Language learning app Duolingo late Wednesday beat expectations on the top and bottom lines for the third quarter. But new subscribers were a tad light. Duolingo stock fell in extended trading.
The Pittsburgh, Pa.-based company earned 49 cents a share on sales of $192.6 million in the September-ended quarter. Analysts polled by FactSet had expected earnings of 35 cents a share on sales of $189.2 million. In the year-earlier period, Duolingo earned 6 cents a share on sales of $137.6 million.
Duolingo ended the quarter with 8.6 million paid subscribers, up 47% year over year. But Wall Street was hoping for 8.66 million.
Daily active users totaled 37.2 million, up 54% year over year. Duolingo also reached 113.1 million monthly active users, up 36% from the same quarter last year.
For the current quarter, Duolingo forecast revenue of $204 million, based on the midpoint of its guidance. Analysts had been expecting $201.4 million in the fourth quarter.
Duolingo offers instruction in more than 40 different languages on its freemium service. Popular languages to learn through Duolingo include English, Spanish, French and Japanese. Its free service is supported by advertising while its paid subscription service is ad-free.
Duolingo Stock Falls After Report
In after-hours trading on the stock market today, Duolingo stock dropped more than 5% to 300. During the regular session Wednesday, it rose 5.2% to close at 318.85. In intraday trading, Duolingo stock hit an all-time high of 319.44.
"We performed superbly across all of our key operating metrics this quarter," Chief Executive Luis von Ahn said in a news release. "This quarter we saw strong new and returning user growth, our highest ever family plan penetration, and a meaningful bookings contribution from Duolingo Max."
He added, "Our AI-powered Video Call feature helped to drive adoption of Max and increase conversational speaking practice, which we believe can unlock new opportunities in the global language learning market."
On Aug. 23, Duolingo stock broke out of a double-bottom base at a buy point of 215.04, according to IBD MarketSurge charts.
Duolingo stock is on two IBD lists: IBD 50 and Tech Leaders.
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