
|
Expiration of statute of limitations
|
(128
|
)
|
|
Unrecognized tax benefits as of June 30, 2019
|
$
|
1,399
|
|
|
Balance at
|
|
Warranties
|
|
Settlements
|
|
Balance at
|
||||||||
Period
|
April 1
|
|
issued
|
|
made
|
|
June 30
|
||||||||
Three months ended June 30, 2019
|
$
|
1,109
|
|
|
$
|
47
|
|
|
$
|
(101
|
)
|
|
$
|
1,055
|
|
Three months ended June 30, 2018
|
$
|
1,348
|
|
|
$
|
82
|
|
|
$
|
(135
|
)
|
|
$
|
1,295
|
|
|
|
|
|
|
|
|
|
||||||||
|
Balance at
|
|
Warranties
|
|
Settlements
|
|
Balance at
|
||||||||
Period
|
October 1
|
|
issued
|
|
made
|
|
June 30
|
||||||||
Nine months ended June 30, 2019
|
$
|
1,172
|
|
|
$
|
263
|
|
|
$
|
(380
|
)
|
|
$
|
1,055
|
|
Nine months ended June 30, 2018
|
$
|
987
|
|
|
$
|
798
|
|
|
$
|
(490
|
)
|
|
$
|
1,295
|
|
Fiscal year
|
|
Amount
|
||
2019 (three months)
|
|
$
|
426
|
|
2020
|
|
2,522
|
|
|
2021
|
|
2,490
|
|
|
2022
|
|
2,228
|
|
|
2023
|
|
2,049
|
|
|
2024
|
|
2,095
|
|
|
Thereafter
|
|
11,361
|
|
|
Total minimum payments required
|
|
$
|
23,171
|
|
|
Three months ended June 30,
|
|
Nine months ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Cost of sales
|
$
|
55
|
|
|
$
|
49
|
|
|
$
|
135
|
|
|
$
|
145
|
|
Sales and marketing
|
453
|
|
|
406
|
|
|
1,272
|
|
|
1,131
|
|
||||
Research and development
|
268
|
|
|
168
|
|
|
737
|
|
|
343
|
|
||||
General and administrative
|
697
|
|
|
597
|
|
|
2,036
|
|
|
1,979
|
|
||||
Stock-based compensation before income taxes
|
1,473
|
|
|
1,220
|
|
|
4,180
|
|
|
3,598
|
|
||||
Income tax benefit
|
(306
|
)
|
|
(249
|
)
|
|
(863
|
)
|
|
(747
|
)
|
||||
Stock-based compensation after income taxes
|
$
|
1,167
|
|
|
$
|
971
|
|
|
$
|
3,317
|
|
|
$
|
2,851
|
|
|
|
Options Outstanding
|
|
Weighted Average Exercised Price
|
|
Weighted Average Contractual Term (in years)
|
|
Aggregate Intrinsic Value (1)
|
|||
Balance at September 30, 2018
|
|
3,526
|
|
|
$10.49
|
|
|
|
|
||
Granted
|
|
606
|
|
|
11.64
|
|
|
|
|
||
Exercised
|
|
(448
|
)
|
|
9.04
|
|
|
|
|
||
Forfeited / Canceled
|
|
(346
|
)
|
|
12.52
|
|
|
|
|
||
Balance at June 30, 2019
|
|
3,338
|
|
|
$10.68
|
|
4.1
|
|
$
|
6,983
|
|
|
|
|
|
|
|
|
|
|
|||
Exercisable at June 30, 2019
|
|
2,226
|
|
|
$10.34
|
|
3.3
|
|
$
|
5,418
|
|
|
Nine months ended June 30,
|
||
|
2019
|
|
2018
|
Weighted average per option grant date fair value
|
$4.37
|
|
$3.76
|
Assumptions used for option grants:
|
|
|
|
Risk free interest rate
|
2.3% - 2.93%
|
|
2.12% - 2.88%
|
Expected term
|
6.00 years
|
|
6.00 years
|
Expected volatility
|
33% - 34%
|
|
33% - 34%
|
