Online Education: Monthly Report Card, 6/25/26: Duolingo June DAU Growth Acceleration, But Investors Looking for Continued Product & Marketing Cycle; Remain Neutral-Rated DUOL

Research evidence excerpt

Online Education: Monthly Report Card, 6/25/26: Duolingo June DAU Growth Acceleration, But Investors Looking for Continued Product & Marketing Cycle; Remain Neutral-Rated DUOL

Bryan M. Smilek AC North America Equity Research

(1-212) 622-8886 25 June 2026 J P M O R G A N

bryan.smilek@jpmorgan.com

trends & strength across Asian markets (drove ~40% of 1Q DAU growth & continue

to monetize well) led by China (~7%-8% of DAUs), South Korea, and Japan. DUOL

remains focused on enhancing the user experience to reach ~100M DAUs in 2028, led

by product optimizations, teaching efficacy & speaking practice enhancements,

marketing diversification, int’l growth, & new verticals. DUOL continues to revamp its

marketing strategy to a more balanced approach across unhinged and wholesome

content, along with ramping its creator presence and Reddit visibility. DUOL has

partnered with McDonald’s China & MINISO in China, which should support user

trends.

• Expecting 2H Bookings Growth Re-Acceleration. 2026 Bookings Y/Y growth

guidance of +10.5% (+8.6% FXN) embeds 2H re-acceleration following challenging Y/

Y comps in 2Q (Energy system rollout, select Super price increases, & Ads strength). We

believe DUOL’s Bookings guidance reflects minimal tailwinds from product initiatives,

with DUOL forgoing ~500bps of 2026 Bookings growth to prioritize user growth, though

initiatives such as streak restorations & free trials could support greater than expected

subscriber conversions. We believe Duolingo will continue to test Max pricing &

relative tier features, & Max penetration has remained stable (~9% of paid

subscribers in 4Q) despite the shift of select Video Call usage to select Super

subscribers (with some calls costing users XP). DUOL is rolling out Avatar Suits