SANTA CLARA, Calif., May 11, 2026 /PRNewswire/ -- Tuya Inc. ("Tuya" or the "Company") (NYSE: TUYA; HKEX: 2391), a global leading AI cloud platform service provider, today announced its unaudited financial results for the first quarter ended March 31, 2026.
-- Total revenue was US$80.9 million, up approximately 8.3% year-over-year
(1Q2025: US$74.7 million).
-- Platform-as-a-service ("PaaS") revenue was US$59.0 million, up
approximately 9.8% year-over-year (1Q2025: US$53.7 million).
-- AI application & others[1] (formerly known as Software-as-a-service
("SaaS") and others) revenue was US$11.6 million, up approximately 16.9%
year-over-year (1Q2025: US$10.0 million).
-- Smart home & robot product[2] (formerly known as Smart solution) revenue
was US$10.2 million, down approximately 6.9% year-over-year (1Q2025:
US$11.0 million).
-- Overall gross margin was 46.9%, down 1.6 percentage points year-over-year
(1Q2025: 48.5%). Gross margin of PaaS was 46.1% (1Q2025: 48.4%).
-- Operating margin was 9.2%, improved by 11.1 percentage points
year-over-year (1Q2025: negative 1.9%). Non-GAAP operating margin was
10.0% (1Q2025: 9.1%).
-- Net margin was 19.5%, improved by 4.7 percentage points year-over-year
(1Q2025: 14.8%). Non-GAAP net margin was 20.3% (1Q2025: 25.8%).
-- Net profits were US$15.8 million (1Q2025: US$11.0 million). Non-GAAP net
profits were US$16.4 million (1Q2025: US$19.3 million).
-- Net cash generated from operating activities was US$6.4 million (1Q2025:
US$9.4 million).
-- Total cash and cash equivalents, time deposits and treasury securities
recorded as short-term and long-term investments were US$1,017.1 million
as of March 31, 2026, compared to US$1,017.3 million as of December 31,
2025.
Commencing from the current reporting period, the Group has renamed the
revenue stream previously presented as Software-as-a-service ("SaaS") and
others to "AI Application & others." This change reflects the Group's
strategic direction to fully integrate AI capabilities into all software
products within this business stream. The Group will focus on providing
various subscription-based value-added services powered by large-scale AI
models in this stream, such as AI Guardian and Energy Butler. Commencing from
the current reporting period, the Group has renamed the revenue stream
previously presented as "Smart solution" to "Smart home & robot product." This
change aligns with the Group's business orientation for this stream, where
product offerings will be focused on AI-enabled consumer electronics and home
robotics, including AI-powered security systems, AI energy management
solutions, and home companion robots.
For further information on the non-GAAP financial measures presented above, see the section headed "Use of Non-GAAP Financial Measures."
-- Premium PaaS customers[1] for the trailing 12 months ended March 31, 2026
were 306 (1Q2025: 287). In the first quarter of 2026, the Company's
premium PaaS customers contributed approximately 89.3% of its PaaS
revenue (1Q2025: approximately 88.7%).
-- Registered AI developers were over 1,970,000 as of March 31, 2026, up
9.4% from approximately 1,801,000 developers as of December 31, 2025.
The Company defines a premium PaaS customer as a customer as of a given date
that contributed more than US$100,000 of PaaS revenue during the immediately
preceding 12-month period.
Mr. Xueji (Jerry) Wang, Founder and Chief Executive Officer of Tuya, commented, "In the first quarter, despite ongoing external uncertainties and certain regional disruptions, we continued to demonstrate solid growth momentum and strong execution capabilities. Since the fourth quarter, we have benefited from a continued recovery in downstream demand, supporting the ongoing expansion of our business scale. Total revenue increased by 8.3% year over year, with the growth rate further improving from the previous quarter, and we maintained positive growth for multiple consecutive quarters. Our gross margin remained at a healthy level, underscoring the continued enhancement of our product value proposition and platform competitiveness.
