The Audioengine D1 is definitely an upgrade from the uDac (original). Deeper soundstage with much better bass reproduction. Very good instrument separation. Now, it is closer with the uDac2- this one is brighter than the Audioengine D1 with a tad wider soundstage (in my system) however I find it too bright for my KEF Q15s and my Dayton Audio DTA-100a t-amp. The uDac2 pairs nicely with more laid back phones like the V-moda M80s.