Duolingo Stock (DUOL) Earnings: A Deep Dive Before the Report
Language-learning giant Duolingo (NASDAQ: DUOL) is set to release its latest earnings report this Thursday after market close. Investors are keenly watching to see if the company can maintain its impressive growth trajectory. Here’s a comprehensive look at what you need to know before the announcement.
Recent Performance: A Strong Track Record
Duolingo has consistently outperformed expectations. Last quarter, the company reported revenues of $271.7 million, a significant 41.1% increase year-over-year. This strong performance was coupled with a substantial beat of analysts’ EBITDA estimates and an optimistic full-year EBITDA guidance. The platform also boasts a growing user base, reaching 135.3 million users – a 19.6% year-over-year increase.
What to Expect This Quarter
The market anticipates Duolingo’s revenue to grow by 31.6% year-over-year this quarter, a slight deceleration from the 38.8% growth recorded in the same period last year. However, analysts covering the stock have largely maintained their estimates in the last 30 days, suggesting a continued positive outlook. Duolingo has a history of exceeding Wall Street’s expectations, and investors will be hoping for another positive surprise.
Peer Performance: A Mixed Bag
Looking at Duolingo’s competitors in the consumer subscription space, the results have been varied. Roku recently reported year-over-year revenue growth of 16.1%, exceeding analyst expectations by 3%, leading to an 8.6% jump in its stock price. Conversely, Udemy reported a 3% revenue decline, aligning with consensus estimates, and its stock price remained relatively unchanged. You can find a detailed analysis of Roku’s results and Udemy’s results here.
Looking Ahead: Challenges and Opportunities
The broader economic outlook for 2025 remains uncertain, with potential trade policy changes and corporate tax discussions looming. These factors could impact business confidence and overall growth. However, consumer subscription stocks have, so far, been relatively shielded from these concerns, with share prices down an average of 19.2% over the past month. Duolingo has experienced a more significant decline of 27.9% during the same period.
Analyst Sentiment and Price Targets
Despite the recent stock price dip, analysts maintain an average price target of $250.40 for Duolingo, significantly higher than its current trading price of $109.20. This suggests a strong belief in the company’s long-term potential.
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