FiscalNote Holdings Reports 27.2% Revenue Decline and $42.5 Million Operating Loss in Q1 2026

FiscalNote Holdings, Inc. reported a significant decline in its financial performance for the first quarter of 2026, with total revenues of $20.0 million, down 27.2% from $27.5 million in the same period last year. The decrease was primarily driven by a 24.5% drop in subscription revenue, which fell to $19.1 million from $25.2 million. Non-subscription revenue also decreased by 57.3%, from $2.3 million to $1.0 million. The company attributed these declines to challenges in customer retention, particularly in the context of federal government budget cuts, as well as the impact of previous business disposals, including the sales of Dragonfly and Oxford Analytica.

Operating expenses surged by 51.5% to $62.5 million, largely due to a $35.6 million goodwill impairment charge, which was a significant factor in the company's operating loss of $42.5 million, compared to a loss of $13.8 million in the prior year. Other operating expenses, including general and administrative costs, also saw substantial reductions, reflecting the company's ongoing efforts to streamline operations and reduce costs. Notably, general and administrative expenses decreased by 42% to $9.5 million, while research and development expenses fell by 34% to $2.0 million.

In terms of operational metrics, FiscalNote's annual recurring revenue (ARR) decreased to $75.7 million as of March 31, 2026, down from $84.1 million at the end of 2025. The company's net revenue retention rate (NRR) also declined to 89% from 93% year-over-year, excluding the impact of the aforementioned business sales. The company reported a headcount reduction from approximately 407 employees at the end of 2025 to about 370 employees by the end of the first quarter of 2026, as part of its cost-saving measures.

Looking ahead, FiscalNote faces challenges related to its liquidity and capital resources, with a negative working capital balance of $139.0 million as of March 31, 2026. The company has entered into forbearance agreements with its creditors following the delisting of its Class A common stock from the New York Stock Exchange, which has raised concerns about its ability to meet financial covenants. Management is exploring various strategies to improve liquidity, including potential asset sales and restructuring debt obligations. The company remains focused on its core policy business and aims to enhance its product offerings while navigating the current market conditions.