Core Insights - Tuya Smart has integrated the DeepSeek large language model into its AIoT platform, enhancing the development of smart home management robots and driving significant transformation in the smart home sector [1][5][14] - The global home service robot market is projected to grow from USD10.7 billion in 2023 to USD14.24 billion by 2030, with a compound annual growth rate of 4.4% from 2024 to 2030, indicating a strong demand for home management solutions [3] Group 1: Market Dynamics - The shift in global family structure towards fewer children and an aging population has increased reliance on home management robots for chores and caregiving, contributing to market growth [3] - Despite high demand, the home management robot market faces challenges such as high technical costs and operational mismatches that affect user experience [4] Group 2: Technological Advancements - The integration of DeepSeek will provide developers with advanced solutions, enabling robots to offer bio-level interaction and cognitive enhancement, thus evolving into "personal butlers" [5][14] - Future robots will utilize full-domain reasoning technology to learn user habits and make decisions based on the entire home environment, enhancing their functionality [7][14] Group 3: User Interaction and Safety - Home management robots will evolve to engage in emotional interactions, responding to user emotions and preferences, thereby becoming more anthropomorphic companions [9][10][11] - These robots will also play a crucial role in family safety, capable of responding to emergencies and assisting in daily care for children and the elderly [12][13][14]

Core Viewpoint - Tuya Smart has announced a deep collaboration with Beijing Volcano Engine Technology Co., Ltd. to integrate the "Doubao" large model into Tuya's cloud developer platform, aiming to promote the application of AI large models and AI cloud-native technologies across various fields [1] Group 1 - The partnership will leverage the capabilities of the Doubao large model, including language, voice, and video, to support AI smart hardware developers in accelerating innovation through comprehensive support in development, marketing resources, and traffic [1]

Core Viewpoint - The article highlights the successful transformation of Tuya Smart, which has achieved significant revenue growth and profitability in 2024, driven by its focus on AI and IoT integration, despite previous losses [3][6][12]. Financial Performance - Tuya Smart reported preliminary unaudited revenue of $299 million for the fiscal year ending December 31, 2024, representing a year-over-year increase of 29.8% [3][8]. - The company turned a profit with a net income of $4.997 million, compared to a net loss of $60.315 million in the previous year [3][6]. - The operating loss for 2024 was $47.6 million, a significant reduction from the $106 million loss in 2023, indicating improved operational efficiency [6][11]. Quarterly Growth - In Q1 2024, Tuya Smart achieved total revenue of $61.7 million, a year-over-year increase of approximately 29.9%, marking its first Non-GAAP profit of $12.3 million [7]. - Q2 revenue continued to grow by 28.55% to $73.3 million, with a net profit of $3.128 million [8]. - Q3 revenue reached $81.6 million, up about 34%, with a Non-GAAP net profit of $20.1 million [8]. - Q4 revenue further increased to $82.1 million, with a total annual revenue of $299 million [8]. Business Segments - The IoT PaaS segment remains the core business, generating $217 million in revenue for 2024, a 29.4% increase from the previous year [10][11]. - The smart solutions segment saw the fastest growth, with a revenue increase of 58.3% to $42 million, driven by demand in various sectors including smart energy and smart retail [12]. - The software SaaS services and other businesses showed stable growth, with a year-over-year increase of approximately 10.6% to $39.6 million [12]. Market Position and Strategy - Tuya Smart's DBNER (Dollar-Based Net Expansion Rate) improved from 103% to 122%, indicating enhanced business expansion capabilities within existing customers [11]. - The company focuses on strategic customer engagement, leading to increased operational efficiency and profitability [11]. - Tuya Smart is actively investing in AI, cloud computing, and edge computing to enhance its technological capabilities and product competitiveness [13][14]. Future Outlook - The global IoT market is expected to continue its rapid growth, providing significant opportunities for Tuya Smart [13]. - The company plans to expand its presence in both domestic and international markets, leveraging its technological advantages [14]. - Tuya Smart's board has approved a dividend of $0.0608 per share, totaling approximately $37 million, reflecting its strong cash position of $1.017 billion as of December 31, 2024 [14][15].

