Duolingo Shares Plunge 20% on Weak Q4 Bookings Forecast Despite Revenue Beat
Duolingo's stock tumbled 20% in after-hours trading after the language-learning platform projected Q4 bookings below Wall Street estimates. The company expects $329.5-$335.5 million in Q4 bookings, missing the $343.6 million consensus, despite raising its annual revenue guidance to $1.028-$1.032 billion.
CEO Luis von Ahn signaled a strategic pivot toward user growth and teaching quality, telling Reuters monetization efforts WOULD take a backseat in the near term. The shift comes as Duolingo reported strong Q3 results, with revenue climbing to $271.7 million and paid subscribers jumping 34% to 11.5 million users.
Geopolitical risks loom over the company's Chinese operations, though a July partnership with Luckin Coffee boosted performance in the region. The earnings miss underscores the challenges of balancing growth initiatives with investor expectations in the edtech sector.
