Shares in language learning app Duolingo (DUOL) popped on a surge in people signing up to learn Mandarin.
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DUOL rallied almost 7% after the company told CNBC that it’s seen a 216% rise in sign-ups for learning Mandarin versus a year ago.
The great leap forward in users logging in to learn Chinese compares with company-wide user growth of around 50%.
In its Fiscal Q3 report the company said paid subscribers jumped 47% to 8.6 million, whilst daily active users climbed 54% to 37.2 million. It says it has around 113 million monthly users, a rise of 36% from a year ago.
Meanwhile, total bookings rose 38% from the same quarter a year ago to $211.5 million. Subscription bookings were $176.3 million, an increase of 45% from the prior year quarter. Total revenues rose 40% to $192.6 million.
DUOL Unveils New AI Video Tool
Furthermore, the pop in DUOL shares came as it announced a new AI video tool available in new languages.
In a release, the company said Video Call is an AI-powered tool that allows Duolingo Max subscribers to engage in “spontaneous, realistic conversations “with one of its characters, Lily.
“Video Call is the kind of teaching tool we’ve dreamed of building for years, but is only possible now with the latest advances in generative AI,” said Luis von Ahn, co-founder and CEO.
The announcement underscores why some analysts think DUOL is an underrated AI beneficiary.
Is DUOL a Good Stock to Buy?
Overall, Wall Street has a Moderate Buy rating on DUOL, based on seven Buys and six Holds. After rallying 70% in the last 12 months, the average DUOL price target of $361.00 implies over 5% upside to current levels.
