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Research from Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

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Equity Bottom-Up

<ul><li>Tuya reported another strong quarter, with revenue of $81.6 million, up 34% Y/Y (1Q and 2Q were up 30% and 29%, respectively).</li><li>Gross margin stayed in the mid-40s (46%). IoT PaaS revenue grew 26% Y/Y to $57.9 million.</li><li>Its 230-bp Y/Y margin improvement was significant, coming in at 46.9%. </li></ul>

Tuya reported another strong quarter, with revenue of $81.6 million, up 34% Y/Y (1Q and 2Q were up 30% and 29%, respectively).Gross margin stayed in the mid-40s (46%). IoT PaaS revenue grew 26% Y/Y to $57.9 million.Its 230-bp Y/Y margin improvement was significant, coming in at 46.9%. 

Tuya, Inc. - Another Strong Quarter of Revenue Growth (+34%) And Stable Margins

<ul><li>Tuya reported another strong quarter, with revenue of $73.3 million, up 29% Y/Y (1Q24 was up 30%).</li><li>Gross margin continued to grow, up 130 bps Y/Y to 48.0% (a company 2Q record). IoT PaaS revenue grew 32% Y/Y to $54.3 million.</li><li>Its 320-bp Y/Y margin improvement was significant to corporate margin growth.</li></ul>

Tuya reported another strong quarter, with revenue of $73.3 million, up 29% Y/Y (1Q24 was up 30%).Gross margin continued to grow, up 130 bps Y/Y to 48.0% (a company 2Q record). IoT PaaS revenue grew 32% Y/Y to $54.3 million.Its 320-bp Y/Y margin improvement was significant to corporate margin growth.

Tuya, Inc. - 2Q24 Revenue Up 29% Y/Y; First Non-GAAP Profit

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>At equal price to ACT, Ito-san wins because of certainty/immediacy, but provided his price is above the bottom of the range and adequately compensates 7&amp;i for "additional actionable avenues."</li>
<li>The <a href="https://www.smartkarma.com/entities/amcor-limited" target="_blank" data-smartkarma-citation="entities:674:1" rel="noopener">Amcor Limited (AMC AU)</a>/<a href="https://www.smartkarma.com/entities/berry-global-group-inc" target="_blank" data-smartkarma-citation="entities:9428:1" rel="noopener">Berry Global Group (BERY US)</a> merger looks clean. However, Berry's % of earnings (revs, EBITDA, and profit), are higher than the % under the share split</li>
<li>This Temasek-led development will have a marginal impact on <a href="https://www.smartkarma.com/entities/tuya-inc" target="_blank" data-smartkarma-citation="entities:32158:1" rel="noopener">Tuya Inc (TUYA US)</a>. Creating supply and demand is hard. And Temasek-held/backed vehicles on the SGX are already abundant.</li>
</ul>


At equal price to ACT, Ito-san wins because of certainty/immediacy, but provided his price is above the bottom of the range and adequately compensates 7&amp;i for "additional actionable avenues."
The Amcor Limited (AMC AU)/Berry Global Group (BERY US) merger looks clean. However, Berry's % of earnings (revs, EBITDA, and profit), are higher than the % under the share split
This Temasek-led development will have a marginal impact on Tuya Inc (TUYA US). Creating supply and demand is hard. And Temasek-held/backed vehicles on the SGX are already abundant.


Last Week in Event SPACE: Seven & I, Amcor/Berry, WH Group/Smithfield, Tuya

<ul><li>Tuya is leveraging GenAI technology to enhance user experiences and strengthen its footprint in the consumer electronics sector.</li><li>The strategic integration of GenAI addresses market demands for greater automation and customization, boosting Tuya’s product intelligence.</li><li>On July 18, at the CICC Consumer Sector Summit 2024, Tuya showcased several upcoming GenAI- powered functions in the pipeline, including smart multicolor LED strips, smart pet cameras, AI Developer and AI Business Analyst portals, and the App AI Assistant.</li></ul>

Tuya is leveraging GenAI technology to enhance user experiences and strengthen its footprint in the consumer electronics sector.The strategic integration of GenAI addresses market demands for greater automation and customization, boosting Tuya’s product intelligence.On July 18, at the CICC Consumer Sector Summit 2024, Tuya showcased several upcoming GenAI- powered functions in the pipeline, including smart multicolor LED strips, smart pet cameras, AI Developer and AI Business Analyst portals, and the App AI Assistant.

Tuya, Inc - Ramps Up GenAI Efforts as Valuation Analysis Has Tuya Below Comps

<ul><li>Tuya reported a strong 1Q24, with revenue of $61.7 million, up 30% Y/Y (consensus was for ~15% Y/Y growth).</li><li>Gross margin continued to grow, up 360 bps Y/Y to 47.8% (a company record). IoT PaaS revenue grew 36% Y/Y to $45.6 million.</li><li>Its 590-bp Y/Y margin improvement was significant to corporate margin growth. </li></ul>

Tuya reported a strong 1Q24, with revenue of $61.7 million, up 30% Y/Y (consensus was for ~15% Y/Y growth).Gross margin continued to grow, up 360 bps Y/Y to 47.8% (a company record). IoT PaaS revenue grew 36% Y/Y to $45.6 million.Its 590-bp Y/Y margin improvement was significant to corporate margin growth. 

United States

Tuya Inc., doing business as Tuya Smart, provides IoT cloud platform. The Company offers solutions which enables brands, retailers, OEMs, and manufacturers to develop, launch, manage, and monetize software-enabled devices and services. Tuya Smart serves customers worldwide.

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Tuya Inc (TUYA US)

Tuya, Inc. - Another Strong Quarter of Revenue Growth (+34%) And Stable Margins

Tuya reported another strong quarter, with revenue of $81.6 million, up 34% Y/Y (1Q and 2Q were up 30% and 29%, respectively).

Water Tower Research

Tuya, Inc. - 2Q24 Revenue Up 29% Y/Y; First Non-GAAP Profit

Gross margin continued to grow, up 130 bps Y/Y to 48.0% (a company 2Q record). IoT PaaS revenue grew 32% Y/Y to $54.3 million.

Water Tower Research

Last Week in Event SPACE: Seven & I, Amcor/Berry, WH Group/Smithfield, Tuya

It’s Sunday! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed during the...

David Blennerhassett

Tuya, Inc - Ramps Up GenAI Efforts as Valuation Analysis Has Tuya Below Comps

Tuya is leveraging GenAI technology to enhance user experiences and strengthen its footprint in the consumer electronics sector.

Water Tower Research

Tuya, Inc. - 1Q24 Earnings Strong

Tuya reported a strong 1Q24, with revenue of $61.7 million, up 30% Y/Y (consensus was for ~15% Y/Y growth). Gross margin continued to grow, up 360...

Water Tower Research

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