BigBear.ai Shares Tumble. Should Investors Buy the Dip or Stay Away?

It's been a pugnacious commencement to the twelvemonth for BigBear.ai's (NYSE: BBAI) stock, and things did not get immoderate amended aft the institution reported its fourth-quarter results connected Monday. Following its retreat, the banal is present down astir 28% connected the year, arsenic of this writing.

With the banal down and immoderate caller acquisitions successful tow, let's spot if present is simply a bully clip to bargain shares of the beaten-up artificial quality (AI) analytics company.

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BigBear.ai ended 2025 connected a down note, with its Q4 gross sinking 38% twelvemonth implicit twelvemonth to $27.3 million. The institution said the diminution stemmed from little volumes related to contracts it has with the U.S. Army. That was good beneath the $33.3 cardinal expert consensus.

On apical of the large diminution successful revenue, the company's gross margins plunged to 20.3% from 37.4% a twelvemonth ago. It said the borderline compression was the effect of one-time high-margin contracts not repeating this year. This is simply a debased borderline for a institution that bills itself arsenic an artificial quality (AI) analytics company, arsenic it is overmuch much of a authorities systems integrator whose engineers and information scientists request to beryllium on-premise for astir of the authorities projects it is progressive in.

BigBear.ai saw its adjusted net earlier interest, taxes, depreciation, and amortization (EBITDA) crook negative, falling to a nonaccomplishment of $10.3 cardinal versus a summation of $2 cardinal a twelvemonth ago. The institution had currency travel from operations of antagonistic $21.8 cardinal successful the 4th and antagonistic $42 cardinal for the year. Free currency travel was antagonistic $42.5 cardinal for the year. The institution ended 2025 with currency and investments of $87.1 cardinal and $107 cardinal successful indebtedness aft issuing implicit $693 cardinal successful equity successful 2025.

Looking ahead, absorption forecasted full-year gross to autumn betwixt $135 cardinal and $165 million, representing 17% maturation astatine the midpoint. Meanwhile, it precocious closed connected the acquisitions of some Ask Sage and CargoSeer.

Given its gross margins and lumpy revenue, BigBear.ai isn't precisely the AI analytics software-as-a-service (SaaS) institution that 1 mightiness expect from its name. However, with the acquisitions of Ask Sage and CargoSeer, it is surely trying to caput much successful that direction. The institution has besides raised currency done equity offerings and looks well-positioned to proceed to bargain much AI-software-oriented companies.