Category: Duolingo

Duolingo Annual Earnings for FY 2024

Posted on by TOEFL Resources

Duolingo has published its annual report for the year ending December 31, 2024 (Look for a 10-K file if you are seeking the below numbers).

Revenue from the Duolingo English Test increased by about 10.7 percent in 2024 to a total of $45,640,000.  This suggests that test volumes in 2024 were about the same as in 2023.

Below are quarter-by-quarter revenues for 2024.  Following each revenue figure is a crude estimate (see below for an explanation) of how many times the test was taken in that quarter.

Note that the test cost $59 from January 1 to April 15.  For the rest of the year, it cost $65.

  • Q4: $11,415,000  (175,615)
  • Q3: $10,772,000  (165,723)
  • Q2: $10,698,000  (164,584)
  • Q1: $12,755,000  (217,000)

My crude estimates are derived by dividing revenue by the cost of taking the test. This a VERY rough estimate – some people pay an additional fee to get faster results, while others get a discount by purchasing two tests at a time.  Others pay nothing at all thanks to the Duolingo Access program. And if you pay for the test and don’t show up… Duo keeps your money.  Note also that the Q2 estimate assumes a price of $65 for the whole quarter, though the price was actually a bit cheaper for the first 15 days.

With that out of the way: we can guess there were about 722,922 administrations of the DET in 2024.

–

Here are the quarterly revenues and estimates for 2023.  The test cost $49 from January 1 to April 5.  For the rest of the year it cost $59.

  • Q4 2023 – $10,819,000 (183,372)
  • Q3 2023 – $10,600,000 (179,661)
  • Q2 2023 – $9,800,000 (166,101)
  • Q1 2023 – $9,970,000 (203,469)

From this we can guess there were about 732,603 administrations in 2023.  Again, though, take that figure with a grain of salt.

On the Usefulness of Practice Tests

Posted on by TOEFL Resources

Here’s a blog post from Duolingo about how DET test takers benefit from the free practice test accessed via the DET website.  Remember that this test is generated by AI, so it is different every time a test taker accesses it.  As a result, they enjoy an unlimited number of free practice tests.

The blog notes that according to research, “test takers who took more practice tests reported higher confidence levels when taking the official test. They also felt more prepared and motivated compared to those who took fewer or no practice tests.”

Yeah, no kidding.

Much has been written about the meteoric rise* of the DET.  Various factors are mentioned – the cost, the length, the at-home format, the green owl (RIP), the item types, engagement with admissions staff – but I don’t think enough credit has been given to the free practice test.

Historically, students preparing for legacy English tests have spent a ton on test prep.  A significant amount of that spending goes to the test makers themselves.  A quick glance at the Pearson site reveals that they offer scored PTE practice tests for $35.99 a pop (or buy five at a time for a discount).  ETS charges $45.95 for the same (ever unable to curate its offerings, ETS still sells dozens of separate test prep products).  Some students spend hundreds of dollars on this kind of stuff.

Duolingo’s choice to give unlimited mock tests away for free makes the DET an attractive proposition.

We take it for granted that testing companies are also test prep companies.  But it hasn’t always been this way.  For decades, ETS didn’t offer any paid prep products at all.  Whatever prep they provided was given away at no cost.  Moving into the test prep space was a choice.

Nowadays, test makers go whole hog with coupons and sales worth five or ten bucks… but when we consider the ancillary costs including (but not limited to) test prep, those marketing efforts seem pretty inconsequential.

I spent years begging my friends at ETS to provide a practice test similar to the one provided by Duolingo.  But my friends all took buyouts last year and I’m too tired to start begging anew.  Seriously, though – this is the sort of decision test firms should emulate to help ensure their long term viability.

*actually, the rise was slower than you think

Printed LanguageCert Certificate

Posted on by TOEFL Resources

A couple of weeks ago I received this keen certificate from LanguageCert in the mail.  It was printed on nice cardstock and came protected by a durable mailer.  Everyone who takes the LANGUAGECERT Academic test gets a certificate – it isn’t necessary to opt-in and no extra fees are charged.

I appreciate how, at $165, the LanguageCert test represents a pretty decent value.  It seems to be part of a new category of at-home tests that has emerged in recent years.  We might dub the category “affordable-traditional.”  This category also includes the Kaplan Test of English which costs about $149, and the Password Skills Plus Test, which costs about $139.

