Duolingo Inc (DUOL)

Pretax margin

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021
Earnings before tax but after interest (EBT)	US$ in thousands	17,777	-58,636	-59,958
Revenue	US$ in thousands	531,109	369,495	250,772
Pretax margin		3.35%	-15.87%	-23.91%

December 31, 2023 calculation

Pretax margin = EBT ÷ Revenue
= $17,777K ÷ $531,109K
= 3.35%

Duolingo Inc has shown an improvement in its pretax margin over the last three years. The pretax margin was -23.91% in 2021, which improved to -15.87% in 2022 and further increased to 3.35% in 2023. This positive trend indicates that the company's profitability before taxes has been on the rise, with a significant turnaround from negative margins to a positive margin in the most recent year. This improvement in pretax margin suggests that Duolingo Inc has been successfully managing its costs and generating more income relative to its revenues, which is a positive signal for investors and stakeholders.