Duolingo Inc. (NASDAQ: DUOL) saw its shares surge 10.16% in after-hours trading on Thursday, following the release of its impressive first-quarter 2025 results and raised full-year guidance. The language learning app provider demonstrated strong growth across key metrics, driven by the success of its AI-powered subscription tiers.

The company reported quarterly earnings of $0.72 per share, significantly beating the analyst consensus estimate of $0.51. Revenue for the quarter came in at $230.7 million, surpassing the expected $223 million and representing a 37.71% increase from the same period last year. Duolingo also announced that it had surpassed 10 million paid subscribers and achieved a record number of daily active users (DAUs) during the quarter.

CEO Luis von Ahn commented on the results, stating, "Q1 was an outstanding start to the year--we added more Daily Active Users this quarter than any in our history, highlighting the continued strength of our product and brand. We also surpassed 10 million paid subscribers and delivered 38% year-over-year revenue growth, driven by strong user momentum and increased adoption of our premium subscription tiers."

Investors were particularly encouraged by Duolingo's raised guidance for the full year 2025. The company now expects revenue between $987 million and $996 million, up from its previous forecast of $962.5 million to $978.5 million. This new outlook surpasses the analyst consensus of $977.2 million. Additionally, Duolingo increased its adjusted EBITDA guidance to a range of $271.4 million to $283.9 million for the year.

The strong performance and optimistic outlook appear to be driven by the success of Duolingo's AI-powered subscription tiers, particularly the Max plan, which offers features such as conversational practice with AI chatbots and personalized feedback. The company's focus on AI-driven content creation has also allowed it to rapidly expand its language course offerings, launching 148 new courses in under a year.

As Duolingo continues to leverage AI technology to enhance its product offerings and streamline operations, investors seem confident in the company's growth trajectory, as reflected in the significant after-hours stock price increase.