Duolingo Inc (DUOL)

Financial leverage ratio

		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
Total assets	US$ in thousands	1,068,670	953,957	870,714	834,803	790,379	747,347	713,699	701,050	684,511	661,311	617,777	181,693
Total stockholders’ equity	US$ in thousands	711,052	655,501	614,819	596,405	565,188	542,078	533,826	528,219	520,714	513,056	510,731	-93,777
Financial leverage ratio		1.50	1.46	1.42	1.40	1.40	1.38	1.34	1.33	1.31	1.29	1.21	—

March 31, 2024 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $1,068,670K ÷ $711,052K
= 1.50

Duolingo Inc's financial leverage ratio has shown a generally increasing trend over the past quarters, rising from 1.21 in September 2021 to 1.50 in March 2024. This indicates that the company has been increasingly relying on debt financing to support its operations and growth. A higher financial leverage ratio suggests that a larger portion of the company's assets is financed through debt rather than equity. While higher leverage can amplify returns on equity, it also increases financial risk as the company has to make interest payments and repay principal amounts on the borrowed funds. It will be important for Duolingo to manage its debt levels prudently to ensure its long-term financial health and stability.