Financial Data and Key Metrics Changes - In Q4 2024, Tuya Inc. reported approximately $82 million in revenue, reflecting a year-over-year growth of 27.4% [13] - For the entire year 2024, total revenue reached about $298.6 million, marking nearly 30% year-over-year growth [15] - The company achieved its first-ever annual GAAP net profit and inaugural quarterly and annual non-GAAP operating profitability [6][15] - The overall gross margin remained stable at around 47%, while annual operating expenses declined by approximately 10% year-over-year [15] Business Line Data and Key Metrics Changes - Q4 PaaS revenue was approximately $59.3 million, a 25.7% year-over-year increase [14] - Other revenue reached about $11.5 million, up 21.1% year-over-year, driven by stable growth in SaaS validator services [14] - Smart solution revenue grew by 45.5% year-over-year, reaching about $11.3 million, supported by robust demand across various categories [14] Market Data and Key Metrics Changes - The number of IoT PaaS premium customers grew by 11% to 298 [17] - The revenue dollar expansion rate (DBNER) was 122% at the end of Q4, marking five consecutive quarters above 100% [18] - The company maintained a retention rate of about 97% among its top 10% revenue-contributing customers [19] Company Strategy and Development Direction - Tuya Inc. aims to build a global AIoT developer ecosystem, focusing on AI agents and open-source software solutions [11] - The company is committed to expanding its market presence in Europe, Latin America, and the Asia Pacific region [33] - Tuya Inc. plans to integrate AI capabilities across all categories within its developer platform, ensuring AI-enabled devices by default in the future [31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in future growth, emphasizing the importance of AI, IoT, and cloud technologies in driving user experience [7][11] - The company noted sustained growth in end-market demand and stable customer relationships throughout 2024 [16] - Management highlighted the importance of maintaining operational efficiency and improving profitability through a strong developer ecosystem [37] Other Important Information - Tuya Inc. ended Q4 with a net cash balance of over $1 billion, maintaining a strong liquidity position [16] - The company received recognition for its home energy management system solutions in the United Nations Global Compact report [26] - Tuya Inc. achieved an MSCI ESG rating of A and a WINS ESG rating of A2, reflecting its commitment to sustainability [26] Q&A Session Summary Question: Can you elaborate on AI usage scenarios in PaaS and smart solutions? - Management indicated that 2024 is a pivotal year for AI, focusing on audio and video interaction devices and energy solutions that require complex decision-making [47][49] Question: What is the trend in unit prices and its impact on margins? - Management noted that AI is still in early stages, and while margins may not be significantly impacted in the short term, long-term value is expected to increase [56][60] Question: What are the growth prospects for SaaS? - Management stated that SaaS growth is dependent on the deployment of devices and emphasized the importance of customer stickiness for recurring revenue [68][70] Question: Is M&A an active consideration for the company? - Management confirmed that M&A is an open option, focusing on extending the developer ecosystem and identifying potential partners [76][79] Question: What is the current demand for IoT parts and potential for high-quality customers? - Management highlighted a balanced structure in the business across categories and regions, with ongoing efforts to expand high-quality PaaS customers [84][88]

Group 1 - Tuya Inc. (NYSE: TUYA) was suggested for a trade in November when the stock price was approximately $1.50, indicating a potential for strong returns [1] - The company is associated with a strategy that combines trading and income approaches to enhance savings and retirement timelines [1] Group 2 - The service offered by the company includes a money-back guarantee for unsatisfied customers, emphasizing confidence in their investment ideas [2] - The company claims to provide high-conviction investment ideas from a team with a proven track record [2]

Tuya Inc. (NYSE:TUYA) Q4 2024 Earnings Call February 26, 2025 8:00 AM ET Company Participants Reg Chai - Investor Relations Jerry Wang - Founder and Chief Executive Officer Alex Yang - Co-Founder and Chief Financial Officer Conference Call Participants Timothy Chow - Goldman Sachs John Roy - WTR Brenda Zhao - CICC Research. Yang Liu - Morgan Stanley Operator Good morning, and good evening, ladies and gentlemen. Thank you for standing by, and welcome to Tuya Inc. Fourth Quarter 2024 Earnings Conference Call. ...

