0001836981-26-000018
SEC filingNotes detail $374.4M AFS investments, $142.3M convertible debt, $271.6M Ask Sage acquisition financed via cash and $192.7M goodwill.
BigBear.ai Holdings, Inc. describes itself as a specialized provider of mission-ready artificial intelligence technology, originally founded to serve defense and national security mission customers. The company’s objective is to deliver enduring strategic advantage for the U.S., its allies, and select commercial partners. It unites capabilities from artificial intelligence to computer vision, predictive analytics, and biometrics. Its core industries are national security, travel, and trade, which the company describes as highly specialized, interdependent, and requiring deep domain expertise.
The Business section does not disclose any formal reporting segments. The company organizes its capabilities around two broad areas: National Security Capabilities and Travel and Trade Capabilities, but these are not presented as financial reporting segments with revenue share.
BigBear.ai’s key named products and platforms include Ask Sage, a platform-agnostic generative AI solution designed for defense and intelligence customers, which was acquired on December 31, 2025. Ask Sage is FedRAMP authorized and used by more than 16,000 government teams, 100,000 Department of War users, and 2,500 companies as of January 2026. ConductorOS is an AI, data, and sensor orchestration platform for mission-critical defense environments, central to exercise Talisman Sabre in 2025. The CargoSeer AI Shipment Inspection Platform, acquired in January 2026, provides cargo scanning enhancement and trade risk management for customs enforcement. The company also offers digital identity solutions using advanced vision AI, digital twin capabilities for modeling and simulation, and operational readiness tools for manpower, equipment, and supply chain data.
BigBear.ai’s go-to-market approach relies on deep, trusting relationships with unique and discerning customers in the U.S. government and select commercial partners. The majority of employees are security-cleared and many operate alongside their customers daily. The company serves defense and national security mission customers, and its travel and trade capabilities support military, intelligence, and federal agencies, as well as customs authorities worldwide. No specific customer concentration percentages are disclosed in this section.
The company faces competition from system integrators that develop custom software solutions; agency or corporate IT organizations that build internal solutions; commercial enterprise and point solution software providers; and public cloud providers offering AI, analytics, and data management tools. BigBear.ai also competes with the internal software development efforts of potential customers, who often attempt to build their own decision support platforms before turning to the company.
BigBear.ai’s stated strategic priorities include delivering enduring strategic advantage for the U.S., its allies, and select commercial partners; uniting cutting-edge technology capabilities from AI to computer vision, predictive analytics, and biometrics; leveraging first-mover advantage with Ask Sage as a central pillar of its technology capabilities; investing from a position of financial strength following debt reduction and improved liquidity; and expanding digital identity offerings beyond national security into frictionless user experiences.
As of December 31, 2025, BigBear.ai had 579 employees, the vast majority employed in the United States and holding active security clearances. Approximately 67% of the workforce comprises software engineers, data scientists, cloud/systems engineers, analysts, and cyber subject-matter experts. The company is headquartered in McLean, Virginia, with additional offices in Ann Arbor, Michigan; Chantilly, Virginia; Columbia, Maryland; Charlottesville, Virginia; London, U.K.; and Abu Dhabi, UAE. None of the employees are affiliated with labor unions, and the company reports uninterrupted operations free from labor disputes.
As of December 31, 2025, the company holds $87.1 million in cash and cash equivalents and $5.5 million in restricted cash (primarily for Ask Sage acquisition escrow and performance bonds). The balance sheet also includes $374.4 million in available-for-sale (AFS) debt securities (amortized cost $374.3 million), consisting of U.S. Treasury securities ($131.4 million fair value) and corporate bonds ($243.1 million fair value). The reclassification from held-to-maturity to AFS occurred in Q4 2025 after selling securities to fund the Ask Sage cash consideration. Total assets stand at $894.5 million, up from $343.8 million at year-end 2024, driven primarily by the Ask Sage acquisition and the ATM equity raise. Total liabilities are $282.7 million, down from $347.5 million, with derivative liabilities decreasing to $116.9 million from $170.5 million. Shareholders' equity improved to $611.9 million from a deficit of $(3.7) million, reflecting the ATM issuance of 142.3 million shares for net proceeds of $628.8 million and other equity transactions.
