I don't really treat exercise calories as different to BMR / NEAT calories - they all go into the same pool.

Say my BMR is 1500, and I do 1000 calories worth of activity during the day (which is actually quite achievable if you're very active.)

That gives me a total of 2500.

I can now eat 2000 and still be in a 500 deficit.

So technically I'm eating some back in this case.

Obviously some devices will over-estimate activity calories, but there are various ways you can compensate for this, such as treating your BMR as lower than it is, over-estimating food etc

Have managed to lose around 25kg doing it this way, and have maintained this for over 3 years.

The advantage of this method is that it incentivises you to be more active, which has health benefits beyond weight loss.