Shares of artificial-intelligence software firm BigBear.ai fell 29% in after-hours trading after its earnings and outlook came in far short of expectations.
Revenue for the second quarter was $32.5 million, far short of the $40.6 million analysts had expected and lower that the $39.8 million it posted during the same period last year. It also reported a loss of 71 cents a share, versus an expected loss of six cents a share, among the three analysts polled by FactSet who follow the stock.
The company also cut its revenue outlook for 2025 to a range of $125 million to $140 million, versus the $160 million to $180 million it had forecast when it last reported earnings in May.
BigBear CEO Kevin McAleenan blamed disruptions in federal contracts as part of the government’s efficiency drive for lowering guidance. However, he touted potential opportunities from President Donald Trump’s tax and spending bill for possible revenue growth.
“This legislation will bring a generational investment and provides over $170 billion in supplemental funding to the Department of Homeland Security, and $150 billion to the Department of Defense for disruptive defense technology,” McAleenan said in the earnings report.
BigBear, which went public in 2021 through a merger with a special purpose acquisition company, sells its AI software to the defense department, other branches of the federal government, and private industry.
Before the earnings report, BigBear stock had risen 60% in 2025 and more than 400% over the past year despite persistently losing money on an earnings per share basis. The last time it reported a positive EPS was in 2023. It closed down 0.7% Monday at $7.09 a share.
The miss comes on the heels of another AI-software firm’s earnings warning. Shares of C3.ai closed down 26% at $16.52 Monday after it said earnings would fall short of expectations.
