Language-learning software maker Duolingo late Thursday beat Wall Street's targets for subscribers, total users and revenue in the fourth quarter. But Duolingo stock fell in extending trading.
The Pittsburgh, Pa.-based company added 900,000 paying customers in the December quarter, ending the period with 9.5 million subscribers. Wall Street had expected 9.26 million subscribers.
Duolingo also reported 40.5 million daily active users and 116.7 million monthly active users, topping consensus estimates of 40.2 million and 116.5 million, respectively.
Duolingo offers instruction in more than 40 different languages on its freemium service. Its free service is supported by advertising while its paid subscription service is ad-free.
On a year-over-year basis, paid subscribers increased 43%. Meanwhile, daily active users rose 51% and monthly active users rose 32%.
Duolingo's revenue rose 39% year over year to $209.6 million in Q4. Its adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) increased 49% to $52.3 million. Duolingo did not give an earnings-per-share figure in its shareholder letter.
Analysts polled by FactSet had expected earnings per share of 48 cents on sales of $205.5 million in the fourth quarter. In the year-earlier period, Duolingo earned 26 cents a share on sales of $151 million.
Duolingo Stock Drops After Report
"We see exciting opportunities ahead in 2025," Chief Executive Luis von Ahn said in a news release. "We intend to continue to invest in our product in order to drive engagement and user growth, as well as in features like Video Call to drive adoption of Duolingo Max. These investments will help us teach better, continue to expand our market, and enable sustained, long-term growth."
Based on the midpoint of its guidance, Duolingo expects first-quarter revenue of $222 million, up 32.5% from the year-ago period. Wall Street had been looking for $220.8 million.
For the full year, Duolingo is targeting revenue of $970.5 million, up about 30%. Analysts were modeling $965.5 million.
In after-hours trading on the stock market today, Duolingo stock slid more than 5% to 356. During the regular session Thursday, Duolingo stock fell 2.8% to close at 375.78.
Duolingo stock is on two IBD lists: the IBD 50 and Tech Leaders.
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