Duolingo Q3 2026 earnings review

DAU growth accelerated to 29% and revenue beat consensus by 1.4%, but diluted EPS missed.

Duolingo · Q3 2026 · Published Nov 4, 2026 · By DeepCell AI · Sources

Duolingo Q3 2026 earnings review

Quarter ended September 30, 2026

For information only, not investment advice. No rating or price target.

Built with DeepCell / deepcell.net

1 · Duolingo (DUOL) Q3 2026 earnings review

DAU growth accelerated to 29% and revenue beat consensus by 1.4%, but diluted EPS missed

  1. 1.Daily active users rose 29% to 64.9M, faster than 23% in Q2
  2. 2.Revenue rose 13.7% to $309.0M, above the Zacks consensus
  3. 3.Diluted EPS of $0.54 missed the Zacks consensus of $0.55
  4. 4.Adjusted EBITDA margin fell 399 bps to 25.5%
  5. 5.Full-year revenue guidance rose $14.0M to $1,221M
  6. 6.Shares closed at $128.00 on Nov 3 and traded at $142.30 after hours

Note: EPS is as reported (GAAP); Duolingo reports no adjusted EPS. The after-hours price is not a regular-session close.Source: Duolingo Form 8-K, Nov 3, 2026; Zacks via Yahoo Finance, Nov 3, 2026; Yahoo Finance and Public.com prices, Nov 3, 2026; analysis of company data

2

2 · Executive summary

Q3 revenue beat the Zacks consensus by 1.4%, while diluted EPS missed by 1.8%

Q3 2026 results vs. Zacks consensus

MetricActualConsensusVarianceResult
Revenue$309.0M$304.7M+$4.3M / +1.4%Beat
Diluted EPS$0.54$0.55-$0.01 / -1.8%Miss
Total bookings$316.1M$309.1M+$7.1M / +2.3%Beat
Daily active users64.9M63.49M+1.41M / +2.2%Beat
Paid subscribers13.1M13.12M-0.02M / -0.2%Miss

Share price, Nov 3, 2026

MeasureNov 3 closeNov 3 after-hoursChange
Duolingo (Nasdaq)$128.00$142.30+11.2%

Note: Zacks consensus is as of Nov 3; bookings, DAU and subscriber estimates average three analysts. Investing.com shows $303.04M and $0.57. Close is 4:00 PM ET; after-hours is 8:00 PM ET. The Nov 4 close is not yet available.Source: Duolingo Form 8-K, Nov 3, 2026; Zacks via Yahoo Finance, Nov 3, 2026; Yahoo Finance and Public.com prices, Nov 3, 2026; analysis of company data

3

3 · Q3 results vs. consensus

Q4 revenue guidance sits 2.4% above consensus, and full-year guidance rose

Q4 2026 revenue guidance vs. consensus (TheFly)

MetricGuidanceConsensusVariancevs. Street
Q4 2026 revenue$322.0M$314.6M+$7.5M / +2.4%Above

Full-year 2026 guidance, Nov 3 vs. Aug 5

MetricAug 5Nov 3Change
Total bookings ($M)$1,285M$1,296M+$11.0M
Revenues ($M)$1,207M$1,221M+$14.0M
Adjusted EBITDA ($M)$320M$323M+$3.0M
Adjusted EBITDA margin26.5%26.5%0 bps

Q4 2026 guidance

MetricBookingsRevenuesAdjusted EBITDAGross margin
Q4 2026$382M$322M$84M72.0%

Note: Variance is guidance less consensus. Consensus is TheFly, Nov 3, 4:09 PM ET. Prior guidance is from the Aug 5 letter.Source: Duolingo Form 8-K, Nov 3, 2026; Duolingo Form 8-K, Aug 5, 2026 (prior guidance); TheFly via TipRanks, Nov 3, 2026; analysis of company data

4

4 · Guidance vs. consensus

Revenue rose 13.7%, but net income fell 90.7% on a prior-year tax benefit

  1. Bookings grew slower than revenueTotal bookings rose 12.1% to $316.1M.
  2. Adjusted EBITDA fell slightlyAdjusted EBITDA fell 1.7% to $78.7M.
  3. Q3 2025 carried a tax benefitQ3 2025 net income included a one-time tax benefit of $222.7M.

