Duolingo Inc. Class A Common Stock Q3 2026 Earnings Recap

Duolingo’s shares rose 26.0% after earnings, as accelerating DAU growth and bookings ahead of expectations were accompanied by Q4 bookings guidance slightly above the company’s prior outlook. The outlook still points to slower growth in some monetization measures and roughly flat year-over-year adjusted EBITDA in Q4.

Key Takeaways

• DAU growth accelerated to 29% year over year in Q3, from 23% in Q2; growth accelerated in 8 of the company’s 10 largest countries.
• Management said bookings, revenue, and profitability were ahead of expectations, and expects Q4 DAU growth similar to Q3.
• Q4 guidance calls for 13% bookings growth and 14% revenue growth year over year; bookings are expected to be slightly above prior guidance.
• Q4 adjusted EBITDA is expected to be roughly flat year over year at $84 million, with a 26.1% margin. Gross margin is expected to dip slightly as Video Call rolls out to paid subscribers, while operating expenses are expected to grow faster than revenue.
• Paid subscriber growth has continued to slow; management said it may bottom in a couple of quarters as bookings growth flows through to revenue and subscriber numbers.