Duolingo Inc (DUOL) 2021 Q4 法說會逐字稿

Good day, and welcome to the Duolingo Fourth Quarter 2021 Earnings Call. (Operator Instructions) Please note, this event is being recorded.

I would now like to turn the conference over to Debbie Belevan, Head of Investor Relations. Please go ahead.

Thank you, operator, and welcome, everyone, to Duolingo's Fourth Quarter and Full Year 2021 Earnings Call. Today, after market closed, we released a shareholder letter with our results and commentary, which you can find on our IR website at investors.duolingo.com. With me on the call today are Luis von Ahn, Co-Founder and CEO; Matt Skaruppa, CFO; and Bob Meese, our Chief Business Officer. We'll begin with some brief remarks before opening the call to Q&A.

Just to remind everyone that during this call, we'll make forward-looking statements regarding our future events and financial performance, which are subject to material risks and uncertainties that could cause actual results to differ materially. We caution you to review the risk factors contained in our SEC filings. These forward-looking statements are based on assumptions that we believe to be reasonable as of today, and we undertake no obligation to update these statements as a result of new information or future events.

Additionally, we'll present both GAAP and non-GAAP financial measures on today's call. These non-GAAP measures are not intended to be considered in isolation from, a substitute for or superior to our GAAP results, and we encourage you to reconsider all the measures when analyzing our performance.

And with that, I'd now like to turn the call over to Luis.

Thank you, Debbie, and welcome, everyone. We are a global company that serves learners in every country in the world. I want to start by acknowledging the horrible situation in Ukraine, saying that we stand with all those working towards peace and that our hearts are with the Ukrainian people.

Since our shareholder letter contains an in-depth discussion of our performance, we'll just provide some brief remarks and then get right into Q&A. First, as I always do, I'd like to start out by reminding everyone about our mission. Since we started the company, our mission has been to develop the best education in the world and make it universally available. Everything we do is guided by this mission. We started out with languages to help reduce economic inequality but we are expanding into other areas of education in order to touch even more people's lives. I'm very proud to say that we've made tremendous progress towards our mission, but we are just getting started.

I'd also like to congratulate our entire team on the amazing performance they delivered in 2021. Not only did we take the company public, but we also delivered incredible user and subscriber growth. Our total bookings and revenue both grew by 55%. Our team continued its unwavering focus on creating quality products that are fun and effective. In 2021, we rolled out a number of new product innovations that further increased user engagement and retention, and ultimately drove more conversions to our premium subscription. In fact, during the fourth quarter, we had the highest number of DAUs, MAUs and net new subscribers ever.

We also continue to build a beloved brand that is synonymous with language learning. The vast majority of our growth comes organically through word of mouth. As we move into 2022, we'll continue building upon this momentum. We're planning to introduce an entirely new design of the Duolingo app home screen that we believe will further drive user engagement. We'll continue making Duolingo more social with features that allow learners to interact with each other. We'll continue to grow acceptance of the Duolingo English Test at institutions around the world. We'll refine the Duolingo ABC app with a fresh design to drive engagement and learning efficacy, and we are excited to launch a math app towards the end of the year.

And now, Matt will discuss our outlook for 2022.

Thanks, Luis. First, I'd like to reiterate that it was a great year for our business, and we are very proud of our performance. Our product and marketing initiatives paid off and we surpassed our own high expectations, resulting in record metrics and accelerating growth in the fourth quarter. Looking ahead to 2022, we plan to continue prioritizing our investment in R&D in order to fuel growth and make our products even better and increase our monetization opportunities.

For Q1 2022, we are guiding to $92 million to $95 million for total bookings, $75.5 million to $78.5 million for revenue and adjusted EBITDA of negative $5.5 million to negative $2.5 million. And for the full year 2022, we are guiding to $372 million to $382 million for total bookings, $332 million to $342 million for revenue and adjusted EBITDA of negative $5 million to negative $1 million.

