Jefferies Boosts Tuya Inc. (TUYA) Price Target Amid AIoT Opportunity

Jefferies reiterated a Buy rating for Tuya Inc. (NYSE:TUYA) with a price target of $3.60, citing the company's strong momentum and solid financial results. Jefferies expects Tuya to benefit from increasing AIoT adoption and its SaaS business growth. Tuya is a global AIoT platform provider offering cloud-based services, app development tools, and AI capabilities.

Global AIoT platform provider Tuya Inc. (NYSE: TUYA) is making significant strides in integrating artificial intelligence (AI) into its tools and products, as highlighted in its latest earnings report. The company, which offers cloud-based services, app development tools, and AI capabilities, reported a 14.7% revenue increase in the first half of 2025 to $155 million, up from $135 million in the year-ago period.

Tuya's AI strategy is twofold: enhancing its tools for developers and improving the AI capabilities of the hardware and applications they create. As of June, about 93% of the products deployed on its platform were equipped with AI capabilities [1]. The company's developer platform supported 150 million AI interactions per day globally, covering areas such as translation, healthcare, energy management, pet care, toys, and AI robotics.

Jefferies reiterated a Buy rating for Tuya with a price target of $3.60, citing the company's strong momentum and solid financial results. The investment bank expects Tuya to benefit from increasing AIoT adoption and its SaaS business growth. Tuya's core business revolves around its platform-as-a-service (PaaS) offerings, which accounted for about two-thirds of its total revenue in the first half of 2025.

Tuya's operating margin for the first half of 2025 was nearly breakeven, representing a significant improvement year-on-year. The company reported a net profit of $23.6 million for the first half of the year, reversing a $400,000 loss a year earlier. Tuya cautioned that U.S. tariffs are creating uncertainties for some of its clients but forecasted that these pressures should ease in the fourth quarter.

To strengthen its AI ecosystem, Tuya has expanded its developer base to over 1.51 million developers in 200 countries and regions. The company has lowered barriers to entry through its AI developer platform, including TuyaOpen, an open-source development framework that supports mainstream open-source software and hardware ecosystems. Tuya has also been hosting hackathons and partnering with external developer communities to drive AI adoption.

Tuya's focus on AIoT and its developer ecosystem positions the company well for future growth. With increasing AI penetration in hardware and a strong financial performance, Tuya is poised to capitalize on the growing AI market.