Why Did Tuya Stock Plunge 10.93% Amid Market Volatility?

On April 7, 2025, Tuya's stock price dropped by 10.93% in pre-market trading, reflecting significant market volatility and investor sentiment shifts.

Tuya Inc. has experienced a notable decline in its share price, dropping by 30% over the past 30 days. Despite this, the stock has still managed to gain 43% over the past year, indicating a mixed performance. The company's price-to-sales (P/S) ratio stands at 4.9x, which is slightly above the industry median of 4.1x. This discrepancy suggests that while the company has shown strong revenue growth, investors may be cautious about its future prospects.

Tuya's recent revenue growth has been impressive, outpacing many other companies in the industry. However, the company's revenue has declined by 1.1% over the past three years, raising concerns about its long-term sustainability. Analysts predict that Tuya's revenue will grow by 18% annually over the next three years, which is higher than the industry average of 15%. Despite these positive forecasts, the market's skepticism about Tuya's ability to meet these growth expectations is evident in its P/S ratio.

Investors are advised to consider multiple factors when evaluating Tuya's stock, including its revenue growth, market position, and potential risks. While the company's recent performance has been strong, the market's reaction suggests that there may be underlying concerns about its future prospects. It is essential for investors to conduct thorough research and consider all available information before making investment decisions.