Digi International Inc. announced on January 27 that it will acquire Particle Industries, Inc. for $50 million in cash, a transaction that will add $20 million in annual recurring revenue (ARR) to Digi’s IoT Products & Services segment.
Particle’s $20 million ARR represents double‑digit growth and will combine with Digi’s existing $32 million IoT ARR to create a $52 million recurring revenue base, a 25 % increase in the segment’s ARR and a significant boost to Digi’s overall subscription‑first business model.
The deal is designed to accelerate Digi’s shift from one‑time hardware sales to high‑margin software subscriptions, deepen its “embedded‑as‑a‑service” offering, and strengthen its competitive moat in mission‑critical industrial IoT markets. By integrating Particle’s edge‑to‑cloud platform, Digi can deliver a more complete end‑to‑end solution, improve cross‑sell opportunities, and expand its addressable market.
Digi will fund the purchase using its current credit facility, and Moelis & Company LLC served as the exclusive financial advisor to Particle. The transaction is expected to close in the second quarter of 2026, pending customary regulatory approvals and customary closing conditions.
Ron Konezny, Digi’s President and CEO, said the acquisition “positions us to lead the shift toward intelligent, connected product platforms and accelerates annual recurring revenue growth.” Particle CEO Zach Supalla added that the partnership “accelerates our mission to make IoT accessible and scalable for businesses of all sizes.” Steve Ericson, President of Digi’s OEM Solutions Business Unit, noted that the combination will “enable customers to ship software to hardware at scale, delivering unique value across the industry.”
The acquisition signals Digi’s confidence in the long‑term growth of subscription‑based IoT services and underscores its strategy to build a robust, scalable platform that can serve both legacy hardware customers and new cloud‑centric enterprises. The added ARR and platform capabilities are expected to improve Digi’s guidance for fiscal 2026, as the company prepares to report its first quarterly earnings on February 4, 2026.
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