Earnings call transcript: FiscalNote Holdings Q4 2024 misses forecasts

FiscalNote Holdings reported its fourth-quarter 2024 earnings on March 13, revealing a wider-than-expected loss and lower revenue than forecasted. The company posted an earnings per share (EPS) loss of $0.10, missing the consensus estimate of a $0.08 loss. Revenue also fell short, coming in at $27.06 million compared to the expected $30.59 million. Despite these results, the company’s stock saw a slight uptick of 1.53% in after-hours trading, closing at $0.98. According to InvestingPro data, analysts maintain a strong buy consensus with price targets ranging from $1.75 to $5.00, suggesting significant potential upside despite current challenges.

Key Takeaways

• FiscalNote’s Q4 2024 EPS and revenue both missed analyst expectations.
• The company achieved its first full year of positive adjusted EBITDA at $9.8 million.
• FiscalNote reduced its operating expenses by 24% in the fourth quarter.
• The company launched a new AI-driven platform, Policy Note, in January 2024.
• FiscalNote’s stock climbed 1.53% in after-hours trading despite the earnings miss.

Company Performance

FiscalNote Holdings demonstrated resilience in its overall performance despite missing earnings expectations. The company reported a total revenue of $29.5 million for Q4 2024, a decrease from the prior year due to divestitures. While it achieved positive adjusted EBITDA for the first time over a full year, totaling $9.8 million, InvestingPro data shows the last twelve months’ EBITDA remains negative at -$29.76 million. The company maintains impressive gross profit margins of 74.63%, demonstrating strong core business efficiency despite challenges. FiscalNote also reduced its operating expenses significantly, which contributed to a reduced net loss compared to the previous year.

Financial Highlights

• Revenue: $29.5 million in Q4 2024, down from the prior year due to divestitures.
• Full Year Revenue: $120.3 million.
• Annual Recurring Revenue (ARR): $107 million, slightly down from $109 million in 2023.
• Net Revenue Retention: 98%, a slight decrease from 99% the previous year.
• Adjusted EBITDA: $9.8 million for the full year.
• Gross Margin: 79% (GAAP), 86% (Adjusted).

Earnings vs. Forecast

FiscalNote reported an EPS loss of $0.10, missing the forecasted loss of $0.08 by 25%. The revenue of $27.06 million was also below the expected $30.59 million, representing an 11.6% shortfall. This marks a deviation from the company’s historical performance, where it has typically met or exceeded expectations.

Market Reaction

Following the earnings announcement, FiscalNote’s stock experienced a 1.53% increase in after-hours trading, closing at $0.98. This movement contrasts with the 7.21% decline during the regular trading session, where the stock closed at $1.04. InvestingPro analysis indicates the stock is currently undervalued, though it has shown significant volatility with a 38.1% decline over the past year. The market cap stands at $135.71 million, reflecting the company’s current market position. Despite the earnings miss, the market’s reaction suggests a cautiously optimistic sentiment, possibly due to the company’s strategic initiatives and cost management.

Outlook & Guidance

FiscalNote provided guidance for 2025, projecting revenue between $94 million and $100 million, and adjusted EBITDA between $10 million and $12 million. For Q1 2025, the company anticipates revenue in the range of $26 million to $27 million. The company expects ARR growth in the second half of 2025 and targets substantial revenue growth in 2026.

Executive Commentary

CEO Josh Resnick stated, "We are executing a proven, time-tested playbook for success in information services and SaaS." CFO John Slabaugh added, "Our expectations for 2025 reflect the building strength and resilience of our streamlined and disciplined operating plan." These comments underscore the company’s strategic focus and confidence in its future performance.

Risks and Challenges

• Government sector volatility could impact FiscalNote’s revenue.
• Macroeconomic unpredictability may affect private sector demand.
• Continued pressure to maintain positive EBITDA amidst revenue challenges.
• Integration and adoption of new AI-driven platforms like Policy Note.
• Potential competitive pressures in the information services sector.

Q&A

During the earnings call, analysts inquired about the adoption of the Policy Note platform and its impact on customer engagement. They also explored FiscalNote’s debt reduction strategy and sought clarification on pro forma financial expectations. The company highlighted the availability of its new CoPilot feature, reflecting its ongoing innovation efforts.

