Duolingo stock jumps on Q1 user growth and AI content push

Duolingo shares rose about 8.8% on Monday, outperforming a roughly 2.2% gain in the Nasdaq. The stock extended a recent recovery but remained well below its highs from the past year.

The company reported first-quarter revenue rose 27% year over year. Daily active users increased 21% to 56.5 million, and paid subscribers grew 21% to 12.5 million. Management reported that profitability has been improving.

Duolingo has updated its app to add more speaking exercises and reduce reliance on selecting correct answers. In its first-quarter shareholder presentation, the company described those speaking exercises as ‘critical for developing conversational skills’ and noted they could lift retention and encourage cross-selling of additional languages.

In a shareholder letter, the company wrote it is using artificial intelligence tools to ‘fundamentally change how quickly [they] can create content.’ The letter added, ‘This is already improving engagement among new users.’ The company also noted AI allows faster, broader changes across many courses.

Technical indicators showed short-term momentum: the stock traded about 9.1% above its 20-day moving average and 14.3% above its 50-day moving average, while it remained roughly 34.3% below its 200-day moving average. The relative strength index stood near 51. Key trading levels cited by technical analysts include resistance around $119 and support near $98.50.

Valuation has declined from peak levels. Duolingo once traded at a forward price-to-earnings multiple above 100; it now trades around 15.7 times forward earnings.

Company executives are focusing on faster content production through AI and increased speaking practice in the app, with the stated aim of deepening engagement and supporting longer-term monetization.