Tuya (TUYA) Q4 2022 Earnings Call Transcript

For the period ending December 31, 2022

March 1, 2023 7:00 p.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good morning and good evening, ladies and gentlemen. Thank you for standing by and welcome to Tuya Inc. Fourth Quarter and Full Year 2022 Earnings Conference Call. [Operator Instructions] I would now like to turn the call over to the first speaker today, Mr. Reg Chai, Investor Relations Director of Tuya. Please go ahead, sir.

Reg Chai

Thank you. Hello, everyone. Welcome to our fourth quarter 2022 earnings call. Joining us today are Founder and CEO of Tuya, Mr. Jerry Wang; and our CFO, Ms. Jessie Liu. The first quarter 2022 financial results and webcast of this conference call are available at ir.tuya.com. A replay of this call will also be available on our website in a few hours. Before we continue, I refer you to our Safe Harbor statement in our earnings press release, which applies to this call as we will make forward-looking statements.

With that, I will now turn the call to our Founder and CEO, Mr. Jerry Wang. Jerry will deliver his remarks in Chinese, which will be followed by corresponding English translation.

Jerry Wang

Hello, everyone. Thank you for joining our fourth quarter and full year 2022 earnings call.

In 2022, we experienced our first year of revenue decline due to inventory destocking as consumer product end market turned down after 7 years of hyper growth since inception. Our 2022 full year revenue decreased by just over 30% to $210 million. In the fourth quarter, end market consumption was sluggish, totaling revenue to decrease by about 40% year-over-year to $45 million. Notably, industry healing are placing greater demand in our business execution, operational efficiency, management and team development. We responded to macroeconomic adversity with a series of cost control and efficiency improvement measures. These measures span from product offerings to operating procedures to efficiency improvements, enabling us to sustain the 43% gross margin, while narrowing the non-GAAP net loss by 29% year-over-year from $109 million in 2021 to $77 million in 2022.

Additionally, our Q4 non-GAAP net loss narrowed by 83% year-over-year to $5 million from $31 million, net cash used in operating activities was about $140,000 in Q4 and the $70 million in full year 2022, which was down 44% compared to the $126 million in 2021. These improvements reflect our determination and confidence in the long-term growth prospects of the industry. We have also repurchased a total of over $53 million shares in 2021 and then repurchased a total of over $59 million shares in 2022.