Summary
FiscalNote reported second-quarter revenue of $23.26 million, down 20.5% from the prior-year quarter. The decline reflects divested businesses and sunset products, and the quarter includes Timebase, which was sold on July 1, 2025. The prior-year quarter also includes Oxford Analytica, Dragonfly Intelligence, and Aicel, all divested. Operating loss narrowed to $7.43 million, an improvement of 6.6% from the prior-year quarter. Net loss widened 4.0% to $13.27 million. Diluted EPS was -$0.08, a narrower loss than the prior-year quarter. Operating margin was -31.9%, down 4.7 percentage points from the prior-year quarter. Non-GAAP profitability improved. Adjusted EBITDA rose 58% to $2.8 million, and adjusted EBITDA margin doubled to 12% from 6%.
Cash generation remains a pressure point. Operating cash flow was -$6.18 million in the quarter, down 65.8% from the prior-year quarter. Year to date, operating cash flow was -$2.90 million, down 193.0% from the prior-year period. Capital expenditures were $1.49 million in the quarter, down 45.6%, and $3.47 million year to date, down 21.6%. Deferred revenue was $33.18 million, down 24.8% from the prior-year quarter. Remaining performance obligations were $75.16 million, down 15.1% from the prior-year quarter. Those declines follow the divestitures and product sunsets that reduced the business. Management has been cutting costs, simplifying the organization, and focusing investment on PolicyNote.
ARR was $85.9 million at June 30, 2025, down 21% from $109.0 million a year earlier. Pro forma ARR, which adjusts for divestitures, was $85.9 million, down 8% from $93.6 million. Quarterly net revenue retention was 96%, down 200 basis points from 98%. Management attributes the ARR decline to previously known execution challenges, customer engagement issues in legacy products, and atypical instability in the US federal sector. New corporate customers for policy information entered multiyear commitments at more than double the Q2 2024 rate, and PolicyNote daily usage surpassed the legacy FiscalNote platform in June. The company launched a Tariff Tracker in April and added AI-powered legislative forecasting, alerts, bill discovery, drafting, and social listening capabilities. It also sold TimeBase on July 1, 2025 for total consideration of $6.5 million, after selling Dragonfly and Oxford Analytica on March 31, 2025 for $40.3 million in cash.
Guidance for full year 2025 was reaffirmed. Revenue guidance is $94 to $100 million. Adjusted EBITDA guidance is $10 to $12 million. For the third quarter of 2025, revenue guidance is $22 to $23 million. Adjusted EBITDA guidance is about $2 million. The company expects a return to ARR growth in the second half of 2025 and continued margin expansion, though it lists risks tied to private-sector macroeconomic unpredictability, potential public-sector changes, PolicyNote migration, customer retention, and debt covenants. The board's strategic review continues, with no timetable and no assurance of a transaction. On August 5 and 12, 2025, FiscalNote refinanced debt: it replaced its prior senior term loan with a $75.0 million new senior term loan maturing in August 2029, issued $21.0 million of debentures for $18.9 million of cash, redeemed $30.0 million of principal under the GPO convertible note for $27.0 million, and retired the amended legacy notes for $3.6 million. After the refinancing, annualized cash interest payments are expected to be about $9.0 million, with principal repayments of about $1.9 million in year one and about $3.8 million thereafter. The new senior term loan has four financial covenants covering minimum cash, minimum annual recurring revenue, adjusted EBITDA, and capital expenditure limits.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q2 FY2025 | Q1 FY2025 | QoQ | Q2 FY2024 | YoY |
|---|---|---|---|---|---|
| Revenue | $23.3M | $27.5M | -15.4% | $29.2M | -20.5% |
| Research & development | $2.3M | $3.1M | -26.9% | $3.2M | -29.3% |
| Sales & marketing | $6.7M | $7.8M | -13.8% | $9.0M | -25.7% |
| General & administrative | $11.4M | $16.3M | -30.2% | $11.3M | +1.0% |
| Total operating expenses | $30.7M | $41.3M | -25.6% | $37.2M | -17.5% |
| Operating income (loss) | -$7.4M | -$13.8M | +46.0% | -$8.0M | +6.6% |
| Operating margin | -31.9% | -50.0% | +18.1 pp | -27.2% | -4.7 pp |
| Net income (loss) | -$13.3M | -$4.3M | -212.3% | -$12.8M | -4.0% |
| Net margin | -57.0% | -15.4% | -41.6 pp | -43.6% | -13.4 pp |
| Diluted EPS | -$0.08 | -$0.03 | -$0.05 | -$0.09 | +$0.01 |
| Net retention rate | 96.0% | 93.0% | +3.0 pp | 98.0% | -2.0 pp |
Risks
Total revenue fell 20.5% to $23.26 million for FY2025 Q2 from the prior-year quarter, and subscription revenue fell 21.3% for the three months ended June 30, 2025. MD&A attributes the organic subscription decline primarily to customer retention challenges combined with Federal government cuts.
Net revenue retention excluding Board.org, Aicel, Oxford Analytica, and Dragonfly was 96% for the three months ended June 30, 2025 compared with 98% for the three months ended June 30, 2024. ARR was $85.9 million at June 30, 2025 and $107.5 million at December 31, 2024.
MD&A states that the decrease in organic subscription revenue was primarily the result of customer retention challenges combined with the impact of Federal government cuts. This exposure could continue to pressure revenue and ARR if government budget constraints persist.
Risk Factors newly highlight potential significant dilution from the Third Era Convertible Note, the 2025 GPO Note, and the Debentures. The Third Era note has $5.8 million principal plus 2,596,050 fee shares and 300,000 broker shares; the 2025 GPO Note requires quarterly $2 million principal installments beginning April 1, 2026 payable in shares, cash, or a combination; and the Debentures include an initial approximately $21 million tranche and an expected $12 million second tranche.
The Company had negative working capital of $27.9 million excluding cash and short-term investments at June 30, 2025, an accumulated deficit of $824.4 million, and net losses excluding gain on sale of businesses of $32.9 million for the six months ended June 30, 2025. Cash, cash equivalents, restricted cash, and short-term investments were $39.2 million at June 30, 2025 compared with $35.3 million at December 31, 2024.
The 2025 Senior Term Loan contains four financial covenants, including minimum cash, minimum annual recurring revenue, adjusted EBITDA, and capital expenditure limits. The refinancing creates approximately $9.0 million of annualized cash interest payments and principal repayments of approximately $1.9 million in year one and approximately $3.8 million thereafter.
SaaS KPIs
All quarters →Adjusted EBITDA Margin
Adjusted EBITDA
Adjusted Gross Profit
Annual Recurring Revenue (ARR)
Adjusted Gross Margin
Net Revenue Retention (NRR)
Pro Forma Annual Recurring Revenue (ARR)
Subscription Revenue as % of Total Revenues
Summary, forecast, risks and KPIs are extracted from FiscalNote Holdings, Inc.'s SEC filings for Q2 FY2025 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 2, 2026.