Duolingo Q4 2024 Earnings Report
Key Takeaways
Duolingo reported strong Q4 2024 results with revenue growing 39% YoY to $209.6 million. GAAP EPS was $0.32, while non-GAAP EPS was not provided. Operating income increased to $13.88 million, and free cash flow surged to $87.8 million, reflecting a 42% free cash flow margin. Paid subscribers reached 9.5 million, up 43% YoY, driving record total bookings of $271.6 million.
Total revenue grew 39% YoY to $209.6 million.
Paid subscribers reached 9.5 million, a 43% YoY increase.
Subscription bookings rose 50% YoY to $236.5 million.
Free cash flow surged to $87.8 million, with a 41.9% margin.
Duolingo Revenue
Duolingo EPS
Duolingo Revenue by Segment
Forward Guidance
Duolingo expects continued revenue growth in Q1 and FY25, with full-year revenue guidance between $962.5 million and $978.5 million. Total bookings are projected between $1.08 billion and $1.10 billion, with an adjusted EBITDA margin ranging from 27% to 28%.
Positive Outlook
- Revenue forecast between $962.5 million and $978.5 million for FY25.
- Total bookings expected to reach $1.08 billion to $1.10 billion.
- Paid subscriber base expected to continue growing with Duolingo Max expansion.
- Strong engagement metrics with continued investment in AI-driven features.
- Operating leverage expected to improve despite increased AI-related costs.
Challenges Ahead
- Subscription margins under pressure due to higher AI costs.
- Advertising revenue per DAU declined YoY.
- Foreign exchange fluctuations may impact revenue growth.
- Higher operational costs expected due to AI and product investments.
- Potential user churn as Duolingo Max pricing evolves.
Revenue & Expenses
Visualization of income flow from segment revenue to net income