FiscalNote (NOTE) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue was $29.2M, down 10.9%–11% year-over-year, mainly due to the Board.org divestiture and market headwinds.

• Adjusted EBITDA was $1.8M, marking the fourth consecutive quarter of positive adjusted EBITDA and the first year of positive trailing LTM adjusted EBITDA.

• The company serves over 4,500 customers globally, including more than 50 Fortune 100 firms, and continues to invest in AI-powered solutions and data licensing.

• Management implemented cost-saving measures, reducing headcount and streamlining the product portfolio, while emphasizing operational discipline and product innovation.

• The Board is actively reviewing all strategic alternatives to maximize shareholder value.

Financial highlights

• Q2 2024 total revenue was $29.2M; subscription revenue accounted for 93% of total, falling 8% YoY but up 3% excluding Board.org.

• Adjusted gross margin improved to 85% from 80% YoY; adjusted EBITDA margin was 6.1% in Q2 2024.

• Net loss for Q2 2024 was $12.8M, a significant improvement from $31.0M in Q2 2023.

• Cash and cash equivalents at quarter end were $38.4M; total debt was $172M, down sequentially.

• Annual Recurring Revenue (ARR) was $109M at June 30, 2024, down from $126.1M at year-end 2023, mainly due to the Board.org sale.

Outlook and guidance

• Full-year 2024 revenue forecast revised to ~$121M, down from $123M–$127M, reflecting higher churn and macroeconomic headwinds.

• Full-year adjusted EBITDA guidance raised to ~$8M, reflecting operational efficiencies.

• Q3 2024 guidance: total revenue of ~$29M and adjusted EBITDA of ~$2M.

• Management anticipates accelerated growth and improved operating leverage in 2025, driven by product innovation and enhanced customer engagement.

• Additional cost-saving measures and strategic alternatives, including divestitures or restructuring, are under evaluation.