The category has become particularly valuable for test takers as fees charged by more established companies have increased precipitously in recent years.  At-home tests from legacy firms cost more than $400 in some countries.*  Notably, the at-home TOEFL just hit $470 in its most expensive market.

Of course my friends at Duolingo will be quick to point out that their test costs just $70.  But I think you get my point – in an ideal world individuals aren’t charged an arm and a leg just because they opt for a more traditional testing format.

*Yes, some testing companies charge a different price depending on which country the test-taker is located in. Prices can differ by hundreds of dollars depending on the location of the test-taker.

IELTS – What’s the Plan?

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The Guardian has weighed in with an editorial suggesting that the UK government should “cherish and preserve” the British Council.  I imagine that they will soon step in to provide favorable terms for repayment of the British Council’s large debt.  They might even kick in more funding as well.  The Council does good work, and I’ve recently enjoyed learning about it via the “Our World, Connected” podcast (do check it out).  Soft power can be a valuable thing, and for very obvious reasons many populations still view western European governments with suspicion that they don’t have for, say, the government of Russia.  The British Council can help to remedy this.

But before funding is increased, CEO Scott McDonald should probably be queried about challenges related to language testing.  Even following its exit from the lucrative Indian market, revenue from the IELTS test remains a major part of how the BC funds its activities. This revenue is at risk: regulatory changes have wiped out most of the old IELTS monopolies and (more importantly) competing tests are increasingly attractive to both test takers and score users.  There is a very real chance that IELTS revenue will decline year after year.  IDP Education shareholders might have a few thoughts to share on this possibility.

So while the UK government can create stability in the short term with more funding and more favorable loan repayment terms, it is entirely possible that some future CEO will also appear, hat-in-hand, looking for a bailout.

What’s the plan, then?

A few months ago, the IELTS team received plaudits for stating that they are “cautiously curious” about AI in language testing.  And that they think AI “has a lot of potential.”  But among the plaudits there was some snark*, as Pearson has successfully been using AI in the PTE for 15 years.  And Duolingo has been doing so in the DET for a decade.  Some have suggested that the IELTS test is falling behind the times.  There was a bit more snark** late last year when the IELTS team made an “important announcement” about switching from pencils to ballpoint pens.

I spoke to a colleague with some experience in the industry a few weeks ago.  She said:  “Everyone is worried about Duolingo but do absolutely nothing about it. Not with product development, marketing, nothing.”

The plan is unclear.

What’s worse is that some of the people responsible for handing out hundreds of millions of pounds of public money don’t even seem to know that tests like the DET even exist.  It is perhaps unfortunate that these issues weren’t explored in more depth when Scott McDonald appeared before the Foreign Affairs Committee last month.

*not from me!!

**a little bit from me

Keep Your Eyes Open

Posted on by TOEFL Resources

While browsing the “recent acquisitions” shelf at the Doksan Public Library I spotted this newish DET prep book (just beside a handsome new Korean edition of Ben Hogan’s “Five Lessons”). Given Doksan’s demographic makeup, we don’t get a lot of new test prep books, so finding it was a pleasant surprise.

A few months ago I wrote about how people working in test prep need to keep their eyes open in order to stay current.  Sometimes, I guess, that means visiting their local library.  Too many times have I heard people in test prep say things like “everyone stopped accepting the DET after the pandemic” or even “the DET isn’t very popular nowadays.”

Sometimes these statements are a sort of defense mechanism for individuals who have a livelihood tied up in the old testing duopoly.   But most of the time they are just rooted in ignorance of what is going on in the world of English testing.

(the book is decent enough, by the way)

 

 

See “English” for Free in New York!

Posted on by TOEFL Resources

If you are in New York from January 14 to 25 you can go see the Pulitzer Prize winning play “English” for free.  The folks behind the Duolingo English Test will pay for your tickets!

Set in Iran in 2008, the play tells the story of four students preparing to take the TOEFL test.  The action is set entirely within their classroom. It has a lot to say about how being understood (or not) can impact our well-being. “English” is a very touching work, but at times also very funny.

I’ve mentioned the play quite a few times in this space, starting in early 2022 when it debuted.  Sadly, I’ll be a continent away (as always) and won’t be able to claim my free seat… but I highly recommend that anyone with an interest in this sort of thing make the trip to Broadway.

Details here.