Full transcript - Fiscalnote Holdings Inc (NOTE) Q4 2024:

Abby, Conference Operator: Ladies and gentlemen, good afternoon and thank you for standing by. My name is Abby and I will be your conference operator today. At this time, I would like to welcome everyone to the Fiscal Note Holdings, Inc. Fourth Quarter and Full Year twenty twenty four Financial Results Conference Call. All lines have been placed on mute to prevent any background noise.

After the speakers’ remarks, there will be a question and answer session.

: Thank you. And I would now like to turn

Abby, Conference Operator: the conference over to the company. You may begin.

Bob Burrows, Investor Relations, Fiscal Note Holdings: Good evening. My name is Bob Burrows, Investor Relations for Fiscal Notes, and we are pleased you all could join us. The purpose of today’s call is to discuss Fiscal Notes’ fourth quarter and full year 2024 financial results and 2025 outlook. Joining me with prepared comments are Josh Resnick, President and CEO and John Slabaugh, CFO and Chief Investment Officer. Other members of the senior management team will be available if needed during the Q and A session that will follow these prepared comments.

Please note today’s press release and related current report on Form eight ks are available on the company website. In terms of important housekeeping, it is important to mention the following. During this call, we may make certain statements related to our business that are forward looking statements under federal securities laws. These statements are not guarantees of future performance, but rather are subject to a variety of risks and uncertainties. Our actual results could differ materially from expectations reflected in any forward looking statements.

For a discussion of the material risks and important factors that could affect our actual results, as well as the risks and other important factors discussed in today’s earnings release, please refer to our SEC filings, which are available either on our company website or the Securities and Exchange Commission’s EDGAR system. Additionally, non GAAP financial measures will be discussed on this conference call. Please refer to the tables in our earnings release or the updated version of the corporate overview presentation, both of which are available on the Investor Relations portion of our website, for a reconciliation of these measures to their most directly comparable GAAP financial measure. Finally, we use key performance indicators or KPIs in evaluating the performance of our business. These include annual recurring revenue or ARR and net revenue retention or NRR.

Once again, I refer you to the earnings release or the updated corporate deck for definitions of these important metrics. With that, I’d like to turn the call over to fiscal note’s CEO and President, Josh Resnick. Josh?

Josh Resnick, President and CEO, Fiscal Note Holdings: Thank you, Bob, for that introduction. And thanks to everyone for being here this evening. I’m pleased to join you as we cover key updates on the company, including our fourth quarter and full year 2024 financial results, our 2025 guidance and what lies ahead for fiscal net. With that, let’s dive into the state of the company as we have continued to transform the business with clear focus and swift execution. We’ve emphasized three crucial pillars of this transformation.

One, we are consistently and rapidly expanding adjusted EBITDA margin two, we are managing our debt and accelerating our path to positive free cash flow. And three, we are building a strong foundation for long term profitable, sustainable growth. I’ll discuss each of these now. First, regarding adjusted EBITDA margins. Today, we announced $9,800,000 in adjusted EBITDA for 2024, a year over year improvement of more than $17,000,000 and 1,400 basis points.

This is an incredible accomplishment by our teams. It means that the company is operating vastly differently than in the past. To get there, we’ve been extremely disciplined in our operations. We’ve streamlined our management structure, sunset unprofitable and non core initiatives and made additional changes throughout the organization that enable us to drive greater efficiencies. For 2025, we’re guiding to an adjusted EBITDA range of $10,000,000 to $12,000,000 even after the impact of the anticipated divestiture of Oxford Analytica and Dragonfly.

This is more than double 2024 adjusted EBITDA margins on a pro form a basis. We’ve said before that we will focus on areas that are primed for profitable growth, simplify our product portfolio and reduce organizational complexity. Excellence matters in what we do. And as we simplify and focus, you’re increasingly seeing that excellence manifested in our expanding margins. And as we drive growth in the future, which I’ll address in a few moments, We expect to see more of that revenue drop straight to the bottom line to fuel profit expansion and an acceleration towards positive free cash flow.