I want to make sure to point out that our full year guidance takes into account our typical booking seasonality, with Q1 and Q4 being our strongest quarters. This seasonality was confirmed in the fourth quarter of last year. We plan to invest significantly in R&D this year, in engineering, product and design. And for us, that means investing in talent.

We believe we have been a beneficiary of the Great Resignation that started last year, as we have added some very talented new employees to our team while keeping the talent we have. Our attrition rate was less than 6% last year. We believe this trend will continue, and we want to seize the opportunity. We have been able to attract talent because of our mission-driven and fun culture, and we believe that, that has helped us grow. This approach to growth through investment in our product is consistent with how we've grown historically. And that's what we plan to do in our language learning app, in the DET, ABC and in our math product.

On the marketing side, we plan to continue to spend on influencers and innovative brand marketing in underpenetrated markets and to continue to invest in highly efficient performance marketing like our global DAU campaign. We also plan to expand our marketing efforts related to bringing in new test takers to the DET. As we have since our founding, we plan to continue to manage the business with cost and capital discipline as we did last year, which is why we are confident in our adjusted EBITDA guidance that is nearly breakeven.

And now I'll turn it back to Luis.

Thank you, Matt. Before we wrap up, I'd like to take this opportunity to thank each and every team member for all your hard work this year, to thank our learners who put their trust in us and to thank our shareholders for all your support. We look forward to sharing more with you in the coming quarters.

And now we will be happy to take your questions.

(Operator Instructions) And our first question will come from Mario Lu of Barclays.

So the first one is on conversion, coming in at 6.2%. It's a pretty big improvement even from the third quarter. Just curious if you could identify what kind of drove this improvement? And what conversion percentage is implied in the fiscal '22 guidance?

And then secondly, within the EBITDA margin guidance of flat for '22, now I was wondering if you could talk a bit about each of the cost items. Should we expect leverage in COGS due to the Google Play changes and also in sales and marketing G&A and that being offset fully by marketing? Any color there would help.

Mario, this is Luis. So first, you asked what drove the increase in the conversion? As you saw, we increased conversions by about 2 percentage points in the year. And that's -- basically, we've seen increases in conversion ever since we launched Duolingo Plus as a subscription package in 2017. We were increasing about 1 percentage point per year. We seem to have increased by about 2 percentage points in the last year.

And the way we've been increasing it this whole time is just by running literally hundreds of A/B tests to get more people to convert. The types of -- some of these are very small A/B tests. They're just things that are just changes to the purchase page. Some of them are bigger things like new features to the premium package.

So it's just basically been a lot of things. A couple of things that were particularly big this year, one of them was called the legendary feature, which is basically just a change in color. If you -- for some of the skills, so the red circles in our home screen, they're called skills. And before legendary, you can only basically go around that circle 5x. We added a sixth time. And you can only do that if you were a Plus subscriber and that added more conversion.

So there's stuff like that, that drove it. I'll let Matt add the -- answer the couple of other questions, including what's the implied rate.

Yes. Thanks, Mario, for that. When it comes to costs and gross margin, as you mentioned, we're -- as we mentioned on the last call, we're still expecting about 150 basis points improvement mainly from the Google Play shift in costs. So that still holds from last call.

And then to your point around operating leverage, as we mentioned multiple times before, we plan to continue to invest in R&D. So you should not expect to see operating leverage in that as a percentage of revenue. However, in sales and marketing, we do expect operating leverage over the course of the year. And on G&A, just given this is our first full year being public, it will be pretty close, not a ton of operating leverage there this year. So thanks. Yes, that's a good question.

The next question comes from Eric Sheridan of Goldman Sachs.

Two, if I could. Maybe following up on Mario's question about the margins, can you help unpack where some of the dollars on the marketing side might be aimed either from a qualitative or quantitative standpoint? You talked a little bit about underpenetrated markets and sort of driving greater product adoption.

