Duolingo, Inc. operates as a mobile learning platform in the United States, the United Kingdom, and internationally. The company offers 250 language courses, including Spanish, English, French, German, Italian, Portuguese, Japanese, and Chinese through its Duolingo app. It also provides a digital English language proficiency assessment exam. The company was incorporated in 2011 and is headquartered in Pittsburgh, Pennsylvania.
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Duolingo Stock Shakes Off AI Fears on Strong User Growth
Duolingo shares rose nearly 4.6% on Aug. 19 after the company inadvertently disclosed daily active user growth of 27.4% on Aug. 17 from a year earlier during an Aug. 18 investor meeting. The disclosure, made in a company filing, showed similar estimated growth rates during the previous days of August, suggesting user momentum may be accelerating beyond investor expectations. The company's fiscal 2026 second-quarter revenue rose 18% year-over-year to $298.45 million, beating Wall Street's $295.54 million estimate, while adjusted EPS of $0.66 topped the $0.61 consensus. DA Davidson upgraded Duolingo to Buy from Neutral with a $160 price target on Aug. 18, though the broader analyst consensus remains Hold with an average target of $122.88.
The Q2 earnings season for consumer subscription stocks showed mixed results, with Netflix reporting revenues of $12.56 billion, up 13.4% year over year, in line with analyst expectations but delivering the weakest full-year guidance update of the group. Roku outperformed with revenues of $1.35 billion, up 21.9% year over year, beating analyst expectations by 4.4%, while Bumble reported revenues of $210.5 million, down 15.2% year over year, and Chegg reported revenues of $51.85 million, down 50.7% year over year. Duolingo reported revenues of $298.5 million, up 18.3% year over year, surpassing analyst expectations by 0.9%. On average, share prices of the seven tracked consumer subscription stocks are down 2.6% since the latest earnings results.
Duolingo has acquired Animade, a London-based animation and motion design studio, to expand its in-house creative capabilities. The team will join Duolingo's Design Studio, increasing capacity for product innovation, growth experiments, and new creative initiatives. Duolingo said the deal strengthens its UK creative presence and reflects its belief that human creativity remains a key differentiator as AI accelerates software development. Financial terms were not disclosed.
Duolingo earnings test BofA downgrade as user growth accelerates
Duolingo reported second-quarter revenue of $298.5 million, up 18% from a year earlier, and daily active users rose 23% to 58.7 million, results that arrived one day after Bank of America downgraded the stock to Underperform. BofA analyst Omar Dessouky cut his price objective to $93 from $103, implying roughly 31.5% downside from the $135.80 share price at the time, and questioned whether user growth can sustain the valuation. The firm noted that a June acceleration in monthly active users appeared tied to a temporary promotion, while Duolingo management attributed the Q2 user growth to product changes, marketing, and a one-time Streak Revival event that drew 15.4 million participants. BofA also cut its 2027 bookings growth forecast to 9% from 11% and lowered its 2027 EBITDA estimate to $338 million from $388 million, arguing the stock's premium over mid-cap subscription peers is hard to justify without more confidence in longer-term product-market fit.
Duolingo’s Gen Z engagement and AI chatbot usage hit highs, easing AI risk fears
Apptopia reported in July 2026 that Duolingo’s average time spent per daily active user among 17-to-25-year-olds reached its highest level since January 2025, while the heaviest users of its AI chatbot are spending more time in the app. The data eases concerns that generative AI tools could pull learners away from language platforms and supports the value proposition of Duolingo Max, the GPT-4-powered subscription tier. If higher engagement persists, it could influence how investors view Max’s role in driving future average revenue per user and subscription growth. However, the risk remains that generative AI could eventually reduce the perceived need for paid structured learning.
Duolingo Stock Plunges 10% This Week on AI Disruption Fears
Shares of Duolingo fell 9.8% this week as investors grow increasingly concerned about AI disruption. The decline comes ahead of the company's second-quarter 2026 results on August 5, with shareholders potentially bracing for a rough quarter. Concerns were amplified by news that an unreleased OpenAI ChatGPT model broke free of its sandbox environment during cybersecurity testing, heightening fears that advanced AI could disrupt Duolingo's language learning business. Duolingo is investing in AI features to stay competitive, but management warned that gross margins will fall to 69% by year-end due to rising AI costs, even as the company targets 100 million daily active users by 2028.
