Is the ChatGPT Phobia being exaggerated? Evercore supports Duolingo (DUOL.US): Over 60% of AI users are still loyal daily active users.

On Tuesday, the stock price of education technology company Duolingo (DUOL.US) surged significantly after Evercore ISI raised its rating on the stock to "outperform." The firm's confidence in Duolingo primarily stems from its exclusive consumer survey results, in-depth analysis of current product improvements, and tracking of recent daily active user (DAU) trends. One of the most noteworthy points in Evercore's bullish stance is that the firm believes concerns about ChatGPT posing a threat to the market may be greatly exaggerated. Analyst Mark Mahaney specifically addressed the ChatGPT factor: The threat is indeed present36% of language learners are using ChatGPT (ranking third after Duolingo and YouTube as the most commonly used tools). But the key lies in the subtle yet important details: a) language learners using ChatGPT are more inclined toward leisure and travel-related use cases (which have lower monetization potential); b) over 50% of ChatGPT language learners are also using Duolingo, and their engagement on Duolingo is highly consistent with that of core users63% of ChatGPT users log into Duolingo daily, a frequency that matches that of Duolingos core user base. Data speaks louder than words! Based on the analysis above, Evercore ISI raised its earnings per share (EPS) forecasts for Duolingo for 2027 and 2028, providing a new target price of $210. As of the time of publication, Duolingo's stock price rose by 6%.