Q4 2025 FiscalNote Holdings Inc Earnings Call

March 19, 2026

Speaker #1: Ladies and gentlemen, good afternoon. My name is Abby, and I'll be your conference operator today. At this time, I would like to welcome everyone to the FiscalNote Holdings, Inc. fourth quarter and full year 2025 financial results conference call.

Operator: Ladies and gentlemen, good afternoon. My name is Abby, and I'll be your conference operator today. At this time, I would like to welcome everyone to the FiscalNote Holdings, Inc. Q4 and Full Year 2025 Financial Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one a second time. Thank you. With that, I would now like to turn the call over to the company to begin the conference.

Operator: Ladies and gentlemen, good afternoon. My name is Abby, and I'll be your conference operator today. At this time, I would like to welcome everyone to the FiscalNote Holdings, Inc. Q4 and Full Year 2025 Financial Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one a second time. Thank you. With that, I would now like to turn the call over to the company to begin the conference.

Speaker #1: All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star followed by the number 1 on your telephone keypad.

Speaker #1: If you would like to withdraw your question, press star 1 a second time. Thank you. And with that, I would now like to turn the call over to the company to begin the conference.

Speaker #2: Good evening. My name is Yojen, Investor Relations for FiscalNote, and we are pleased you could join us this evening. The purpose of today's call is to discuss FiscalNote's fourth quarter and full year 2025 financial results, and guidance for 2026.

Yojin Yoon: Good evening. My name is Yojin, Investor Relations for FiscalNote, and we are pleased you could join us this evening. The purpose of today's call is to discuss FiscalNote's Q4 and full year 2025 financial results and guidance for 2026. Joining me with prepared remarks are Josh Resnik, Chief Executive Officer and President, and Jon Slabaugh, Chief Financial Officer and Chief Investment Officer. Other members of the senior management team will be available as needed during the Q&A session that will follow. Please note, today's press release, related current report on Form 8-K, and updated version of the corporate overview presentation are all available on the investor relations portion of the company website. In terms of important housekeeping, please take note of the following. During this call, we may make certain statements related to our business that are forward-looking statements under federal securities laws.

Yojin Yoon: Good evening. My name is Yojin, Investor Relations for FiscalNote, and we are pleased you could join us this evening. The purpose of today's call is to discuss FiscalNote's Q4 and Full Year 2025 Financial Results and guidance for 2026. Joining me with prepared remarks are Josh Resnik, Chief Executive Officer and President, and Jon Slabaugh, Chief Financial Officer and Chief Investment Officer. Other members of the senior management team will be available as needed during the Q&A session that will follow. Please note, today's press release, related current report on Form 8-K, and updated version of the corporate overview presentation are all available on the investor relations portion of the company website. In terms of important housekeeping, please take note of the following. During this call, we may make certain statements related to our business that are forward-looking statements under federal securities laws.

Speaker #2: Joining me with prepared remarks are Joshua Resnik, Chief Executive Officer and President, and Jon Slabaugh, Chief Financial Officer and Chief Investment Officer. Other members of the senior management team will be available as needed during the Q&A session that will follow.

Speaker #2: Please note, today's press release, related current report on Form 8-K, and updated version of the corporate overview presentation are all available on the investor relations portion of the company website.

Speaker #2: In terms of important housekeeping, please take note of the following: during this call, we may make certain statements related to our business that are forward-looking statements under federal securities laws.

Speaker #2: 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 statement.

Yojin Yoon: 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 statement. 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 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.

Speaker #2: 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.

Speaker #2: Additionally, non-DAP 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 for a reconciliation of these measures to their most directly comparable DAP financial measure.

Speaker #2: 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.

Yojin Yoon: These include annual recurring revenue, or ARR, and net revenue retention, or NRR. With that, I'd like to turn the call over to FiscalNote CEO and President, Josh Resnik.

Speaker #2: With that, I'd like to turn the call over to FiscalNote's CEO and President, Josh Resnik.

Speaker #3: Thank you, Yojen, and thanks to everyone for joining us. I'm glad to be here to discuss FiscalNote's full year 2025 results and to share our strategic vision for 2026 and beyond.

Josh Resnik: Thank you, Yojin, and thanks to everyone for joining us. I'm glad to be here to discuss FiscalNote's full year 2025 results and to share our strategic vision for 2026 and beyond. Over the past year, and including the recent market expansions and the additional streamlining that we announced today, we've made significant changes to strengthen our foundation and align our strategy with evolving customer needs and market opportunities. The FiscalNote you see today is more profitable, more agile, and better positioned for the future. As outlined in today's press release, we are guiding to approximately $1 million of Adjusted EBITDA in Q1 and, reflecting the cost actions announced today, $14 million to $16 million for the full year.

Speaker #3: Over the past year, and including the recent market expansions and the additional streamlining that we announced today, we've made significant changes to strengthen our foundation and align our strategy with evolving customer needs and market opportunities.

Speaker #3: The FiscalNote you see today is more profitable, more agile, and better positioned for the future. As outlined in today's press release, we are guiding to approximately $1 million of adjusted EBITDA in the first quarter and, reflecting the cost actions announced today, $14 million to $16 million for the full year.

Speaker #3: This implies adjusted EBITDA of roughly $13 million to $15 million across the remaining three quarters, with margins expected to exceed 20% in that same period.

Josh Resnik: This implies Adjusted EBITDA of roughly $13 to 15 million across the remaining 3 quarters, with margins expected to exceed 20% in that same period. That represents a meaningful step change in profitability and approximately doubles our Adjusted EBITDA margin profile compared to the same period in 2025. Separate from Adjusted EBITDA, what's vitally important is that after implementing the changes announced today and excluding one-time costs associated with the restructuring, we expect FiscalNote will generate positive free cash flow for the 12 months ending 31 March 2027. This is a significant inflection point and represents the start of a promising new chapter in FiscalNote's evolution.

Speaker #3: That represents a meaningful step change in profitability and approximately doubles our adjusted EBITDA margin profile compared to the same period in 2025. Separate from adjusted EBITDA, what's vitally important is that after implementing the changes announced today, and excluding one-time costs associated with the restructuring, we expect FiscalNote will generate positive free cash flow for the 12 months ending March 31, 2027.

Speaker #3: This is a significant inflection point and represents the start of a promising new chapter in FiscalNote's evolution. These efforts have provided the company with a much stronger foundation, and we are now taking a new leap forward to positive free cash flow while also positioning the company to take advantage of opportunities in two new high-growth markets.

Josh Resnik: These efforts have provided the company with a much stronger foundation, and we are now taking a new leap forward to positive free cash flow, while also positioning the company to take advantage of opportunities in two new high-growth markets. Today, we announced a plan to reduce our cash operating expenses by over 19%, significantly accelerating our ongoing operational transformation through changes to personnel as well as insourcing third-party spend. More specifically, we are implementing a workforce transformation plan that will reduce headcount by approximately 25% year-over-year. This is a continuation of our operational discipline that is now being accelerated by rapid advancements in generative and agentic AI. As you know, we have already eliminated more than $35 million in annual cash operating expenses over the past three years.

Speaker #3: Today, we announced a plan to reduce our cash operating expenses by over 19%, significantly accelerating our ongoing operational transformation through changes to personnel as well as insourcing third-party spend.

Speaker #3: More specifically, we are implementing a workforce transformation plan that will reduce headcount by approximately 25% year over year. This is a continuation of our operational discipline that is now being accelerated by rapid advancements in generative and agentic AI.

Speaker #3: As you know, we have already eliminated more than $35 million in annual cash operating expenses over the past three years. We've done this through applying a clear strategic focus and ensuring that our operating structure and cadence reflect that focus.

Josh Resnik: We've done this through applying a clear strategic focus and ensuring that our operating structure and cadence reflects that focus, reducing investment in non-core, and unprofitable areas. As an organization that was born during the age of big data, when AI was known as machine learning and natural language processing, we have always operated at the leading edge of what we now call artificial intelligence. We have been deploying the most recent forms of generative and agentic AI over the past year, with the greatest focus in our R&D organization to strong results. We now have 100% adoption of AI tooling across our engineering organization, which is translating directly into development cycles that are now approximately three times faster than before. With work that previously took months, now often completed in weeks, and work that took weeks, increasingly delivered in days.

Speaker #3: Reducing investment in non-core and unprofitable areas. And as an organization that was born during the age of big data, when AI was known as machine learning and natural language processing, we have always operated at the leading edge of what we now call artificial intelligence.

Speaker #3: We have been deploying the most recent forms of generative and agentic AI over the past year, with the greatest focus in our R&D organization, to strong results.

Speaker #3: We now have 100% adoption of AI tooling across our engineering organization, which is translating directly into development cycles that are now approximately three times faster than before, with work that previously took months now often completed in weeks.

Speaker #3: And work that took weeks is increasingly delivered in days. In Q4, our R&D teams used AI in 88% of their completed development work, enabling them to accomplish 70% more than they did in the same period one year prior.

Josh Resnik: In Q4, our R&D teams used AI in 88% of their completed development work, enabling them to accomplish 70% more than they did in the same period one year prior. This is a clear example of what becomes possible when these tools are deployed effectively at scale. The bulk of reductions tied to today's announcement are in our commercial teams, content generation, and G&A. I'll walk you through how we're doing this and what that means for what you can expect going forward. We are reducing our commercial organization by approximately 24% on an expense basis and approximately 18% on a headcount basis as we continue to align our go-to-market structure with how customers increasingly discover, evaluate, and adopt our products.

Speaker #3: This is a clear example of what becomes possible when these tools are deployed effectively at scale. The bulk of reductions tied to today's announcement are in our commercial teams, content generation, and G&A.

Speaker #3: I'll walk you through how we're doing this, and what that means for what you can expect going forward. We are reducing our commercial organization by approximately 24% on an expense basis, and approximately 18% on a headcount basis.

Speaker #3: As we continue to align our go-to-market structure with how customers increasingly discover, evaluate, and adopt our products, these actions include eliminating certain highly compensated senior roles and increasing automation of our outbound marketing activities, allowing us to operate more efficiently without reducing capacity.

