Thank you for reading and subscribing! I think while Duolingo has a beloved game, my focus of my article is pointing out how the financial metrics resemble that of a hamster wheel. Yes, revenue will grow, but Duolingo will never get the high P/E multiple it used to have because the financials show there are no network effects. $DUOL will have to keep spending over +30% of its revenue just to keep players hooked. Too many other writers have naively taken management's promises at face value. Please let me know any questions!
An intersting view - I'm a Duolingo shareholder and now wondering whether this is a hamster wheel or a value creator.
Thank you for reading and subscribing! I think while Duolingo has a beloved game, my focus of my article is pointing out how the financial metrics resemble that of a hamster wheel. Yes, revenue will grow, but Duolingo will never get the high P/E multiple it used to have because the financials show there are no network effects. $DUOL will have to keep spending over +30% of its revenue just to keep players hooked. Too many other writers have naively taken management's promises at face value. Please let me know any questions!
Wait, how do you know financials don’t show network effects? How did you quantify that? I thought it was purely based on monetisation & user growth.