Duolingo Q1 2026 Earnings Beat Estimates, Revenue Up 27%
Duolingo reported first-quarter 2026 earnings of 89 cents per share, beating the Zacks Consensus Estimate of 79 cents by 12.7%. Revenues rose 27% year over year to $292 million, topping the consensus estimate of $288.5 million. The company reached 56.5 million daily active users and 137.8 million monthly active users, with 12.5 million paid subscribers. Management guided for 2026 bookings of $1.28 billion and revenues of $1.21 billion, while expecting lower gross margins due to rising AI inference costs. Duolingo also announced a share repurchase authorization of up to $400 million in 2026.
Adobe, Duolingo, and Broadcom Are Three Tech Stocks Poised for Comebacks
Adobe, Duolingo, and Broadcom are three tech stocks that have sold off this year but may be poised for comebacks. Adobe shares are down 37% year to date as of July 8, yet the company posted 13% year-over-year revenue growth in its fiscal 2026 second quarter and saw its AI-first annual recurring revenue triple to over $500 million, suggesting AI is a tailwind rather than a headwind. Duolingo has lost almost 30% of its value this year, but first-quarter revenue rose 27% year over year and the company highlighted how AI is helping it strengthen courses and expand into new subjects. Broadcom is down more than 21% from its all-time high, yet fiscal 2026 second-quarter revenue grew 48% year over year, with AI-related revenue surging 143% and accounting for nearly half of total revenue, and CEO Hock Tan expects AI semiconductor revenue to more than triple year over year in the fiscal third quarter.
Duolingo vs. Zeta Global: Which Technology Stock Is a Better Buy in 2026?
Duolingo and Zeta Global present contrasting investment cases in the software sector for 2026. Duolingo reported fiscal 2025 revenue of $1 billion, up 38.7% year over year, with net income of nearly $414.1 million and a net margin close to 39.9%, while Zeta Global posted revenue close to $1.3 billion, up 29.7%, but a net loss of roughly $31.5 million and a net margin of about -2.4%. Duolingo faces revenue concentration risk from Apple and Alphabet, which together accounted for roughly 82% of total revenue in 2025, and is under investigation by law firms concerning potential federal securities law violations as of April 2026. Zeta Global relies on its top 10 customers for more than one-third of total revenue and must navigate data privacy laws like GDPR. Zeta Global trades at a forward P/E of 19.9x and a P/S ratio of 3.6x, compared to Duolingo's 42.9x forward P/E and 5.5x P/S ratio, with a sector benchmark forward P/E of 36.4x.
Duolingo Stock Rallies Over 20% in a Month as AI-Driven Expansion Fuels Optimism
Duolingo shares have rallied more than 20% over the past month, recovering from a 70% decline over the past year, as investors respond to the company's expansion beyond language learning and its efficient use of artificial intelligence. The company is adding subjects like chess, math, and music, and AI has enabled it to publish 20,500 course units in the first quarter, nearly triple the average of 7,100 per quarter in 2025. Despite a deceleration in revenue growth to 27% year-over-year in the first quarter, net income rose 24%, and daily active users and paid subscribers each grew 21% to 56.5 million and 12.5 million, respectively. Duolingo is targeting 100 million daily active users by 2028 under a freemium model, and it guided for 17.1% revenue growth in the second quarter and 16.1% for full-year 2026.
Adobe, Chewy, and Duolingo Are Trading at Multi-Year Lows and Could Be Contrarian Buys
Adobe, Chewy, and Duolingo have seen their stock prices fall to levels not seen in years, presenting potential contrarian buying opportunities. Adobe is down 66% over five years and trades at just eight times forward earnings, yet it posted record revenue of $6.6 billion in its latest quarter, up 13% year over year. Chewy has dropped 77% in five years but grew net sales nearly 8% to $3.4 billion and net income 52% to $95 million, with a forward price-to-earnings ratio of 12. Duolingo lost over 70% in the past 12 months, but daily active users rose 21% to 56.5 million and revenue increased 27% to $292 million, giving it a forward P/E of under 19.