Duolingo surges as AI-led growth, forecast raise boost investor confidence

Duolingo raised its 2025 revenue guidance to $1.01–$1.02 billion, surpassing analysts’ estimates and previous forecasts[1][2][4].
Q2 2025 revenue reached $252.3 million, up 41% year-on-year and well above projections[1][2][3].
This surge is attributed to strong performance in AI-powered premium subscriptions, which grew 44% to $232.2 million[1].
Profitability also hit a new record, with quarterly profits up 84% to $44.8 million[3].

Daily active users reached 46.6 million, representing 40% year-on-year growth[1][3].
The company credits its aggressive deployment of generative AI for expanding the platform’s educational offerings and user engagement[2].
Innovations include the launch of new interactive features like the Energy mechanic and personalized content, powered by advanced AI models[2].
Strategic acquisitions, such as NextBeat, and the development of generative AI courses have diversified the business beyond language learning[1].

In response to social backlash over a post about mandatory AI usage, CEO Luis von Ahn pivoted the company’s online messaging, prioritizing positive sentiment over viral, edgy content[3].
While this more cautious approach led to U.S.-specific softening in daily active user growth, von Ahn noted that this impact was temporary, and the focus remains on product innovation and global expansion[3].

Duolingo’s stock rose nearly 1% on August 6, 2025, with an after-hours jump of almost 19% and a trading volume of $1.14 billion — the 74th highest in market activity that day[1][3].
Shares have climbed 113% in the past year as investors respond to consistent growth led by AI and new product lines[3][4].
With a raised full-year forecast and continued innovation in AI-driven education, Duolingo is positioned for sustained expansion well into 2025[1][2][4].

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