Stocks for the language learning platform Duolingo soared during Thursday's United States session after reporting record profitability and impressive revenue growth.
The company reported an increase in subscription revenue of 46% while overall revenue rose by 41%.
Alongside this, Duolingo also raised full-year guidance to between US$1.01 billion - US$1.02 billion from the prior range of US$987 million - US$996 million, signalling high confidence in its future prospects.
This caused the language learning platform’s stocks to skyrocket by nearly 14%.
Daily active users also jumped around 40% from around 34 million to almost 48 million in the year-ago period.
These rises come after the company implemented an ‘AI first’ model earlier this year, which was initially met with backlash but ultimately increased its growth.
Duolingo’s efforts aimed to use AI to expand its course offerings and boost users through tools such as video-call conversation practice for paying subscribers.
In a letter to shareholders, Duolingo CEO and co-founder, Luis Von Anh said the business's growth could be attributed to “lower-than-expected AI costs and strength in our ads business”.
The company also announced the acquisition of London-based music gaming startup NextBeat for an undisclosed amount as it looks to broaden its app products.
At the time of writing, Duolingo (NASDAQ: DUOL) stocks rose 13.75% to US$390.84. Its market cap is US$17.77 billion.