Weighted average volatility
|
33%
|
|
31%
|
Expected dividend yield
|
0
|
|
0
|
|
Number of Awards
|
|
Weighted Average Grant Date Fair Value
|
|||
Nonvested at September 30, 2018
|
674
|
|
|
$
|
11.05
|
|
Granted
|
547
|
|
|
$
|
11.62
|
|
Vested
|
(250
|
)
|
|
$
|
10.42
|
|
Canceled
|
(131
|
)
|
|
$
|
12.20
|
|
Nonvested at June 30, 2019
|
840
|
|
|
$
|
11.43
|
|
|
Manufacturing Transition
|
|
2017
Restructuring
|
|
|
||||||||||
|
Employee
Termination Costs |
|
Employee
Termination Costs |
|
Other
|
|
Total
|
||||||||
Balance at September 30, 2018
|
$
|
147
|
|
|
$
|
293
|
|
|
$
|
13
|
|
|
$
|
453
|
|
Payments
|
(108
|
)
|
|
(233
|
)
|
|
(18
|
)
|
|
(359
|
)
|
||||
Reversals
|
(39
|
)
|
|
(53
|
)
|
|
5
|
|
|
(87
|
)
|
||||
Foreign currency fluctuation
|
—
|
|
|
(7
|
)
|
|
—
|
|
|
(7
|
)
|
||||
Balance at June 30, 2019
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
•
|
IoT Products & Services segment; and
|
•
|
IoT Solutions segment.
|
|
Three months ended June 30,
|
|
Nine months ended June 30,
|
||||||||||||||||||||||||
|
2019
|
|
2018
(as adjusted)* |
|
2019
|
|
2018
(as adjusted)* |
||||||||||||||||||||
($ in thousands)
|
|
|
% of total
revenue |
|
|
|
% of total
revenue |
|
|
|
% of total
revenue |
|
|
|
% of total
revenue |
||||||||||||
Total revenue
|
$
|
61,166
|
|
|
100.0
|
%
|
|
$
|
62,272
|
|
|
100.0
|
%
|
|
$
|
189,243
|
|
|
100.0
|
%
|
|
$
|
161,775
|
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income (loss)
|
$
|
1,648
|
|
|
|
|
$
|
2,904
|
|
|
|
|
$
|
7,672
|
|
|
|
|
$
|
(1,709
|
)
|
|
|
||||
Interest income, net
|
(205
|
)
|
|
|
|
(92
|
)
|
|
|
|
(463
|
)
|
|
|
|
(331
|
)
|
|
|
||||||||
Income tax expense
|
4
|
|
|
|
|
147
|
|
|
|
|
886
|
|
|
|
|
3,246
|
|
|
|
||||||||
Depreciation and amortization
|
3,186
|
|
|
|
|
3,473
|
|
|
|
|
10,012
|
|
|
|
|
9,306
|
|
|
|
||||||||
Stock-based compensation
|
1,473
|
|
|
|
|
1,220
|
|
|
|
|
4,180
|
|
|
|
|
3,598
|
|
|
|
||||||||
Gain on sale of building
|
—
|
|
|
|
|
—
|
|
|
|
|
(4,396
|
)
|
|
|
|
—
|
|
|
|
||||||||
Restructuring (reversal) charge
|
(20
|
)
|
|
|
|
190
|
|
|
|
|
(87
|
)
|
|
|
|
190
|
|
|
|
||||||||
Acquisition-related expense
|
54
|
|
|
|
|
13
|
|
|
|
|
1,045
|
|
|
|
|
1,763
|
|
|
|
||||||||
Adjusted EBITDA
|
$
|
6,140
|
|
|
10.0
|
%
|
|
$
|
7,855
|
|
|
12.6
|
%
|
|
$
|
18,849
|
|
|
10.0
|
%
|
|
$
|
16,063
|
|
|
9.9
|
%
|
|
Three months ended June 30,
|
% incr.
|
|
Nine months ended June 30,
|
% incr.
|
||||||||||||||||||||||||||
($ in thousands)
|
2019
|
|
2018
(as adjusted)* |
(decr.)
|
|
2019
|
|
2018
(as adjusted)* |
(decr.)