Core Viewpoint - Tuya Inc. achieved significant financial milestones in 2024, including quarterly and full-year profitability on both GAAP and non-GAAP bases, driven by strong revenue growth across all segments and improved operational efficiency [5][21][30]. Financial Highlights Fourth Quarter 2024 - Total revenue increased by 27.4% year-over-year to $82.1 million, up from $64.4 million in Q4 2023 [6][7]. - IoT platform-as-a-service (PaaS) revenue rose by 25.7% to $59.3 million [15]. - Software-as-a-service (SaaS) and others revenue grew by 21.1% to $11.5 million [15]. - Smart solution revenue surged by 45.5% to $11.3 million [15]. - Overall gross margin improved to 47.8%, up from 47.3% in Q4 2023 [9]. - Non-GAAP operating margin reached 10.3%, a significant improvement from negative 0.4% in Q4 2023 [12]. - Net profit was $9.8 million, compared to a net loss of $10.8 million in the same period last year [13][14]. Full Year 2024 - Total revenue for the year was $298.6 million, reflecting a year-over-year growth of approximately 29.8% [21]. - IoT PaaS revenue increased by 29.4% to $217.1 million [26]. - SaaS and others revenue rose by 10.6% to $39.6 million [26]. - Smart solution revenue increased by 58.3% to $42.0 million [26]. - Gross margin for the year improved to 47.4%, up from 46.4% in 2023 [23]. - The company reported a net profit of $5.0 million for the year, marking its first fiscal year of net profitability on a GAAP basis [30]. Operational Efficiency - Operating expenses decreased by 11.0% to $189.1 million for the year, reflecting the company's focus on cost management [25]. - Research and development expenses were $95.0 million, down 7.1% from the previous year [27]. - Sales and marketing expenses decreased by 8.3% to $37.1 million [27]. - General and administrative expenses fell by 15.4% to $68.3 million [27]. Cash Flow and Liquidity - Net cash generated from operating activities was $80.4 million for the year, up 120.5% from $36.4 million in 2023 [35]. - As of December 31, 2024, total cash and cash equivalents were $1,016.7 million, compared to $984.3 million at the end of 2023 [34]. Dividend Declaration - The Board declared a dividend of $0.0608 per ordinary share, amounting to approximately $37 million, payable on or around April 9, 2025 [38][40].

Core Insights - The company reported a net loss of $10,816 thousand for the three months ended December 31, 2023, compared to a profit of $9,785 thousand for the same period in 2024, indicating a significant turnaround in financial performance [3] - Non-GAAP net profit for the three months ended December 31, 2023, was $12,555 thousand, which increased to $22,068 thousand in 2024, reflecting a strong growth trajectory [4] - The non-GAAP net margin improved from 19.5% in 2023 to 26.9% in 2024, showcasing enhanced operational efficiency [4] Financial Performance - The net margin for the three months ended December 31, 2023, was -16.8%, while it improved to 11.9% in 2024 [3] - For the year ended December 31, 2023, the company experienced a net loss of $60,315 thousand, which turned into a profit of $4,997 thousand in 2024 [3] - The weighted average number of ordinary shares used for computing non-GAAP net profit per share increased from 557,103,923 in 2023 to 587,987,654 in 2024 for basic shares [5] Shareholder Metrics - Non-GAAP net profit per share attributable to ordinary shareholders was $0.02 for basic shares in 2023, increasing to $0.04 in 2024, and for diluted shares, it remained at $0.02 in 2023 and increased to $0.04 in 2024 [7] - For the year ended December 31, 2023, the non-GAAP net profit per share was $0.04 for basic shares and $0.03 for diluted shares, which rose to $0.13 for both categories in 2024 [7]

