FiscalNote | 10-Q: FY2025 Q3 Revenue Misses Estimate at USD 22.43 M

Revenue: As of FY2025 Q3, the actual value is USD 22.43 M, missing the estimate of USD 22.83 M.

EPS: As of FY2025 Q3, the actual value is USD -1.73, missing the estimate of USD -0.81.

EBIT: As of FY2025 Q3, the actual value is USD -6.044 M.

Segment Revenue

Subscription Revenue: $21.2 million for the three months ended September 30, 2025, a decrease of $6.1 million (22%) from $27.2 million for the same period in 2024. For the nine months ended September 30, 2025, subscription revenue was $67.8 million, a decrease of $16.2 million (19%) from $84.0 million in 2024.
Advisory, Advertising, and Other Revenue: $1.2 million for the three months ended September 30, 2025, a decrease of $1.0 million (43%) from $2.2 million for the same period in 2024. For the nine months ended September 30, 2025, this revenue was $5.4 million, a decrease of $1.4 million (20%) from $6.8 million in 2024.

Operational Metrics

Net Loss: - $24.9 million for the three months ended September 30, 2025, an increase of - $9.9 million (66%) from - $14.9 million for the same period in 2024. For the nine months ended September 30, 2025, net loss was - $42.4 million, a decrease of - $65.3 million from a net income of $22.9 million in 2024.
Operating Loss: - $9.7 million for the three months ended September 30, 2025, an increase of - $2.9 million (43%) from - $6.8 million for the same period in 2024. For the nine months ended September 30, 2025, operating loss was - $30.9 million, an increase of - $4.7 million (18%) from - $26.2 million in 2024.
Gross Profit: $17.7 million for the three months ended September 30, 2025, a decrease of $5.5 million (24%) from $23.2 million for the same period in 2024. For the nine months ended September 30, 2025, gross profit was $56.5 million, a decrease of $13.9 million (20%) from $70.5 million in 2024.
Adjusted Gross Profit: $19.4 million for the three months ended September 30, 2025, a decrease of $6.0 million (24%) from $25.4 million for the same period in 2024. For the nine months ended September 30, 2025, adjusted gross profit was $63.6 million, a decrease of $14.0 million (18%) from $77.6 million in 2024.
Adjusted EBITDA: $2.2 million for the three months ended September 30, 2025, a decrease of $1.2 million (37%) from $3.4 million for the same period in 2024. For the nine months ended September 30, 2025, adjusted EBITDA was $7.8 million, an increase of $1.4 million (21%) from $6.4 million in 2024.

Cash Flow

Operating Cash Flow: - $11.2 million for the nine months ended September 30, 2025, an increase of - $7.2 million from - $4.0 million for the same period in 2024.
Investing Cash Flow: $41.4 million for the nine months ended September 30, 2025, a decrease of - $43.2 million from $84.5 million for the same period in 2024.
Financing Cash Flow: - $32.4 million for the nine months ended September 30, 2025, a decrease of - $39.2 million from - $71.6 million for the same period in 2024.

Unique Metrics

Annual Recurring Revenue (ARR): $84.8 million at September 30, 2025, compared to $107.5 million at December 31, 2024.
Net Revenue Retention (NRR): 98% for the three months ended September 30, 2025 and 2024, excluding the impact of sold businesses.

Future Outlook and Strategy

Core Business Focus: The company plans to invest in building innovative products, attracting new customers, and expanding its leadership role in the legal and regulatory information market to drive growth organically. Strategic acquisitions may also be a component of the growth strategy.
Non-Core Business: The company has implemented various cost-saving measures and may execute other strategic actions to maximize stakeholder value, including further expense reductions, sale of all or portions of the business, corporate capital restructuring, or liquidation of assets.