Duolingo (NASDAQ:DUOL) Exceeds Q1 Expectations But Stock Drops 14.7%
Stock Story
Published May 08, 2024 04:07PM ET
Updated May 08, 2024 04:34PM ET
Duolingo (NASDAQ:DUOL) Exceeds Q1 Expectations But Stock Drops 14.7%
Language-learning app Duolingo (NASDAQ:DUOL) reported results ahead of analysts' expectations in Q1 CY2024, with revenue up 44.9% year on year to $167.6 million. The company expects next quarter's revenue to be around $176.3 million, in line with analysts' estimates. It made a GAAP profit of $0.57 per share, improving from its loss of $0.06 per share in the same quarter last year.
Is now the time to buy Duolingo? Find out by reading the original article on StockStory, it's free.
Duolingo (DUOL) Q1 CY2024 Highlights:
- Revenue: $167.6 million vs analyst estimates of $165.7 million (1.1% beat)
- EPS: $0.57 vs analyst estimates of $0.26 (117% beat)
- Revenue Guidance for Q2 CY2024 is $176.3 million at the midpoint, roughly in line with what analysts were expecting
- The company lifted its revenue guidance for the full year from $723.5 million to $731 million at the midpoint, a 1% increase
- Gross Margin (GAAP): 73%, in line with the same quarter last year
- Free Cash Flow of $79.62 million, up 67% from the previous quarter
- Paid Subscribers: 7.4 million
- Market Capitalization: $10.72 billion
Founded by a Carnegie Mellon computer science professor and his Ph.D. student, Duolingo (NASDAQ:DUOL) is a mobile app helping people learn new languages.
Consumer SubscriptionConsumers today expect goods and services to be hyper-personalized and on demand. Whether it be what music they listen to, what movie they watch, or even finding a date, online consumer businesses are expected to delight their customers with simple user interfaces that magically fulfill demand. Subscription models have further increased usage and stickiness of many online consumer services.
Sales GrowthDuolingo's revenue growth over the last three years has been impressive, averaging 45.7% annually. This quarter, Duolingo beat analysts' estimates and reported excellent 44.9% year-on-year revenue growth.
Guidance for the next quarter indicates Duolingo is expecting revenue to grow 39% year on year to $176.3 million, slowing from the 43.5% year-on-year increase it recorded in the comparable quarter last year. Ahead of the earnings results, analysts were projecting sales to grow 33.4% over the next 12 months.
Get The News You Want
Key Takeaways from Duolingo's Q1 Results We were impressed by Duolingo's exceptional revenue growth this quarter, driven by more paid subscriber additions than expected. We were also glad its EPS blew past analysts' estimates. On the other hand, its revenue guidance for next quarter was underwhelming, though it upgraded its full-year revenue and EBITDA outlook, topping projections. Zooming out, we think this was a decent quarter, showing the company is staying on track. Investors were likely disappointed by the quarterly guidance, however, and the stock is down 14.7% after reporting. It currently trades at $208.75 per share.
Written By: Stock Story
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.