Digital products and services can be delivered over the internet to any country in the world, at minimal cost and nearly instantaneously. Consequently, it is often asserted that firms selling such digital products (‘digital firms’) are inherently global. While there is anecdotal evidence of some highly internationalized digital firms, systematic empirical research on this phenomenon remains scarce. We study 132 publicly listed digital firms and find surprisingly low levels of internationalization. While a subset of digital firms is highly internationalized, most firms engage in limited internationalization (mainly in their home regions) or remain purely domestic. Using fuzzy-set qualitative comparative analysis (QCA), we show that only certain configurations of home country, industry, and business model characteristics consistently lead to high levels of internationalization among digital firms. Our multi-level configurational explanation aims to advance emerging theory development on the internationalization of digital firms, particularly contributing to internalization theory and the notion of bundling non-location-bound firm-specific assets with complementary location-bound assets.