Revenue and Profitability - Total revenue for the year ended December 31, 2024, was $298.6 million, an increase of approximately 29.8% compared to $230.0 million for the year ended December 31, 2023[5]. - IoT Platform as a Service (PaaS) revenue reached $217.1 million, up approximately 29.4% from $167.7 million in the previous year[5]. - Net profit for the year was $5.0 million, marking a significant recovery from a net loss of $60.3 million in the previous year[7]. - The net profit for the year ended December 31, 2024, was $5.0 million, compared to a net loss of $60.3 million for the year ended December 31, 2023, marking the first fiscal year of net profitability under GAAP[15]. - The adjusted net profit for the year ended December 31, 2024, was $75.3 million, a 268.5% increase from $20.4 million in 2023, indicating strong profitability under non-GAAP measures[15]. - Non-GAAP net profit for 2024 is projected at $75.308 million, with a non-GAAP net profit margin of 25.2%[98]. - The company reported a net loss attributable to common shareholders of $60.315 million for 2023, with a projected profit of $4.997 million for 2024[91]. Cash and Investments - Cash and cash equivalents, along with short-term and long-term investments, totaled $1,016.7 million, up from $984.3 million as of December 31, 2023[7]. - The net cash provided by operating activities for the year ended December 31, 2024, was $80.4 million, a 120.5% increase from $36.4 million in 2023[18]. - The company had no interest-bearing bank loans or other borrowings as of December 31, 2024, resulting in a debt-to-equity ratio of zero[25][28]. - The company made significant investments in government bonds, with total purchases amounting to approximately $156.8 million within an authorized limit of $400 million[30]. - Total cash and cash equivalents are projected to rise to $653,384,000 by the end of 2024, up from $498,688,000 at the end of 2023[68]. Customer Metrics - The number of IoT PaaS customers was approximately 3,700, down from 4,000 in the previous year, while total customers were about 5,800, down from approximately 6,100[7]. - The number of registered IoT developers exceeded 1,316,000, a growth of 32.6% from approximately 993,000 developers in the previous year[7]. - The company’s focus on strategic customers contributed to a net expansion rate (DBNER) of 122%, up from 103% in the previous year[7]. - The DBNER for IoT PaaS for the year ended December 31, 2024, was 122%, indicating revenue growth from existing customers[20]. Operating Performance - Operating profit margin improved to -15.9%, an increase of 30.1 percentage points from -46.0% in the previous year[5]. - The operating loss for the year ended December 31, 2024, was $47.6 million, a 55.0% improvement from the $105.8 million loss in the same period of 2023[14]. - The adjusted operating loss for 2023 was $(105.824) million, expected to improve to $(47.620) million in 2024[96]. Research and Development - The adjusted R&D expenses for the year ended December 31, 2024, were $80.7 million, down from $87.5 million in 2023, reflecting a 7.1% decrease[14]. - Research and development expenses are expected to decrease to $95,049,000 in 2024 from $102,277,000 in 2023, reflecting a focus on cost management[64]. Corporate Governance and Compliance - The company has adhered to all corporate governance codes as per the Hong Kong Stock Exchange, with a noted exception regarding the dual role of the chairman and CEO[38]. - The audit committee reviewed the unaudited consolidated financial statements for the reporting period, with no disagreements on accounting policies[42]. - The company has confirmed compliance with the standard code for securities trading by directors for the fiscal year ending December 31, 2024[41]. Future Outlook and Strategy - The company aims to enhance its product and service offerings through the application of emerging technologies like generative AI, while also diversifying revenue sources[21]. - The company plans to allocate 30% of the proceeds to enhance IoT technology and infrastructure, amounting to approximately 21.0 million HKD[47]. - The company is committed to expanding its market presence and enhancing its product offerings through continuous innovation in AI and cloud services[54]. Shareholder Returns - The company has approved a dividend of USD 0.0608 per share, totaling approximately USD 37 million, to be funded from retained earnings[48]. - The company declared a special dividend of $0.0589 per share, totaling $33 million, to be paid in October 2024[90]. - During the reporting period, the company repurchased 223,773 American Depositary Shares for a total consideration of approximately USD 0.4 million[50]. Taxation - The effective tax rate for 2024 is expected to be 30.0%, significantly higher than the statutory rate of 25.0% due to various jurisdictional impacts[86]. - The company has accumulated tax losses of approximately $576,439, primarily from its subsidiaries in China, which will expire between 2025 and 2034[88]. - The company expects to continue benefiting from the preferential tax rate as a qualified high-tech enterprise, impacting its overall tax expenses positively[86].

