Duolingo (DUOL) Fell Following OpenAI’s Product Demonstration

In its third-quarter 2025 capitalist letter, Baron Technology Fund highlighted stocks specified arsenic Duolingo, Inc. (NASDAQ:DUOL). Duolingo, Inc. (NASDAQ:DUOL) is simply a connection learning level that offers courses successful 40 antithetic languages. The one-month instrumentality of Duolingo, Inc. (NASDAQ:DUOL) was -42.03%, and its shares mislaid 38.66% of their worth implicit the past 52 weeks. On November 10, 2025, Duolingo, Inc. (NASDAQ:DUOL) banal closed astatine $192.80 per share, with a marketplace capitalization of $8.913 billion.

Baron Technology Fund stated the pursuing regarding Duolingo, Inc. (NASDAQ:DUOL) successful its 3rd 4th 2025 capitalist letter:

"Despite connection learning level Duolingo, Inc. (NASDAQ:DUOL) reporting a beardown 2nd 4th with 40% regular progressive idiosyncratic maturation and 41% gross growth, the banal traded down intra-quarter pursuing an OpenAI merchandise objection astir connection learning and third-party information trends that indicated slowing idiosyncratic maturation connected the app. While the OpenAI demo was impressive, we judge that OpenAI’s offering requires important effort connected the portion of the user, lacks Duolingo’s expert-approved exercises, and astir importantly, lacks the engaging gaming mechanics that Duolingo is known for and keeps users motivated to support coming back. Duolingo was besides negatively impacted by third-party information trends showing a deceleration successful idiosyncratic growth, pursuing societal media contention implicit the company’s determination to usage much AI to dilatory hiring. While we judge that regular progressive idiosyncratic maturation has slowed from 2nd quarter’s 40-plus percent twelvemonth implicit twelvemonth level, we cbelieve that the institution should proceed to turn users northbound of 20% (and gross maturation up of idiosyncratic growth) English speaking regions proceed to support beardown engagement and idiosyncratic growth, and precocious English courses unlock a larger addressable marketplace successful the hundreds of millions. The company’s newest AI offering, Max, allows users to signifier speaking with a virtual tutor, allowing for greater engagement, improved learning, and higher monetization for the company. We proceed to intimately show trends successful idiosyncratic maturation and monetization."