Key figures in $M and YoY % for Q3 2026 vs. Q3 2025

$M unless notedQ3 2025Q3 2026YoY
Revenues$271.7M$309.0M13.7%
Total bookings$281.9M$316.1M12.1%
Adjusted EBITDA$80.0M$78.7M(1.7%)
Net income$292.2M$27.2M(90.7%)
Diluted EPS$5.95$0.54(90.9%)

Note: Bookings and Adjusted EBITDA are company non-GAAP or operating measures. Other figures are as reported (GAAP).Source: Duolingo Form 8-K, Nov 3, 2026; analysis of company data

5

5 · Q3 key financials

Subscription revenue rose 17.6% and made up 87.4% of revenue

Revenues by product type

$M unless noted, Q3 2025 vs. Q3 2026

ProductQ3 2025Q3 2026YoY
Subscription$229.5M$270.0M17.6%
Advertising$21.0M$20.8M(0.9%)
Duolingo English Test$9.6M$9.9M2.1%
In-app purchases$11.1M$6.9M(38.0%)
Other$0.5M$1.5M220.5%
Total revenues$271.7M$309.0M13.7%
In-app purchase revenue fell 38.0% to $6.9M“This year, we’re prioritizing teaching better and user growth, and we’re seeing that strategy paying off.” Luis von Ahn, CEO

Note: Subscription revenue is recognized ratably over the subscription term, mostly twelve months.Source: Duolingo Form 8-K, Nov 3, 2026; analysis of company data

6

6 · Revenue by product

Subscription revenue supplied 109% of the $37.3M revenue increase

Revenue change by product

$M, Q3 2025 to Q3 2026

$M · Subscription: $40.5M$M · Advertising: -$0.2M$M · English Test: $0.2M$M · In-app: -$4.2M$M · Other: $1.0M$M · Total: $37.3MSubscriptionAdvertisingEnglish TestIn-appOtherTotal-$10.0M$0.0M$20.0M$40.0M$50.0M$40.5M-$0.2M$0.2M-$4.2M$1.0M$37.3M
Subscription revenue rose $40.5M, while in-app purchases fell $4.2M

Note: Bars are each product line’s YoY revenue change and sum to the total.Source: Duolingo Form 8-K, Nov 3, 2026; analysis of company data

7

7 · Revenue bridge

DAU rose 29%, faster than subscription bookings at 15.9% and revenue at 13.7%

YoY growth by user and financial metric

% change YoY, Q3 2026

YoY growth · Bookings: 12.1%YoY growth · Monthly users: 13.0%YoY growth · Revenue: 13.7%YoY growth · Paid subs: 14.0%YoY growth · Sub. bookings: 15.9%YoY growth · Daily users: 29.0%BookingsMonthly usersRevenuePaid subsSub. bookingsDaily users0.0%10.0%20.0%35.0%12.1%13.0%13.7%14.0%15.9%29.0%
DAU reached 64.9M, up from 50.5M

Note: DAU is daily active users. User metric growth is as reported. Sub. bookings is subscription bookings; paid subs is paid subscribers.Source: Duolingo Form 8-K, Nov 3, 2026; analysis of company data

8

8 · User and bookings growth

Net income fell to $27.2M as income taxes swung by $254.1M

Net income bridge

$M, Q3 2025 to Q3 2026

$M · Q3 2025: $292.2M$M · Gross profit: $28.2M$M · Opex: -$39.2M$M · Interest: $0.1M$M · Taxes: -$254.1M$M · Q3 2026: $27.2MQ3 2025Gross profitOpexInterestTaxesQ3 2026$0.0M$100.0M$200.0M$300.0M$350.0M$292.2M$28.2M-$39.2M$0.1M$27.2M
Operating expenses rose 24.2%, faster than gross profit at 14.3%

Note: Steps are YoY changes. Higher opex and taxes are reductions. Interest is interest income and other expense, net.Source: Duolingo Form 8-K, Nov 3, 2026; analysis of company data

9

9 · Net income bridge

Adjusted EBITDA margin fell 399 bps to 25.5%, while gross margin rose 39 bps

Gross, Adjusted EBITDA and FCF margins

% of revenue, Q3 2025 vs. Q3 2026

Gross margin · Q3 2025: 72.5%Gross margin · Q3 2026: 72.9%Adjusted EBITDA margin · Q3 2025: 29.5%Adjusted EBITDA margin · Q3 2026: 25.5%FCF margin · Q3 2025: 28.5%FCF margin · Q3 2026: 24.4%Q3 2025Q3 20260.0%25.0%50.0%80.0%72.5%72.9%29.5%25.5%28.5%24.4%

Gross marginAdjusted EBITDA marginFCF margin

Q3 opex included an $11.4M accrual for a DAU-linked bonus

Note: DAU is daily active users; FCF is free cash flow. Adjusted EBITDA margin is Adjusted EBITDA divided by revenue.Source: Duolingo Form 8-K, Nov 3, 2026; analysis of company data