But maybe we can get a little more granular on where those dollars get spent and how you think about the return of those dollars, not just in 2022, but as the platform continues to scale in 2023?

Thank you, Eric, for your question. So the first thing to note is the vast majority of our growth is organic. So most of our growth comes from word of mouth. We are spending some in marketing. I mean, what we've decided to do is we take -- we have a number of markets that are just less penetrated. In particular, Asia is the fastest-growing market, but it is less penetrated than all our other markets like Europe and the Americas.

So we're -- what we do is we typically pick a country. There's a few that we target. And then we try to decide which are the best ways to market. We have found that influencer marketing works pretty well in certain countries, like India and Japan, for example. And then we spent some money. The amount that we spend per country is not a lot. So a country the size of Japan is probably -- we would spend maybe $1 million or $2 million in the year. And then what that does is that gets our organic flywheel going, the word of mouth going and then that just takes us up.

Another example, by the way, this is kind of the paid marketing, but actually, a lot of our marketing effort has also gone on just things that are not paid, for example, our TikTok, for those of you who have seen it, I mean this is -- we don't spend money on that. This is entirely organic and our TikTok have gotten literally over 500 million views just because our brand is so strong that we're able to really appeal to all the TikTok users. So this is the type of stuff that we do.

The next question comes from Aaron Kessler of Raymond James.

A couple of questions. Maybe first, if you can update us on the regional pricing initiatives, kind of the progress you're making there, maybe along the same lines, maybe if you can give us an updated breakout of U.S. versus international for revenues or bookings and paid subs?

And then maybe finally, just Duolingo for schools, are you starting to see this effort also drive kind of increased subscriptions as well for at-home usage?

Great question. So in terms of regional pricing, just to give some background, when we IPO-ed or right before we IPO-ed, we had the same price in every single country in the world. We knew, of course, that was not optimal. And what we've done since then, we started trying different prices in a few countries. And so far, there are 4 countries where we've launched different prices. And we are working on doing it, basically, for every country in the world.

The reason you can't change this superfast is because everything we do, of course, we A/B test. And these A/B tests take a little while to run because whenever we run a new price on something, first of all, we try multiple prices, and then what we're doing is it takes a while for people we know whenever they sign up on Duolingo, it takes a while for them to subscribe for some of them. And also, we have to measure renewal rates, which take a while to measure.

So some of this takes some time. But I'd say throughout this year, we are going to basically probably have different prices in every single country now. What I will say is this is just one of many levers that we have for increasing conversion and also increasing bookings. Ultimately, the way we increase our bookings and our penetration of paid subscribers is by running again, hundreds of A/B tests. This is just one of those levers.

And I will say the other thing about regional pricing is we believe that this will have an impact. However, it's not probably not going to have this insane impact that some people may believe where like it's going to double revenue or something because what's happening is that the countries that we get most of our bookings from usually are the developed countries, the U.S., Western Europe, et cetera. In those places, the prices are unlikely to change too much.

Now in the places where the prices are likely to change more, these are usually more kind of developing countries or whether the GDP per capita is lower. There we will change -- our product is probably too expensive, so we will probably lower the prices, what will end up happening.

But there's more than one barrier in many of those countries for people to subscribe, probably the price is one. Another one is just that in many of these countries, digital subscriptions are just not that mature as they are in a country like the U.S. or in Western Europe. So we see regional pricing as something that is a necessary condition for us to really make a lot more bookings from many of these countries, but not necessarily a sufficient condition. So that's just something that is important.

I will also answer, you asked about schools. The schools initiatives, so just also to give you some context, we have this thing called Duolingo for Schools, it is a dashboard that teachers can use when their students -- so the students are using just the normal Duolingo app and Duolingo for Schools is a dashboard that teachers can use to track their students' progress. We relaunched Duolingo for Schools in 2021. That did really well and we're seeing it definitely get more and more adoption in schools.

