BigBear.ai (NYSE:BBAI) shares plummeted more than 20% during market action on Tuesday, following second quarter results that failed to meet expectations.
However, analysts argue that the stock remains promising despite disappointing quarterly results and near-term challenges.
“On a combination of lower 2Q25 revenue and disruptions in federal contracts, especially in programs supporting the U.S. Army, the company lowered its full year revenue guidance to $125.0M to $140.0M, down meaningfully from $160.0M and $180.0M, previously,” said Scott Buck, an analyst with H.C. Wainwright and Co., in an investor note. “While disappointing, these results should not come as a surprise given what we have heard from other reporting peers in the defense space, which have also experienced program delays. We believe revenue visibility could begin to improve as the business moves towards 2026.”
The firm reiterated its Buy rating, but lowered its price target to $8 from $9.
Meanwhile, Canto reiterated its Overweight rating and increased its price target to $6 from $5.
“The quarter demonstrated solid progress on key initiatives, including core product development and balance sheet improvements,” said Cantor analysts Jonathan Ruykhaver and Ben Mitchell, in an investor note. “The ending backlog of $380 million represents a 42.9% y/y increase.”
“We are bullish on the various potential catalysts to drive near-to-long- term growth, including the Pangiam acquisition to boost vision AI and the transition to target higher-margin commercial customers,” Ruykhaver added. “We believe BigBear.ai is well-positioned to establish itself as a leading AI/ML platform provider in the intelligence space.”
Competitor Palantir (PLTR) was up 2%, while C3.ai (AI) inched up 1%.