Tuya Smart: Global AI Cloud Platform Service Provider

Introduction

Tuya Smart is the global leading AI cloud platform service provider, enabling everything to be smart through its AI developer ecosystem.

Company Overview

Dual-Primary Listed, R&D Driven Innovator with Strong Global Presence

Tuya is dual-primary listed (NYSE: TUYA / HKEX: 2391.HK) and driven by R&D, boasting a strong global presence.

• Global AI Developers: 1,514,000+
• Global Brands Served: ~7,000
• YoY Revenue Growth: 15%+
• Non-GAAP Net Margin: 25%+
• Employees Worldwide: 1,400+
• R&D/Product Team: 70%+
• Localized Service Coverage: 8 Countries/Regions
• End-User Coverage: 200+ Countries & Regions

The company has a global footprint with operations and service centers in locations including Latin America, Europe, East Asia, North Asia, APAC, China, and Australia.

Tuya serves a vast array of esteemed global customers across various industries.

Founding Team and History

Founded by a team with successful entrepreneurial experiences, including Jerry Wang (Co-Founder, CEO), Leo Chen (Co-Founder, President), Alex Yang (Co-Founder, CFO & COO), Ruixin Zhou (Co-Founder), and Yaona Lin (Co-Founder).

Key milestones include the development of phpwind (2003), Alibaba Cloud & QR code mobile payment (2008), and establishing Tuya as the largest 3rd-party AI cloud platform (2014).

Evolution and AIoT Era

Tuya is positioned to thrive in the next era, bringing intelligence to the physical world. The company has evolved from the PC Internet era (1xNxN) and Mobile Internet era (2x4xN) to the current AI Intelligent Era ?, focusing on AIoT Infrastructure ?.

Business Models and Strategy

2 Steps, 3 Business Models to Bring AI to Physical World

Tuya operates with a unified system, one neutral platform, and aims to make everything smart. The business operates in two main steps:

• Step 1: Deploy Devices ➡️
• Step 2: "Apps" on Device ➡️

The three core business models are:

• PaaS (Platform as a Service) ?: Offering Dev Kits for Device Manufacturers, including Device Edge, AIoT Cloud, and User Interaction components.
• Solution ?️: Providing Turnkey Solutions for Smart Devices, encompassing PaaS + Hardware Design, video monitoring, energy management, and safety alerts.
• SaaS (Software as a Service) ☁️: Subscribed software services on devices, catering to both Consumers (cloud storage, GenAI, HEMS, AI pattern recognition) and Commercial & Industrial clients (management systems for hotels, apartments, communities, buildings).

Business Growth Strategies ?:

• Price: Increase average revenue per device through smart solutions ?.
• Volume: Drive AI device growth by acquiring new customers and enhancing existing customer value ?.
• Time: Enhance software capabilities with AI and unlock lifecycle value ⏳.

The Business Driver is defined as Services (Price) x Device Volume x Time.

Market Opportunity

A Highly Promising Total Addressable Market

The market for new smart devices is substantial, with projections indicating significant growth. Approximately 20 billion new Consumer Electronic Devices are produced annually.

• 2024: ~6% penetration rate
• Mid-term: 25%~30% penetration rate
• Long-term: ~50% penetration rate

The volume of new consumer electronic devices is expected to grow at a +3% CAGR ?.

Market Leadership

Clear Market Leader with Favorable Competition Landscape

Tuya holds a significant position in the Smart Devices market, capturing approximately 17% of the market, which represents over 50% of third-party platforms ?. In-house solutions account for about 68%, while other third-party platforms hold around 15%.

Other platforms in the market include AWS IoT, which benefits from collaboration but has minimal customer overlap, and other niche service providers.

Supply Chain Integration

Tuya leverages supply chain integration ? to deliver cross-tier value, encompassing key stages:

1. Chip Cloud LLM: Rapid Application, Mature Channels, New Technology Benchmark.
2. OEM/ODM: RD efficiency, breaking through technical thresholds, achieving technological leadership.
3. Brands/Importers: A neutral platform detached from hardware vendors, offering a unified user system and flexible global capabilities.
4. Distribution Channel: Market insight, supplier surveys, and fast-track programs.
5. End User: Delivering whole-house experiences and extreme cost-effectiveness.