|
||||||||||||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Product
|
$
|
47,136
|
|
|
77.1
|
%
|
|
$
|
51,691
|
|
|
83.0
|
%
|
(8.8
|
)
|
|
$
|
150,045
|
|
|
79.3
|
%
|
|
$
|
137,733
|
|
|
85.1
|
%
|
8.9
|
|
Services and solutions
|
14,030
|
|
|
22.9
|
|
|
10,581
|
|
|
17.0
|
|
32.6
|
|
|
39,198
|
|
|
20.7
|
|
|
24,042
|
|
|
14.9
|
|
63.0
|
|
||||
Total revenue
|
61,166
|
|
|
100.0
|
|
|
62,272
|
|
|
100.0
|
|
(1.8
|
)
|
|
189,243
|
|
|
100.0
|
|
|
161,775
|
|
|
100.0
|
|
17.0
|
|
||||
Cost of sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cost of product
|
25,982
|
|
|
42.5
|
|
|
26,639
|
|
|
42.8
|
|
(2.5
|
)
|
|
80,291
|
|
|
42.4
|
|
|
68,929
|
|
|
42.6
|
|
16.5
|
|
||||
Cost of services and solutions
|
6,137
|
|
|
10.0
|
|
|
5,244
|
|
|
8.4
|
|
17.0
|
|
|
18,328
|
|
|
9.7
|
|
|
12,287
|
|
|
7.6
|
|
49.2
|
|
||||
Amortization of intangibles
|
719
|
|
|
1.2
|
|
|
741
|
|
|
1.2
|
|
(3.0
|
)
|
|
2,184
|
|
|
1.2
|
|
|
2,118
|
|
|
1.3
|
|
3.1
|
|
||||
Total cost of sales
|
32,838
|
|
|
53.7
|
|
|
32,624
|
|
|
52.4
|
|
0.7
|
|
|
100,803
|
|
|
53.3
|
|
|
83,334
|
|
|
51.5
|
|
21.0
|
|
||||
Gross profit
|
28,328
|
|
|
46.3
|
|
|
29,648
|
|
|
47.6
|
|
(4.5
|
)
|
|
88,440
|
|
|
46.7
|
|
|
78,441
|
|
|
48.5
|
|
12.7
|
|
||||
Operating expenses
|
26,707
|
|
|
43.6
|
|
|
27,224
|
|
|
43.7
|
|
(1.9
|
)
|
|
80,476
|
|
|
42.5
|
|
|
77,198
|
|
|
47.7
|
|
4.2
|
|
||||
Operating income
|
1,621
|
|
|
2.7
|
|
|
2,424
|
|
|
3.9
|
|
(33.1
|
)
|
|
7,964
|
|
|
4.2
|
|
|
1,243
|
|
|
0.8
|
|
(540.7
|
)
|
||||
Other income, net
|
31
|
|
|
—
|
|
|
627
|
|
|
1.0
|
|
(95.1
|
)
|
|
594
|
|
|
0.3
|
|
|
294
|
|
|
0.1
|
|
102.0
|
|
||||
Income before income taxes
|
1,652
|
|
|
2.7
|
|
|
3,051
|
|
|
4.9
|
|
(45.9
|
)
|
|
8,558
|
|
|
4.5
|
|
|
1,537
|
|
|
0.9
|
|
(456.8
|
)
|
||||
Income tax expense
|
4
|
|
|
—
|
|
|
147
|
|
|
0.2
|
|
(97.3
|
)
|
|
886
|
|
|
0.4
|
|
|
3,246
|
|
|
2.0
|
|
(72.7
|
)
|
||||
Net income (loss)
|
$
|
1,648
|
|
|
2.7
|
%
|
|
$
|
2,904
|
|
|
4.7
|
%
|
(43.3
|
)
|
|
$
|
7,672
|
|
|
4.1
|
%
|
|
$
|
(1,709
|
)
|
|
(1.1
|
)%
|
548.9
|
|
|
Three months ended June 30,
|
|
$ incr.
|
% incr.
|
|
Nine months ended June 30,
|
|
$ incr.
|
% incr.
|
|||||||||||||||
($ in thousands)
|
2019
|
|
2018
(as adjusted)* |
|
(decr.)