Josh Resnik: These actions include eliminating certain highly compensated senior roles and increasing automation of our outbound marketing activities, allowing us to operate more efficiently without reducing capacity. We also are deploying agentic AI workflows to significantly increase the speed, customization, and scalability of client support, enabling higher service levels with a leaner team while maintaining coverage. In parallel, we are accelerating our transition toward product-led growth by expanding our API offerings and exploring additional low-friction purchasing mechanisms, including credit card-based self-serve onboarding and emerging agentic AI payment models, allowing customers to access and scale usage of our data without traditional sales engagement.

Speaker #3: We also are deploying agentic AI workflows to significantly increase the speed, customization, and scalability of client support, enabling higher service levels with a leaner team while maintaining coverage.

Speaker #3: In parallel, we are accelerating our transition toward product-led growth by expanding our API offerings and exploring additional low-friction purchasing mechanisms, including credit-card-based self-serve onboarding and emerging agentic AI payment models.

Speaker #3: Allowing customers to access and scale usage of our data without traditional sales engagement. We also are improving the efficiency of our content operations by approximately 20% on an expense basis, and approximately 33% on a headcount basis.

Josh Resnik: We also are improving the efficiency of our content operations by approximately 20% on an expense basis and approximately 33% on a headcount basis by leveraging generative AI for segments of our content production and deploying agentic workflows to automate certain routine editorial and publishing tasks, including managing publication workflows into our CMS. These initiatives reduce manual effort and lower value activities while increasing speed and consistency of output. Importantly, we are minimizing changes in our highest value areas, including bespoke monitoring and analytical services for clients, as well as the CQ Roll Call Newsroom's core reporting capabilities. Overall, our objective is to use AI to enhance productivity and scalability while preserving the human expertise and differentiated coverage that define our premium offerings. In G&A, we're reducing by approximately 12% on an expense basis through targeted and aggressive vendor savings.

Speaker #3: By leveraging generative AI for segments of our content production, and deploying agentic workflows to automate certain routine editorial and publishing tasks, including managing publication workflows into our CMS.

Speaker #3: These initiatives reduce manual effort and lower-value activities, while increasing speed and consistency of output. Importantly, we are minimizing changes in our highest-value areas, including bespoke monitoring and analytical services for clients.

Speaker #3: As well as the secure Roll Call newsroom's core reporting capabilities. Overall, our objective is to use AI to enhance productivity and scalability, while preserving the human expertise and differentiated coverage that define our premium offerings.

Speaker #3: In G&A, we're reducing by approximately 12% on an expense basis through targeted and aggressive vendor savings. In parallel, with the rapid advancement of agentic AI capabilities in recent months, we are deploying these tools at scale across the broader organization.

Josh Resnik: In parallel, with the rapid advancement of agentic AI capabilities in recent months, we are deploying these tools at scale across the broader organization. This initiative combines targeted top-down transformation initiatives along with organic adoption at the team level to improve productivity and execution across a broad set of functions. As part of this effort, we are beginning to pair managers and team members with AI platforms, effectively creating human plus AI operating dyads that expand individual capacity and enable higher impact work. We view this as a strategic evolution in how modern companies are built and run, recognizing that AI tools are increasingly becoming true force multipliers, and that incremental adoption alone will not be sufficient to capture their full value. Taken together, these actions are designed to structurally improve our operating leverage while preserving the drivers of retention, expansion, and long-term growth.

Speaker #3: This initiative combines targeted top-down transformation initiatives along with organic adoption at the team level to improve productivity and execution. As a part of this effort, we are beginning to pair managers and team members with AI platforms, effectively creating human-plus-AI operating dyads that expand individual capacity and enable higher impact work.

Speaker #3: We view this as a strategic evolution in how modern companies are built and run, recognizing that AI tools are increasingly becoming true force multipliers.

Speaker #3: And that incremental adoption alone will not be sufficient to capture their full value. Taken together, these actions are designed to structurally improve our operating leverage, while preserving the drivers of retention, expansion, and long-term growth.

Speaker #3: Our relative investment in product and R&D has increased, with a larger share of capital allocated to investment in Policy Note and emerging growth initiatives, while reducing lower-return cost areas.

Josh Resnik: Our relative investment in product and R&D has increased with a larger share of capital allocated to investments in PolicyNote and emerging growth initiatives while reducing lower return cost areas. By simplifying workflows, reducing manual effort, and reallocating capital towards scalable product capabilities, we expect to support both margin expansion and more efficient revenue generation over time. This is what gives us increased confidence in achieving consistent, positive free cash flow while continuing to invest in the strategic initiatives that will define FiscalNote's next phase. Importantly, we believe this transformation positions the company to grow more efficiently as customer consumption models continue to evolve. This transformation comes at a pivotal moment as we sit at an inflection point in how policy intelligence is consumed, trusted, and acted on.

Speaker #3: By simplifying workflows, reducing manual effort, and reallocating capital toward scalable product capabilities, we expect to support both margin expansion and more efficient revenue generation over time.

Speaker #3: This is what gives us increased confidence in achieving consistent, positive free cash flow, while continuing to invest in the strategic initiatives that will define FiscalNote's next phase.

Speaker #3: Importantly, we believe this transformation positions the company to grow more efficiently, as customer consumption models continue to evolve. This transformation comes at a pivotal moment, as we sit at an inflection point in how policy intelligence is consumed, trusted, and acted on.

Speaker #3: This creates new avenues for FiscalNote to apply its data, expertise, and relationships, and FiscalNote is well positioned for these new growth opportunities. Our company has a uniquely valuable set of assets.

Josh Resnik: This creates new avenues for FiscalNote to apply its data, expertise, and relationships, and FiscalNote is well positioned for these new growth opportunities. Our company has a uniquely valuable set of assets. Global to local data spanning more than 100 countries and over 16,000 local districts assembled from highly fragmented and unstructured sources. Award-winning proprietary analysis that is widely recognized for its expertise and objectivity. Deep domain expertise built over many years, and thousands of trusted relationships with leading institutions across the private sector, public sector, and NGO community. The problem in our core business has not been the assets. Even setting aside our proprietary data and analysis, the public datasets are highly fragmented, unstructured, and difficult to collect at scale, and making them decision-ready requires extensive normalization, context, and domain expertise, which is where FiscalNote creates differentiated value.

Speaker #3: Global to local data, spanning more than 100 countries and over 16,000 local districts, assembled from highly fragmented and unstructured sources. Award-winning proprietary analysis that is widely recognized for its expertise and objectivity.

Speaker #3: Deep domain expertise built over many years, and thousands of trusted relationships with leading institutions across the private sector, public sector, and NGO community. The problem in our core business has not been the assets.

Speaker #3: Even setting aside our proprietary data and analysis, the public data sets are highly fragmented, unstructured, and difficult to collect at scale. And making them decision-ready requires extensive normalization, context, and domain expertise.

Speaker #3: Which is where FiscalNote creates differentiated value. And while FiscalNote started doing this more than a decade ago, I think it has now become clear to everyone how important this data is to organizations around the world, making this valuable data even more ripe for consumption.

Josh Resnik: While FiscalNote started doing this more than a decade ago, I think it has now become clear to everyone how important this data is to organizations around the world. Making this valuable data even more ripe for consumption. The challenge with our core business then has not been the data. The problem has been the delivery mechanism. Our valuable data sets have been constrained by legacy platforms that were siloed and increasingly unable to keep pace with technology. That created a gap between the value we had and the value that we were able to deliver to our customers. Beyond our own platform challenges, those interested in the data were limited in their ability to maximize value by combining our insights with their own internal data set, as well as accessing our data through other platforms of their choosing.

Speaker #3: The challenge with our core business, then, has not been the data. The problem has been the delivery mechanisms. Our valuable datasets have been constrained by legacy platforms that were siloed and increasingly unable to keep pace with technology.

Speaker #3: That created a gap between the value we had and the value that we were able to deliver to our customers. And beyond our own platform challenges, those interested in the data were limited in their ability to maximize value by combining our insights with their own internal data set.

Speaker #3: As well as accessing our data through other platforms of their choosing. In short, the policy intelligence that we provide is highly valuable to organizations of all types around the world.

Josh Resnik: In short, the policy intelligence that we provide is highly valuable to organizations of all types around the world, and with the right delivery mechanisms, we believe FiscalNote can build a growing, thriving, and highly profitable business. We've responded by rethinking delivery end-to-end, strengthening our platform while ensuring our intelligence can flow into new channels that are opening up meaningful, scalable growth opportunities. The launch of PolicyNote a year ago was our first step in changing our own delivery mechanism. We knew that the impact of PolicyNote would take some time to develop, and in a moment, I'll explain where we are on that path.

Speaker #3: And with the right delivery mechanisms, we believe FiscalNote can build a growing, thriving, and highly profitable business. We've responded by rethinking delivery end-to-end, strengthening our platform, while ensuring our intelligence can flow into new channels that are opening up meaningful, scalable growth opportunities.

Speaker #3: The launch of Policy Note a year ago was our first step in changing our own delivery mechanisms. We knew that the impact of Policy Note would take some time to develop.

Speaker #3: And in a moment, I'll explain where we are on that path. But beyond PolicyNote itself, because we focused on our strengths in policy and have done the foundational work to ensure that our valuable insights can be leveraged outside our own platforms, we also placed ourselves in the path of significant new opportunities as the world around us is changing.

Josh Resnik: Beyond PolicyNote itself, because we focus on our strengths in policy and have done the foundational work to ensure that our valuable insights can be leveraged outside our own platforms, we also have placed ourselves in the path of significant new opportunities as the world around us is changing. As a result, at this new inflection point for information consumption, FiscalNote is uniquely positioned to take advantage of the growing demand for political and policy intelligence through new markets that barely existed a year ago, specifically prediction markets and AI-driven consumption. These are transformative new areas with the potential to scale quickly. First, I'll touch on PolicyNote. In 2025, we executed the first phase of the PolicyNote migration, completely transitioning customers off of the legacy FiscalNote platform.

Speaker #3: As a result, at this new inflection point for information consumption, FiscalNote is uniquely positioned to take advantage of the growing demand for political and policy intelligence through new markets that barely existed a year ago—specifically, prediction markets and AI-driven consumption.

Speaker #3: These are transformative new areas with the potential to scale quickly. First, I'll touch on Policy Note. In 2025, we executed the first phase of the Policy Note migration, completely transitioning customers off of the legacy FiscalNote platform.

Speaker #3: Usage metrics on Policy Note remain strong throughout 2025, with key activity adoption and frequency of use higher in Policy Note compared to the legacy FiscalNote platform over a similar time period, indicating that a greater share of users have made Policy Note part of their regular workflow.