Strategically, we continue to pursue AI-driven development, harnessing AI capabilities to accelerate the deployment of application-level solutions and scenario-based products, with implementation across multiple scenarios. We continued to iterate our developer tools and platform capabilities, enabling global developers to access and apply the most advanced AI technologies at lower cost and with greater efficiency. This is reflected in the continued growth of our AI-related business revenue, highlighting our steady progress in commercialization and accelerated deployment. Meanwhile, demand for AI-native applications in consumer scenarios continued to rise, driving the scaled application of Physical AI in real-life settings. At the same time, we are expanding the global rollout of validated solutions and further strengthening our developer ecosystem, working with industry partners to jointly explore the long-term opportunities in the AI application market. Looking ahead, supported by our resilient business model and solid financial foundation, we remain focused on AI application innovation, global solution expansion and developer ecosystem development, continuously enhancing our long-term value creation capabilities.
Mr. Yi (Alex) Yang, Director and Chief Financial Officer of Tuya, added, "In the first quarter, we delivered total revenue of US$80.9 million, representing a year-over-year increase of 8.3%, with PaaS revenue growing by 9.8%, as our overall business continued its steady recovery. AI application & others revenue continued to outperform, increasing by 16.9% year over year and serving as an important driver of our structural growth, driven by continued expansion of cloud-based software offerings with AI application functions and application-level commercialization.
Meanwhile, profitability continued to improve, with GAAP operating margin reaching 9.2% and non-GAAP operating margin standing at 10.0%, demonstrating continued operating leverage and disciplined cost management. Net margin expanded to 19.5%, supported by enhanced efficiency and an optimized expense structure. We maintained a solid balance sheet, with over US$1.0 billion in cash and liquid investments, providing flexibility to support continued investment in AI and global expansion. Overall, our performance reflects the resilience of our core platform business, continued optimization of our revenue mix, and steady progress in translating AI capabilities into scalable commercial outcomes."
First Quarter 2026 Unaudited Financial Results
REVENUE
Total revenue in the first quarter of 2026 increased by 8.3% to US$80.9 million from US$74.7 million in the same period of 2025.
-- PaaS revenue in the first quarter of 2026 increased by 9.8% to US$59.0
million from US$53.7 million in the same period of 2025, primarily due to
increasing demand compared with the same period of 2025 and the Company's
strategic focus on customer needs and product enhancements, despite the
disruptions in the international business environment due to
tariff-related headwinds since April 2025. Our core customer base
remained stable.
-- AI application & others revenue in the first quarter of 2026 increased by
16.9% to US$11.6 million from US$10.0 million in the same period of 2025,
primarily due to an increase in revenue from cloud based services. During
the quarter, the Company remained committed to offering recurring
value-added services with AI application functions.
-- Smart home & robot product revenue in the first quarter of 2026 decreased
by 6.9% to US$10.2 million from US$11.0 million in the same period of
2025.
GROSS PROFIT AND GROSS MARGIN
Total gross profit in the first quarter of 2026 increased by 4.5% to US$37.9 million from US$36.3 million in the same period of 2025. The gross margin in the first quarter of 2026 was 46.9%, compared to 48.5% in the same period of 2025.
-- PaaS gross margin in the first quarter of 2026 was 46.1%, compared to
48.4% in the same period of 2025, partly attributable to recent price
fluctuations in the semiconductor supply chain.
-- AI application & others gross margin in the first quarter of 2026 was
71.7%, compared to 74.4% in the same period of 2025.
-- Smart home & robot product gross margin in the first quarter of 2026 was
23.0%, compared to 25.7% in the same period of 2025.
Gross margin fluctuated primarily due to changes in products and solutions mix. As an AI developer platform with a rich ecosystem of smart devices and applications, the Company remains focused on AI offering with compelling value propositions while maintaining economic efficiency.
OPERATING EXPENSES
Operating expenses decreased by 19.3% to US$30.4 million in the first quarter of 2026 from US$37.7 million in the same period of 2025. Non-GAAP operating expenses increased by 1.3% to US$29.8 million in the first quarter of 2026 from US$29.4 million in the same period of 2025. For further information on the non-GAAP financial measures presented above, see the section headed "Use of Non-GAAP Financial Measures."
-- Research and development expenses in the first quarter of 2026 were
US$22.0 million, down 3.7% from US$22.8 million in the same period of
2025, primarily due to lower share-based compensation expenses as equity
incentive awards granted at higher valuations in previous years have been
gradually amortized, partially offset by higher employee-related cost and
ongoing investments in research and development capabilities. Non-GAAP
adjusted research and development expenses in the first quarter of 2026
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