Expanding AIoT Applications

Tuya's AIoT solutions are expanding from home ? to all scenarios where AIoT is needed, including:

• Hotel: IoT-enabled guest experiences, self-check-in, smart lighting, wireless locks.
• Apartment: Keyless entry, smart utility meters, consumption tracking per room.
• Telecom: Smart home products for existing customers to drive revenue.
• Community: Access control, utility management with smart meters for residential projects.
• Parking Lot: Flexible lighting strategies and smart dimming.
• Offices: Smart access, fire alarms, and security control.
• Energy: Smart meters, data-driven operations, revenue growth.
• Retail Shops: Smart lighting, meters, security cameras, and sensors.

Architecture Principles

Our Agnostic, Agile, Open Architecture

Tuya's architecture ?️ is characterized by:

• Agnostic: Supporting Cloud, AI LLMs, and Edge (connectivity protocols, OS).
• Agile & Flexible: Offering Turnkey solutions, SDK/API kits, unified frameworks, and reference designs.
• Open: Providing Open APIs and an Open Source Project.

The platform supports a wide range of AI device architectures ? and integrates diverse hardware ecosystems into a unified user portal ?.

Ecosystem and Network Effects

Tuya fosters an integrated hardware ecosystem ? and a unified user portal, enabling "One App One Smart Home." This approach, combined with a large customer base, creates powerful network effects ?️, leading to higher sales, increased market share, and more brands joining the Tuya ecosystem.

The company offers a full-stack solution ⚖️ with strategic depth, covering technology, product, and business models, and maintains a strong global partnership footprint ?.

Commitment to Sustainability and Security

Tuya is committed to driving global impact through ESG sustainability ?, evidenced by its high ESG ratings (e.g., AA from MSCI, A from Win.d, recognition by S&P Global).

The company is recognized as a best practice and industry leader in global AIoT security compliance ?, adhering to standards like EU GDPR and CCPA, and operating global data centers.

Financial Performance (Q2 2025)

Strong Growth and Continued Profitability

• Total Revenue: $80 Million (up 9% YoY from $73 Million in Q2'24)
• Overall Gross Margin: 48%
• Non-GAAP Operating Profit: $8.6 Million (up 17% YoY), with an 11% margin
• Non-GAAP Net Profit: $20.1 Million (down 4% YoY), with a 25% margin
• GAAP Net Profit: $12.6 Million (up 302% YoY), with a 16% margin
• Net Cash Balance: $1.01 Billion
• Cash Dividends Declared: $33 Million

Tuya has demonstrated solid YoY revenue growth for 8 consecutive quarters ?. The revenue breakdown shows growth across PaaS (+7%), Smart Solution (+17%), and SaaS and Others (+16%). Gross margins remain steady, securing long-term profitability.

Operating expenses are managed effectively, with a focus on R&D. The company has sustained operating leverage, showing continued growth in net profit.

Operating cash flow remains positive, and the company maintains a strong balance sheet with significant net cash and shareholder equities.

Receivables are well-controlled, with competitive account receivable turnover days.

AI Integration and Ecosystem Development

Tuya empowers AI to blend into everything, serving as a super entry to AI-powered living ??. Key offerings include the "All-in-One AI Home Agent" embedded in the Tuya Super AI App and the "Tuya AI Agent Developer Platform," which enables developers to create custom AI Agents.

The company is committed to an open and thriving AI hardware ecosystem, fostering a growing developer community through TuyaOpen, hackathons, co-creation, and ongoing training.

Tuya at a Glance

Business Highlights

• Unique AI Cloud Platform: Providing turnkey solutions worldwide, the largest 3rd AIoT developer platform globally, with limited competition and high stickiness.
• Global Tech Company: Balanced geographic revenue structure (80%-90% international revenue), not reliant on a single market.
• To-B Business: Smart sectors enablement and network effects through an enterprise service model, with revenue tied to hardware cycles and a smart ecosystem.

Key Financial Metrics (Q2'25)

• Total Revenue: $80.1M (+9% YoY)
• Gross Margin: 48%
• Non-GAAP Operating Profits: $8.6M (+17% YoY / 11% Margin)
• Non-GAAP Net Profits: $20.1M (-4% YoY / 25% Margin)
• GAAP Net Profits: $12.6M (+302% YoY / 16% Margin)
• Total Net Cash: $1,006M
• Strong Balance Sheet: Light-asset, No Debts
• Dividend for 2025 H1: $33M
• Current Market Cap: $1,450M - $1,600M

Disclaimer

This presentation contains forward-looking statements and information based on data from various sources. It is intended for informational purposes only and does not constitute an offer to sell or an invitation to purchase securities. The Company uses non-GAAP financial measures as supplemental measures to assess operating performance. Reconciliations of non-GAAP measures to GAAP are available in financial reports.