Josh Resnik: Usage metrics on PolicyNote remained strong throughout 2025, with key activity, adoption, and frequency of use higher in PolicyNote compared to the legacy FiscalNote platform over a similar time period, indicating that a greater share of users have made PolicyNote part of their regular workflow. For example, the share of users viewing legislation rose by 250%, and the share viewing alerts increased by 88%. These stats and others indicate both broader usage and repeat engagement. In addition, as we continue to build a longer track record of customer performance on PolicyNote, we're seeing signs of improved retention compared with legacy platform cohorts.

Speaker #3: For example, the share of users viewing legislation rose by 250%, and the share viewing alerts increased by 88%. These stats and others indicate both broader usage and repeat engagement.

Speaker #3: In addition, as we continue to build a longer track record of customer performance on Policy Note, we're seeing signs of improved retention compared with legacy platform cohorts.

Speaker #3: While Policy Note currently represents only a portion of our overall customer base, and broader factors such as budget constraints, prior customer experience on legacy systems, and ongoing platform refinement continue to influence results, we believe that these early trends point to the potential for stronger, underlying customer health over time as the platform matures and adoption expands.

Josh Resnik: While PolicyNote currently represents only a portion of our overall customer base and broader factors such as budget constraints, prior customer experience on legacy systems, and ongoing platform refinement continue to influence results, we believe that these early trends point to the potential for stronger underlying customer health over time as the platform matures and adoption expands. In that vein, as John will discuss in more depth, we have experienced some headwinds that are worth addressing directly. A small number of large enterprise customers chose to cancel without migrating to PolicyNote, and therefore did not have the opportunity to evaluate the new platform. In addition, broader macroeconomic pressures continue to influence client budgeting decisions across parts of our customer base. Looking ahead, PolicyNote is not standing still, and we still have more work to do.

Speaker #3: In that vein, as John will discuss in more depth, we have experienced some headwinds that are worth addressing directly. A small number of large enterprise customers chose to cancel without migrating the policy note, and therefore did not have the opportunity to evaluate the new platform.

Speaker #3: In addition, broader macroeconomic pressures continue to influence client budgeting decisions across parts of our customer base. Looking ahead, FiscalNote is not standing still, and we still have more work to do.

Speaker #3: From a product development standpoint, we continue to invest in improving the core user experience as well as adding new AI-powered enhancements. I'm confident in the work our product and R&D teams are doing.

Josh Resnik: From a product development standpoint, we continue to invest in improving the core user experience as well as adding new AI-powered enhancements. I'm confident in the work our product and R&D teams are doing, building on the more than 35 major features we launched in 2025, including AI legislative drafting, social listening for early policy signals, bill comparison, and AI-generated tariff impact reports. Going forward, we plan to focus on creating a differentiated experience that is heavy on agentic workflow tied to our unique and proprietary mix of specialized data and insights. In summary, when PolicyNote is complete, it will be an all-in-one platform for customers who want to leverage an AI-native, policy-specific vertical platform with trusted data and expertise. On the PolicyNote back end, we are leveraging best-in-class AI technology so that our customers get the benefit of advancements by the industry's leading platforms.

Speaker #3: Building on the more than 35 major features we launched in 2025, including AI legislative drafting, social listening for early policy signals, bill comparison, and AI-generated tariff impact reports.

Speaker #3: Going forward, we plan to focus on creating a differentiated experience that is heavy on agentic workflow, tied to our unique and proprietary mix of specialized data and insights.

Speaker #3: In summary, when PolicyNote is complete, it will be an all-in-one platform for customers who want to leverage an AI-native, policy-specific vertical platform with trusted data and expertise.

Speaker #3: On the policy note backend, we are leveraging best-in-class AI technology so that our customers get the benefit of advancements by the industry's leading platforms.

Speaker #3: But our in-depth prompt engineering and our ability to leverage continually updated, accurate data sets and proprietary analysis give Policy Note customers an important edge over what they can get from AI agents built on top of general-purpose platforms.

Josh Resnik: Our in-depth prompt engineering and our ability to leverage continually updated, accurate datasets, and proprietary analysis give PolicyNote customers an important edge over what they can get from AI agents built on top of general purpose platforms. Nonetheless, we also embrace the fact that the world is rapidly changing, and the ways in which users want to consume our trusted information has and will continue to change. Users have more options for information discovery and consumption. The barriers to creating their own custom platforms are coming down. Third-party AI platforms are getting better, and the use of agents is proliferating. This creates new opportunities for us, and I'll now turn to discussion of our policy intelligence as the infrastructure for AI-driven consumption outside of our PolicyNote platform.

Speaker #3: Nonetheless, we also embrace the fact that the world is rapidly changing, and the ways in which users want to consume our trusted information have, and will continue to, change.

Speaker #3: Users have more options for information discovery and consumption. The barriers to creating their own custom platforms are coming down. Third-party AI platforms are getting better, and the use of agents is proliferating.

Speaker #3: This creates new opportunities for us, and I'll now turn to discussion of our policy intelligence as the infrastructure for AI-driven consumption outside of our Policy Note platform.

Speaker #3: The world is changing rapidly, and customers increasingly will want to consume authoritative policy intelligence inside their own environments, embedded directly into their own enterprise tools, workflows, and AI agents.

Josh Resnik: The world is changing rapidly, and customers increasingly will want to consume authoritative policy intelligence inside their own environments, embedded directly into their own enterprise tools, workflows, and AI agents, rather than through a standalone platform. Alongside the emergence of new contexts, such as prediction markets, which I'll discuss shortly, this shift has the potential to unlock a significant expansion in demand for FiscalNote's unique blend of data and expertise. We believe this represents a large and durable growth opportunity and one where we are well positioned to lead defining the infrastructure layer for how policy intelligence is operationalized in AI-driven environments. Over the past year, as part of the PolicyNote transformation, we completed foundational work to modernize and enhance our APIs. More recently, we extended that capability by introducing native support for the Model Context Protocol, or MCP.

Speaker #3: Rather than through standalone platforms. Alongside the emergence of new contexts such as prediction markets, which I'll discuss shortly, this shift has the potential to unlock a significant expansion in demand for FiscalNote's unique blend of data and expertise.

Speaker #3: We believe this represents a large and durable growth opportunity, and one where we are well positioned to lead in defining the infrastructure layer for how policy intelligence is operationalized in AI-driven environments.

Speaker #3: Over the past year, as part of the policy note transformation, we completed foundational work to modernize and enhance our APIs. More recently, we extended that capability by introducing native support for the Model Context Protocol, or MCP.

Speaker #3: And for those of you for whom MCP is a new term, it's an emergent standard with extremely high adoption rates within the agentic AI community.

Josh Resnik: For those of you for whom MCP is a new term, it's an emergent standard with extremely high adoption rates within the agentic AI community. Earlier this month, we formally announced the expansion of the PolicyNote API alongside the launch of these MCP wrappers. This enables MCP-compatible AI agents and platforms, including those built on Claude, OpenAI, Google Gemini, or Microsoft ecosystems, to discover, query, and integrate FiscalNote's legislative, regulatory, and stakeholder intelligence as a first-class, trusted, and verified operational data layer within their workflows. Importantly, the value of FiscalNote does not reside in any single delivery interface. It resides in the depth and breadth of our data, our domain expertise, our governance processes, our commitment to accuracy, and the trust we have built with customers over many years.

Speaker #3: Earlier this month, we formally announced the expansion of the Policy Note API alongside the launch of these MCP wrappers. This enables MCP-compatible AI agents and platforms, including those built on Claude, OpenAI, Google Gemini, or Microsoft ecosystems.

Speaker #3: To discover, query, and integrate FiscalNote's legislative, regulatory, and stakeholder intelligence as a first-class, trusted, and verified operational data layer within their workflows. Importantly, the value of FiscalNote does not reside in any single delivery interface.

Speaker #3: It resides in the depth and breadth of our data, our domain expertise, our governance processes, our commitment to accuracy, and the trust we have built with customers over many years.

Speaker #3: As intelligence increasingly moves into automated systems, these capabilities position FiscalNote as a critical operating layer or infrastructure that enables AI agents and enterprise workflows to function with confidence in high-stakes policy environments.

Josh Resnik: As intelligence increasingly moves into automated systems, these capabilities position FiscalNote as a critical operating layer or infrastructure that enables AI agents and enterprise workflows to function with confidence in high-stakes policy environments. This shift significantly expands our total addressable market. By making our intelligence programmatically accessible, we can attract a broader ecosystem of developers, partners, and third-party platforms that may never have purchased a traditional software product but are highly willing to embed and rent trusted infrastructure. This creates the potential for FiscalNote to scale alongside the growth of AI-native enterprise applications and agentic AI decision support systems globally. This is already live in market. We have enterprise customers actively using our APIs today, including organizations such as Lumen Technologies and ICE Data Services, a subsidiary of Intercontinental Exchange, which operates multiple futures markets and stock exchanges.

Speaker #3: This shift significantly expands our total addressable market. By making our intelligence programmatically accessible, we can attract a broader ecosystem of developers, partners, and third-party platforms that may never have purchased a traditional software product, but are highly willing to embed and rent trusted infrastructure.

Speaker #3: This creates the potential for FiscalNote to scale alongside the growth of AI-native enterprise applications and agentic AI decision support systems globally. This is already live in market.

Speaker #3: We have enterprise customers actively using our APIs today, including organizations such as Lumen Technologies and ICE Data Services, a subsidiary of Intercontinental Exchange, which operates multiple futures markets and stock exchanges.

Speaker #3: These deployments are generating revenue and represent early proof points for what we believe can become a meaningful and scalable growth engine. Strategically, this approach opens FiscalNote to new categories of customers, including enterprises building internal decision tools, smaller organizations seeking targeted, on-demand access, and developers creating AI-native products who need appropriately sourced and verified data.

Josh Resnik: These deployments are generating revenue and represent early proof points for what we believe can become a meaningful and scalable growth engine. Strategically, this approach opens FiscalNote to new categories of customers, including enterprises building internal decision tools, smaller organizations seeking targeted on-demand access, and developers creating AI-native products who need appropriately sourced and verified data. It also supports a true product-led growth motion, where teams can provision API keys, explore documentation, and begin integrating our intelligence without a lengthy custom sales or onboarding process. Over time, as more third-party applications and automated workflows rely on our infrastructure, FiscalNote can benefit from an additional strategic advantage, the creation of richer longitudinal data and usage signals. This continuous feedback loop can further strengthen our internal models, improve product quality, and reinforce our data moat in ways that are difficult for competitors to replicate.