|
(decr.)
|
|
2019
|
|
2018
(as adjusted)* |
|
(decr.)
|
(decr.)
|
|||||||||||
North America, primarily United States
|
$
|
43,604
|
|
|
$
|
44,740
|
|
|
(1,136
|
)
|
(2.5
|
)
|
|
$
|
138,808
|
|
|
$
|
113,246
|
|
|
25,562
|
|
22.6
|
Europe, Middle East & Africa
|
9,582
|
|
|
10,216
|
|
|
(634
|
)
|
(6.2
|
)
|
|
30,450
|
|
|
29,876
|
|
|
574
|
|
1.9
|
||||
Rest of world
|
7,980
|
|
|
7,316
|
|
|
664
|
|
9.1
|
|
|
19,985
|
|
|
18,653
|
|
|
1,332
|
|
7.1
|
||||
Total revenue
|
$
|
61,166
|
|
|
$
|
62,272
|
|
|
(1,106
|
)
|
(1.8
|
)
|
|
$
|
189,243
|
|
|
$
|
161,775
|
|
|
27,468
|
|
17.0
|
|
Three months ended June 30,
|
|
$ incr.
|
|
Nine months ended June 30,
|
|
$ incr.
|
||||||||||||||||||||||||||||
($ in thousands)
|
2019
|
|
2018
(as adjusted)* |
|
(decr.)
|
|
2019
|
|
2018
(as adjusted)* |
|
(decr.)
|
||||||||||||||||||||||||
Sales and marketing
|
$
|
11,392
|
|
|
18.6
|
%
|
|
$
|
11,595
|
|
|
18.6
|
%
|
|
$
|
(203
|
)
|
|
$
|
34,583
|
|
|
18.3
|
%
|
|
$
|
32,530
|
|
|
20.1
|
%
|
|
$
|
2,053
|
|
Research and development
|
8,584
|
|
|
14.0
|
%
|
|
8,205
|
|
|
13.2
|
%
|
|
379
|
|
|
27,671
|
|
|
14.6
|
%
|
|
24,573
|
|
|
15.3
|
%
|
|
3,098
|
|
||||||
General and administrative
|
6,751
|
|
|
11.0
|
%
|
|
7,234
|
|
|
11.6
|
%
|
|
(483
|
)
|
|
18,309
|
|
|
9.7
|
%
|
|
19,905
|
|
|
12.3
|
%
|
|
(1,596
|
)
|
||||||
Restructuring reversal
|
(20
|
)
|
|
—
|
%
|
|
190
|
|
|
0.3
|
%
|
|
(210
|
)
|
|
(87
|
)
|
|
0.1
|
%
|
|
190
|
|
|
0.1
|
%
|
|
(277
|
)
|
||||||
Total operating expenses
|
$
|
26,707
|
|
|
43.7
|
%
|
|
$
|
27,224
|
|
|
43.7
|
%
|
|
$
|
(517
|
)
|
|
$
|
80,476
|
|
|
42.5
|
%
|
|
$
|
77,198
|
|
|
47.7
|
%
|
|
$
|
3,278
|
|
|
Three months ended June 30,
|
% incr.
|
|
Nine months ended June 30,
|
% incr.
|
||||||||||||||||||||||||||
($ in thousands)
|
2019
|
|
2018
(as adjusted)* |
(decr.)
|
|
2019
|
|
2018
(as adjusted)* |
(decr.)