Second, regarding managing our debt and accelerating the path to positive free cash flow. We have committed to taking the steps necessary to improve our capital structure. In 2024, we reduced our senior debt materially. And with the anticipated divestiture of Oxford Analytica and Dragonfly expected to close by the end of this month, we will have paid down our senior debt by more than 60% in the past year. Just as we had previously committed to transforming our operations and achieving adjusted EBITDA profitability, which we did sooner than was expected of us, us, we are now equally focused on paying down our debt and working towards positive free cash flow.

Accordingly, a direct outcome of this debt reduction is a proportional decrease in our anticipated cash interest payments. And as I just noted, we are continuing to expand operating margins and drive greater efficiencies across the business, meaning that a greater proportion of our revenue is dropping to the bottom line. And beyond operating margins, we also are focused on disciplined management of capital expenditures, where we expect to achieve greater efficiencies as we consolidate our policy products onto a single platform, Policy Note, and deprecate multiple legacy platforms. The collective result of these efforts, lower cash interest expense, increasing operating margins and reduction in CapEx, is that we are accelerating the path to positive free cash flow. As John will discuss, our cash flow from operations improved significantly by more than $30,000,000 in 2024.

Our path and progress towards positive free cash flow is clear. And it should also be clear by now that when we commit to a path, we apply relentless focus and determination to achieve it. Third, regarding our foundation for long term profitable, sustainable growth. On our last call, I explained that our investment in product will fuel future growth by impacting customer engagement, retention and expansion revenue. This is our strategy.

It is sound and it is working. I’ll share more details in a moment, and I’m excited to provide deeper visibility into what we’re doing and how we know it’s working. That said, I also want to be direct about our 2025 revenue guidance and how it fits within the context of our plans and progress. Simply put, this year’s guidance reflects in part the fact that the company’s typical end of year ARR uptick did not materialize at the end of twenty twenty four. Needless to say, that falls short of our standards.

We’ve moved quickly to address it, implementing key management changes that are already driving meaningful improvements in execution. At the same time, our investment in product, including the public launch of Policy Note in January, is driving momentum as I’ll discuss. The combination of these factors is impacting our leading indicators, specifically pipeline and customer engagement, which should drive a return to ARR growth in the second half of this year and serve as the foundation for sustained GAAP revenue growth in 2026 and beyond. We are confident in our path and I will take you through exactly what is fueling our confidence in more detail. As I noted, in January of this year, we announced the launch of Policy Note.

Policy Note builds on Cisco Note’s decade of applying AI to policy and regulation as an AI first platform that will consolidate all of our policy related data and content via a single user interface. This is foundational for product led sales and growth and will be a centerpiece for efficient, scalable innovation for the future. While it’s still early in Policy Note’s lifecycle, we’re already seeing strong engagement and promising adoption trends. Customers using the platform are actively leveraging our advanced AI features and more importantly, finding real value in it. We’re closely monitoring usage to refine experiences and enhance workflows in ways that will drive customer engagement and retention.

Notably, we’re seeing the new features and experience in policy notes drive higher levels of customer activity, a strong signal of its potential to broadly increase both gross and net retention in the future. In addition, the qualitative feedback we’re hearing from customers is overwhelmingly positive, with users highlighting the platform’s intuitive experience and tangible impact on their organization. Since the launch of Policy Note, we’ve also seen greater momentum in sales and marketing with increased inbound interest and a higher conversion rate as leads move through the funnel. More corporate clients are also committing to multiyear agreements. In the corporate sector, so far in Q1 of this year, the share of new logo ARR on multiyear contracts in our policy business is almost double what it was a year ago.

This demonstrates the market’s confidence in our offerings and our product roadmap as well as our customers’ expectation of continued reliance on our data, proprietary analysis and AI features. Additionally, the Ryzen multiyear commitments serves as a clear signal of anticipated improvements in gross retention, positioning us for stronger top line revenue growth in 2026 and beyond. A product transformation is not an overnight fix, but it is a lasting one. And especially here, where we’re not just redesigning a product, but rather we’re consolidating our platforms, creating an entirely new AI forward experience and establishing a culture of product excellence and product led sales and growth across the company. We expect that the indicators of future revenue growth, some of which I’ve just discussed, will continue to become more apparent over the course of this year as we return to ARR growth and our momentum accelerates, which will be further reflected in GAAP revenue growth in 2026.

