Tuya's 2026 Outlook: Software Strategy Drives Sustained Margin Expansion
Tuya has successfully transitioned from a loss-making hardware distributor to a profitable software-driven IoT platform company. The company achieved GAAP profitability in fiscal 2025 with a net profit of $58 million and improved operating margins to 8.4% in Q2 2026. With 2.09 million registered developers and strong adoption among high-value customers, Tuya presents a buying opportunity at modest valuations, though it faces competitive risks from cloud hyperscalers and uneven revenue growth.