Duolingo Stock (DUOL) Faces Pressure Amid AI Competition Concerns

Duolingo shares tumbled nearly 8% last Friday, extending their monthly decline to over 12%. The sell-off was triggered by Google's unveiling of an AI-powered real-time translation tool, seen as a potential threat to the language-learning platform. Despite strong user growth—daily active users surged 40% year-over-year to 48 million—investors remain wary of rising competition and valuation concerns.

Wall Street analysts maintain a supportive stance, but the stock's 8% year-to-date drop reflects lingering uncertainty. The abrupt sell-off suggests broader market jitters may be at play, beyond just AI-related fears. Duolingo's CEO had previously addressed competition concerns, yet the market reaction underscores how quickly sentiment can shift in the tech sector.