Can We Expect More Volatility From Duolingo Inc. (DUOL)?

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Duolingo Inc. (NASDAQ: DUOL), an online language learning platform guide, prefers to ignore short-term volatility. The company plans to create a sustainable business, designed for long-term growth.


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DUOL provides opportunities for learning foreign languages ​​online. Users can start learning the language at any level and at any age. During the lockdown, the demand for such services was very high, which allowed the company to quickly increase its subscriber base.

However, some investors feared that as social activity resumed, the demand for such services could drop sharply. As a result, Duolingo Inc. (DUOL) prices have lost about 50% over the past few months compared to 52-week highs. But Duolingo’s management prefers to ignore short-term trends and focus on long-term growth.

In the first quarter, Duolingo Inc. (DUOL) reported strong earnings and raised its full-year guidance on orders, revenue, and EBITDA. The number of active daily users increased by 31% to 12.5 million. The number of monthly active users in the first quarter was 50 million, up 55% year-on-year.

At the same time, DUOL notes that its diverse audience is its main competitive advantage. The platform has users of all ages from different regions of the planet. Therefore, such a factor as a decrease in college applications does not affect Duolingo’s business.

Another benefit of Duolingo Inc. (DUOL) is its focus on investing in products. The company does not increase spending on marketing and sales but invests heavily in innovative products that would meet the requirements of modern users.

According to Duolingo management, this is the best strategy in the long run, as new features will allow the company to grow its paying user base.

The 52-week high price of DUOL is now $204.99, which is 52.85% greater than the current trading price of the company. The current trading price of DUOL, however, is -59.75 percent lower than the 52-week low price of $60.50.

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