TUYA · Tuya Inc.

Tuya Inc. delivered solid Q1 2026 results with total revenue growing 8.3% year-over-year to $80.9 million, driven primarily by 9.8% PaaS revenue expansion to $59.0 million amid recovering downstream demand and strategic product enhancements, despite tariff headwinds and regional disruptions. AI application & others revenue surged 16.9% to $11.6 million, fueled by cloud-based AI services like AI Guardian and Energy Butler, underscoring structural growth in AI commercialization. Conversely, smart home & robot product revenue dipped 6.9% to $10.2 million. Gross margin contracted slightly to 46.9% from 48.5%, with PaaS margin at 46.1% impacted by semiconductor price fluctuations and product mix shifts, though overall gross profit rose 4.5% to $37.9 million. Operating expenses fell sharply 19.3% to $30.4 million, led by lower share-based compensation across R&D, sales & marketing, and G&A, enabling GAAP operating profit of $7.5 million and margin expansion to 9.2% from negative 1.9%. Net profit climbed to $15.8 million with 19.5% margin, bolstered by $3.3 million in other operating income from software VAT refunds, despite interest rate pressures. CEO Jerry Wang highlighted AI-driven momentum, developer ecosystem growth with over 1.97 million registered AI developers (up 9.4% QoQ) and 306 premium PaaS customers contributing 89.3% of PaaS revenue, and expansion into Physical AI scenarios. CFO Alex Yang emphasized operating leverage, revenue mix optimization, and a robust $1.02 billion cash position for AI investments and global rollout. Operating cash flow of $6.4 million reflected working capital normalization. Exhibit 99.2 discloses minor issuance of 5,500 Class A ordinary shares for employee options under the 2015 Equity Incentive Plan, increasing total issued shares to 543,158,871. No forward guidance provided, but management expressed confidence in AI application innovation amid normalizing market conditions.