On Magical Thinking

Posted on by TOEFL Resources

Here’s a new blog post from Duolingo.  It expresses the same point I’ve been making here for a month, which is that due to recent regulatory changes in Canada students are now free to choose whatever English test they desire, as long as their target school accepts it.  No longer are they forced to choose from a small number of expensive tests.

Says the green owl:

“Students can use any English language proficiency test accepted for admission by the academic institution they’re applying to – we know because we asked IRCC and they confirmed that for us!”

And:

“At just $65 USD, the DET is much more cost-effective than other tests, which range from $300 to $400 USD. Plus, there are no travel costs to go to a test center or hidden fees for sending scores to multiple schools.”

Legacy tastemakers have expressed the idea that despite the changes students will continue to take their tests.  They suggest that students like their tests because they include items that closely resemble what students do on campus.  Sometimes they say that students like their tests because the time they spend preparing for them gets them ready for their studies.  Other times they say that their test is “the gold standard” or that it is “fit for purpose.”

This is magical thinking.

Students are practical and pragmatic.  Indeed, they are some of the most pragmatic and practical people on the planet. They will choose the most affordable and accessible test almost every single time.

As I’ve mentioned here before, this is a “break glass in case of emergency” situation for firms that compete with Duolingo. They ought to have a plan already.

The Future of Tests Used for Canadian Admissions

Posted on by TOEFL Resources

Eight months ago, I posted a short item here predicting that within 5-10 years, the big three commonwealth governments would begin accepting at-home English tests for visa purposes.  It remains one of the most widely-read things I’ve written.

With the termination of the SDS in Canada, I suppose my prediction has arrived ahead of schedule.  As things stand, Canada-bound students can now get a study permit without visiting a test center.

Maybe that’s not a huge deal, but the termination of the SDS also means that all tests are now on a level playing field.  Students are now free to pick any test that is accepted by their target school, without consideration of how it will impact the issuance of their study permit.

Previously, students opting for entrance via the SDS program took an IELTS, TOEFL, CAEL, CELPIP or PTE test.  And now?  They have a buffet of options to choose from.  Take the University of Toronto, which is apparently a nice school.  Undergrad applicants can meet language fluency requirements by submitting scores from the following tests:  C1 Advanced, C2 Proficiency, DET, COPE, IELTS, PTE and TOEFL.  They can also submit an IB literature result, or some qualifications from the UK that I’m not familiar with.  Whatever their choice, it won’t affect their study permit.

Yes, I know that technically this was always an option, as the SDS could be bypassed in favor of the slow stream, but few students in the key sending markets went that route.

Clearly, then, this change represents yet another challenge for the legacy testing firms.  But it also represents a challenge for Pearson and Prometric (developer of the CAEL and CELPIP tests). In my view it will be very difficult to convince a student in China to pay $300 to take the TOEFL or $310 to take the PTE when the DET costs $65 and will get them to Canada just as easily.  Likewise, it will be hard to convince a student in India to take a 165 minute IELTS when a 60 minute DET is just as good.

And decades of shabby customer service from legacy testing firms has left them without enough goodwill to convince test takers to stick with them during these trying times.

Some may wonder how legacy test makers will approach this challenge.  One strategy might be to pray daily that IRCC introduces a language test requirement into the study permit system, rendering moot all of the above.  That may happen.  Another strategy may be to focus mostly on testing students bound for graduate programs, where the DET doesn’t have widespread acceptance.  That could be a smart approach.

A more ambitious strategy would be to take this as an opportunity to innovate in terms of test content and item development.

Hear me out.

One reason why items on legacy tests seem to be set in stone is that the test makers are beholden to whatever research and validity studies they have submitted to gain acceptance by governments.  Any drastic changes to test design can result in that acceptance being revoked.  That’s why Australia’s Department of Home Affairs temporarily stopped accepting TOEFL scores starting in July of last year.

But with the shuttering of the SDS and the winding down of the SELT program in the UK, this isn’t as big a concern as it used to be.

The folks at ETS have little to lose and much to gain from reinventing the TOEFL as a cheaper, shorter and more consumer friendly test.  Doing so will no longer impact their relationship with IRCC.  And since the TOEFL isn’t accepted in the UK, they have nothing to worry about there.  Yeah, it would cost them Australia (again) but I don’t think the test is widely used by students heading to that country anyway.  And, heck, the aforementioned changes would likely increase use of the test among US-bound students.

