Duolingo Inc (DUOL)

Return on total capital

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020
Earnings before interest and tax (EBIT) (ttm) US$ in thousands 49,358 40,271 35,714 11,924 -12,921 -35,747 -51,175 -61,456 -64,897 -64,281 -72,996 -58,440 -60,048 -53,204 -27,571 -27,011 -16,011
Long-term debt US$ in thousands — — — — — — — — — — — — — — — — —
Total stockholders’ equity US$ in thousands 824,550 822,453 766,944 711,052 655,501 614,819 596,405 565,188 542,078 533,826 528,219 520,714 513,056 510,731 -93,777 -97,785 -80,691
Return on total capital 5.99% 4.90% 4.66% 1.68% -1.97% -5.81% -8.58% -10.87% -11.97% -12.04% -13.82% -11.22% -11.70% -10.42% — — —

December 31, 2024 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $49,358K ÷ ($—K + $824,550K)
= 5.99%

The return on total capital for Duolingo Inc experienced a downward trend from September 2021 to March 2024, with negative percentages indicating a decrease in the company's profitability in relation to its total capital. The return on total capital improved gradually from March 2024 onwards, showing positive percentages from that point. It is essential for the company to sustain this positive trend to ensure efficient utilization of total capital and improved profitability in the future.