Speaker #3: It also supports a true product-led growth motion, where teams can provision API keys, explore documentation, and begin integrating our intelligence without a lengthy, custom sales or onboarding process.

Speaker #3: Over time, as more third-party applications and automated workflows rely on our infrastructure, FiscalNote can benefit from an additional strategic advantage: the creation of richer, longitudinal data and usage signals.

Speaker #3: This continuous feedback loop can further strengthen our internal models and improve product quality, and reinforce our data model in ways that are difficult for competitors to replicate.

Speaker #3: From a commercial perspective, we're exploring both consumption-based pricing models and hybrid structures that allow customers to shift spend between seat-based licenses and API usage credits.

Josh Resnik: From a commercial perspective, we're exploring both consumption-based pricing models and hybrid structures that allow customers to shift spend between seat-based licenses and API usage credits. Given the scarcity and mission-critical nature of governed policy intelligence and the real-world financial and operational outcomes it influences, we believe we can maintain pricing integrity across delivery models. Finally, this expanding business model is expected to be highly profitable. The core infrastructure has already been built, incremental cost of delivery is low, and the absence of per-seat scaling constraints allows revenue to grow efficiently as usage expands. In summary, making our intelligence programmatically accessible allows FiscalNote to participate more directly in new ecosystems where high-quality policy insight is becoming mission-critical. Now, I'd like to discuss a second major application of our capabilities and one where we see particularly compelling growth potential, political prediction markets.

Speaker #3: Given the scarcity and mission-critical nature of governed policy intelligence, and the real-world financial and operational outcomes it influences, we believe we can maintain pricing integrity across delivery models.

Speaker #3: Finally, this expanding business model is expected to be highly profitable. The core infrastructure has already been built, incremental cost of delivery is low, and the absence of per-seat scaling constraints allows revenue to grow efficiently as usage expands.

Speaker #3: In summary, making our intelligence programmatically accessible allows FiscalNote to participate more directly in new ecosystems where high-quality policy insight is becoming mission-critical. And now, I'd like to discuss a second major application of our capabilities, and one where we see particularly compelling growth potential: political prediction markets.

Speaker #3: Our entry into the space is exciting, highly relevant, and extremely adjacent. It is a high-conviction extension of the same foundational assets that define FiscalNote today.

Josh Resnik: Our entry into this space is exciting, highly relevant, and extremely adjacent. It is a high-conviction extension of the same foundational assets that define FiscalNote today. The proprietary data that we've assembled, our domain expertise, our predictive modeling capabilities, and our deep understanding of regulatory and geopolitical dynamics all translate naturally into the needs of participants in prediction markets. The market itself has undergone a structural transformation. In the United States, prediction market volume expanded from approximately $9 billion in 2024 to roughly $44 billion in 2025, a fourfold increase in just one year. Current trends suggest the market could approach a $150 billion annualized run rate in 2026. Institutional validation is also accelerating. Bloomberg has integrated prediction market signals into the terminal, and major trading firms are beginning to establish dedicated prediction market desks.

Speaker #3: The proprietary data that we've assembled, our domain expertise, our predictive modeling capabilities, and our deep understanding of regulatory and geopolitical dynamics all translate naturally into the needs of participants in prediction markets.

Speaker #3: The market itself has undergone a structural transformation. In the United States, prediction market volume expanded from approximately $9 billion in 2024 to roughly $44 billion in 2025, a fourfold increase in just one year.

Speaker #3: And current trends suggest the market could approach a $150 billion annualized run rate in 2026. Institutional validation is also accelerating. Bloomberg has integrated prediction market signals into the terminal, and major trading firms are beginning to establish dedicated prediction market desks.

Speaker #3: At the regulatory level, the CFTC's Future-Proof initiative has signaled a meaningful shift toward treating political event contracts as legitimate derivatives rather than speculative wagering instruments.

Josh Resnik: At the regulatory level, the CFTC's Future Proof Initiative has signaled a meaningful shift toward treating political event contracts as legitimate derivatives rather than speculative wagering instruments. Its recent announcement regarding potential rulemaking indicates a desire to mature the applicable regulatory frameworks and bring greater trust and transparency to these markets. Taken together, these developments point to the early stages of what we believe could become a significant new category within institutional financial markets. Longer term, event-based derivatives tied to policy and geopolitical outcomes could represent a market measured in the hundreds of billions and potentially approaching a trillion in annual volume as they become embedded in brokerage platforms, corporate risk management frameworks, and macro trading strategies. Even a modest participation in this ecosystem would represent a meaningful opportunity relative to FiscalNote's current revenue base. Our role in this market is distinct.

Speaker #3: In its recent announcement regarding potential rulemaking, it indicates a desire to mature the applicable regulatory frameworks and bring greater trust and transparency to these markets.

Speaker #3: Taken together, these developments point to the early stages of what we believe could become a significant new category within institutional financial markets. Longer term, event-based derivatives tied to policy and geopolitical outcomes could represent a market measured in the hundreds of billions and potentially approaching a trillion in annual volume, as they become embedded in brokerage platforms, corporate risk management frameworks, and macro trading strategies.

Speaker #3: Even a modest participation in this ecosystem would represent a meaningful opportunity relative to FiscalNote's current revenue base. Our role in this market is distinct.

Speaker #3: We are not seeking to build or operate an exchange. Instead, we are focused on providing the differentiated intelligence layer that improves market quality and usability, including proprietary political risk data, contract design insights, and analytical overlays that help market participants interpret signals more effectively.

Josh Resnik: We're not seeking to build or operate an exchange. Instead, we are focused on providing the differentiated intelligence layer that improves market quality and usability, including proprietary political risk data, contract design insights, and analytical overlays that help market participants interpret signals more effectively. This approach allows us to leverage our core strengths while avoiding the capital intensity associated with exchange infrastructure. To support this strategy, we're partnering with specialized infrastructure providers, including 365Prediction, founded by Dr. Laila Mintas. These partnerships enable us to access exchange, clearing, and distribution capabilities while concentrating our investment on areas where we believe we can create the most value. We also believe FiscalNote is uniquely positioned to help raise the bar for market integrity. Factors such as accuracy, governance, transparency, and trusted resolution criteria will determine whether prediction markets evolve into institutional-grade financial infrastructure.

Speaker #3: This approach allows us to leverage our core strengths while avoiding the capital intensity associated with exchange infrastructure. To support this strategy, we're partnering with specialized infrastructure providers, including 365 Prediction, founded by Dr. Leila Mintos.

Speaker #3: These partnerships enable us to access exchange, clearing, and distribution capabilities while concentrating our investment on areas where we believe we can create the most value.

Speaker #3: We also believe FiscalNote is uniquely positioned to help raise the bar for market integrity. Factors such as accuracy, governance, transparency, and trusted resolution criteria will determine whether prediction markets evolve into institutional-grade financial infrastructure.

Speaker #3: These are precisely the areas where FiscalNote has built credibility over many years. Our structured legislative datasets and domain expertise, which span decades and cover multiple jurisdictions, provide a foundation for more precise contract specification and more defensible resolution frameworks—advantages that new entrants may find difficult to replicate.

Josh Resnik: These are precisely the areas where FiscalNote has built credibility over many years. Our structured legislative datasets and domain expertise, which span decades and cover multiple jurisdictions, provide a foundation for more precise contract specification and more defensible resolution frameworks, advantages that new entrants may find difficult to replicate. In parallel with these efforts, we also are developing and testing a portfolio of related products, some of which are previewed at PoliticalPredictions.com, aimed at other elements of this new ecosystem. From a capital perspective, the prediction market opportunity is attractive because the primary inputs, our data assets, analytical models, and institutional relationships already exist. As a result, we can pursue meaningful participation in this market without requiring significant incremental investment. We recognize that investors will naturally focus on three areas as this initiative progresses. First, timing of revenue contribution.

Speaker #3: In parallel with these efforts, we also are developing and testing a portfolio of related products, some of which are previewed at politicalpredictions.com, aimed at other elements of this new ecosystem.

Speaker #3: From a capital perspective, the prediction market opportunity is attractive because the primary inputs are data assets, analytical models, and institutional relationships already exist. As a result, we can pursue meaningful participation in this market without requiring significant incremental investment.

Speaker #3: We recognize that investors will naturally focus on three areas as this initiative progresses. First, timing of revenue contribution. While prediction markets represent a large and rapidly growing opportunity, monetization will scale over time as partnerships mature and products gain traction.

Josh Resnik: While prediction markets represent a large and rapidly growing opportunity, monetization will scale over time as partnerships mature and products gain traction. Second, margin profile. Given the infrastructure-light nature of our role, we believe incremental revenue in this area has the potential to be highly attractive from a profitability standpoint. Third, early indicators of success. In the first year, we will be focused on metrics such as product adoption, partner integrations, user engagement, and the development of new revenue streams tied to transactional activity and content distribution. Taken together, we view prediction markets as a logical and potentially transformative extension of FiscalNote's capabilities, one that allows us to participate in the evolution of how policy risk is priced, hedged, and acted upon globally. Stepping back, the FiscalNote you see today is fundamentally different from the company that existed just a year ago. First, we have reshaped the core business.

Speaker #3: Second, margin profile. Given the infrastructure-light nature of our role, we believe incremental revenue in this area has the potential to be highly attractive from a profitability standpoint.

Speaker #3: And third, early indicators of success. In the first year, we will be focused on metrics such as product adoption, partner integrations, user engagement, and the development of new revenue streams tied to transactional activity and content distribution.

Speaker #3: Taken together, we view prediction markets as a logical and potentially transformative extension of FiscalNote's capabilities—one that allows us to participate in the evolution of how policy risk is priced, hedged, and acted upon globally.

Speaker #3: Stepping back, the FiscalNote you see today is fundamentally different from the company that existed just a year ago. First, we have reshaped the core business.

Speaker #3: Policy Note is now a modern, AI-forward policy intelligence platform that is driving strong engagement. With the transition well underway and operational efficiencies taking hold, we see a clear path for this business to become a high-margin, free-cash-flow generative engine over time.