10

10 · Margin analysis

11 · Free cash flow

Q3 bookings beat company guidance by 3.0%, and Adjusted EBITDA beat by 3.6%

Q3 2026 results vs. company guidance of Aug 5, 2026

$M unless noted, Q3 2026

MetricGuidanceActualVariance
Total bookings$307.0M$316.1M+3.0%
Revenues$302.0M$309.0M+2.3%
Adjusted EBITDA$76.0M$78.7M+3.6%
Adjusted EBITDA margin25.2%25.5%+27 bps
Bookings were $9.1M above the company’s Aug 5 guidance of $307.0M

Note: Guidance is from the Q2 2026 shareholder letter of Aug 5, 2026.Source: Duolingo Form 8-K, Nov 3, 2026; Duolingo Form 8-K, Aug 5, 2026 (prior guidance); analysis of company data

12

12 · Q3 vs. company guidance

Cash and short-term investments rose to $1,373.9M, with no borrowings

Cash, short-term investments and deferred revenues

$M, Dec 31, 2025 vs. Sep 30, 2026

$MDec 31, 2025Sep 30, 2026
Cash and cash equivalents$1,036.4M$1,239.6M
Short-term investments$104.1M$134.3M
Cash and short-term investments$1,140.5M$1,373.9M
Deferred revenues$496.2M$513.6M
Deferred revenues rose to $513.6M from $496.2M

Note: The balance sheet shows no debt. Deferred revenues are subscriptions paid but not yet recognized.Source: Duolingo Form 8-K, Nov 3, 2026; analysis of company data

13

13 · Balance sheet and cash

Q4 guidance assumes gross margin falls 86 bps from Q3 as AI features expand

Indicator
What to watch
Implication
Q3 reading
Gross margin
Q4 guide of 72.0%
AI rollout lifts costs
Q3 gross margin 72.9%
DAU bonus
Q4 DAU growth of 25% or more
Accrual weighs on EBITDA
Q3 accrual of $11.4M
In-app purchases
Revenue keeps falling
Non-subscription growth lags
Revenue (38.0%) YoY
Currency
A 1% USD move
About $2M of Q4 bookings
Q4 bookings guide $382M

Note: DAU is daily active users. These are analytical watch points, not company targets. The company cites a 90 bps decline using rounded margins.Source: Duolingo Form 8-K, Nov 3, 2026; analysis of company data

14

14 · Key risks to guidance

Appendix: bookings and revenue detail

ClaimEvidenceCalculation
Subscription bookings grew faster than total bookingsSubscription bookings 15.9%; total bookings 12.1%Company operating metrics
Subscriptions dominate bookingsSubscription share of bookings 85.2% to 88.1%Subscription bookings divided by total bookings
Non-subscription revenue fellNon-subscription revenue $42.2M to $39.0M (-7.6%)Advertising, English Test, in-app and other

Source: Duolingo Form 8-K, Nov 3, 2026; analysis of company data

15

15 · Appendix: Bookings detail

Appendix: profit and cost detail

ClaimEvidenceCalculation
SBC rose faster than revenueSBC related to equity awards $37.4M to $49.1M (31.4%)Adjusted EBITDA reconciliation
R&D was the largest expenseR&D $107.7M, or 34.9% of revenueR&D divided by revenue
Operating margin narrowedOperating margin 12.9% to 7.8%Income from operations divided by revenue
Net income margin normalizedNet income margin 107.5% to 8.8%Net income divided by revenue

SBC is stock-based compensation. Source: Duolingo Form 8-K, Nov 3, 2026; analysis of company data

16

16 · Appendix: Profit and costs

Appendix: guidance and capital return detail

ClaimEvidenceCalculation
Full-year bookings guidance roseRaised $11.0M to $1,296MNov 3 less Aug 5 guidance
Full-year Adjusted EBITDA guidance roseRaised $3.0M to $323MNov 3 less Aug 5 guidance
Buybacks continued under the program$82.0M repurchased through Oct 30 under a $400M programAs stated in the letter
Q3 buybacks were small$6.4M of repurchases in Q3As stated in the letter

Source: Duolingo Form 8-K, Nov 3, 2026; analysis of company data

17

17 · Appendix: Guidance and capital

Appendix: engagement and share count detail

ClaimEvidenceCalculation
A larger share of monthly users came dailyDAU as share of MAU 37.3% to 42.4%DAU divided by MAU
MAU grew more slowly than DAUMAU 153.1M, up 13%As reported
Diluted share countFully diluted shares of 50.8M at Sep 30, 2026As stated in the letter
Capital spending rosePurchases of property and equipment 125.7% YoYCash flow reconciliation

DAU is daily active users; MAU is monthly active users. Source: Duolingo Form 8-K, Nov 3, 2026; analysis of company data