The Notes do not disclose any material off-balance-sheet purchase commitments or contractual obligations beyond those recognized on the balance sheet. Operating lease commitments total $12.8 million in future minimum payments (undiscounted) with $7.8 million recognized as a liability (current $1.1 million, long-term $6.7 million). There are no disclosed supply purchase agreements, long-term capacity commitments, or inventory purchase obligations. Contingencies include $0.3 million accrued for legal disputes; tax audits are routine.
No share repurchase programs or dividends are disclosed. Capital expenditures were minimal at $0.5 million (0.4% of sales), with capitalized software development costs of $3.8 million. Debt activity: total debt (principal) is $142.3 million ($17.7 million 2026 Convertible Notes, $124.6 million 2029 Convertible Notes); net debt decreased by $63.4 million during the year due to $57.7 million of 2029 Notes converted into 16.7 million shares (with a $135.6 million equity issuance), and $4.1 million paid-in-kind interest on the 2029 Notes. The 2026 Notes mature in December 2026. The company raised $628.8 million net from at-the-market offerings (142.3 million shares) and $114.0 million from warrant exercises. Capex is negligible.
The company operates as a single operating and reportable segment, consistent with how the Chief Operating Decision Maker reviews performance and allocates resources. No further segment or geographic breakdown is provided in the Notes.
BigBear.ai is highly exposed to U.S. government budget cycles and appropriations. The risk factors emphasize that government contracts are often subject to termination for convenience and partial funding. Geopolitical tensions (Ukraine, Middle East, Africa) could disrupt operations or reduce demand. The evolving regulatory landscape for AI (EU AI Act, U.S. state laws) imposes compliance costs and liability risks.
The company carries $142.3M in debt, with $17.7M of 2026 Convertible Notes maturing in December 2026. Covenants in the 2029 Notes include a minimum liquidity requirement and restrictions on additional debt, liens, and restricted payments. Fixed-price contracts (25% of revenue) pose cost overrun risk, especially on long-term projects with new technologies. Customer concentration is acute: 51% of 2025 revenue came from customers individually exceeding 10% of revenue, and only $27M of their backlog remains, all expected to be recognized in 2026.
Limited operating history and past losses highlight profitability challenges. The sales cycle is lengthy (6-9 months commercial, >12 months government), often requiring free pilot deployments. AI/ML risks include flawed algorithms, biased outcomes, and potential ‘hallucinations’. Integration of third-party cloud (AWS, GCP, Azure) creates dependency and service interruption risk. Open source software usage may trigger source code disclosure obligations. The biometrics market (via Pangiam acquisition) is nascent and competitive.
Competitors include large defense contractors and enterprise software firms with greater resources. The company’s culture of promoting early-career employees to customer-facing roles may lead to inexperience. Joint ventures and channel partnerships carry execution risk and may dilute focus. Acquisitions (past and future) involve integration challenges and potential goodwill impairment.
The risk factors are comprehensive but contain substantial boilerplate. The most material risks are customer concentration, debt maturity, fixed-price contract exposure, and AI regulatory uncertainty.
Operating cash flow (CFO) improved significantly year-over-year, with net cash used in operations decreasing from $30.5 million in 2024 to $17.5 million in 2025. This improvement occurred despite a net loss of $124.6 million (including $70.6 million goodwill and $53.4 million intangible asset impairment charges). The primary driver of the CFO improvement was a reduction in working capital outflows, particularly a $10.2 million decrease in accounts receivable and a $5.1 million increase in accrued liabilities. Capital expenditures (capex) were $1.5 million in 2025, down from $2.0 million in 2024, indicating low capital intensity. Free cash flow (FCF), defined as CFO minus capex, was -$19.0 million in 2025, compared to -$32.5 million in 2024. No share repurchases or dividends were paid, and financing activities were minimal. The company's cash flow remains negative, but the trend is improving, driven by working capital management and lower capex. The large non-cash impairment charges do not affect cash flow but highlight underlying asset valuation concerns.