Josh Resnik: PolicyNote is now a modern, AI-forward policy intelligence platform that is driving strong engagement. With the transition well underway and operational efficiencies taking hold, we see a clear path for this business to become a high-margin, free cash flow generative engine over time. Second, we are opening meaningful new growth vectors that leverage the same underlying assets. Our expanded API capabilities and native MCP support position FiscalNote as an infrastructure layer provider of authoritative policy intelligence for the enterprise AI ecosystem. This represents a large, highly scalable product-led opportunity, one that allows us to expand total addressable market while requiring relatively modest incremental capital. Third, our entry into political prediction markets reflects another natural extension of our capabilities into one of the fastest-growing financial market categories globally.

Speaker #3: Second, we are opening meaningful new growth vectors that leverage the same underlying assets. Our expanded API capabilities and native MCP support position FiscalNote as an infrastructure layer provider of authoritative policy intelligence for the enterprise AI ecosystem.

Speaker #3: This represents a large, highly scalable, product-led opportunity—one that allows us to expand total addressable market while requiring relatively modest incremental capital. Third, our entry into political prediction markets reflects another natural extension of our capabilities into one of the fastest-growing financial market categories globally.

Speaker #3: By focusing on the intelligence layer, data analytics, contract design, and governance, we can participate in this ecosystem in a capital-efficient way while helping to raise the quality and credibility of market signals.

Josh Resnik: By focusing on the intelligence layer, data analytics, contract design, and governance, we can participate in this ecosystem in a capital-efficient way while helping to raise the quality and credibility of market signals. Underpinning all of this is a deliberate operational transformation. We are deploying AI at scale across the organization to simplify workflows, automate routine work, and increase productivity. This allows us to pursue new opportunities with a reduced cost base, strengthening operating leverage as we grow and achieving positive free cash flow on a defined near-term timeline. As a result, while FiscalNote is a more focused company today, we believe we are also a more profitable and more strategically positioned company. We have worked to make the core business structurally stronger, and we are entering large emerging markets with meaningful tailwinds without taking balance sheet risk or making capital-intensive bets.

Speaker #3: Underpinning all of this is a deliberate operational transformation. We are deploying AI at scale across the organization to simplify workflows, automate routine work, and increase productivity.

Speaker #3: This allows us to pursue new opportunities with a reduced cost base, strengthening operating leverage as we grow, and achieving positive free cash flow on a defined, near-term timeline.

Speaker #3: As a result, while FiscalNote is a more focused company today, we believe we are also a more profitable and more strategically positioned company.

Speaker #3: We have worked to make the core business structurally stronger, and we are entering large emerging markets with meaningful tailwinds, without taking balance sheet risk or making capital-intensive bets.

Speaker #3: Looking ahead over the next 12 to 18 months, investors should expect to see continued progress across all three dimensions. We expect FiscalNote to be free-cash-flow positive by the end of Q1 2027.

Josh Resnik: Looking ahead over the next 12 to 18 months, investors should expect to see continued progress across all three dimensions. We expect FiscalNote to be free cash flow positive by the end of Q1 2027. We expect the API and MCP business to become a growing contributor as adoption expands across enterprise and developer ecosystems. We expect the prediction markets initiative to demonstrate early commercial traction through partnerships, product launches, and expanding engagement. We also will continue to explore opportunities to optimize our portfolio through the strategic divestiture of non-core assets. Taken together, we believe these actions position FiscalNote to grow more efficiently, participate in new categories of demand, and create long-term shareholder value. With that, I'll turn it over to Jon to walk through the financials in more detail. Jon?

Speaker #3: We expect the API and MCP business to become a growing contributor as adoption expands across enterprise and developer ecosystems. And we expect the prediction markets initiative to demonstrate early commercial traction through partnerships, product launches, and expanding engagement.

Speaker #3: We also will continue to explore opportunities to optimize our portfolio through the strategic divestiture of non-core assets. Taken together, we believe these actions position FiscalNote to grow more efficiently, participate in new categories of demand, and create long-term shareholder value.

Speaker #3: With that, I'll turn it over to Jon to walk through the financials in more detail. Jon?

Speaker #2: Thank you, Josh. Good evening, everyone, and thank you for joining FiscalNote's fourth quarter and full year 2025 earnings call. Before getting into the details of the quarter, I want to start with a brief framing comment.

Jon Slabaugh: Thank you, Josh. Good evening, everyone, and thank you for joining FiscalNote's Q4 and Full Year 2025 Earnings Call. Before getting into the details of the quarter, I want to start with a brief framing comment. 2025 was a year of significant operational execution and strategic transition for FiscalNote. Over the course of the year, we simplified the company, divested several non-core assets, streamlined our cost structure, and focused the business squarely on our core policy intelligence platform and subscription-driven model. As a result of these efforts, FiscalNote today is a more focused company with improved operating leverage and a clear path forward towards sustainable profitability and positive free cash flow. Q4 2025 results. Total revenue for Q4 2025 was $22.2 million within our guidance range.

Speaker #2: 2025 was a year of significant operational execution and strategic transition for FiscalNote. Over the course of the year, we simplified the company, divested several non-core assets, streamlined our cost structure, and focused the business squarely on our core policy intelligence platform and subscription-driven model.

Speaker #2: As a result of these efforts, FiscalNote today is a more focused company with improved operating leverage and a clearer path forward towards sustainable profitability and positive free cash flow.

Speaker #2: Fourth quarter 2025 results. Total revenue for Q4 2025 was $22.2 million, within our guidance range. Subscription revenue continues to be the foundation of our business and represented approximately 93% of total revenue for the full year.

Jon Slabaugh: Subscription revenue continues to be the foundation of our business and represented approximately 93% of total revenue for the full year, reinforcing the durability and predictability of our recurring revenue model. As of the end of Q4, annual recurring revenue or ARR was $84.1 million. On a pro forma basis, ARR remained relatively stable compared to Q3, reflecting stabilization of the core business following product sunsetting and divestiture activities earlier in the year. On the retention side, net revenue retention was approximately 96% for the quarter, in line with expectations as clients migrate onto the PolicyNote platform. The GAAP net loss for Q4 was $22.9 million, and this includes a non-cash goodwill impairment charge of $12.4 million recorded in the quarter.

Speaker #2: Reinforcing the durability and predictability of our recurring revenue model. As of the end of the fourth quarter, annual recurring revenue, or ARR, was $84.1 million on a pro forma basis.

Speaker #2: ARR remained relatively stable compared to the third quarter, reflecting stabilization of the core business following product sunsetting and divestiture activities earlier in the year.

Speaker #2: On the retention side, net revenue retention was approximately 96% for the quarter, in line with expectations as clients migrate under the PolicyNet platform.

Speaker #2: The GAAP net loss for the fourth quarter was $22.9 million, and this includes a non-cash goodwill impairment charge of $12.4 million recorded in the quarter.

Speaker #2: Adjusted EBITDA for the fourth quarter was $2.5 million, exceeding our recent guidance of approximately $2 million and representing the 10th consecutive positive quarter for this important metric.

Jon Slabaugh: Adjusted EBITDA for the Q4 was $2.5 million, exceeding our recent guidance of approximately $2 million and representing the 10th consecutive positive quarter for this important metric. I will speak to comparative results in a minute when I address our full-year performance, but I first want to highlight several key operational milestones achieved in the Q4. The product and account management team successfully completed the migration of customers from the legacy FiscalNote platform to the new PolicyNote platform. The sales team increased the share of multi-year contracts among private sector customers from 17 to 40%, representing a 235% increase from the Q4 of 2024 to the Q4 of 2025, and our sales development efficiency doubled from the integration of more AI technology into the daily workflows. Full-year 2025 results.

Speaker #2: I will speak to comparative results in a minute when I address our full-year performance, but I first want to highlight several key operational milestones achieved in the fourth quarter.

Speaker #2: The product and account management team successfully completed the migration of customers from the legacy FiscalNote platform to the new PolicyNote platform. The sales team increased the share of multi-year contracts among private sector customers from 17% to 40%, representing a 235% increase from the fourth quarter of 2024 to the fourth quarter of 2025, and our sales development efficiency doubled from the integration of more AI technology into the daily workflows.

Speaker #2: Full year 2025 results. For fiscal year 2025, total revenue was $95.4 million compared with $120.3 million in 2024 and within our previous full year guidance range.

Jon Slabaugh: For fiscal year 2025, total revenue was $95.4 million compared with $120.3 million in 2024 and within our previous full year guidance range. As mentioned, ARR at year-end for 2025 was $84.1 million versus $107.5 million at the end of 2024. The year-over-year decline in GAAP revenue and ARR was largely driven by the strategic divestitures of several non-core businesses, including Board.org on 11 March 2024, Aicel on 31 October 2024, Oxford Analytica and Dragonfly on 31 March 2025, and Timebase on 1 July 2025.

Speaker #2: As mentioned, ARR at year-end for 2025 was $84.1 million versus $107.5 million at the end of 2024. The year-over-year decline in GAAP revenue and ARR was largely driven by the strategic divestitures of several non-core businesses, including Board.org on March 11, 2024, ASOL on October 31, 2024, Oxford Analytica and Dragonfly on March 31, 2025, and TimeBase on July 1, 2025.

Speaker #2: These divestitures collectively generated $144.9 million of gross cash proceeds for the company, approximately 4.8 times divested ARR, and the transactions were all aligned with our strategy to simplify the company, concentrate resources on our core policy business, and de-leverage the company's balance sheet.

Jon Slabaugh: These divestitures collectively generated $144.9 million of gross cash proceeds for the company, approximately 4.8 times divested ARR, and the transactions were all aligned with our strategy to simplify the company, concentrate resources on our core policy business, and de-leverage the company's balance sheet. On a pro forma basis, which excludes the impact of divested businesses, full year GAAP revenue declined by 7% or approximately $7 million, and ARR declined by 9% or approximately $8 million. This contraction reflects the impact of DOGE, non-renewals from legacy products, and the sales execution challenges we addressed earlier in 2025. As mentioned, subscription revenue represented approximately 93% of total revenue in 2025. Throughout the year, the company continued executing the structural efficiency initiatives and operating discipline across the organization.

