The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed on behalf of investors who acquired Duolingo, Inc. (“Duolingo” or the “Company”) (NASDAQ: DUOL) securities between May 2, 2025 and February 26, 2026, inclusive (“the Class Period”). If you suffered a loss on your Duolingo investments, you have until December 7, 2026 to request lead plaintiff appointment.
[CONTACT THE FIRM IF YOU SUFFERED A LOSS]
Investors are encouraged to fill out the contact form above or contact Lauren Molinaro of Kirby McInerney LLP by email at investigations@kmllp.com to discuss your rights or interests in the securities fraud class action lawsuit at no cost.
What Is This Lawsuit About? The lawsuit alleges that Duolingo failed to disclose that: (i) Daily Active User (“DAU”) growth rates were being leveraged against deliberately added user friction in the form of significant increases in ad volume, subscription tier upsells, and worsened product quality, and Duolingo understood that any amount of user friction would cause users to leave the app and, ultimately, negatively impact DAU growth rates; (ii) the Company’s rigorous A/B testing demonstrated that increased friction in the free user experience was having negative impacts on DAU growth rates; (iii) Duolingo’s quickly generated AI content was worsening the quality of the Company’s product offerings, negatively impacting the user experience and user trends, and threatening the sustainability of the Company’s financial performance; and (iv) Duolingo’s constant A/B testing informed the Company that its monetization push and lower-quality, rapidly generated AI content were degrading the Duolingo product experience and the value proposition of its subscription tiers.
On November 5, 2025, Duolingo reported its third quarter 2025 financial results, revealing a sequential decline in DAU growth to 36%, a drop from 49% in first quarter 2025 and 40% in second quarter 2025. Additionally, the Company announced a reversal of its monetization push, stating that the Company would invest more in “teaching better” and prioritize user growth over monetization moving forward. On this news, the price of Duolingo shares fell $66.28, or approximately 25.5%, from $260.02 per share on November 5, 2025 to close at $193.74 on November 6, 2025.
Then, on January 12, 2026, Duolingo announced that CFO Matthew Skaruppa had resigned. The Company also announced preliminary fourth quarter 2025 financial results, revealing DAU growth of 30%. On this news, the price of Duolingo shares declined by $14.92 per share, or approximately 8.5%, from $176.66 per share on January 11, 2026 to close at $161.74 on January 12, 2026.
On February 26, 2026, Duolingo announced its fourth quarter 2025 financial results, confirming the slowdown in DAU growth and revealing that the financial consequences of its strategy shift away from monetization and towards DAU growth would result in material negative impacts on 2026 bookings, DAU growth rates, revenue, and adjusted EBITDA. Additionally, Defendants provided initial 2026 guidance, stating that 2026 DAU growth would come in at 20% and that bookings growth, revenue growth, and adjusted EBITDA would all come in below consensus estimates. On this news, the price of Duolingo shares declined by $16.45 per share, or approximately 14%, from $117.45 per share on February 26, 2026 to close at $101.00 on February 27, 2026.
[LEARN MORE ABOUT THE LAWSUIT]
The Lead Plaintiff Appointment Process. The federal securities laws permit any investor who acquired eligible securities during the class period to seek appointment as lead plaintiff in a class action lawsuit. Courts do not consider lead plaintiff applications submitted after the relevant deadline. If you choose to take no action, you may remain an absent class member. Learn more about the lead plaintiff process and eligibility requirements here. Courts typically appoint the investor(s) with the largest financial loss in the case and the ability to represent the class rather than investors with simply the largest investment portfolio. Courts regularly appoint individual investors, whether acting alone or as a group, as lead plaintiffs. The rights of any investor who bought shares during the class period are generally already protected. However, lead plaintiffs have the power to influence case strategy and have a say in settlement decisions, as well as decisions concerning allocation of settlement funds among class members.
[LEARN MORE ABOUT THE LEAD PLAINTIFF PROCESS]
What Should I Do? If you purchased or otherwise acquired Duolingo securities, have information, or would like to learn more about this investigation, please contact Lauren Molinaro of Kirby McInerney LLP by email at investigations@kmllp.com, or fill out the contact form below, to discuss your rights or interests with respect to these matters at no cost.
Kirby McInerney LLP is a New York-based plaintiffs’ law firm concentrating in securities, antitrust, whistleblower, and consumer litigation. The firm’s efforts on behalf of shareholders in securities litigation have resulted in recoveries totaling billions of dollars. Additional information about the firm can be found on Kirby McInerney LLP’s website.
This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.
View source version on businesswire.com: https://www.businesswire.com/news/home/20261008399415/en/
Media gallery
