DAU Growth Approaching ~30%, w/Bookings Growth Picking Up; Incrementally Positive But Looking for Sustained Monetization; Neutral w/$155 PT

DUOL reported the second consecutive quarter of user growth acceleration — 3Q DAU growth improved ~600bps to +29% — and 3Q Bookings growth accelerated ~400bps to +12%. DUOL's 4Q outlook also suggests similar DAU growth (vs. 3Q) and ~100bps of Bookings growth acceleration to ~13%, broadly in-line with investor expectations. DAU growth improvement remains broad-based as the company works toward its goal of ~100M DAUs in 2028, with Green Machine optimizations driving ~90% of improvement, most geos delivering improving trends, and product velocity ramping. User growth and teaching better remain DUOL's key priorities but monetization is becoming a bigger focus. Improved Bookings trends will lag DAU growth, but there are early signs of improving monetization and DUOL is entering a re-tiering strategy: it is stopping the sale of new Max subscriptions and shifting existing Max Individual subscribers into Super Family at similar pricing, with minimal Bookings impact expected into 4Q. Max as a c