Duolingo Inc (DUOL)
Solvency ratios
| 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | — | — | — |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | — | — | — |
| Financial leverage ratio | 1.58 | 1.48 | 1.49 | 1.50 | 1.47 | 1.42 | 1.40 | 1.40 | 1.38 | 1.34 | 1.33 | 1.31 | 1.29 | 1.21 | — | — | — |
Duolingo Inc's solvency ratios indicate a strong financial position in terms of its ability to meet its long-term obligations without relying heavily on debt. The debt-to-assets ratio, debt-to-capital ratio, and debt-to-equity ratio have consistently remained at 0.00 across different reporting periods, reflecting that the company has minimal or no debt relative to its assets and capital structure.
Furthermore, the financial leverage ratio, which measures the extent of a company's debt financing relative to its equity, shows a gradual increase over the years from 1.21 in September 2021 to 1.58 in December 2024. While the ratio has been increasing, it remains at relatively moderate levels, indicating that Duolingo has been managing its debt levels prudently and is not overly reliant on borrowing to finance its operations.
Overall, Duolingo's solvency ratios suggest a healthy financial position with minimal debt levels and a stable capital structure, reflecting the company's sound financial management and sustainable growth strategy.
Coverage ratios
| 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | — | — | — | — | -70.99 | -8.02 | -6.64 | -7.84 | -8.18 | -17.56 | -178.47 | -209.46 | — | — | — | — | — |
The interest coverage ratio indicates a company's ability to make interest payments on its outstanding debt. Duolingo Inc's interest coverage ratio has shown a declining trend over the periods provided. In March 2022, the interest coverage ratio was -209.46, indicating a significant negative position which raises concerns about the company's ability to cover its interest expenses. The ratio improved slightly by September 2022 to -17.56, but it remained negative.
By the end of December 2023, the interest coverage ratio deteriorated significantly to -70.99, signaling a continued struggle to meet interest obligations with available earnings. It is important to note that during some periods, the interest coverage ratio was not available, which may suggest inconsistent financial performance reporting or potential challenges impacting the company.
Overall, the consistently negative interest coverage ratios for Duolingo Inc raise flags regarding the company's financial stability and ability to service its debt obligations. Investors and stakeholders should closely monitor this metric to assess the company's financial health and sustainability.