Duolingo(US:DUOL)2023-11-08 16:00Financial Performance - Revenues for Q3 2023 reached $137.6 million, a 43% increase from $96.1 million in Q3 2022[23] - Gross profit for Q3 2023 was $101.4 million, compared to $69.8 million in Q3 2022, reflecting a gross margin improvement[23] - The company reported a net income of $2.8 million for Q3 2023, contrasting with a net loss of $18.4 million in Q3 2022[23] - Net income for the nine months ended September 30, 2023, was $3,950,000, a significant improvement compared to a net loss of $45,644,000 for the same period in 2022[32] - Total revenues for the three months ended September 30, 2023, were $137,624, a 43.3% increase from $96,065 in the same period of 2022[66] - Subscription revenue for the nine months ended September 30, 2023, was $287,230, up 47.0% from $195,376 in 2022[66] - The company reported a net income of $2.8 million in Q3 2023, compared to a net loss of $18.4 million in Q3 2022, marking a significant improvement[145][149] - Adjusted EBITDA for Q3 2023 was $22.501 million, compared to $2.130 million in Q3 2022, showing a substantial increase[104] User Metrics - The total number of monthly active users (MAUs) and daily active users (DAUs) is a key operating metric, although specific numbers were not disclosed in the provided content[15] - The company reported 83.1 million monthly active users (MAUs) for the three months ended September 30, 2023, up from 56.5 million in the same period of 2022, representing a year-over-year increase of 47.5%[101] - Daily active users (DAUs) increased to 24.2 million in Q3 2023, compared to 14.9 million in Q3 2022, reflecting a growth of 62.4%[104] - Paid subscribers reached 5.8 million at the end of Q3 2023, up from 3.7 million in Q3 2022, indicating a growth of 56.8%[104] Expenses and Investments - Research and development expenses increased to $50.3 million in Q3 2023, up from $42.0 million in Q3 2022, indicating a focus on innovation[23] - Operating expenses totaled $106.0 million in Q3 2023, compared to $89.9 million in Q3 2022, reflecting increased investment in growth[23] - Stock-based compensation expense increased to $70,219,000 for the nine months ended September 30, 2023, from $53,188,000 in the same period of 2022, reflecting a rise of 31.9%[32] - Sales and marketing expenses rose by 26% to $22.3 million for the three months ended September 30, 2023, mainly due to increased direct marketing expenses[158] Cash Flow and Assets - Cash and cash equivalents at the end of September 2023 totaled $701,737,000, up from $608,180,000 at the end of September 2022, representing an increase of approximately 15.3%[32] - Operating cash flow for the nine months ended September 30, 2023, was $104,421,000, compared to $42,048,000 for the same period in 2022, indicating a substantial increase of 148.5%[32] - Free cash flow for Q3 2023 was $33.472 million, up from $6.055 million in Q3 2022, reflecting improved financial health[104] - Total assets as of September 30, 2023, were $870.7 million, up from $747.3 million at the end of 2022[21] Deferred Revenue - Deferred revenues increased to $208.9 million as of September 30, 2023, compared to $157.6 million at the end of 2022, indicating strong future revenue potential[21] - Deferred revenue for the nine months ended September 30, 2023, was $51,338,000, compared to $36,677,000 in 2022, marking an increase of 40%[32] - Deferred revenues amounted to $208.9 million as of September 30, 2023, expected to be recognized as revenue in the next 12 months[170] Market and Economic Factors - The company has not entered into any hedging arrangements for foreign currency risk but may consider it in the future[181] - Inflationary factors, such as increases in costs, may adversely affect the company's results of operations[182] - The company does not believe inflation has had a material effect on its business or financial condition to date[182] - Significant inflationary pressures could hinder the company's ability to offset higher costs through price increases[183]