services; FiscalNote's ability to introduce new features, integrations, capabilities, and enhancements to its products and services; FiscalNote's ability to maintain and improve its methods and technologies, and anticipate new methods or technologies, for data collection, organization, and analysis to support its products and services; competition and competitive pressures in the markets in which FiscalNote operates, including larger well-funded companies shifting their existing business models to become more competitive with FiscalNote; FiscalNote's ability to protect and maintain its brands; FiscalNote's ability to comply with laws and regulations in connection with selling products and services to U.S. and foreign governments and other highly regulated industries; FiscalNote's ability to retain or recruit key personnel; FiscalNote's ability to effectively maintain and grow its research and development team and conduct research and development; FiscalNote's ability to adapt its products and services for changes in laws and regulations or public perception, or changes in the enforcement of such laws, relating to artificial intelligence, machine learning, data privacy and government contracts; adverse general economic and market conditions reducing spending on our products and services; the outcome of any known and unknown litigation and regulatory proceedings; FiscalNote's ability to successfully establish and maintain public company-quality internal control over financial reporting; the ability to adequately protect FiscalNote's intellectual property rights; and the possibility that the strategic review undertaken by the Board of Directors does not result in any transaction or other outcome or that any outcome is disruptive to operations and impacts financial performance.
These and other important factors discussed in FiscalNote's SEC filings, including its most recent reports on Forms 10-K and 10-Q, particularly the "Risk Factors" sections of those reports, could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. These forward-looking statements are based upon estimates and assumptions that, while considered reasonable by FiscalNote and its management, are inherently uncertain. Nothing in this press release should be regarded as a representation by any person that the forward-looking statements set forth herein will be achieved or that any of the contemplated results of such forward-looking statements will be achieved. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. FiscalNote undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
FiscalNote Holdings, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)
(in thousands, except shares and per share data)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
---------------------------- ------------------------------
2024 2023 2024 2023
------------- ------------- ------------- ---------------
Revenues:
Subscription $ 27,238 $ 30,057 $ 84,015 $ 87,986
Advisory,
advertising,
and other 2,201 3,952 6,782 10,394
----------- ----------- ----------- -----------
Total
revenues 29,439 34,009 90,797 98,380
----------- ----------- ----------- -----------
Operating
expenses: (1)
Cost of
revenues,
including
amortization 6,235 10,441 20,342 28,863
Research and
development 3,250 4,540 9,935 14,170
Sales and
marketing 9,068 11,235 27,484 35,222
Editorial 4,639 4,516 13,752 13,533
General and
administrative 10,622 14,418 37,958 48,813
Amortization of
intangible
assets 2,436 2,899 7,541 8,614
Impairment of
goodwill - - - 5,837
Transaction
(gains) costs,
net - $(579.SI)$ (4) 1,138
----------- ----------- ----------- -----------
Total operating
expenses 36,250 47,470 117,008 156,190
----------- ----------- ----------- -----------
Operating loss (6,811) (13,461) (26,211) (57,810)
Gain on sale of
business - - (71,599) -
Interest expense,
net 5,585 8,018 18,267 21,853
Change in fair
value of financial
instruments 3,501 (7,157) 3,174 (18,850)
Loss on settlement - - - 3,474
Other (income)
expense, net (341) 207 (82) 245
----------- ----------- ----------- -----------
Net (loss)
income before
income taxes (15,556) (14,529) 24,029 (64,532)
(Benefit) provision
from income taxes (621) (62) 1,129 181
----------- ----------- ----------- -----------
Net (loss)
income (14,935) (14,467) 22,900 (64,713)
Other comprehensive
income (loss) 1,123 (1,006) 1,062 (1,037)
----------- ----------- ----------- -----------
Total
comprehensive
(loss) income $ (13,812) $ (15,473) $ 23,962 $ (65,750)
----------- ----------- ----------- -----------
Earnings (loss)
per share
attributable to
common
shareholders:
Basic and
Diluted $ (0.11) $ (0.11) $ 0.17 $ (0.49)
Weighted average
shares used in
computing earnings
(loss) per share
attributable to
common
shareholders:
Basic and
Diluted 135,050,093 128,832,502 135,160,124 131,994,563
(1) Amounts include stock-based compensation expenses, as follows:
Three Months
Ended Nine Months Ended
September 30, September 30,
-------------- ---------------------
2024 2023 2024 2023
------ ------ ---------- ---------
Cost of
revenues,
including
amortization $ 116 $ 45 $ 324 $ 185
Research and
development 454 328 1,138 1,080
Sales and
marketing 486 1,041 1,182 1,718
Editorial 200 120 465 292
General and
administrative 2,925 4,690 10,776 14,937
FiscalNote Holdings, Inc.
Condensed Consolidated Balance Sheets
(in thousands, except shares, and par value)
(Unaudited)
September 30, 2024 December 31, 2023
-------------------- ---------------------
Assets
Current assets:
Cash and cash
equivalents $ 25,688 $ 16,451
Restricted cash 683 849
Short-term investments 7,040 7,134
Accounts receivable, net 11,249 16,931
Costs capitalized to
obtain revenue
contracts, net 3,078 3,326
Prepaid expenses 3,210 2,593
Other current assets 3,414 2,521
--------------- --------------
Total current assets 54,362 49,805
Property and equipment, net 5,444 6,141
Capitalized software costs,
net 14,895 13,372
Noncurrent costs
capitalized to obtain
revenue contracts, net 3,347 4,257
Operating lease assets 17,062 17,782
Goodwill 165,964 187,703
Customer relationships, net 44,164 53,917
Database, net 17,208 18,838
Other intangible assets,
net 15,005 18,113
Other non-current assets 498 633
--------------- --------------
Total assets $ 337,949 $ 370,561
--------------- --------------
Liabilities and
Stockholders' Equity
Current liabilities:
Current maturities of
long-term debt $ 10,018 $ 105
Accounts payable and
accrued expenses 7,635 12,909
Deferred revenue,
current portion 40,257 43,530
Customer deposits 1,136 3,032
Contingent liabilities
from acquisitions,
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