Duolingo Inc (DUOL)

Short-term

Turnover ratios

The activity ratios of Duolingo Inc provide insights into the efficiency of the company's operations in managing inventory, receivables, payables, and working capital.

- Inventory Turnover: The data for this ratio is not available for all periods, but from the available figures, it seems that Duolingo maintains a relatively stable level of inventory turnover, indicating that they efficiently manage their inventory levels.

- Receivables Turnover: Duolingo's receivables turnover has shown fluctuations over the periods, ranging from 5.97 to 11.22. A higher receivables turnover indicates that the company is collecting its receivables more quickly, which is generally a positive sign of efficient credit management.

- Payables Turnover: The payables turnover ratio for Duolingo has varied significantly across the periods. Fluctuations in this ratio could suggest changes in the company's payment terms with suppliers or its ability to manage payable obligations efficiently.

- Working Capital Turnover: Duolingo's working capital turnover has been increasing over the periods, indicating that the company is generating more revenue relative to its working capital. A higher turnover ratio suggests better utilization of working capital in generating sales.

Overall, while these ratios provide insights into Duolingo's operational efficiency, a comprehensive analysis would require benchmarking against industry averages or competitors to fully evaluate the company's performance. It is important for investors and stakeholders to consider these ratios in conjunction with other financial metrics and qualitative factors when assessing the company's operational effectiveness.

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Average number of days

The activity ratios for Duolingo Inc show fluctuations in its operating efficiency over the past quarters.

Days of inventory on hand (DOH) measures how many days it takes for Duolingo to sell its inventory. There is no data available for DOH in the most recent quarters, suggesting a lack of inventory management information. In the previous quarters, the trend indicates a range between 128.63 days to 133.87 days, which may imply that Duolingo may have a slow inventory turnover rate.

Days of sales outstanding (DSO) represents the average number of days it takes for Duolingo to collect revenue from sales. The DSO has varied over the quarters, with a notable increase in December 2023, but a decrease in the most recent quarter. The trend indicates improvement in collecting revenue more efficiently recently.

Number of days of payables shows how long it takes Duolingo to pay its vendors. The data shows fluctuations, with an increase in December 2022 and September 2023, followed by decreases in the latest quarter. This suggests that Duolingo has been managing its payables more effectively recently.

Overall, Duolingo's activity ratios indicate some fluctuations in operating efficiency, showcasing areas where the company may need to focus on improving its inventory management and further optimizing its receivables and payables processes to enhance overall operational performance.

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Long-term

Duolingo Inc's fixed asset turnover ratio has been consistently increasing over the recent quarters, reaching 44.14 at the end of March 2024. This indicates that the company generated $44.14 in revenue for every $1 invested in fixed assets during the period. The upward trend suggests that Duolingo is utilizing its fixed assets more efficiently to generate sales.

In terms of total asset turnover, Duolingo also shows a positive trend with a ratio of 0.55 at the end of March 2024. This ratio signifies that the company generated $0.55 in revenue for every $1 of total assets during the period, reflecting an increase in the efficiency of asset utilization.

Overall, the increasing trend in both fixed asset turnover and total asset turnover ratios indicates that Duolingo is effectively managing its assets to generate revenue and improve its overall operational efficiency. This trend is a positive sign for the company's long-term financial performance and sustainability.