The IELTS partnership is also looking at a brave new world right now, though changes to that test would be trickier to implement. Though they are in the same boat as ETS as far as Canada is concerned, they have much more to lose in Australia and (in the short term) in the UK.  But the HOELT is coming, and in a few years the IELTS partners will find themselves in a position where innovation is much easier to pull off.

With all that said, there is a fourth possible strategy.  That is, of course, to do nothing.

Duolingo’s 2024 Q3 Earnings and the DET

Posted on by TOEFL Resources

Duolingo’s quarterly financial report was published a few days ago.  It indicates that for the three months ending September 30, revenue from the DET was about $10,772,000.  If we divide that number by the cost of the DET ($65) we can estimate that the test was taken about 165,723 times in the quarter.  That’s down about 8% from the same period last year, when the same math suggests the test was taken about 179,864 times.

Keep in mind that this is an imprecise calculation.  Some people pay less than $65 by purchasing a bundle of tests.  Others pay more than $65 to get fast results.  Some people pay less (or nothing) because they get vouchers from a third party partner or through Duolingo’s Access program.

With that said, the math suggests that the test was taken 547,223 times for the nine months ending September 30.  That’s basically unchanged from the same period last year, when the test was taken about 549,231 times.  The lack of a year-on-year decline is due to a very strong Q1 in 2024.  Indeed, I think Q1 of 2024 is actually the high water mark for the test.

These numbers track what’s going on in this industry as a whole.  Pearson has suggested that PTE test volumes will likely be flat for the year.  And IDP Education reported an 18% decline in IELTS volumes for the year ending June 30, 2024.

Note that if you are looking for these sorts of numbers from Duolingo, you have to check the 10-Q forms filed by Duolingo.  Nowadays, they aren’t reported elsewhere. 

Canada Ends the Student Direct Stream (SDS)

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Canada has ended the Student Direct Stream (SDS).  This program was introduced by IRCC in 2018 to provide expedited study permit processing from select countries, including the key sending countries of India and China.  

Applicants opting for the SDS route were subject to requirements beyond those in the regular non-SDS study permit application.  These requirements included a language test result.

Moving forward, all students must apply through the regular study permit stream.

Notably, the regular study permit stream does not require a language test score.  It merely requires a letter of acceptance from an institution.  Institutions set their own language test requirements and issue the LOA once applicants have fulfilled them.

In terms of language testing, one imagines that this change will generate business for Duolingo’s DET, which is widely accepted by schools across the country but was not accepted for use in the SDS stream.  It may reduce volumes of more expensive tests like the TOEFL, PTE and IELTS, scores from which were accepted as part of the SDS stream.

I suppose, though, that one should keep an eye on the specific requirements of the student permit program.  Perhaps a language test requirement will be added in the future.

Note that the Nigeria Student Express program has also been eliminated.  It was similar to the SDS.

On the Importance of Writing Task Length

Posted on by TOEFL Resources

The folks at Duolingo have published an article (and matching blog post) about how much time test takers should be given to complete writing tasks. Their research suggests that shorter tasks are just as useful as longer tasks in terms of reliability and validity.

This is a controversial topic among people who take the time to look at the sorts of tasks that are included on tests of English proficiency. It has generated some discussion.

Nowadays, both test makers and test takers seem to favor test forms that are shorter (in duration) than those used in the past. Since long essay tasks require a significant amount of time to complete, they are less popular than they used to be. Recall that last year the 300(ish) word “Independent Essay” task was dropped from the TOEFL, in favor of a 100(ish) word “Academic Discussion” response, meant to simulate a message board interaction. Research provided by ETS indicates that the shorter task is just as useful as the longer one it replaced.

A separate (but related) controversy relates to how closely test items should resemble real-world tasks carried out by students in the course of their future studies. The move to shorter writing tasks means that newer tests often include items that do not simulate real academic work. Some people find this problematic. Some do not. Yet others argue that the tasks on more traditional tests never actually simulated this sort of thing in the first place.

Duolingo English Test Now Requires Secondary Camera

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Everyone taking the Duolingo English Test must now use a phone as a “secondary camera” during the test. This involves propping a phone against a heavy option and angling it in such a way that it can record the test taker’s screen and keyboard during the test.

This requirement seems designed to target remote-access cheaters. I guess Duolingo’s security team seem to believe they can detect when the action of a test taker’s fingers doesn’t match what is recorded from the screen.

I’ll take the DET before the end of the year to see how straightforward the setup is.

This video explains what to do (or you can read about it on the official DET blog):