As for 2025, beyond these trends, we’re also keeping an eye on market volatility. This is certainly true in the private sector, where macroeconomic unpredictability is likely to impact corporate buying decisions and timelines over the course of the year. In addition, unlike past years, we’re also seeing some volatility in the public sector due to changes in the federal government. However, our platforms deliver essential data, information and insights that enhance government efficiency, a value proposition that remains strong as federal spending comes under greater scrutiny and that even serves to further the administration’s goals of reducing overall government spend. By our estimates, the government saved $10 for every dollar spent with us, reinforcing the critical role we play.

Given this, we currently do not anticipate these changes to have a material impact on our business. And in fact, we see potential upside as agencies shift their operations and spending priorities. That said, the dynamic nature of the government landscape is unprecedented and the ultimate impact is difficult to predict at this time. Of course, we’ll continue to closely monitor developments as the year goes on. Regardless of near term variability, we’re executing on a clear and compelling plan for long term sustainable, profitable growth.

We have a diverse base of more than 4,000 customers spanning a wide range of industries and market sectors. We solve complex global challenges that are becoming increasingly difficult for organizations to manage. Our transformational new product integrates the best in data, proprietary insights and AI to deliver more powerful and efficient solutions for our customers. We’ve sharpened our focus by continuing to improve and streamline operations and by divesting non core businesses, ensuring that our teams can execute with excellence. Looking ahead to the future, we’ll continue to leverage our technology and industry expertise to automate more and more aspects of policy and regulatory workflows, driving greater share of wallet and high growth for the long run.

At its core, we are executing a proven, time tested playbook for success in information services and SaaS. We provide data and content that solves a high value problem for end users. We offer insights via a technology platform with a best in class user experience and will acquire new users, retain those accounts, and expand relationships over time. I’m extremely confident in our ability to do this, and I’m excited for what the future holds for fiscal note. With that, I’ll now turn the call over to John to take us through the company’s 2024 financial results.

John?

John Slabaugh, CFO and Chief Investment Officer, Fiscal Note Holdings: Thank you, Josh. Good afternoon, and thank you for joining Fiscal Note’s twenty twenty four year end conference call. As Josh mentioned, we’re pleased to announce that we met and exceeded previous financial guidance for 2024. And I will dive into some of the key drivers behind our performance. Total revenue for Q4 twenty twenty four was $29,500,000 ahead of our forecast and lower than the prior year period, primarily due to the divestiture of Board.org.

Subscription revenue remains the cornerstone of our business and while flat on a sequential basis, it accounted for 92% of total in quarter revenue consistent with our historical trends. Now looking at some of the key performance metrics. As of Q4 twenty twenty four, annual recurring revenue was $107,000,000 versus $109,000,000 in 2023 on a pro form a basis after adjusting for the impact of the ASIL and Board.org divestitures. As Josh noted, we expect Policy Note to have a meaningful positive impact as 2025 unfolds and we’re planning for ARR growth in the second half of twenty twenty five that will translate into GAAP revenue growth in 2026. For the fourth quarter twenty twenty four, net revenue retention was 98% versus 99% in the prior year.

This is in line with our historical trends in a metric we are focused on improving over time through continued product innovation. Principal operating expenses in Q4 twenty twenty four continued to trend of year over year decreases, reflecting the benefits of efficiency measures first initiated in 2023 and consistently carried forward across the entirety of 2024. We also realized cost savings following the board.org and ASIL divestitures. And we realized additional savings from sunsetting a few small non core products. Cost of revenues decreased by $6,000,000 or 53% in Q4, primarily due to previous technology related amortization expenses that became fully amortized in 2024.

R and D decreased by $1,100,000 or 28%. Sales and marketing decreased by just under $3,000,000 or 28%. And G and A decreased by $4,500,000 or 27%. Taken together, total operating expenses in Q4 twenty twenty four fell by over $11,000,000 versus the prior year or 24% when excluding the goodwill impairment charge recorded in Q4 twenty twenty three. On a pro form a basis, excluding non cash charges and the impact of the divestitures of Board.org and ASIL, OpEx decreased approximately $1,800,000 or 6%.

