Duolingo Raises 2026 Guidance as Daily Users Jump 28.5% and Q3 Revenue Rises 13.7%
Duolingo raised its full-year guidance across all key financial metrics after daily active users jumped 28.5% to 64.9 million in the third quarter, an acceleration from the prior quarter that helped lift revenue 13.7% to $309.0 million.
Revenue rose from $271.7 million a year earlier, according to the earnings release and shareholder letter the language-learning app maker filed with an 8-K on Tuesday. Bookings grew 12.1% to $316.1 million, led by subscription bookings, which climbed 15.9% to $278.4 million. The company said DAU growth accelerated from 23% in the second quarter.
"We had a great Q3, with DAU growth accelerating to 29% year over year, and all of our key financial metrics coming in ahead of expectations," CEO Luis von Ahn said in the release.
Profit falls against a tax-boosted comparison
Net income dropped to $27.2 million, or $0.54 per diluted share, from $292.2 million, or $5.95 per share, a year earlier. The prior-year quarter included a $222.7 million one-time tax benefit from releasing a valuation allowance.
Adjusted EBITDA slipped 1.7% to $78.7 million from $80.0 million, and the adjusted EBITDA margin narrowed to 25.5% from 29.5%. GAAP operating expenses rose 24.2% to $200.9 million, including an $11.4 million bonus accrual tied to a fourth-quarter goal of DAU growth of 25% or more. Gross margin improved to 72.9% from 72.5%.
Subscriptions drive revenue
Subscription revenue grew 17.6% to $270.0 million, while advertising revenue dipped 0.9% to $20.8 million. Duolingo English Test revenue rose to $9.9 million from $9.6 million, and in-app purchase revenue fell 38.0% to $6.9 million.
Paid subscribers increased 13.9% to 13.1 million, and monthly active users rose 13.2% to 153.1 million.
The company said it is sunsetting its Duolingo Max tier and moving Max individual subscribers to a Super family plan at the same price, and plans to bring Unlimited Video Call to all Super subscribers by year-end. It also announced partnerships with the games Brawl Stars and Eggy Party.
Guidance raised
For the fourth quarter, Duolingo expects bookings of $382 million, up 13%, revenue of $322 million, up 14%, and adjusted EBITDA of $84 million, a 26.1% margin. For the full year, it now expects bookings of $1.296 billion, up 12%, revenue of $1.221 billion, up 18%, and adjusted EBITDA of $323 million, a 26.5% margin. The adjusted EBITDA outlook is $3 million above prior guidance, and the company said it expects to land at the high end of its 10% to 12% bookings growth and 15% to 18% revenue growth targets. It expects fourth-quarter DAU growth similar to the third quarter.
Cash and buybacks
Operating cash flow rose to $89.4 million from $84.2 million, while free cash flow eased to $75.3 million from $77.4 million. Cash and short-term investments totaled $1.4 billion.
Duolingo repurchased 48,419 shares for $6.4 million in the quarter under its $400 million program announced in February. Through Oct. 30, it had bought back 781,439 shares for $82.0 million under the program.
By the numbers
- DAUs: 64.9 million, up 28.5%
- Revenue: $309.0 million, up 13.7%
- Bookings: $316.1 million, up 12.1%
- Paid subscribers: 13.1 million, up 13.9%
- Diluted EPS: $0.54, versus $5.95 with a prior-year tax benefit
- Full-year adjusted EBITDA guidance: $323 million
Sources
- Duolingo Form 8-K with third-quarter 2026 earnings release and shareholder letter, filed Nov. 3, 2026 (accession 0001628280-26-069474)
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