Digi International Inc.

Good day and thank you for standing by. Welcome to the Fiscal Q2 2026 Digi International Inc. Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1 1 again. please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Jamie Locke, Chief Financial Officer. Please go ahead.

Thank you. Good day, everyone. It's great to talk to you again, and thanks for joining us today to discuss the earnings results of Digi International. Joining me on today's call is Ron Konezny, our President and CEO. We issued our earnings release after the market closed today. You may obtain a copy of the press release through the financial releases section of our investor relations website at digi.com. This afternoon, Ron will provide a comment on our performance, and then we'll take your questions. Some of the statements that we make during this call are considered forward-looking and are subject to significant risks and uncertainties. These statements reflect our expectations about future operating and financial performance and speak only as of today's date. We undertake no obligation to update publicly or revise these forward-looking statements. While we believe the expectations reflected in our forward-looking statements are reasonable, we give no assurance such expectations will be met or that any of our forward-looking statements will prove to be correct. For additional information, please refer to the forward-looking statement section in our earnings release today and the risk factor section of our most recent form 10-K and subsequent reports on file with the SEC. Finally, certain of the financial information disclosed on this call includes non-GAAP measures. The information required to be disclosed about these measures, including reconciliations to the most comparable GAAP measures, are included in the earnings release. The earnings release is also furnished as an exhibit to form 8K that can be accessed through the SEC filing sections of our investor relations website. Now, I'll turn the call over to Ron.

Thank you, Jamie. And welcome, everyone, to Digi International's second fiscal quarter of 2026 earnings call. As you can tell, we're doing things a little bit differently this time. For the first time, we're doing this via video conference. We're actually live at Digi's headquarters in Hopkins, Minnesota. And this is Ron Koneczny. I'm joined by our CFO, Jamie Locke. We've got a brief presentation we're going to run through as we talk about some of the comments on the quarter and outlook. And then we'll have time for Q&A. with our analysts, followed by some closing comments. As a reminder, we have sent out an earnings release, an investor presentation, and the materials we're going to review, as well as this video, will be posted on our website for you to view if you're not able to attend live. So, grand experiment. Thank you for joining. So, let's digi as a background. Digi participates in what's called the industrial Internet of Things market. So, we're not involved with consumer applications. We help our customers connect, and help manage and control their remote assets and resources. We do that with a combination of technologies. The technologies include edge-based hardware, which is the largest portion of the industrial IoT market. It's been around the longest. It's actually growing the slowest, but a critical part of any IoT solution. The next biggest part of the market is the connectivity, the transport layer that gets you the data from that edge device that's connected to your resources remotely, and brings that information typically to cloud-based software, sometimes on-prem. Software is the third largest and the second fastest growing part of the industrial IoT market. And finally, what you do with all that data, the services required to understand, to implement, and to ultimately get that ROI from your industrial IoT application is the fastest growing and the smallest piece of the industrial IoT market. It's growing double digits, so it's a great place to be. It is incredibly fragmented. There are a lot of different players out there, but the ROI from remotely managing, controlling, and improving your assets and resources is compelling. And what we're seeing in the marketplace, and it's a hypothesis we've had since we started, since I started here at Digi, and we're seeing it play in the real world is people are looking for providers to bring the entire solution set versus putting those pieces together on their own and then having to manage those things with all of the change that's going on in the world. Digi's in a perfect spot to meet those customers' needs. We have four key attributes that customers are looking for, and we survey our customers annually to make sure we understand the trends and what's important to their business and to their industrial IoT solution. The number one, which has risen up the ranks dramatically as security, is in the age of more dynamic exposure and attacks, your IoT device needs to be secure or critical infrastructure could be vulnerable. The second thing has got to be incredibly reliable. Oftentimes, our equipment and solutions being deployed in remote areas, and if that solution doesn't stand the test of time and provide that constant connection, it really eats into the ROI. The third is it's got to be scalable. We deal with large customers, so it's got to be scalable in numbers, but we also deal with global customers. So it's got to scale across geographies as well. And finally, it's got to be easy. It's got to be easy to implement. It's got to be easy to configure. It's got to be easy to get ultimately that ROI. That combination of attributes is something we really work hard on to become that complete solution provider that we see the market looking for. And ultimately, This combination of attributes is helping our customers improve their time to value. We want to get them ROI quicker than if they had to do it themselves. And it's got to be managed fully and indefinitely. With all of the dynamics going on with security, technology, regulation, with business opportunities and challenges, an actively managed system is critical in today's age. A new vector, of course, that's come up in the industrial IoT world is rapid advancement of artificial intelligence. And Digi's hard at work taking advantage of these incredible tools, both internally and in our product set. I've got two images here to explain some of the work we're doing here at Digi. On the left-hand side is actually a Google framework called the Model Context Protocol. Long story short, it's a framework that allows you to put in technology that can access your corporate data in a highly governed and secure way. And you use the LLM of your choice to then be able to interrogate that data in a natural language. You can use these tools now for internal use to examine, say, the attributes of your demand profile with your supply chain to make sure you're going to have enough supply to meet your customer's demands. You can look at it for financial reporting and for analysis to help speed the process for understanding what's likely to happen in the future. And we can help it to build products. On the right-hand side is an example that comes from our SmartSense division. The use of one of our AI tools, we're now able to use those tools to create incredibly accurate systems that not only identify challenges in this case with an asset, that you may be monitoring, a refrigerator, a walk-in freezer, but also what is the likely scenario? What's the likely problem? What's the likely root cause that needs attention? How much confidence do you have? And that information can be shared in more layman's term to a store operator or employee and more technical term to a technician or a facilities professional. And we're able to do this in weeks, which is some of the incredible power that AI has. And as we expose these technologies and offerings to our customers, we're going to get feedback and we're going to improve this, these types of offering continuously. So an exciting age of edge-based AI. Edge-based AI has a slower trajectory, a more uneven path because there's so many different types of equipment out there. And these models need to be constructed and consume this data to give high confidence answers that you can act on. With that, I'm going to pass it to Jamie for some comments on our financial results.