Gross margins in Q4 twenty twenty four improved, primarily due to the amortization expense recorded and cost of sales fully amortizing earlier in the year. Our adjusted gross margin improved to 87% in Q4 of twenty twenty four as compared to 83% in the prior comparable quarter. GAAP net loss for Q4 twenty twenty four was $13,400,000 significantly lower than the prior year period due in part to a large non cash goodwill impairment charge recorded in Q4 of twenty twenty three. In 2024, we did not record any goodwill impairment charges. Adjusted EBITDA was a positive $3,300,000 higher than the prior year above our guidance of 2,500,000 in the sixth consecutive quarter of positive adjusted EBITDA.

The improvement to adjusted EBITDA even after the pro form a impact of the divestiture of Board.org and ASIL is the result of actions we’ve taken to improve operating efficiency. We will continue to increase operating leverage and realize additional efficiencies wherever and whenever possible. A few full year highlights in 2024 include total revenues worth $120,300,000 lower year over year due to the impact of the various divestitures in 2024, but slightly above our guidance. Gross margin came in at 79% and adjusted gross margin was 86%. And in terms of profitability, adjusted EBITDA was a positive $9,800,000 higher than the prior year and above the guidance of approximately $9,000,000 This performance in 2024 represents the first full year of positive adjusted EBITDA in our history, an important milestone and achievement.

Cash and cash equivalents, including short term investments at year end 2024, were $35,300,000 And in terms of our debt stack, we ended 2024 with a substantially reduced senior term loan balance of $89,000,000 following the two divestitures during the year. In aggregate, we reduced this balance by $70,000,000 over a one year span, clear evidence of our commitment to deleverage the capital structure, simplify the product mix and focus on the core policy business servicing more than 4,000 top tier customers across the globe. The senior term loan will be further reduced by the pending close of the recently announced asset sales. And before I get to guidance for 2025, I want to take a moment and touch on one final important metric for 2024. Cash flow from operations was negative $5,300,000 in 2024, a $30,000,000 improvement compared to the full year 2023.

We took numerous steps to improve the operations and financial footing of the company in 2023 and 2024. And the trend lines indicate that we were on a clear path towards achieving positive operating cash flow. Finally, let me move to our forecast for 2025. For background and context, it is important to keep the following considerations in mind. Our forecast incorporates the impact of the assumed completed divestiture of Oxford Analytica and Dragonfly Intelligence initially announced in late February, which we expect to close later this month following the receipt of regulatory clearance.

Importantly, our 2025 forecast includes total revenues of approximately $3,000,000 and a nominal amount of adjusted EBITDA from these two businesses in the first quarter of twenty twenty five. Given these transactions, there are a few customary additional disclosures required in our 10 K filing. Therefore, we plan to file a Form 12B25 to extend the 2024 Form 10 K filing deadline. This will give us a bit more time to finalize the additional disclosures, including full year pro form a financial information giving effect to the transaction after closing. Absent this transaction, we would otherwise be prepared to file on time and we expect to file by the extended April 1 deadline.

The forecast also reflects realization of additional efficiency initiatives, driving a substantially expanded adjusted EBITDA margin more than double on a pro form a basis versus 2023. These initiatives combined with a further reduction of our debt service costs will accelerate our progress towards positive free cash flow. We anticipate our new Policy Note platform to have an increasing impact on customer engagement and retention over the course of the year as we migrate more users to the platform and offer additional enhancements, features and micro products. In turn, we expect this will have an increased positive impact on ARR across the year with a weighting on the second half contributing to a higher more substantial revenue growth rate in 2026. Finally, and as Josh alluded to earlier, our forecast is informed by our ongoing evaluation of current market volatility, in particular the private sector where macroeconomic unpredictability is likely to impact corporate buying decisions and timelines over the course of the year.