Right now, our best belief, by the way, we don't know exactly how many schools use us because they don't have to tell us necessarily that they use us. So our best belief is that about 40% of U.S. language teachers use Duolingo for Schools. And that's in the U.S., there are some other numbers internationally. So we're seeing that help with adoption. So far, we don't have any reports on what exactly this does for our subscriptions, but we are assuming that many of these students in the end, ultimately, are subscribing as well. So the main thing that this is helping with is growing our user base.

And then, Aaron, just to jump in there on one of your questions on U.S. versus rest of world, it didn't change materially from 2020, which in 2021, it was about 44%, 45% U.S. and the remainder rest of the world. So that stayed pretty consistent.

And that's bookings?

No. Revenue.

Revenue? That's revenue.

Our next question comes from Ralph Schackart of William Blair.

On the family plan, in the letter, you talked about seeing some early results that you're encouraged by and increasing the visibility of that this year. Just curious what you're seeing, I know it's probably early, but just any thoughts on that product and thoughts on conversion and how that might impact 2022 and going forward?

Yes. Family Plan -- thank you, Ralph, for your question, by the way. This is something that we're very excited about. I do want to remind you and everyone that Family Plan is one of many, many levers that we have to pull, regional pricing is another one, but it's just ultimately the way we grow our bookings is just by running hundreds and hundreds of A/B tests. Family Plan is one we're very excited about. It's in its early days. Right now, I mean, it's -- a low percentage points of all our subscribers are in the Family Plan, but it is growing pretty fast, actually.

And we're very excited by it for 2 reasons. The first one is that it really seems to increase lifetime value of our subscribers, because what ends up happening is you subscribe for a Family Plan for your family, but also your significant other is in that Family Plan and maybe your son and your daughter are in the Family Plan. And maybe you stop using Duolingo, but as long as anybody in your family is still using it, you still keep paying. So we have data that really shows that those who are in the Family Plan just have significantly better retention in terms of payers. So we're very excited by that. This should help with our retention quite a bit.

And then the other reason why I'm personally excited, and this is more in the long term, the more we can have people in our Family Plan, the more we know they're a family. And a lot of the products that we're working on, for example, we're working on a math app for elementary school math. We launched Duolingo ABC already, which is a literacy app for kids to learn how to read at ages, call it, 3 to 6. Those are people who belong in a family. And the more we have people in our Family Plan subscription on Duolingo, the more we'll be able to cross-promote these other products there.

So the way we see it, I mean, we're not yet doing that. But the way we see it, Family Plan is going to be a really strong glue for many of our new products. So this is why we're excited by it.

Maybe I'd just add one more. Just as you talk about broadening out beyond languages, maybe specifically math. Just curious how the testing is going. I know you do quite a bit of testing. I'm just curious, just in terms of the rollout, how wide that will be, will it be focused on certain geographic areas? But just the way you plan to roll that out would be helpful to know.

Great. So yes, so the math app, we're working on it. It -- of course, I'm biased, but it looks beautiful. But we're working on it. We have not released it yet. We're going to release it this year. I cannot comment yet on exactly what the rollout plan is because we haven't quite decided on that, but pretty likely that's going to be at least in English-speaking countries. I don't know if we're going to localize it to other English on -- at the very beginning on Day 1. But yes, we're going to roll that out, and that's something that we're pretty excited by it.

I should say one thing that I think is important for people to understand. We're going to roll it out, and it's going to be great. But the way we do product at Duolingo is we have our products grow organically. So we're going to put it out, and it's going to take some time for it to really start growing and then after it has grown to a reasonable size, then we're going to start monetizing it in some sort of freemium manner because that is what we do at Duolingo, and that's going to take some time.

So my sense is, if you're expecting the math app to give any kind of meaningful revenue this year, basically, that's not something you should expect and probably not even next year. My sense is we're going to launch this year, we're going to use next year to grow the user base quite a bit and then probably have meaningful revenue after that.

