Duolingo Q1 Beats Estimates, But Cuts Full-Year Guide After 5.8% Q2 Growth Forecast
Duolingo posted Q1 revenue of $292 million, up 27% year-over-year, with adjusted EBITDA margin of 28.6% and EPS of $0.89. It guided Q2 bookings of $283.5 million, signaling 5.8% growth, and cut full-year revenue to $1.205 billion and bookings to $1.28 billion.
1. Q1 Financial Performance
Duolingo reported first-quarter revenue of $292 million, surpassing the $289 million estimate, and delivered adjusted EBITDA of $83.4 million, representing a 28.6% margin. Daily active users reached 56.5 million, up 21% year-over-year, while paid subscribers grew 21% to 12.5 million, driving EPS of $0.89.
2. Guidance Revision and Growth Outlook
The company projected second-quarter bookings of $283.5 million, a 5.8% increase year-over-year, reflecting a sharp deceleration from prior trends. It trimmed full-year revenue midpoint by $4 million to $1.205 billion and bookings midpoint by $6 million to $1.28 billion, signaling caution on near-term growth.
3. User Engagement Trends
Monthly active user growth slowed to 6% year-over-year, down from 14% in the prior quarter, with the US market showing the most pronounced decline. This deceleration in top-of-funnel engagement raises concerns about the sustainability of paid subscriber growth and overall monetization.
4. Strategic Initiatives and Analyst Commentary
Duolingo highlighted longer free trials, expanded video call functionality, and refined performance marketing to boost engagement. Analysts remain cautious, noting that it may take time for these measures to materially impact bookings and restore growth momentum.