In addition, it was informed by our assumptions regarding changes within the federal government. Our 2025 forecast reflects our current expectations based on the most recent information available and is subject to adjustment based on changes in business conditions across the year. With that as a backdrop, we are forecasting full year 2025 total revenues in the range of $94,000,000 to $100,000,000 and adjusted EBITDA in a range of $10,000,000 to $12,000,000 And for pacing across the year, we are also forecasting first quarter twenty twenty five total revenues in a range of $26,000,000 to $27,000,000 and adjusted EBITDA of approximately $2,000,000 In summary, our business experienced significant change in 2024 and ended the year in a more stable and resilient position than at the outset of the year. Our expectations for 2025 reflect the building strength and resilience of our streamlined and disciplined operating plan and focused product roadmap. As we work to drive growth and retention in our customer base, we also look to realize increasing operating leverage and therefore expanding adjusted EBITDA, both in absolute dollars as well as margins.

Additionally, we will continue to control annual CapEx while managing and where possible reducing cash interest expense, all in pursuit of accelerating the path to positive free cash flow. That concludes my prepared remarks. I’ll turn it over to the operator to begin the question and answer session. Operator?

Abby, Conference Operator: Thank you. And we’ll now begin the question and answer session. And your first question comes from the line of Jesse Fobelson with D. Boral Capital. Your line is open.

: Hey, everyone. Thanks for taking my questions here. I was just curious, on this new policy note platform, would you be able to disclose how many of your existing customers have begun to adopt it since the January launch and what the initial feedback has been?

Josh Resnick, President and CEO, Fiscal Note Holdings: Hey, Jesse. This is Josh. Thanks for the question. We’re not right now disclosing how many customers are using that versus using our other platforms. But I will tell you, we are getting good engagement on the platform.

We’re monitoring activity very closely, as you can imagine, for a new product. Some of the things that we’re seeing are very high activity, on the part of the accounts who are using it. That includes both at the account level and the individual user level. We’re also looking, to see what exactly they’re engaging with and trying to gauge what value they’re getting out of the features that we have. And we’re very pleased to see that they’re engaging to a high degree with our AI features, including our AI assistant or AI alerting and the like.

And that helps tell us the value that they’re getting out of it as well. So in other words, they’re able to quickly get to the answers they’re trying to get to, which is what proves out value to them. And as an example, with our AI alerts, that does a good job of letting them know about things they weren’t even aware that they needed to be tracking. So again, tremendous value add for customers. So we’re seeing them, the levels of engagement that we like to see.

We’re seeing them engage with the types of features that we want to see as well to know they’re getting value. And then we’re also engaging highly to get qualitative feedback out of customers as well. And again, that’s validating what we’re seeing in the data in terms of usage and in terms of benefits to their organization. So again, examples being discovering policy changes they otherwise would not have been aware of, and that’s something that’s highly valuable to our end users. So we’re continuing to monitor closely, looking at that data that helps inform future product development as well.

And we’ll be excited to move more customers over the platform over time.

: Great. I appreciate the detail there. Just one real quick one for me and I’ll jump back in the queue. You’ve done a great job reducing debt this year and are near to completing $40,000,000 asset sale, which is pretty material. Going forward, have you determined what the target leverage ratio for the business might be?

And do you have any thoughts on how quickly you might be able to get there? And thanks again.

John Slabaugh, CFO and Chief Investment Officer, Fiscal Note Holdings: Sure. Jesse, it’s John. And thanks for the question. We are thinking about both bringing the leverage down in kind of an absolute amount, but also relative to our EBITDA. And we do plan to bring that kind of into kind of a more conventional leverage model in the next couple of years.

I think as we think about kind of EBITDA stepping up and debt stepping down, I can’t really give specific targets, but we do think about it in that context and want to bring the leverage down into the kind of two to three times leverage range over the kind of foreseeable future.

Abby, Conference Operator: And your next question comes from the line of Zack Cummins with B. Riley Securities. Your line is open.

Zack Cummins, Analyst, B. Riley Securities: Hi, good afternoon. Thanks for taking my questions. And just tailing off of the balance sheet question. Once the divestments of Oxford, Analytica and Dragonfly close hopefully at the end of this month, can you give us a sense of maybe what kind of the pro form a balance sheet would look like at that point? I know you disclosed an anticipated amount you were hoping to pay down against the senior debt, but just curious if you can give any sort of insight around that.