The next question comes from Justin Patterson of KeyBanc.

Great. Luis, it sounds like a meaningful year for innovation in the core language app. How do you think about the impact of redesign and more social features could have upon engagement and conversion versus prior future rollouts like hearts and legendary?

And then for Matt, the transition to more annual memberships has been very positive toward LTV. Given that dynamic, how do you think about the pace of reinvestment across marketing and engineering?

Thank you, Justin. These are great questions, I mean this because I love to talk about our innovation. So yes, we're very excited about a number of features that we're pulling out this year. One is this redesign of the home screen. Again, I think it was beautiful. We're going to start testing it.

And I think it's going to have a number of good effects. I think our hope is that it's going to improve user retention, freeze the retention in particular. We also think it's going to help us teach better. I mean the new redesign has been really done with a lot of input from our learning scientists.

So I think it's going to help us teach better. And I also think it's going to simplify the app quite a bit. One of the things about the Duolingo app is as we become more mature, it becomes more and more complex. And we like simplification, I think that's going to help quite a bit. So we have a lot of things. That's just one thing, but we're doing a number of other features that you'll see, and you should probably just download the app and see how much it changes over the year. And I think, Matt, the next question?

Yes. Thanks, Justin. It's a great point about the focus on LTV. I'm just glad you asked the question in that way because it gives me a chance to just echo something Luis has already said, which is we run a bunch of tests, hundreds of tests every quarter and every year to experiment with ways to increase subscriber LTV. You mentioned hearts and health, which is a great improver of LTV, the annual plan is one, Family Plan is another. But these are just examples of some of the ways that we are continually focused on improving LTV over time.

And that's really how we think about our growth opportunities. We have growth opportunities in the main language learning app. We have growth opportunities and assessment and literacy and math, as Luis just mentioned. And so we're excited to deploy capital against those opportunities because we think there's high returns there.

And specifically, to go back to something I've mentioned in a bit of a broken record on we really like to invest our capital into talent and specifically talent in R&D so that they can execute against all those experiments and capitalize on the opportunities we see to have those high ROIs. That's why this year, again, you should not expect to see operating leverage in our R&D line.

And while we've gotten much more efficient at marketing and we have really innovative playbooks, especially in the developing markets, and we're going to spend an absolute dollar and more in marketing, we will expect -- or we do expect to see operating leverage in marketing as opposed to R&D.

Our next question comes from Nat Schindler of Bank of America.

You guys did such a great job increasing your conversion to paying this year, obviously. Can you walk us through and maybe break that number down a little bit by -- maybe a little bit by region? I assume that's much higher in the U.S. and Europe and the developed world. And I want to know if when do we hit what you think is a functional barrier? Where is the pay? Where could it go?

Well, thank you for this question, Nat. I think -- so okay, there's a couple of things. So you're right. Generally, payer conversion is higher in, well, wealthier countries. That's generally the case. We don't think we are anywhere near kind of a wall, as you saw, there's actually an acceleration of -- by percentage points of how we're growing there. It's very hard to say how high we can get. I mean, basically, the way we grow this, again, and by basically just running hundreds of A/B tests that get more and more people to subscribe.

We have a long list of A/B tests still to run over the next several years. We have a lot of levers that we can pull. And so we think that that's going to continue growing. But it's very hard for us to know how much it's going to grow. I mean right now, we're around 6%, 6.2% or something like that of our monthly active users or paid subscribers. You could look at comps. So our business model is pretty similar to the dating apps. And they are -- those are at around 12%.

Our business models are pretty similar to Spotify, which is around 50%. I don't actually think we're going to get to 50%, but I don't -- I see no reason why we can't get to something like where the dating apps are. But again, I really want to caution here saying, ultimately, I don't know how high it can get. This is just something that we're going to continue increasing over the next few years.

