• Spotify for language learning
• Headspace or Calm for language learning

• Duolingo Language Learning App: The primary platform offering interactive lessons to learn various languages.
• Duolingo English Test (DET): A standardized online English proficiency assessment accepted by thousands of institutions worldwide.
• Duolingo Max: A premium subscription tier of the language learning app featuring AI-powered explanations and roleplay exercises.
• Duolingo ABC: An early literacy app designed to teach children to read and write.
• Duolingo Math: A mobile application providing interactive lessons to learn elementary and middle school mathematics.
• Duolingo for Schools: A complementary platform for educators to manage student progress and assignments within the Duolingo language learning app.

Duolingo (symbol: DUOL) primarily sells its language learning services and products to **individuals**, rather than other companies. Its major customers can be categorized as follows:

• 1. Free Learners

  The vast majority of Duolingo's user base consists of individuals who use the core language learning app for free. These users generate revenue through advertising impressions and serve as a funnel for conversion to premium subscriptions.

• 2. Premium Subscribers (Duolingo Plus/Super)

  This category includes individuals who pay a recurring subscription fee for Duolingo Plus (now Super Duolingo). Subscribers gain access to an ad-free experience, unlimited hearts, progress quizzes, Legendary levels, and other exclusive features, enhancing their learning journey.

• 3. Duolingo English Test (DET) Candidates

  Individuals who pay a fee to take the Duolingo English Test (DET) constitute another significant customer category. The DET is an online English proficiency assessment accepted by thousands of universities and institutions worldwide for academic admissions and professional certification.

• Amazon Web Services (a subsidiary of Amazon.com, Inc. (AMZN))
• Apple Inc. (AAPL)
• Google LLC (a subsidiary of Alphabet Inc. (GOOGL))

1. Slowing User Growth and Rising User Acquisition Costs

Duolingo faces the risk of decelerating user growth, with some reports indicating a slowdown in daily and monthly active user numbers. This suggests the company may be approaching market saturation, leading to potential difficulties in acquiring new users. Consequently, Duolingo may incur higher customer acquisition costs to maintain its growth trajectory.

2. Intense Competition and AI Disruption

The EdTech sector is highly competitive, and Duolingo faces significant challenges from established players like Rosetta Stone and Babbel, as well as newer apps such as Busuu and Memrise. A prominent threat comes from emerging artificial intelligence (AI) competition, including large language models, which could offer more personalized and potentially cheaper learning experiences that directly challenge Duolingo's offerings. While Duolingo is investing in AI features like Duolingo Max, this also incurs higher generative AI costs, putting pressure on margins.

3. Reliance on Freemium Model and Valuation Pressure

Duolingo's business model heavily relies on converting its large free user base into paying subscribers. While the company has shown success in increasing its paid subscriber base, any slowdown in user growth or increased competitive pressure could impact its conversion rates and monetization strategy. This could, in turn, affect its revenue growth and put pressure on its premium valuation, which is highly dependent on sustaining rapid growth.

The rapid advancement and adoption of Generative AI and Large Language Models (LLMs) present a clear emerging threat to Duolingo.

LLMs are becoming exceptionally proficient in generating human-like conversation, explaining complex grammar concepts, and providing personalized feedback and adaptive learning experiences. This technology could enable new competitors, or existing major tech companies, to develop highly sophisticated and potentially free AI-powered language tutors that offer a more natural, immersive, and personalized learning environment than Duolingo's current gamified, structured lessons. Such disruptive offerings could significantly erode Duolingo's unique value proposition by providing superior conversational practice, highly individualized learning paths, and on-demand content generation that could make traditional app-based learning feel less dynamic and effective.

Furthermore, major tech players (such as Google, Apple, or Microsoft), who are heavily investing in LLMs, have the resources and distribution channels to integrate powerful AI language tutors directly into their operating systems, search engines, or other widely used platforms. This could effectively turn Duolingo's core service into a free feature of a broader ecosystem, diminishing the need for a standalone app.