|
||||||||||||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Product
|
$
|
47,136
|
|
|
93.3
|
%
|
|
$
|
51,691
|
|
|
95.0
|
%
|
(8.8
|
)
|
|
$
|
150,045
|
|
|
93.9
|
%
|
|
$
|
137,733
|
|
|
94.9
|
%
|
8.9
|
|
Services
|
3,374
|
|
|
6.7
|
|
|
2,715
|
|
|
5.0
|
|
24.3
|
|
|
9,798
|
|
|
6.1
|
|
|
7,378
|
|
|
5.1
|
|
32.8
|
|
||||
Total revenue
|
50,510
|
|
|
100.0
|
|
|
54,406
|
|
|
100.0
|
|
(7.2
|
)
|
|
159,843
|
|
|
100.0
|
|
|
145,111
|
|
|
100.0
|
|
10.2
|
|
||||
Cost of sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cost of product
|
25,982
|
|
|
51.4
|
|
|
26,639
|
|
|
49.0
|
|
(2.5
|
)
|
|
80,291
|
|
|
50.2
|
|
|
68,929
|
|
|
47.5
|
|
16.5
|
|
||||
Cost of services
|
1,252
|
|
|
2.5
|
|
|
1,655
|
|
|
3.0
|
|
(24.4
|
)
|
|
4,895
|
|
|
3.1
|
|
|
4,404
|
|
|
3.0
|
|
11.1
|
|
||||
Amortization of intangibles
|
218
|
|
|
0.4
|
|
|
219
|
|
|
0.4
|
|
(0.5
|
)
|
|
670
|
|
|
0.4
|
|
|
549
|
|
|
0.4
|
|
22.0
|
|
||||
Total cost of sales
|
27,452
|
|
|
54.3
|
|
|
28,513
|
|
|
52.4
|
|
(3.7
|
)
|
|
85,856
|
|
|
53.7
|
|
|
73,882
|
|
|
50.9
|
|
16.2
|
|
||||
Gross profit
|
23,058
|
|
|
45.7
|
|
|
25,893
|
|
|
47.6
|
|
(10.9
|
)
|
|
73,987
|
|
|
46.3
|
|
|
71,229
|
|
|
49.1
|
|
3.9
|
|
||||
Total operating expenses
|
19,941
|
|
|
39.5
|
|
|
21,349
|
|
|
39.2
|
|
(6.6
|
)
|
|
60,018
|
|
|
37.6
|
|
|
60,732
|
|
|
41.9
|
|
(1.2
|
)
|
||||
Operating income
|
$
|
3,117
|
|
|
6.2
|
%
|
|
$
|
4,544
|
|
|
8.4
|
%
|
(31.4
|
)
|
|
$
|
13,969
|
|
|
8.7
|
%
|
|
$
|
10,497
|
|
|
7.2
|
%
|
33.1
|
|
|
Three months ended June 30,
|
% incr.
|
|
Nine months ended June 30,
|
% incr.
|
||||||||||||||||||||||||||
($ in thousands)
|
2019
|
|
2018
(as adjusted)* |
(decr.)
|
|
2019
|
|
2018
(as adjusted)* |
(decr.)
|
||||||||||||||||||||||
Solutions revenue
|
$
|
10,656
|
|
|
100.0
|
%
|
|
$
|
7,866
|
|
|
100.0
|
%
|
35.5
|
|
|
$
|
29,400
|
|
|
100.0
|
%
|
|
$
|
16,664
|
|
|
100.0
|
%
|
76.4
|
|
Cost of sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cost of services
|
4,885
|
|
|
45.8
|
|
|
3,589
|
|
|
45.7
|
|
36.1
|
|
|
13,433
|
|
|
45.7
|
|
|
7,883
|
|
|
47.3
|
|
70.4
|
|
||||
Amortization of intangibles
|
501
|
|
|
4.7
|
|
|
522
|
|
|
6.6
|
|
(4.0
|
)
|
|
1,514
|
|
|
5.1
|
|
|
1,569
|
|
|
9.4
|
|
(3.5
|
)
|
||||
Total cost of sales
|
5,386
|
|
|
50.5
|
|
|
4,111
|
|
|
52.3
|
|
31.0
|
|
|
14,947
|
|
|
50.8
|
|
|
9,452
|
|
|
56.7
|
|
58.1
|
|
||||
Gross profit
|
5,270
|
|
|
49.5
|
|
|
3,755
|
|
|
47.7
|
|
(40.3
|
)
|
|
14,453
|
|
|
49.2
|
|
|
7,212
|
|
|
43.3
|
|
100.4
|
|
||||
Total operating expenses
|
6,766
|
|
|
63.5
|
|
|
5,875
|
|
|
74.7
|
|
15.2
|
|
|
20,458
|
|
|
69.6
|
|
|
16,466
|
|
|
98.8
|
|
24.2
|
|
||||
Operating loss
|
$
|
(1,496
|
)
|
|
(14.0
|
)%
|
|
$
|
(2,120
|
)
|
|
(27.0
|
)%
|
(29.4
|