John Slabaugh, CFO and Chief Investment Officer, Fiscal Note Holdings: Somewhat limited what we talk about prospectively, but I think the debt we’re making about a $30,000,000 or 29 point something million dollars reduction to the senior term loan. That will obviously bring down our cash interest expense to right around $2,000,000 per quarter, which I think is going to be helpful for us in the long term. And we still have a couple of subordinated convertible notes behind that and we’ll continue to kind of manage those and think about ways to deleverage those over time as well.

Zack Cummins, Analyst, B. Riley Securities: Understood. And just my one quick follow-up. Just so I’m level setting kind of a pro form a expectation for the coming year. Within your slides that you provided, can you give us a sense of what all is stripped out of kind of the Q1 guidance and also the 2025 guidance when comparing to those pro form a 2024 numbers?

John Slabaugh, CFO and Chief Investment Officer, Fiscal Note Holdings: When you say stripped out, the guidance for Q1 is our GAAP revenue guidance. So there’s nothing really pro form a out. I think you’re talking about where we compare that to the pro form a number for the prior year?

Zack Cummins, Analyst, B. Riley Securities: Correct. Yes.

John Slabaugh, CFO and Chief Investment Officer, Fiscal Note Holdings: And the difference there would be, there’s roughly $3,000,000 of revenue attributable to the Dragonfly and Oxford businesses in the first quarter that will kind of not be there in subsequent quarters after we close that transaction.

Zack Cummins, Analyst, B. Riley Securities: Got it. That’s helpful. Well, thanks for taking my questions and best of luck with the rest of the quarter.

John Slabaugh, CFO and Chief Investment Officer, Fiscal Note Holdings: Thanks.

Abby, Conference Operator: And your next question comes from the line of Mike Latimore with Northland Capital Markets. Your line is open.

Vijay Devar, Analyst, Northland Capital Markets: Hi. This is Vijay Devar for Mike Latimore. A couple of questions. So what percent of global intelligence customers are using the Copilot?

Josh Resnick, President and CEO, Fiscal Note Holdings: I’m sorry, can you repeat the question?

Vijay Devar, Analyst, Northland Capital Markets: Yes. What percent of global intelligence customers are using the CoPilot version,

John Slabaugh, CFO and Chief Investment Officer, Fiscal Note Holdings: Jayco? Well, that’s a feature that’s generally available through the product to all subscribers. So they all have the opportunity to engage with it. We don’t disclose kind of metrics around customer usage, but it is something that was a broadly presented feature

Josh Resnick, President and CEO, Fiscal Note Holdings: for the product. Yes.

Josh Resnick, President and CEO, Fiscal Note Holdings: This is Josh. I can just add qualitatively. As John was saying, we don’t disclose down to that level of metric. I will say we have had very good usage of the FNGI co pilot and both in terms again of share of accounts, breadth of accounts and frequency of visits and the like. So we’re very pleased with the metrics that we saw for that experience, but we don’t give specific metrics to that level of detail.

Vijay Devar, Analyst, Northland Capital Markets: Understood. And secondly, how were upsells and cross sells in the quarter for the CoPilot?

Josh Resnick, President and CEO, Fiscal Note Holdings: Again, we don’t disclose down to that level. CoPilot, again, I can say generally was helpful or has been helpful in enabling those customers to discover new content, new products they weren’t otherwise using. It was a good channel to drive some product led sales, but again we don’t disclose metrics down to that level.

Vijay Devar, Analyst, Northland Capital Markets: Got it.

Abby, Conference Operator: Thank you. And we have no further questions at this time. I will now turn the conference back over to the company for closing remarks.

Bob Burrows, Investor Relations, Fiscal Note Holdings: Thank you, Abby. This again is Bob Burrows. That concludes our call this evening, and we appreciate everyone’s participation. With any additional questions, please contact any of us at any time. Again, all the materials related to the company’s fourth quarter and full year twenty twenty four financial results are available on the fiscal note website.

We look forward to speaking with all of you again in the future. Goodbye.

Abby, Conference Operator: Ladies and gentlemen, this concludes today’s call. We thank you for your participation. You may now disconnect.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.