The last thing I would say is, even though Duolingo has been around for about 10 years, our monetization is still pretty early. I mean we only started monetizing in 2017 kind of towards the end of 2017 that we started in earnest. So there's just a lot that we don't know and a lot of opportunities still.

Yes. And Nat, the only thing I would add to that is just to go back to what I said on the last earnings call about our growth framework. And so it's not just user penetration. Obviously, that's an important metric, and we track it, and we're driving that up. But remember, we saw a return to pre-COVID level user growth rates. We saw a reacceleration of user growth as well. So we have multiple ways to increase our monetization. User growth obviously growing nicely is great, and we're heartened by that.

The other two things that are really underlying that metric are retention and conversion, both of which we saw really strong trends in Q4 that we believe will continue on. So it's really on all 3 of those dimensions, user growth, retention -- sorry, user growth, conversion and retention, we're just doing really well on.

Okay. Then to just follow up on this, just a tiny bit. On top of just the demographic shift towards -- the geographic shift of payers versus non-payer, so it's heavily in First World countries, not surprising. Isn't there also a demographic shift?

Outside of your Family Plan, do many of those kids who are doing this for school, pay? Or is it mostly adults who are using it for self-improvement or learning before they go on a trip or something?

Yes. I mean that's a great question. One of the interesting things about working on Duolingo is that our user base is just so wide. We really have kids aged 6 using Duolingo to adult aged literally 100 that we get stories from. And it's pretty much -- the main thing that tells you whether somebody is going to pay or not so far is kind of how much money they have. That's basically it. But I don't think there's much of a -- I don't think we have seen much in terms of kind of age, distributions, et cetera.

The next question comes from Andrew Boone of JMP Securities.

Following up on Justin's questions, you guys offered some compelling metrics in the growth of congratulatory messages. Can you talk about increasing social interaction on the platform? And just help us understand the benefits that, that brings. Is that usage, engagement or anything else?

And then question number two, is just talk about the impact from Omicron in December and January. Is there anything to call out there? And is there anything else to think about as we think about additional variants or just broadly the reopening?

Great. Great, Andrew. Thank you for the questions. Okay. So social -- I mean, social, as I said in the shareholder letter, social is one of the things I'm most excited about. We've been -- we really started working on social in earnest over roughly the last year. We have a team behind it, that is a very high-performing team.

And what they've done is -- well, they've added, basically, a social layer behind Duolingo, where people can follow each other and send congratulatory messages. We've had a lot of growth on that, I mean like I said in our shareholder letter. At the beginning of the year, we probably have had about 1% of our daily active users were sending congratulatory messages to each other. By now, it's about 10%.

We also have -- the number of people that follow at least -- the number of daily active users that follow at least 3 other learners on Duolingo is now 25%. So we really are a much more social app than we were even a year ago. That's going to continue happening. And the way we're going to continue increasing that is by basically letting people do more with their connections. So -- and I can't really tell you exactly what these things are because we're going to be testing a lot of different things, but we're going to be letting them do more things with their friends.

And we've seen that, that actually moves our KPIs. It gets people to spend more time on the app. It gets people to come back to the app more days, so it increases use of retention. And it also -- because they're spending more time and retain better, are also -- it's also increasing the fraction of people that actually pay for a subscription. So the social component really is having an impact on the KPIs.

The other thing that I really like about the social component is that it has network effects. So it's something that -- now that your friends are also on Duolingo, Duolingo just gets better the more people that use it. And then that's something that we're very proud of.

And then you also asked -- so that's for social, you asked about Omicron. Honestly, we didn't see much of that. For us, we're not -- there's some products or something like a humongous quadruple boom or something whenever there was COVID. We did get a boom in 2020, when there was the first kind of wave of COVID. After that, unless there's like really strict lockdowns, we don't see much of an impact.