)
|
|
$
|
(6,005
|
)
|
|
(20.4
|
)%
|
|
$
|
(9,254
|
)
|
|
(55.5
|
)%
|
(35.1
|
)
|
|
Nine months ended June 30,
|
|
% increase
|
|||||
|
2019
|
|
2018
|
|
(decrease)
|
|||
Euro
|
1.1359
|
|
|
1.1997
|
|
|
(5.3
|
)%
|
British Pound
|
1.2915
|
|
|
1.3601
|
|
|
(5.0
|
)%
|
Japanese Yen
|
0.0090
|
|
|
0.0094
|
|
|
(4.3
|
)%
|
Canadian Dollar
|
0.7499
|
|
|
0.7835
|
|
|
(4.3
|
)%
|
Period
|
|
Total Number of Shares Purchased (1)
|
|
Average Price Paid per Share
|
|
Total Number of Shares Purchased as Part of a Publicly Announced Program
|
|
Maximum Dollar Value of Shares that May Yet Be Purchased Under the Program
|
|||||
April 1, 2019 - April 30, 2019
|
|
270
|
|
|
$
|
12.81
|
|
|
—
|
|
|
$20,000,000.00
|
|
May 1, 2019 - May 31, 2019
|
|
270
|
|
|
$
|
12.75
|
|
|
—
|
|
|
—
|
|
June 1, 2019 - June 30, 2019
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
—
|
|
Total
|
|
540
|
|
|
$
|
12.78
|
|
|
—
|
|
|
—
|
|
(1)
|
All shares reported were forfeited by employees in connection with the satisfaction of tax withholding obligations related to the vesting of restricted stock units.
|
ITEM 6.
|
|
EXHIBITS
|
|
|
|
|
|
Exhibit No.
|
Description
|
Method of Filing
|
||
3
|
|
(a)
|
Restated Certificate of Incorporation of the Company, as amended (1)
|
Incorporated by Reference
|
|
|
|
|
|
3
|
|
(b)
|
Incorporated by Reference
|
|
|
|
|
|
|
10
|
|
(a)
|
Incorporated by Reference
|
|
|
|
|
|
|
31
|
|
(a)
|
Filed Electronically
|
|
|
|
|
|
|
31
|
|
(b)
|
Filed Electronically
|
|
|
|
|
|
|
32
|
|
|
Filed Electronically
|
|
|
|
|
|
|
101.INS
|
|
|
XBRL Instance Document
|
Filed Electronically
|
|
|
|
|
|
101.SCH
|
|
|
XBRL Taxonomy Extension Schema Document
|
Filed Electronically
|
|
|
|
|
|
101.CAL
|
|
|
XBRL Taxonomy Calculation Linkbase Document
|
Filed Electronically
|
|
|
|
|
|
101.DEF
|
|
|
XBRL Taxonomy Definition Linkbase Document
|
Filed Electronically
|
|
|
|
|
|
101.LAB
|
|
|
XBRL Taxonomy Label Linkbase Document
|
Filed Electronically
|
|
|
|
|
|
101.PRE
|
|
|
XBRL Taxonomy Presentation Linkbase Document
|
Filed Electronically
|
(1)
|
Incorporated by reference to Exhibit 3(a) to the Company’s Annual Report on Form 10-K for the year ended September 30, 1993 (File No. 0-17972)
|
(2)
|
Incorporated by reference to Exhibit 3(b) to the Company’s Current Report on Form 8-K filed on August 28, 2017 (File No. 1-34033)
|
(3)
|
Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on May 10, 2019 (File No. 1-34033)
|
|
|
|
|
|
|
|
|
DIGI INTERNATIONAL INC.
|
|
||
Date:
|
August 9, 2019
|
By:
|
/s/ James J. Loch
|
|
|
|
|
|
James J. Loch
|
|
|
|
|
|
Senior Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer and Authorized Officer)
|
|
1 Year Digi Chart |
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