Revenue Growth - Total revenue for Q4 2024 was $82.1 million, representing a year-over-year increase of approximately 27.4% compared to $64.4 million in Q4 2023[10]. - Total revenue for the fiscal year 2024 was $298.6 million, a year-over-year increase of approximately 29.8% from $230.0 million in 2023[14]. - In 2024, the company achieved total revenue of $298.6 million, a year-over-year increase of nearly 30%[16]. - Total revenue for 2024 increased by 29.8% to $298.6 million from $230.0 million in 2023, driven by growth in IoT PaaS and smart solutions revenue[29]. IoT Platform as a Service (PaaS) Performance - IoT Platform as a Service (PaaS) revenue reached $59.3 million, up about 25.7% from $47.2 million in Q4 2023[10]. - The company's IoT PaaS revenue in Q4 2024 increased by 25.7% to $59.3 million, driven by global economic recovery and strategic focus on customer needs[17]. - The company reported a significant increase in IoT PaaS revenue, which rose by 29.4% to $217.1 million for the year ended December 31, 2024[30]. - The company's DBNER (dollar-based net expansion rate) for IoT PaaS was 122% as of December 31, 2024, up from 103% in Q4 2023[16]. Profitability - Net profit for Q4 2024 was $9.8 million, compared to a net loss of $10.8 million in Q4 2023[10]. - The company achieved a net profit of $5.0 million for the year ended December 31, 2024, compared to a net loss of $60.3 million in 2023, marking its first net profit under GAAP[37]. - The net profit margin for the year ended December 31, 2024, was 1.7%, an increase of 27.9 percentage points from a net loss margin of 26.2% in 2023[37]. - The company's non-GAAP net profit for the year ended December 31, 2024, was $75.3 million, a 268.5% increase from $20.4 million in 2023[37]. Cash Flow and Financial Position - Operating cash flow for Q4 2024 was $30.2 million, slightly down from $31.8 million in Q4 2023[10]. - The company reported a total cash and cash equivalents of $1,016.7 million as of December 31, 2024, compared to $984.3 million as of December 31, 2023[10]. - The net cash balance at the end of Q4 2024 was approximately $1.017 billion, marking seven consecutive quarters of positive operating cash flow[16]. - Cash and cash equivalents, along with short-term and long-term investments, totaled $1,016.7 million as of December 31, 2024, up from $984.3 million as of December 31, 2023[39]. Operating Expenses and Margins - Gross margin for the overall business was 47.8%, an increase of 0.5 percentage points from 47.3% in Q4 2023[10]. - The company's non-GAAP operating profit margin in Q4 2024 was 10.3%, a significant improvement from a loss of 0.4% in Q4 2023[24]. - Operating costs for the year ended December 31, 2024, rose to $157.2 million, up 27.4% from $123.3 million in 2023, consistent with the revenue growth trend[30]. - Operating expenses decreased by 11.0% to $189.1 million for the year ended December 31, 2024, compared to $212.5 million in 2023[33]. Research and Development - R&D expenses for Q4 2024 were $23.7 million, remaining stable compared to $22.8 million in Q4 2023[23]. - Research and development expenses decreased by 7.1% to $95.0 million for the year ended December 31, 2024, from $102.3 million in 2023[35]. - Research and development expenses for the year ending December 31, 2023, were $102,277,000, which is projected to decrease to $95,049,000 in 2024, reflecting a reduction of about 7%[64]. Future Outlook - The company is optimistic about its business outlook, citing a stable macroeconomic environment and effective implementation of customer and product strategies, particularly leveraging AI technologies[41]. - The company plans to expand its market presence and invest in new product development to drive future growth[56]. - The company acknowledges potential challenges ahead, including shifts in consumer spending patterns and geopolitical uncertainties[41]. Dividend Information - The board approved a dividend of $0.0608 per ordinary share or ADS, totaling approximately $37 million, to be paid in cash from retained earnings[42]. - The dividend payment date for ordinary shareholders is expected around April 9, 2025, and for ADS holders around April 15, 2025[43].