So what has happened to our growth rate is we were growing organically before COVID and just we're growing this whole time, then COVID came in for the first 2, 3 months of COVID, we did see an increase. Then after that, we saw a slight decrease when the world opened back up. And since then, we've basically been going back to pre-COVID growth rates. And this is what we're observing now and this is why you saw, for example, an acceleration of the growth rate of our MAUs and DAUs in the fourth quarter. Because basically, we're now back to grow -- pre-COVID growth rates.

(Operator Instructions) And our next question will come from Mark Mahaney of Evercore ISI.

Two questions, please. First, maybe you covered it earlier, I didn't hear the -- in the quarter, you added over 700,000 MAUs. That seemed like a big number, the last 2 December quarters, you actually had a sequential decline. So just talk through that? Like what is -- was there something unusual in the quarter that caused those MAU growth to be so strong?

And just thinking about how we want to extrapolate that going forward and maybe it's just we shouldn't rely on the prior years because the company was too small? But just is there any color behind that 700,000?

Yes, that's a great question. I mean there's just a lot of things that are working really well. One of the things that I think is unique to the fourth quarter, but I think we're going to see it in every fourth quarter going forward, is our year-end review campaign. So that is something that we kind of discovered over the last couple of years, where the idea is that around, call it, December 15, there's a thing that basically shows up in your app that tells you, here's how you did the whole year, and then you're going to share that. It turns out, a lot of people like sharing this because they feel good, telling everybody that this year they learned Italian or they learned German or something. It's like a feel good thing.

So when we put that out there, it really -- we got literally millions and millions of shares in social media. We became a top 10 trending topic on Twitter, Duolingo -- #Duolingo365 or something became a trending topic on Twitter because of that. So that's a specific fourth quarter thing that we're probably going to be seeing there.

Another thing that has worked really well for us in the fourth quarter was our TikTok. Again, this is a completely unpaid marketing thing, this is basically we have a TikTok channel. And because our brand is so strong, and we really have -- we've done a lot of really good stuff with our mascot in TikTok, it appeals to a lot of people and with essentially no marketing spend. I mean, we're not spending any marketing other than the salary of the people who are doing this. We've gotten over 500 million video views on TikTok. And as far as I know, we're probably the brand that gets the most interactions on TikTok of all brands.

So I think that's another thing that has been pretty good. And in addition to that, of course, the thing that always helps us, which is just continuous product improvements.

And Mark, as you asked about extrapolation, just on the go forward, we had said historically, our pre-COVID MAU growth rate was about anywhere between 10% and 15% and our DAU growth rate was around 20% plus or minus. And that's kind of what we're seeing. And so as you think about the forward, we don't have any reason to believe we're not back at those levels of growth. And then our historical seasonality is probably at play as well.

The 2020 and some 2021 seasonality was a little bit muddled because of the COVID spikes. But we think we're back to the normal, not only growth rates, but also seasonality throughout the course of the year.

Okay. And if I could ask one more question on the math product. So Luis, just give us just a tease of what this thing is? I mean, are we doing basic elementary math? Are we doing calculus? Are we doing sophisticated Wall Street math? That was a joke. But just, like who is the market going to be for this math product when it comes out?

Mark, it is a slide ruler. I'm kidding, no, that's not what it is. So it's an app, of course, that's what we do. We're going to start with elementary school math. So think of -- actually, I use the app every single day because I test it every single day. I've gotten very good at fractions, I will tell you. So it's basically elementary school math.

Okay. If I could just put it in a request, if you could, if you're going to launch it, do it before September. I'm just asking on behalf of a friend, but that's when the school will begin. I would much appreciate that.

On behalf of a third grader that you may know. Got it.

This concludes our question-and-answer session. I would like to turn the conference back over to Luis von Ahn for any closing remarks.

Thank you very much. I just want to say really great questions to everybody. And yes, we're very proud of the great quarter that we had, and hopefully, we'll talk in next quarter.

The conference has now concluded. Thank you for attending today's presentation, and you may now disconnect.