BigBear.AI, Inc. (NYSE:BBAI) stock sank on Tuesday after the company revealed massive quarterly losses and cut its full-year outlook due to lower volume on certain Army contracts.
BigBear.AI executives gave more color on the company's Monday evening earnings call.
- BBAI stock is sliding on disappointing news. See the full story here.
Revenue Hit From Program Slowdowns
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BigBear.AI CEO KevinMcAleenan cited contract disruption and lower volume on certain large programs tied to Army customers as the primary driver of revenue falling to roughly $32.5 million in Q2.
"In our first quarter earnings call, we talked about the potential for disruptions in federal contracts from efficiency efforts. We have seen those disruptions this quarter, most notably in programs that support the United States Army," McAleenan said on the earnings call.
The CEO also explained that the company lowered its guidance "to reflect such disruptions."
BigBear.AI slashed its full-year revenue outlook from a range of $160 million to $180 million to a new range of $125 million to $140 million, versus estimates of $167.95 million.
The company also withdrew its adjusted EBITDA guidance for 2025.
Market Reaction And Sentiment
BigBear.AI stock dropped dramatically as investors digested the lowered guidance and 18% year-over-year revenue decline.
The large earnings miss of 70 cents per share, versus the Street estimate for losses of six cents, also weighed on investor sentiment.
What To Watch Next:
BigBear.AI leadership projected optimism with plans to compete for the Army's evolving data systems work. The CEO pointed specifically to the upcoming Global Force Information Management opportunity as a key target aligned with BigBear.ai's expertise in Army data systems.
"Despite these challenges with army contracts, we are not gonna sit back and lick our wounds. We're gonna compete to win this work again," McElhinen said.
BBAI Stock Price: BigBearAI shares were down 26.59% at $5.20 at the time of publication on Tuesday, according to Benzinga Pro data.
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