BigBear.ai posts steep Q4 revenue drop but eyes 17% growth midpoint

BigBear.ai reported Q4 2025 revenue of $27.3 million, a 38 percent decline year over year and short of analyst expectations in the low $30 millions, while adjusted earnings per share of ($0.01) slightly outperformed forecasts. Management set full‑year 2026 revenue guidance at $135 million to $165 million, a range whose midpoint implies roughly 17 percent growth versus 2025, and said it would not provide adjusted EBITDA guidance as it invests to integrate recent acquisitions and expand internationally.

The company framed the results as part of a broader financial reset. BigBear.ai ended 2025 with $462 million in cash and investments and said it raised roughly $693 million in proceeds during 2025 through at‑the‑market facilities and warrant exercises. In January 2026 the company converted about $125 million of 2029 convertible notes into equity, an action it said will save roughly $9 million in annual interest expense through the end of 2029, and it intends to settle roughly $17 million of 2026 notes at maturity.

“At the start of 2025, we set out to transform our financial foundations to establish a base from which to accelerate in 2026. We have delivered exactly that. As of year‑end 2025, BigBear.ai is in the strongest financial position in the company’s history. I am tremendously grateful to our team for the work they have done. We have reduced our debt by more than 90%, established a powerful cash position that gives us the freedom to invest in catalytic technologies, expanded internationally, and acquired two highly specialized technology companies which play directly into our two core markets in national security and travel & trade,” Chief Executive Kevin McAleenan said in the company release.

BigBear.ai has moved to buy capabilities as part of that strategy, closing Ask Sage in December 2025 and CargoSeer in January 2026. The company describes Ask Sage as a secure, model‑agnostic generative AI platform for defense customers and CargoSeer as an AI cargo inspection and predictive risk‑scoring tool for ports and borders. Management stressed the commercial and government use cases for predictive cargo risk scoring, including customs duty collection and supply‑chain efficiency, as a driver of near‑term commercial traction.

Management reiterated the guidance and explained the choice not to give EBITDA guidance in prepared remarks: “Now let us turn to our outlook for 2026. We are projecting full‑year 2026 revenue of between $135,000,000 and $165,000,000. Our 2026 outlook includes the results of our recent acquisitions of Astage and CargoSear and represents about 17% growth from our full‑year 2025 revenue. Given the pace of play in the AI markets and investments we will undertake to integrate recent acquisitions and expand our international presence and growth team, we will not be giving adjusted EBITDA guidance at this time. [...] We see actionable targets in Central America, the Middle East, and within the United States, where the platform's predictive cargo risk scoring capabilities are directly relevant to government and commercial operators seeking to strengthen the efficiency of their customs duty collection and supply chain operations. In short, we see lots of positive developments to drive growth across our portfolio. Now I will turn it over to Sean to walk through the financials and our FY 2026 guidance.”

Operational performance remains mixed: full‑year 2025 revenue totaled $128 million, but management said adjusted EBITDA decreased, driven by lower revenue and gross margins alongside increased R&D and selling expenses as the company scales. BigBear.ai also reported remediation of a previously disclosed material weakness and said its auditor issued a clean, unqualified opinion on internal controls after it transitioned out of emerging growth company status and became subject to SOX 404(b).

Shares initially ticked up roughly 3 percent after the release before moving off early highs as investors weighed the revenue miss against a bolstered balance sheet and acquisition pipeline. Key items for investors to watch include the mechanics and dilution from the note conversions, the pace of integration for Ask Sage and CargoSeer, and the company’s ability to translate predictive cargo products into sustained revenue amid constrained federal and commercial spending.