Key Highlights

  • Daily active users grew 29% to 64.9 million, and paid subscribers rose 14% to 13.1 million at period end.
  • Revenue rose 14% to USD 309.0 million and bookings rose 12% to USD 316.1 million, both ahead of management expectations.
  • Net income was USD 27.2 million, adjusted EBITDA USD 78.7 million and free Cash Flow USD 75.3 million.
  • Fourth-quarter guidance is bookings of USD 382 million and Revenue of USD 322 million, and full-year bookings USD 1,296 million.

User Growth Accelerates

Duolingo, Inc. (NASDAQ:DUOL) reported third-quarter 2026 revenue of USD 309.0 million, up 14% from USD 271.7 million, and bookings of USD 316.1 million, up 12% from USD 281.9 million. Daily active users reached 64.9 million versus 50.5 million, a 29% increase that followed 23% growth in the second quarter. Paid subscribers reached 13.1 million versus 11.5 million, up 14%.

Co-Founder and Chief Executive Officer Luis von Ahn said all key financial metrics came in ahead of expectations and that the strategy of prioritizing teaching quality and user growth is paying off, with growth in every region and every subject. The company ran hundreds of experiments on notifications and streaks and added game partnerships with Brawl Stars and Eggy Party that brought millions of new and returning users.

Analyst estimates were EPS of USD 0.57 against reported EPS of USD 0.54, and revenue of USD 303.2 million against reported revenue of USD 309.0 million.

Profit and Cash Flow

Net income was USD 27.2 million, an 8.8% margin, compared with USD 292.2 million a year earlier, which included a one-time income tax benefit of USD 222.7 million from releasing a valuation allowance. Adjusted EBITDA was USD 78.7 million at a 25.5% margin, compared with USD 80.0 million at 29.5%. Net cash from Operating Activities was USD 89.4 million versus USD 84.2 million, and free cash flow was USD 75.3 million versus USD 77.4 million.

Management said it is gradually putting more focus on growing bookings in ways that preserve the quality of the free experience.

Balance Sheet, Buybacks and Guidance

Cash and cash equivalents were USD 1,036.4 million versus USD 1,239.6 million at the prior Balance Sheet date, and short-term investments were USD 104.1 million. During the quarter the company repurchased 48,419 shares for USD 6.4 million. Through October 30, 2026 it had repurchased 781,439 shares for USD 82.0 million under its USD 400 million program, offsetting all dilution from 2024 and 2025.

For the fourth quarter the company guided bookings of USD 382 million, up 13%, and revenue of USD 322 million, up 14%. Full-year bookings guidance is USD 1,296 million, up 12%. Management expects fourth-quarter daily active user growth similar to the third quarter, and fourth-quarter bookings slightly ahead of the level implied by its prior full-year outlook. Video Call, the AI conversation practice feature, is on schedule to reach all Super subscribers by the end of the year.

Paid subscribers at period end were 13.1 million versus 11.5 million, up 14%, and daily active users were 64.9 million versus 50.5 million. Subscription bookings were USD 278.4 million versus USD 240.3 million, up 16%, and the gross Margin was 72.9% versus 72.5%. Adjusted EBITDA was USD 78.7 million versus USD 80.0 million, a margin of 25.5% versus 29.5%, and net cash provided by operating activities was USD 89.4 million versus USD 84.2 million.

Items to Follow

Daily active user growth near 29%, the conversion of new users to subscribers and the adjusted EBITDA margin are the items to follow.