FiscalNote(NOTE) - 2024 Q4 - Annual Results

Financial Performance - FiscalNote reported total revenues of $29.5 million for Q4 2024, a decrease of 14% from $34.3 million in Q4 2023[4] - Adjusted EBITDA for Q4 2024 was $3.3 million, representing a 10% year-over-year improvement and marking the sixth consecutive quarter of profitability[4] - The company achieved its first full year of positive adjusted EBITDA in 2024, with an improvement of over $17 million year-over-year[4] - Annual Recurring Revenue (ARR) declined to $107.0 million, a decrease of 15% compared to $126.0 million in 2023, primarily due to divestitures[12] - FiscalNote's gross margin improved to 82% in Q4 2024, up from 67% in Q4 2023, reflecting a 1500 basis points increase[7] - The company expects total revenues for FY 2025 to be between $94 million and $100 million, with adjusted EBITDA projected between $10 million and $12 million[18] - Total revenues for Q4 2024 were $29.469 million, a decrease of 14% compared to $34.265 million in Q4 2023[33] - Subscription revenues decreased to $27.058 million in Q4 2024 from $31.096 million in Q4 2023, representing a decline of 13%[33] - Net loss for Q4 2024 was $13.383 million, compared to a net loss of $50.748 million in Q4 2023, indicating a reduction in losses[33] - The company reported a total comprehensive loss of $14.744 million for Q4 2024, compared to a loss of $49.548 million in Q4 2023[33] - Basic and diluted loss per share for Q4 2024 was $0.10, an improvement from a loss of $0.39 per share in Q4 2023[33] - Net income for the year ended December 31, 2024, was $9,517,000, a significant improvement from a net loss of $115,461,000 in 2023[37] - Adjusted Gross Profit for the twelve months ended December 31, 2024, was $103,330,000, compared to $108,255,000 in 2023, reflecting a decrease of 4.5%[45] - Adjusted Gross Profit Margin improved to 86% for the year ended December 31, 2024, up from 82% in 2023[45] - Adjusted EBITDA for the twelve months ended December 31, 2024, was $9,781 thousand, a significant improvement from an adjusted EBITDA of $(7,506) thousand in 2023[46] - The Adjusted EBITDA Margin increased to 8% for the twelve months ended December 31, 2024, compared to a margin of (6)% in 2023[46] Operating Expenses and Efficiency - Operating expenses decreased by 53% year-over-year to $35.2 million in Q4 2024, primarily due to divestitures and efficiency measures[14] - The company’s total operating expenses for Q4 2024 were $35.199 million, down from $74.194 million in Q4 2023[33] - Research and development expenses decreased to $2.893 million in Q4 2024 from $4.016 million in Q4 2023, a reduction of 28%[33] Strategic Initiatives - The new AI-focused PolicyNote platform was launched in January 2025, aimed at enhancing customer engagement and retention[10] - The company plans to continue streamlining operations and reducing debt service costs to accelerate its path to positive free cash flow[21] - FiscalNote is currently reviewing strategic options to maximize value, with no set timetable for completion[22] - The company continues to focus on organic growth through its core Policy business and aims to enhance its existing platforms and services[29] - The company is actively pursuing market expansion and strategic acquisitions to enhance its operational performance and revenue growth[49] Assets and Liabilities - Total current assets increased to $57,187,000 from $49,805,000, a growth of 14.5% year-over-year[35] - Total liabilities decreased to $228,366,000 from $327,102,000, a reduction of 30.2% year-over-year[35] - Cash and cash equivalents at the end of the period increased to $29,454,000 from $17,300,000, representing a growth of 70.1%[37] - Long-term debt, net of current maturities, decreased to $131,172,000 from $222,310,000, a decline of 41.0%[35] - Total assets decreased to $326,197,000 from $370,561,000, a reduction of 12.0% year-over-year[35] Gains and Losses - The company reported a gain on the sale of businesses amounting to $72,017,000 in 2024[37] - The company incurred $72,017 thousand in gains from the sale of businesses during the twelve months ended December 31, 2024[46] - Costs related to acquisitions and disposals amounted to $1,599 thousand for the twelve months ended December 31, 2024[46] - The company reported a non-cash loss contingency charge of $3,474 thousand related to a settlement recorded in the second quarter of 2023[53] Revenue Predictability - Approximately 90% of the company's revenues are subscription-based, indicating high revenue predictability and stability[50] - The company calculates its Annual Recurring Revenue (ARR) based on contracted subscription revenue, which serves as a leading indicator of future revenue opportunities[50] - Net Revenue Retention (NRR) is used to measure the success in retaining and growing recurring revenue, with calculations excluding new clients for the first 12 months post-acquisition[51]