Speaker #2: On a pro forma basis, which excludes the impact of divested businesses, full year GAP revenue declined by 7%, or approximately $7 million. If ARR declined by 9%, or approximately $8 million, this contraction reflects the impact of DOGE, non-renewals from legacy products, and the sales execution challenges we addressed earlier in 2025.

Speaker #2: As mentioned, subscription revenue represented approximately 93% of total revenue in 2025. Throughout the year, the company continued executing the structural efficiency initiatives and operating discipline across the organization, and as Josh mentioned, we have taken steps recently to further reduce costs and increase efficiency.

Jon Slabaugh: As Josh mentioned, we have taken steps recently to further reduce costs and increase efficiency. In 2025, increased efficiency resulted from eliminating expenses from divested businesses, streamlining our efforts on the consolidated PolicyNote platform, and productivity gains from the adoption of AI tools. As a result, we saw meaningful year-over-year reductions across each of our major functional expense categories. For the full year 2025, the functional expense categories were the following. The cost of revenue was $21.2 million, compared with $25.6 million in 2024, representing a decrease of $4.4 million or approximately 17% year-over-year. This decline primarily reflects the impact of divested businesses as well as efficiencies from platform consolidation.

Speaker #2: In 2025, increased efficiency resulted from eliminating expenses from divested businesses, streamlining our efforts on the consolidated policy note platform, and productivity gains from the adoption of AI tools.

Speaker #2: As a result, we saw meaningful year-over-year reductions across each of our major functional expense categories. For the full year 2025, the functional expense categories were the following: the cost of revenue was $21.2 million compared with $25.6 million in 2024, representing a decrease of $4.4 million, or approximately 17% year-over-year.

Speaker #2: This decline primarily reflects the impact of divested businesses, as well as efficiencies from platform consolidation. The sales and marketing expense was $26.6 million compared with $35.1 million in the prior year, a reduction of $8.5 million, or approximately 24% year-over-year.

Jon Slabaugh: The sales and marketing expense was $26.6 million compared with $35.1 million in the prior year, a reduction of $8.5 million or approximately 24% year-over-year. This decline primarily reflects the impact of divested businesses, as well as a more focused go-to-market strategy. Editorial expense, which supports our policy analysis and content operations, was $14.9 million compared with $18.5 million in 2024, representing a decrease of $3.6 million or approximately 19% year-over-year. This decline primarily reflects the impact of divested businesses. The research and development expense was $9.6 million compared with $12.8 million in the prior year, representing a decline of $3.2 million or 25% year-over-year.

Speaker #2: This decline primarily reflects the impact of divested businesses as well as a more focused go-to-market strategy. Editorial expense, which supports our policy analysis and content operations, was $14.9 million compared with $18.5 million in 2024, representing a decrease of $3.6 million, or approximately 19% year-over-year.

Speaker #2: This decline primarily reflects the impact of divested businesses. The research and development expense was $9.6 million, compared with $12.8 million in the prior year, representing a decline of $3.2 million, or 25% year-over-year.

Speaker #2: R&D investments remain focused primarily on the development of the policy note platform and AI-driven policy intelligence capabilities. Finally, general administrative expenses were $52.1 million, compared with $50.2 million in 2024, an increase of $1.9 million, or approximately 4% year-over-year.

Jon Slabaugh: R&D investments remain focused primarily on the development of the PolicyNote platform and AI-driven policy intelligence capabilities. Finally, general and administrative expenses were $52.1 million compared with $50.2 million in 2024, an increase of $1.9 million or approximately 4% year-over-year. After adjusting for non-cash stock-based compensation and depreciation as well as severance, costs related to the divested businesses, and our debt refinancing, our general and administrative costs decreased by approximately $6.5 million or 21%. This reflects continued cost discipline and the benefits of organizational simplification following the divestitures completed over the past 2 years. Taken together, these reductions demonstrate the significant structural cost improvements implemented across the organization during 2025, positioning the company with more efficient operating model going forward. Turning to the margins.

Speaker #2: After adjusting for non-cash stock-based compensation and depreciation, as well as severance, costs related to the divested businesses, and our debt refinancing, our general and administrative costs decreased by approximately $6.5 million, or 21%.

Speaker #2: This reflects continued cost discipline and the benefits of organizational simplification following the divestitures completed over the past two years. Taken together, these reductions demonstrate the significant structural cost improvements implemented across the organization during 2025, positioning the company with a more efficient operating model going forward.

Speaker #2: Turning to the margins for the full year, the gross margin was approximately 78%, consistent with the prior year. Our adjusted gross margin was approximately 87%, highlighting the strong underlying economics of our subscription platform after adjusting for non-cash amortization expense.

Jon Slabaugh: For the full year, the gross margin was approximately 78%, consistent with the prior year. Our adjusted gross margin was approximately 87%, highlighting the strong underlying economics of our subscription platform after adjusting for non-cash amortization expense. For the full year, Adjusted EBITDA totaled $10.3 million, also slightly above our previous full year guidance in demonstrating continued progress in improving the company's operating leverage. The company's full year 2025 Adjusted EBITDA margin was 10.8%, up from 8.1% in 2024, and this operating leverage-driven performance represents another milestone on the path to even higher Adjusted EBITDA margins. Turning to the balance sheet. At the end of 2025, cash and short-term investments totaled $26.9 million, providing solid liquidity as we move into 2026.

Speaker #2: For the full year, adjusted EBITDA totaled $10.3 million, also slightly above our previous full-year guidance and demonstrating continued progress in improving the company's operating leverage.

Speaker #2: The company's full-year 2025 adjusted EBITDA margin was 10.8%, up from 8.1% in 2024, and this operating leverage-driven performance represents another milestone on the path to even higher adjusted EBITDA margins.

Speaker #2: Turning to the balance sheet, at the end of 2025, cash and short-term investments totaled $26.9 million, providing solid liquidity as we move into 2026.

Speaker #2: During the year, we also completed the August 2025 refinancing, which strengthened our capital structure and extended our debt maturity profile. At December 31, 2025, the company had approximately $136.2 million of total debt outstanding, including $74.1 million under our senior term loan facility.

Jon Slabaugh: During the year, we also completed the August 2025 refinancing, which strengthened our capital structure and extended our debt maturity profile. At December 31, 2025, the company had approximately $136.2 million of total debt outstanding, including $74.1 million under our senior term loan facility. We remain focused on continued balance sheet improvement and disciplined capital allocation. Outlook for 2026. Over the past several quarters, we have taken significant structural cost actions across the organization, including operating efficiencies, platform consolidation, and the completion of non-core divestitures. As we look to 2026, our priorities remain focused on driving adoption and deeper engagement with the PolicyNote platform, delivering our proprietary datasets in new ways and into new markets, including through prediction platforms and agentic APIs, enabling customers to further embed our content into their internal workflows.

Speaker #2: We remain focused on continued balance sheet improvement and disciplined capital allocation. Outlook for 2026: Over the past several quarters, we have taken significant structural cost actions across the organization.

Speaker #2: Including operating efficiencies, platform consolidation, and the completion of non-core divestitures. As we look to 2026, our priorities remain focused on driving adoption and deeper engagement with the Policy Note platform, delivering our proprietary data sets in new ways, and then to new markets.

Speaker #2: Including through prediction platforms and eugenic APIs, enabling customers to further embed our content into their internal workflows. We are rolling out an extensive workforce and vendor transformation program to further advance already strong operating disciplines, and leveraging our institutional expertise with artificial intelligence to further streamline internal operations across every functional department.

Jon Slabaugh: Rolling out an extensive workforce and vendor transformation program to further advance already strong operating discipline. Leveraging our institutional expertise with artificial intelligence to further streamline internal operations across every functional department. Together, we expect these initiatives to drive continued margin improvement and greater operating efficiency in 2026. These actions and our strategic focus are designed to immediately increase Adjusted EBITDA margins to levels in excess of 20% and, as Josh mentioned, generate trailing twelve months free cash flow by the end of Q1 2027. Simultaneously, we will maintain disciplined and targeted capital allocation aimed to drive an anticipated return to revenue growth. For full year 2026, we are forecasting GAAP revenue in a range of $80 to 83 million and Adjusted EBITDA in a range of $14 to 16 million.

Speaker #2: Together, we expect these initiatives to drive continued margin improvement and greater operating efficiency in 2026. These actions and our strategic focus are designed to immediately increase adjusted EBITDA margins to levels in excess of 20%, and, as Josh mentioned, generate trailing 12-month free cash flow by the end of Q1 2027.

Speaker #2: Simultaneously, we will maintain disciplined and targeted capital allocation aimed to drive an anticipated return to revenue growth. For full year 2026, we are forecasting GAAP revenue in a range of $80 to $83 million.

Speaker #2: And adjusted EBITDA in a range of $14 to $16 million. For the first quarter of 2026, we expect GAAP revenue between $20 and $21 million.

Jon Slabaugh: For Q1 2026, we expect GAAP revenue between $20 and $21 million and Adjusted EBITDA of approximately $1 million. Our full-year profitability targets are achievable due to the significant workforce transformation and other cost actions we are implementing. We expect these measures to drive progressive improvement in Adjusted EBITDA throughout the year, resulting in higher and increasing margins as we exit the year. Our Q1 results will reflect seasonally high expenses related to our annual audit, operational costs that have since been eliminated or reduced, and the most current revenue pacing. The first quarter saw higher than normal seasonal cancellations, primarily among customers not yet transitioned to the PolicyNote platform and compounded by economic headwinds, and geopolitical complexities. These cancellations at our current pacing are fully incorporated into the company's revenue guidance. Finally, I want to address the path to positive free cash flow.

Speaker #2: And adjusted EBITDA of approximately $1 million. Our full-year profitability targets are achievable due to the significant workforce transformation and other cost actions we are implementing.

Speaker #2: We expect these measures to drive progressive improvement in adjusted EBITDA throughout the year, resulting in higher and increasing margins as we exit the year.

Speaker #2: Our Q1 results will reflect seasonally high expenses related to our annual audit, operational costs that have since been matched by current revenue pacing. The first quarter saw higher-than-normal seasonal cancellations, primarily among customers not yet transitioned to the Policy Note platform, and compounded by economic headwinds and geopolitical complexities.

Speaker #2: These cancellations and our current pacing are fully incorporated into the company’s revenue guidance. Finally, I want to address the past deposit of free cash flow.

