Edtech Studies to Improve Performance

Key Takeaways:

• Chegg’s reported revenue growth in 4Q22 spiked 25% QoQ to $205mn (vs. 33% for ST estimates), as it expanded its content offerings and improved localized content, while its worldwide reported MAU growth YoY was also positive, rising high-single digits 2Q22 - 4Q22, while Sensor Tower’s estimated mobile app MAU growth was directionally aligned, rising ~20% YoY

• Duolingo’s projected reported bookings growth of ~9% QoQ is inline with ST 10% QoQ estimate for total revenue

• Duolingo Language Lessons and Learn to Read are the fastest growing apps within Sensor Tower’s edtech cohort in terms of downloads and MAU in 2022

  • Downloads increased 38% YoY and 108% YoY and MAU grew 27% YoY and 32% YoY for Language Lessons and Learn to Read, respectively

• Of the ST edtech cohort studied, all of the apps had positive download growth in 4Q22, with total downloads for the group rising 34% YoY in 4Q22

  • Duolingo’s Learn to Read app has seen a rapid explosion in downloads with 3Q22 and 4Q22 growth of 88% and 272% YoY, respectively

• Users are spending more time on edtech apps, with average time spent rising 5% in 2022, while the frequency (average number of sessions) only rose 1%, according to ST’s Consumer Intelligence platform

  • While higher engagement bodes well for increasing the likelihood of becoming a paid subscriber or making an in-app purchase, decreasing frequency, along with high 2022 churn rates of 62%, 47% and 39% for Babbel, Udemy and Duolingo, respectively, indicate that fewer users are returning to edtech apps, making it harder to build their paid subscriber base over the long-term

For more information, request the full report from reports@sensortower.com.