18

18 · Appendix: Users and shares

Appendix: GAAP and non-GAAP operating expense detail

GAAP operating expenses, $M and YoY %

$M unless notedQ3 2025Q3 2026YoY
Research and development$82.7M$107.7M30.3%
Sales and marketing$35.1M$42.2M20.2%
General and administrative$44.0M$51.0M16.1%
Total operating expenses$161.8M$200.9M24.2%

Non-GAAP operating expenses, $M and YoY %

$M unless notedQ3 2025Q3 2026YoY
Non-GAAP R&D$55.3M$73.6M33.2%
Non-GAAP S&M$33.0M$39.5M19.5%
Non-GAAP G&A$30.2M$35.2M16.5%
Non-GAAP operating expense$118.5M$148.3M25.1%

Note: SBC is stock-based compensation. Non-GAAP expense excludes D&A, SBC and other items, per the company reconciliation.Source: Duolingo Form 8-K, Nov 3, 2026; analysis of company data

19

19 · Appendix: Opex and non-GAAP

Appendix: sources

  • Filing: Duolingo Form 8-K, Nov 3, 2026 — https://www.sec.gov/Archives/edgar/data/1562088/000162828026069474/0001628280-26-069474-index.html
  • Shareholder letter, Q3 2026 (Ex. 99.2) — https://www.sec.gov/Archives/edgar/data/1562088/000162828026069474/q3fy26duolingo9-30x26share.htm
  • Press release, Q3 2026 (Ex. 99.1) — https://www.sec.gov/Archives/edgar/data/1562088/000162828026069474/q3fy26duolingo9-30x26xpres.htm
  • Prior guidance: Q2 2026 shareholder letter (Ex. 99.2), Aug 5, 2026 — https://www.sec.gov/Archives/edgar/data/1562088/000162828026053299/q2fy26duolingo6-30x26share.htm
  • Investor relations copies of the letter and release: investors.duolingo.com
  • Q3 consensus: Zacks via Yahoo Finance, Nov 3, 2026 — https://finance.yahoo.com/markets/stocks/articles/duolingo-duol-q3-earnings-taking-233003195.html; cross-check: Investing.com earnings report, Nov 3, 2026
  • Q4 revenue consensus: TheFly via TipRanks, Nov 3, 2026 — https://blog.tipranks.com/duolingo-sees-q4-revenue-322m-consensus-314-55m-thefly-news/
  • Share price: Yahoo Finance DUOL history, Nov 3 close, 4:00 PM ET — https://finance.yahoo.com/quote/DUOL/history/; Public.com after-hours, 8:00 PM ET — https://public.com/stocks/duol/after-hours
  • No Form 10-Q for the quarter was on EDGAR when this deck was built.

Built with DeepCell / deepcell.net

20

20 · Sources

Important disclosures and disclaimer

For information only. This presentation is provided for information only. It is not investment, legal, tax or accounting advice, and it is not an offer, or a solicitation of an offer, to buy or sell any security.

No recommendation. It carries no rating, price target or buy, sell or hold view, and it was prepared without regard to any reader's investment objectives, financial situation or needs.

Sources and accuracy. Company figures come from Duolingo's Form 8-K of November 3, 2026 (Exhibits 99.1 and 99.2) and, for prior guidance, its Form 8-K of August 5, 2026. Consensus estimates (Zacks via Yahoo Finance, TheFly via TipRanks, Investing.com) and share prices (Yahoo Finance, Public.com) are third-party data, credited on the sources page. We have not independently verified third-party data and make no warranty that any information here is accurate, complete or timely.

Forward-looking statements. Company guidance, consensus estimates and the watch items in this deck are forward-looking. They rest on assumptions that may prove wrong, and actual results may differ materially.

Past performance. Past results, including those for Q3 2026, are not a reliable indicator of future results.

Non-GAAP measures. Bookings, Adjusted EBITDA, non-GAAP operating expenses and free cash flow follow Duolingo's own definitions. They supplement, and do not replace, GAAP results, and they may not be comparable with other companies' measures. Duolingo's shareholder letter reconciles them to GAAP.

No liability. No liability is accepted for any direct or indirect loss arising from the use of this presentation or its contents.

No affiliation. This presentation is not affiliated with, reviewed or endorsed by Duolingo, Inc. and does not represent Duolingo's views. Company and brand names belong to their owners.

How it was made. The deck was built with DeepCell, with figures linked to a model in the file. Readers should check the figures against the original filings and consult a qualified professional adviser before making any investment decision.

Date of analysis. The analysis reflects information available as of November 3, 2026, after the market close. The November 4 regular-session close was not yet available. It will not be updated for later events, and views may change without notice.

Built with DeepCell / deepcell.net

21

21 · Disclosures

Sources

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