Duolingo's main products and services primarily include language learning courses, the Duolingo English Test (DET), and recently expanded offerings in math, music, and chess.

The addressable markets for Duolingo's key offerings are as follows:

• Language Learning: The global language learning market is valued at $61 billion and is projected to grow to $115 billion by 2025. The online language learning segment, a significant niche for Duolingo, is expected to reach $47 billion by 2025. More broadly, Duolingo operates within a total addressable market of 2 billion language learners worldwide. The direct-to-consumer language learning market is estimated at $115 billion globally.
• Duolingo English Test (DET): The global English Proficiency Test market is projected to increase from $3.65 billion in 2024 to $7.49 billion by 2032.
• Math, Music, and Chess: While specific individual market sizes for these newer products are not separately quantified, Duolingo's expansion into these areas positions it within a broader education market. This larger market, encompassing digital learning and education technology, represents a total addressable market (TAM) of $220 billion globally. Furthermore, Duolingo is positioning itself to tap into the even larger $6 trillion annual global education spend.

Duolingo (DUOL) is expected to drive future revenue growth over the next 2-3 years through several key strategies:

1. Continued Growth in Paid Subscribers and User Monetization: Duolingo has demonstrated robust expansion in its user base and successful conversion of free users to paying subscribers. Paid users increased 34% year-on-year to 11.5 million in the third quarter of 2025. The company projects over 50 million daily active users and nearly $1.2 billion in bookings for the year, representing a 33% growth rate. Duolingo has also raised its annual revenue forecast, attributing this to the rapid growth in paid subscriptions.
2. Expansion of AI-driven Premium Features and Products: The integration of artificial intelligence into Duolingo's premium offerings, particularly Duolingo Max, is a significant growth driver. Duolingo Max, which includes generative AI features, saw its bookings double year-over-year in Q3 2025 and accounts for 9% of total subscribers. The company's CEO has noted that Duolingo is one of the few companies successfully profiting from AI, which is being leveraged to enhance its educational products. New AI-powered features such as "Video Call" for realistic conversations and "Adventures," an immersive game-like experience, were introduced at Duocon 2024 to further engage users and build confidence.
3. Expansion into New Content Verticals: Duolingo has successfully diversified its content beyond language learning. The chess course, for example, is highlighted as its fastest-growing course, exhibiting higher user retention than traditional language learning after several months. Furthermore, Duolingo has broadened its music education offerings through a partnership with Loog for a digital piano and the acquisition of NextBeat, a music gaming startup, which is expected to lead to the development of more music courses.
4. International Expansion, particularly in Asia and Emerging Markets: Asia represents Duolingo's fastest-growing region, with China being the second-largest country by daily active users (DAUs), contributing 5-6% of the company's business. International expansion is explicitly identified as a key driver for future performance. The launch of 148 new AI-created courses, making popular non-English languages accessible across all 28 supported user interface languages, significantly expands learning opportunities for over a billion potential learners globally, especially in regions like Latin America and Europe, to meet the increasing demand for Asian languages.

Share Repurchases

• Duolingo has not reported any share repurchases over the last 3-5 years.

Share Issuance

• Duolingo conducted its Initial Public Offering (IPO) in 2021, raising approximately $521 million by selling 5.1 million shares.
• The fully diluted share count is projected to increase by about 1% in 2025.
• Stock-based compensation, which contributes to share issuance, amounted to $110.48 million in fiscal year 2024 and $124.36 million for the trailing twelve months ending June 30, 2025.

Inbound Investments

• There have been no significant large inbound investments by third-parties, such as strategic partners or private equity firms, publicly reported for Duolingo since its IPO in 2021.

Outbound Investments

• Duolingo acquired NextBeat in August 2025.
• The company acquired Hobbes in July 2024.
• Duolingo made an investment in SigIQ.ai in April 2025.

Capital Expenditures

• Capital expenditures were approximately $3.19 million in fiscal year 2023 and $12.12 million in fiscal year 2024.
• For the trailing twelve months ending June 30, 2025, capital expenditures were approximately $7.65 million.