Duolingo Restores Daily-User Growth After a Slow Quarter

The Tip Desk · August 5, 2026 · 3 min read

Daily Active Users reached 58.7 million, up 23% from a year earlier, and the company said rest-of-year DAU growth should stay above the 20% it had guided.

Duolingo, Inc. (DUOL) reported Daily Active Users of 58.7 million in the second quarter, up 23% from a year earlier, an acceleration of two percentage points from the first quarter. Monthly Active Users were 140.6 million, up 10% year over year, accelerating four percentage points sequentially. Paid subscribers at period end were 12.7 million, up 17% from a year earlier.

The mobile learning platform said the DAU step-up was due to product changes, marketing impact, and a one-time June Streak Revival event. Because two of those factors are permanent, it expects DAU year-over-year growth for the rest of 2026 to remain above the 20% it had previously guided. In the Streak Revival, 15.4 million learners revived their streaks, including nearly 8 million who had no active streak when the event began.

Current User Retention Rate, the share of current-user DAUs who return the next day, was at an all-time high of 84%, up about 1% from last year. The company has concentrated Green Machine testing on retention and learning outcomes, with most new Super Duolingo subscribers now able to use Video Call and an extension to existing Super subscribers expected later this year. Longer free trials have produced good early results and are expected to lift both revenue and DAUs.

Revenue increased 18% year over year, or 17% on a constant-currency basis, to $298.5 million. Total bookings rose 8% year over year, or 6% on a constant-currency basis, to $289.1 million. Subscription bookings were $250.3 million, up 10% year over year. The bookings growth rate slowed from the first quarter because of a tough year-ago comparison from the initial rollout of Energy, a price increase, and advertising outperformance in the year-ago quarter. Bookings seasonality was within expectations.

Gross margin was 72.6%, a 20-basis-point improvement over the prior year and ahead of the company’s expectation of approximately 71.0%. The result reflected a measured pace of AI-powered feature expansion, including Video Call, and AI cost efficiencies. Net income was $33.2 million, an 11.1% margin. Adjusted EBITDA was $77.3 million, a 25.9% margin. The year-over-year Adjusted EBITDA decline was within expectations as the company invests in user growth. Free cash flow was $78.6 million, a 26.3% margin. Cash and short-term investments were about $1.3 billion at quarter-end.

The company reaffirmed full-year 2026 targets of 10-12% year-over-year bookings growth and 15-18% year-over-year revenue growth, and raised its full-year Adjusted EBITDA margin outlook by nearly one point to approximately 26.5%, citing stronger-than-expected gross margin. For the third quarter ending September 30, 2026, it guided bookings of $307 million, revenue of $302 million, and Adjusted EBITDA of $76 million, or a 25.2% margin. It expects gross margin of approximately 71.0% in the third quarter and 71.6% for the full year, better than the trajectory outlined on the first-quarter call based on AI cost trends. Stock-based compensation is expected to be around 15.0% of revenue in 2026.

Under a $400 million share repurchase program announced in February, Duolingo bought about $44.4 million, or about 432 thousand shares, in the second quarter, bringing the total to about $71.9 million through August 1, 2026. Fully diluted shares outstanding ended the quarter at about 50.7 million.