Duolingo, Inc. (DUOL) saw its stock price surge 5.16% in pre-market trading on Friday, as investors responded positively to the company's aggressive promotion of its premium subscription plans, particularly the top-tier Max offering. The language-learning platform's strategic focus on higher-priced tiers appears to be paying off, driving both user growth and revenue.

The company's latest app updates have prominently featured the Duolingo Max plan, which includes advanced features like personalized role-playing sessions and AI-powered mistake explanations. This push towards premium subscriptions has been successful, with subscriptions now accounting for 85% of Duolingo's revenue. The company's CEO, Luis von Ahn, emphasized the data-driven approach behind these decisions, ensuring that changes are based on extensive user testing and research.

Despite some concerns about potential user pushback, Duolingo's recent financial performance has been strong. The company has consistently beaten analyst expectations in recent quarters, demonstrating robust user and revenue growth. With 128 million monthly active users and 11 million paid subscribers, Duolingo's strategy of converting free users to premium subscribers seems to be working. As the company continues to innovate and expand its offerings beyond language learning, investors appear optimistic about its growth prospects, reflected in today's significant stock price increase.