Duolingo shares plunged 22.9% in after-hours trading following a mixed quarterly report and disappointing guidance for next year. While the language-learning app beat fourth-quarter earnings estimates with $0.84 EPS and 35% revenue growth to $282.9 million, its 2026 outlook fell short of Wall Street expectations.

The company expects revenue of $1.20-$1.22 billion for 2026, below the consensus estimate of $1.26 billion. Daily active users grew 30% year-over-year to 52.7 million, but CEO Luis von Ahn acknowledged a deceleration in growth rates throughout 2025 and projected only around 20% growth in 2026, down from previous rates exceeding 40%. The company is prioritizing user growth over near-term profitability, investing over $50 million into the free user experience and shifting its Video Call feature to a standard subscription tier, leading to a projected 25% adjusted EBITDA margin for 2026 compared to 29.5% in 2025. Board approval of a $400 million share repurchase program also signals confidence in the stock's long-term value despite the short-term sell-off.