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Can BigBear.ai's $270M Backlog Translate Into Stronger Revenue Growth?
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Key Takeaways
BigBear.ai ended Q2 with a $270M backlog, up 9% from year-end, strengthening revenue visibility.
More than 20 new contracts added momentum, with individual values reaching $5M during the quarter.
Q2 revenues rose 13% to $36.7M, while Gen AI drove gross margin to 32.8%.
BigBear.ai Holdings, Inc. (BBAI - Free Report) is building a stronger base of contracted business as demand for specialized AI solutions expands across national security, trade and travel. Recent contract activity points to growing customer adoption across these markets, while the company’s focus on applied AI gives it opportunities to address complex and security-sensitive use cases. The key factor for the revenue outlook is whether this expanding contract base can translate into a higher level of reported sales.
BigBear.ai ended the second quarter with a $270 million backlog, which increased 9% from year-end. The company also secured more than 20 new contracts during the quarter, with individual values of up to $5 million, following a $53 million total contract value intelligence contract announced in the first quarter. This contract momentum provides greater visibility into future revenues and supports the company’s 2026 top-line guidance of $135 million to $165 million.
The latest results provide an early indication of that conversion. Second-quarter revenues increased 13% year over year to $36.7 million, driven by Gen AI platforms and products. Gross margin also expanded to 32.8%, up 781 basis points, as the revenue mix shifted toward higher-margin Gen AI offerings.
However, converting backlog into revenues will require continued execution across new and existing contracts. Adjusted EBITDA was negative $11.6 million compared with negative $8.5 million a year earlier, reflecting higher investment in sales, go-to-market capabilities and research and development.
Overall, the $270 million backlog and recent contract wins strengthen revenue visibility. The pace at which these awards move into recognized revenues will be a key factor in determining whether BigBear.ai can build on its current top-line growth.
BBAI Faces Competition From Palantir and C3.ai
BigBear.ai operates in a competitive AI market, with Palantir Technologies (PLTR - Free Report) and C3.ai (AI - Free Report) standing out as relevant peers.
Palantir has a strong presence in defense, national security and commercial AI applications. It focuses on combining AI, data and workflow capabilities to support customers operating in complex and sensitive environments. Palantir’s secure AI and platform capabilities overlap with areas targeted by BigBear.ai, particularly mission-focused applications and government use cases.
C3.ai provides AI solutions across enterprise and government markets, with exposure to defense, intelligence and aerospace. The company is also focused on improving product development and customer deployments across its target markets. C3.ai’s broad enterprise AI offering creates overlap with BigBear.ai’s focus on applied AI, while it remains positioned across a wider range of enterprise and government applications.
Shares of BBAI have plunged 22.3% over the past six months, underperforming the Zacks Computers - IT Services industry, as shown below.
BBAI’s 6-Month Price Performance
Image Source: Zacks Investment Research
BBAI stock is currently trading at a discount compared with the industry peers, with a forward 12-month price-to-sales (P/S) ratio of 8.93, as evidenced by the chart below.
P/S Ratio (F12M)
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for BBAI’s 2026 loss per share has widened in the past 60 days, as shown below. However, the estimated figure indicates a narrower loss than the year-ago loss of 82 cents per share.
EPS Trend of BBAI
Image Source: Zacks Investment Research
BBAI’s Zacks Rank
BigBear.ai currently carries a Zacks Rank #4 (Sell).
View the Zacks #1 Rank List
Image: Bigstock
Can BigBear.ai's $270M Backlog Translate Into Stronger Revenue Growth?
Key Takeaways
BigBear.ai Holdings, Inc. (BBAI - Free Report) is building a stronger base of contracted business as demand for specialized AI solutions expands across national security, trade and travel. Recent contract activity points to growing customer adoption across these markets, while the company’s focus on applied AI gives it opportunities to address complex and security-sensitive use cases. The key factor for the revenue outlook is whether this expanding contract base can translate into a higher level of reported sales.
BigBear.ai ended the second quarter with a $270 million backlog, which increased 9% from year-end. The company also secured more than 20 new contracts during the quarter, with individual values of up to $5 million, following a $53 million total contract value intelligence contract announced in the first quarter. This contract momentum provides greater visibility into future revenues and supports the company’s 2026 top-line guidance of $135 million to $165 million.
The latest results provide an early indication of that conversion. Second-quarter revenues increased 13% year over year to $36.7 million, driven by Gen AI platforms and products. Gross margin also expanded to 32.8%, up 781 basis points, as the revenue mix shifted toward higher-margin Gen AI offerings.
However, converting backlog into revenues will require continued execution across new and existing contracts. Adjusted EBITDA was negative $11.6 million compared with negative $8.5 million a year earlier, reflecting higher investment in sales, go-to-market capabilities and research and development.
Overall, the $270 million backlog and recent contract wins strengthen revenue visibility. The pace at which these awards move into recognized revenues will be a key factor in determining whether BigBear.ai can build on its current top-line growth.
BBAI Faces Competition From Palantir and C3.ai
BigBear.ai operates in a competitive AI market, with Palantir Technologies (PLTR - Free Report) and C3.ai (AI - Free Report) standing out as relevant peers.
Palantir has a strong presence in defense, national security and commercial AI applications. It focuses on combining AI, data and workflow capabilities to support customers operating in complex and sensitive environments. Palantir’s secure AI and platform capabilities overlap with areas targeted by BigBear.ai, particularly mission-focused applications and government use cases.
C3.ai provides AI solutions across enterprise and government markets, with exposure to defense, intelligence and aerospace. The company is also focused on improving product development and customer deployments across its target markets. C3.ai’s broad enterprise AI offering creates overlap with BigBear.ai’s focus on applied AI, while it remains positioned across a wider range of enterprise and government applications.
BBAI’s Price Performance, Valuation & EPS Estimate Trend
Shares of BBAI have plunged 22.3% over the past six months, underperforming the Zacks Computers - IT Services industry, as shown below.
BBAI’s 6-Month Price Performance
Image Source: Zacks Investment Research
BBAI stock is currently trading at a discount compared with the industry peers, with a forward 12-month price-to-sales (P/S) ratio of 8.93, as evidenced by the chart below.
P/S Ratio (F12M)
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for BBAI’s 2026 loss per share has widened in the past 60 days, as shown below. However, the estimated figure indicates a narrower loss than the year-ago loss of 82 cents per share.
EPS Trend of BBAI
Image Source: Zacks Investment Research
BBAI’s Zacks Rank
BigBear.ai currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.