Speaker #2: Based on the operating improvements we are implementing, and our current outlook for revenue and profitability, we expect FiscalNote to achieve trailing 12-month positive free cash flow by the end of the first quarter of 2027, and to remain free cash flow positive thereafter.

Jon Slabaugh: Based on the operating improvements we are implementing and our current outlook for revenue and profitability, we expect FiscalNote to achieve trailing twelve-month positive free cash flow by the end of Q1 2027 and to remain free cash flow positive thereafter. This milestone reflects the cumulative impact of our streamlined operating structure, continued margin expansion, and disciplined capital management. We believe this trajectory positions FiscalNote to deliver sustainable long-term profitability and increasing shareholder value. To summarize, 2025 is a year of significant execution and transformation for FiscalNote. We simplified the business, strengthened the balance sheet, and launched a next generation platform that we believe will drive improved retention, stronger customer engagement, and long-term growth.

Speaker #2: This milestone reflects the cumulative impact of our streamlined operating structure, continued margin expansion, and disciplined capital management. We believe this trajectory positions FiscalNote to deliver sustainable, long-term profitability and increasing shareholder value.

Speaker #2: To summarize, 2025 is a year of significant execution and transformation for FiscalNote. We simplified the business, strengthened the balance sheet, and launched a next-generation platform that we believe will drive improved retention, stronger customer engagement, and long-term growth.

Speaker #2: As we move into 2026, we remain focused on operating leverage, platform adoption, and disciplined financial execution as we continue progressing towards sustainable profitability and positive free cash flow, while also seeking to develop new revenue opportunities in the prediction markets and non-platform products such as our eugenic APIs.

Jon Slabaugh: As we move into 2026, we remain focused on operating leverage, platform adoption, and disciplined financial execution as we continue progressing towards sustainable profitability and positive free cash flow, while also seeking to develop new revenue opportunities in the prediction markets and non-platform products such as our agentic APIs. With that, I'll turn the call back to the operator so we can begin the Q&A session.

Speaker #2: With that, I'll turn the call back to the operators so we can begin the Q&A session.

Speaker #1: Thank you. Again, if you would like to ask a question, press star and then the number one on your telephone keypad. We will pause for just a moment to compile the Q&A roster.

Operator: Thank you. Again, if you would like to ask a question, press star and then the number one on your telephone keypad, and we will pause for just a moment to compile the Q&A roster. Our first question comes from the line of Michael Latimore with Northland Capital Markets. Your line is open.

Speaker #1: And our first question comes from the line of Mike Lattimore with Northland Capital Markets. Your line is open.

Speaker #3: All right. Great. Yeah, thanks. Thanks very much. Yeah. So the— I mean, just the gross margins continue to be really strong. Should we view them as sustainable, or do some of these cost initiatives have a positive impact there?

Michael Latimore: All right, great. Yeah, thanks. Thanks very much. Yeah, so the gross margins continue to be really strong. Should we view them as sustainable, or do some of these cost initiatives have a positive impact there?

Mike Latimore: All right, great. Yeah, thanks. Thanks very much. Yeah, so the gross margins continue to be really strong. Should we view them as sustainable, or do some of these cost initiatives have a positive impact there?

Jon Slabaugh: Thanks for the question, Mike Latimore. It's Jon Slabaugh. You know, over time, I think we'll find ways to squeeze additional margin points. I wouldn't kind of guide to anything on that front, but we are finding that that's an area where technology is helping us drive incremental savings. It should be the case that, as we kind of roll forward throughout the year, the margin improvement on the bottom line will in part be driven by higher gross margins.

Speaker #4: Thanks for the question, Mike. It's John. And over time, I think we'll find ways to squeeze additional margin points. I wouldn't guide to anything on that front, but we are finding that that's an area where technology is helping us drive incremental savings.

Speaker #4: So, it should be the case that as we kind of roll forward throughout the year, the margin improvement on the bottom line will, in part, be driven by higher gross margins.

Speaker #3: Got it. Okay. And now that you've got all the customers and migrated the policy note, are there any incremental savings that would come from basically having everybody on that platform? And also, any initial indications of kind of cross-sell opportunities now with sort of a very unified platform?

Michael Latimore: Okay. Now that you've got all the customers migrated to PolicyNote, you know, are there any incremental savings that would come from, you know, basically having everybody on that platform, and also any initial indications of kind of cross-sell opportunities now with sort of a very unified platform?

Mike Latimore: Okay. Now that you've got all the customers migrated to PolicyNote, you know, are there any incremental savings that would come from, you know, basically having everybody on that platform, and also any initial indications of kind of cross-sell opportunities now with sort of a very unified platform?

Speaker #4: Sure, Mike. This is Josh. I can address that. So just one point of clarification—when you say all the customers. So what we've migrated in 2025 were all the customers on the legacy FiscalNote platform, where FiscalNote had its—that platform had its main focus in state and federal data.

Josh Resnik: Sure, Mike. This is Josh. I can address that. Just one point of clarification when you say all the customers. What we've migrated in 2025 were all the customers on the legacy FiscalNote platform, where FiscalNote had its, that platform had its main focus in state, and federal data. We're still in progress of additional migrations and bringing over additional datasets, which include expanding global datasets that are available on PolicyNote and migrating local, and additional federal, as well. As we've said, the transition to PolicyNote will take some time. It's. We accomplished a lot in 2025. We're very pleased with having moved everyone off of the legacy FiscalNote platform. Still more work to do there.

Speaker #4: And so we're still in progress of additional migrations and bringing over additional data sets, which include expanding global data sets that are available on PolicyNote, and migrating local and additional federal as well.

Speaker #4: So, as we've said, the transition policy note will take some time. We accomplished a lot in 2025. We're very pleased with having moved everyone off of the legacy FiscalNote platform.

Speaker #4: Still more work to do there. We will have some additional cost savings through deprecation of the back end of the FiscalNote platform, which will happen in the first half of this year.

Josh Resnik: We will have some additional cost savings through deprecation of the back end of the FiscalNote platform, which will happen in the first half of this year, and that is built into our operating plan for the year.

Speaker #4: And that is built into our operating plan for the year.

Speaker #3: Got it. Okay, great. And then, with regard to the pipeline, can you give some color or flavor on maybe enterprise versus government versus NGO?

Michael Latimore: Got it. Okay, great. With regard to just kind of the pipeline, you know, can you give some color or flavor on maybe enterprise versus government versus NGO, you know, the relative health? Does your new agentic AI capabilities help all three or does it help, you know, like enterprise more than government or something?

Mike Latimore: Got it. Okay, great. With regard to just kind of the pipeline, you know, can you give some color or flavor on maybe enterprise versus government versus NGO, you know, the relative health? Does your new agentic AI capabilities help all three or does it help, you know, like enterprise more than government or something?

Speaker #3: The relative health, and then does your new agentic AI capabilities—does that help all three, or does it help enterprise more than government, or something?

Speaker #4: Sure. Sure. So I can address that one as well. So, in terms of agentic AI, we think that that's a very, very big opportunity for us going forward.

Josh Resnik: Sure. I can address that one as well. In terms of agentic AI, we think that that's a very, very big opportunity for us going forward as you see, more organizations of all types seek to consume this type of data through their, you know, their own custom platforms they may build internally as well as, through, other AI agents and the like. Where I think you'll see that is, you know, this is part of a very, long-term transformation in terms of how data gets consumed. I think what you'll see are some people in the large enterprise then who want to build internal custom platforms and will need to import our data into their platform.

Speaker #4: As you see, more organizations of all types seek to consume this type of data through their own custom platforms they may build internally, as well as through other AI agents and the like.

Speaker #4: Where I think you'll see that is this part of a very long-term transformation in terms of how data gets consumed. I think what you'll see are some people in the large enterprise end who want to build internal custom platforms and will need to import our data into their platform.

Speaker #4: Those are use cases that we have live today with our API. And so we do expect to see continued growth there, and we view that as a real opportunity for us.

Josh Resnik: Those are use cases that we have live today with our API, and so we do expect that to see continued growth there, and we view that as a real opportunity for us. I think you'll also see some of that in the SMB side, where people have more different types of use cases, don't need internal custom platforms, but will want to consume the data on a periodic basis. You know, it's hard for them to do it through a platform like ours today, but by enabling them to access that through AI agents, it opens new doors for that consumption as well.

Speaker #4: I think you'll also see some of that on the SMB side, where people have more different types of use cases, don't need internal custom platforms, but will want to consume the data on a periodic basis. And it's hard for them to do it through a platform like ours today.

Speaker #4: But by enabling them to access that through AI agents, it opens new doors for that consumption as well. And in terms of pipeline health overall, we're seeing good success right now in mid-market and public sectors. After a rough 2025, it seems to be returning more to the levels that we've typically seen in the past.

Josh Resnik: In terms of pipeline health overall, we're seeing a good success right now in mid-market and public sector, you know, after a rough 2025, seems to be returning more to you know, the levels that we've typically seen in the past.

Michael Latimore: Great. Just on the prediction market opportunity, I think on the original call, you talked about maybe the, like tip sheets and fantasy leagues being potentially, you know, quicker to market, maybe. I guess any just sort of view on, you know, the go-to-market plan for tip sheets, fantasy leagues, you know, timing, essentially.

Speaker #3: Great. And then just on the prediction of the market opportunity—I think on the original call, you talked about maybe the tip sheets and fantasy leads being potentially quicker to market, maybe.

Mike Latimore: Great. Just on the prediction market opportunity, I think on the original call, you talked about maybe the, like tip sheets and fantasy leagues being potentially, you know, quicker to market, maybe. I guess any just sort of view on, you know, the go-to-market plan for tip sheets, fantasy leagues, you know, timing, essentially.

Speaker #3: I guess any, just sort of, view on the go-to-market plan for tip sheets, fantasy leads, timing, and such?

Speaker #4: Sure. Yeah, we do see those are going to be some of the earlier things that you see. And when we talk about what you can expect to see in prediction markets generally, that ties into that in terms of the content generation around that, in terms of opportunities to drive some higher levels of engagement and potentially some transactional revenue around that.

Josh Resnik: Sure. Yeah, we do see. Yeah, those are gonna be some earlier things that you see. You know, when we talk about what you can expect to see in prediction markets, generally, that ties into that in terms of the content generation around that, in terms of opportunities to drive some higher levels of engagement and potentially some transactional revenue around that. We have been working on those, and I would expect that you'll hear more from us on some of those initiatives in the coming weeks.

