Overview
- Duolingo guided Q1 bookings to about $301.5 million and full-year 2026 bookings to $1.27–$1.30 billion, both below Street estimates, with revenue projected at $1.20–$1.22 billion.
- Management expects roughly 11% bookings growth in 2026 and an adjusted margin near 25% as it invests in product access and marketing.
- Shares fell more than 20% following the outlook, with multiple downgrades from firms including JPMorgan and BofA, which cut price targets to $95 and $100 respectively.
- The board authorized a share repurchase program of up to $400 million to manage dilution and support capital allocation during the transition.
- Duolingo will widen access to AI tools, moving 'Video Call with Lily' to Super Duolingo and introducing more AI-speaking features for free users, citing a more than tenfold drop in operating costs, while targeting roughly 100 million daily active users over the medium term.