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Investing.com -- BigBear.ai Holdings, Inc. (NYSE:BBAI) shares tumbled 21.6% after the AI-powered decision intelligence solutions provider reported second-quarter results that missed analyst expectations and significantly lowered its full-year revenue guidance.
The company reported second-quarter revenue of $32.5 million, down 18% YoY and well below the analyst consensus of $41.19 million. Adjusted loss per share came in at -$0.71, substantially worse than the -$0.06 analysts had expected. The disappointing results were primarily attributed to lower volume on certain U.S. Army programs.
BigBear.ai slashed its full-year 2025 revenue guidance to between $125 million and $140 million, far below the previous analyst consensus of $167.7 million. The company also withdrew its previously provided Adjusted EBITDA guidance due to uncertainty surrounding Army programs and anticipated growth investment spending in the second half of the year.
"While we are very optimistic with these significant investments and growth opportunities, we have also seen disruptions in federal contracts from efficiency efforts this quarter, most notably in programs that support the U.S. Army, as they seek to consolidate and modernize their data architecture and in turn, we have adjusted our full-year guidance this quarter to reflect these disruptions," said Kevin McAleenan, CEO of BigBear.ai.
The company reported a net loss of $228.6 million for the quarter, compared to a $14.4 million loss in the same period last year. This increase was primarily driven by non-cash changes in derivative liabilities of $135.8 million and a non-cash goodwill impairment charge of $70.6 million.
Gross margin declined to 25.0% from 27.8% in the second quarter of 2024, while Adjusted EBITDA worsened to -$8.5 million compared to -$3.7 million in the prior-year period.
Despite the disappointing results, the company highlighted its strong cash position of $390.8 million, which it plans to use for significant investments. "Our record cash balance will enable us to make significant investments, both organically and inorganically, in an order of magnitude that was not possible before," said Sean Ricker, CFO of BigBear.ai.
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