Speaker #4: We have been working on those, and I would expect that you'll hear more from us on some of those initiatives in the coming weeks.

Speaker #3: Okay, great. Yeah, that'll do it for me. Thanks a lot. Best of luck this year.

Michael Latimore: Okay, great. Yeah, thanks. That'll do it for me. Thanks a lot. Best of luck this year.

Mike Latimore: Okay, great. Yeah, thanks. That'll do it for me. Thanks a lot. Best of luck this year.

Speaker #4: Thanks so much, Mike.

Josh Resnik: Thanks so much, Mike.

Speaker #1: And as a reminder, please press star one if you would like to ask a question. Our next question comes from the line of Zach Cummins with B. Riley Securities.

Operator: As a reminder, just star one if you would like to ask a question. Our next question comes from the line of Zach Cummins with B. Riley Securities. Your line is open.

Speaker #1: Your line is open.

Zach Cummins: Yep. Hi, thanks for taking my questions. Jon, I wanted to ask you just on the initial revenue guidance, is that essentially just pushing forward the current run rate you have going, exiting Q1 of this year? Or do you have, I would say, non-core business exits or anything else that's currently considered in the initial 2026 revenue guidance?

Speaker #5: Hi, thanks for taking my questions. John, I wanted to ask you, just on the initial revenue guidance—is that essentially just pushing forward the current run rate you have going exiting Q1 of this year, or do you have, I would say, non-core business exits or anything else that's currently considered in the initial 2026 revenue guidance?

Jon Slabaugh: Yeah. The proportions going forward should be about the same. I mentioned that, or I'm sorry, 93% of our total revenue was subscription, so the other 7% is kind of in that other category. As you think about that revenue guidance range, you know, you should assume that 93% to 95% of it will be subscription. That would suggest, and ARR will be down a little bit initially, and we, you know, as we go through the year, expect it to come back up. It's part of our really kind of our seasonal cadence where, you know, it's not uncommon for the ARR to drop a little bit in Q1. Right?

Speaker #4: Yeah. So if you the portions going forward should be about the same. And I mentioned that 23 or I'm sorry, 93% of our total revenue was subscriptions.

Speaker #4: So the other 7 is kind of in that other category. So as you think about that revenue guidance range, you should assume that 93 to 95 percent of it will be subscription.

Speaker #4: So that would suggest ARR will be down a little bit initially. And as we go through the year, we expect it to come back up.

Speaker #4: And it's part of our, really, kind of our seasonal cadence, where it's not uncommon for the ARR to drop a little bit in the first quarter.

Speaker #4: You mentioned that also kind of in my remarks. I think about just a little bit of the visibility we have into the first quarter.

Jon Slabaugh: You've mentioned that also kind of in my remarks, I think, about just a little bit of the visibility we have into Q1. Our guidance fully incorporates kind of our current run rate kind of coming into the year and you know pipelines and expectations for the year.

Speaker #4: So our guidance fully incorporates kind of our current run rate coming into the year, and pipelines and expectations for the year.

Speaker #3: Understood. And is there any way that we can get a little more detail around some of the enterprise customers that ultimately decided to turn off instead of moving over to Policy Note?

Zach Cummins: Understood. Is there any way that we can get a little more detail around some of the enterprise customers that ultimately decided to turn off instead of moving over to PolicyNote? It feels like you've had a lot of success on the migration front, especially as more of these customers got the new PolicyNote platform in front of them. I was just curious if there's any additional insight into that churn or if it was more budget constraints on why there wasn't interest from that cohort of customers.

Speaker #3: It feels like you've had a lot of success on the migration front, especially as more of these customers got the new policy note platform in front of them.

Speaker #3: So, I'm just curious if there's any additional insight into that churn, or if it was more budget constraints on why there wasn't interest from that cohort of customers.

Josh Resnik: Oh, in terms of the

Speaker #4: In terms of the large enterprises who we've—yeah. So, yeah. So, Zach, Josh, I'm happy to address that. So, as you recall, the migration plan naturally contemplated moving some of the largest enterprises over latest in the year.

Zach Cummins: Yeah.

Josh Resnik: Yeah.

Zach Cummins: Yeah.

Josh Resnik: Yeah. Zach, Josh, I'm happy to address that. As you recall, the migration plan naturally contemplated moving some of the largest enterprises over last in the year, wanting to make sure that we had all the right use cases built out, data sets in and the like, and to meet some of the complex workflow needs that they would have. I think part of it is a reflection of the fact that, you know, as a lot of them would have made their decision by the time it was time for them to migrate. You would have seen some churn for that reason, you know, in terms of the timelines of migration essentially coming in, kind of beyond their internal deadlines.

Speaker #4: Wanting to make sure that we had all the right use cases built out, data sets in, and the like, and to meet some of the complex workflow needs that they would have.

Speaker #4: So I think part of it is a reflection of the fact that a lot of them would have made their decision by the time it was time for them to migrate.

Speaker #4: So you would have seen some churn for that reason. In terms of the timelines of migration, essentially coming in kind of beyond their internal deadlines.

Speaker #4: And then, as we said, there’s been some impact from macro and uncertainty and the like that I think were drivers there as well. So what we’re seeing on Policy Note is still very high levels of engagement that we’re very pleased with.

Josh Resnik: There as we said, there's been some impact from macro and uncertainty and the like that I think were drivers there as well. What we're seeing on PolicyNote is still very high levels of engagement that we're very pleased with. We know that we're moving the right direction with it. We're planning to continue to add valuable datasets, expand the global datasets and the like. The longer that people are on it, the more they will get bound to that platform. For a platform like this to be very effective, what you want is to drive the engagement, drive the usage, and overall see customers get bound to that platform as it becomes a natural part of their ongoing workflow and as they see the value over time.

Speaker #4: We know that we're moving in the right direction with it. We're planning to continue to add valuable data sets, expand the global data sets, and the like.

Speaker #4: And the longer that people are on it, the more they will get bound to that platform. So for a user, for a platform like this to be very effective, what you want is to drive the engagement, drive the usage, and overall see customers get bound to that platform as it becomes a natural part of their ongoing workflow.

Speaker #4: And as they see the value over time. So, we're still in the relatively early innings of Policy Note, because it takes time for those user behaviors to build up.

Josh Resnik: We're still in the relatively early innings of PolicyNote because it takes time for those user behaviors to build up. We're encouraged by the engagement levels that we see and what we're starting to see around our ability to retain customers when they're on the platform. We expect to see that continue to improve over time.

Speaker #4: But we're encouraged by the engagement levels that we see, and what we're starting to see around our ability to retain customers when they're on the platform.

Speaker #4: And so, we expect to see that continue to improve over time.

Speaker #3: Understood. And final question for me, maybe towards Josh, is just as you undertake some pretty considerable transformation initiatives within the business this year, can you give me a sense of your confidence in being able to drive growth with more of a product-led approach moving forward, in essentially a pretty meaningful change in terms of just the monetization of a usage-based model?

Zach Cummins: Understood. Final question for me, maybe towards Josh, is just as you undertake some pretty considerable transformation initiatives within the business this year, can you give me a sense of your confidence in being able to drive growth, with more of a product-led approach, moving forward and essentially a pretty meaningful change in terms of just the monetization from seat-based licenses to more of a usage-based model?

Speaker #4: Sure, Zach. Yeah, I feel very confident in it. What we're seeing is an environment where our data continues to be incredibly valuable to customers.

Josh Resnik: Sure, Zach. Yeah, I feel very confident in it. What we're seeing is an environment where our data continues to be incredibly valuable to customers and is very unique. The fact that we have our proprietary analysis on top of these difficult to get fragmented data sets, we sit very well positioned. All of these changes in the industry, changes in the way that people are consuming information, that becomes opportunity for us, both in terms of expanding use cases for how customers may wanna interact with our data, but also in terms of how they think about the value of that data.

Speaker #4: And it's very unique, the fact that we have our proprietary analysis on top of these difficult-to-get, fragmented data sets. We sit very well positioned.

Speaker #4: So, all of these changes in the industry, changes in the way that people are consuming information, that becomes opportunity for us—both in terms of expanding use cases for how customers may want to interact with our data, but also in terms of how they think about the value of that data.

Speaker #4: So, as we think about whether it’s volume-based pricing, outcome-based pricing, or whether it’s hybrid models where users are able to switch between seat-based and consumption-based, we actually feel very good about our ability to maintain pricing integrity in that type of environment.

Josh Resnik: As we think about whether it's, you know, volume-based pricing, outcome-based pricing, whether it's hybrid models where users are able to switch between seat-based and consumption-based, we actually feel very good about our ability to maintain pricing integrity in that type of environment. Overall, from a very high level outlook, the more we're able to make this unique and valuable data available to people who wanna consume it, and the more they make good use of it and realize the value that it has, that's where good things will happen. We expect to see revenue growth driven by that over time. We feel very good about that opportunity.

Speaker #4: And overall, from a very high-level outlook, the more we're able to make this unique and valuable data available to people who want to consume it, and the more they make good use of it and realize the value that it has, that's where good things will happen.

Speaker #4: And we expect to see revenue growth driven by that over time. So we feel very good about that opportunity.

Zach Cummins: Great. Well, thanks for taking my questions and best of luck with the rest of the quarter.

Speaker #3: Great. Well, thanks for taking my questions, and best of luck with the rest of the quarter.

Josh Resnik: Thank you, Zach.

Speaker #4: Thank you, Zach.

Speaker #1: And, as a reminder, this is Star One. If you would like to ask a question, and there are no further questions at this time.

Operator: As a reminder, it is star one if you would like to ask a question. There are no further questions at this time. Miss Yoon, I will turn the call back over to you for any closing remarks.

Speaker #1: Ms. Yoon, I will turn the call back over to you for any closing remarks.

Speaker #5: Thank you. That concludes our call this evening. We appreciate everyone's participation and look forward to speaking with all of you again in the future.

Yojin Yoon: Thank you. That concludes our call this evening. We appreciate everyone's participation and look forward to speaking with all of you again in the future. Goodbye.

Speaker #5: Goodbye.

Operator: Ladies and gentlemen, this concludes today's call, and we thank you for your participation. You may now disconnect.

Q4 2025 FiscalNote Holdings Inc Earnings Call

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