BigBear.ai Q2 Earnings Call Highlights
Fri, July 31, 2026 at 7:03 AM GMT+3 6 min read
Key Points
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Revenue rose 13% year over year to $36.7 million in Q2 2026, while gross margin improved to 32.8% from 25.0%. Management reaffirmed full-year revenue guidance of $135 million to $165 million.
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BigBear.ai won more than 20 contracts during the quarter and ended it with $270 million in backlog, up about 9% from year-end. The company also reported $410 million in cash and investments to support product development and potential acquisitions.
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Management highlighted growth initiatives including CargoSeer's five-year deployment in El Salvador, expanded secure generative AI offerings through Ask Sage, and ConductorOS for coordinating autonomous systems. BigBear.ai also achieved Cybersecurity Maturity Model Certification Level 2 ahead of schedule.
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BigBear.ai (NYSE:BBAI) reported second-quarter 2026 revenue growth and a substantial improvement in gross margin, while management said it is pursuing additional contract wins, product deployments and acquisitions to expand its position in defense, security, trade and travel technology markets.
Revenue for the quarter totaled $36.7 million, up 13% from the comparable period in 2025. Gross margin rose to 32.8%, an increase of 781 basis points year over year, which Chief Financial Officer Sean Ricker attributed to a higher mix of revenue from the company's generative AI platforms and products.
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Chief Executive Officer Kevin McAleenan said the company remains on track to meet its full-year revenue guidance of $135 million to $165 million. He said BigBear.ai won more than 20 new contracts during the second quarter, with individual values of up to $5 million, spanning existing and new customers in the United States and international markets.
Backlog Expands as Company Pursues Growth
BigBear.ai ended the quarter with $270 million in backlog, up approximately $22 million from the start of the year. McAleenan said backlog had increased 9% since year-end and described the company's pipeline as healthy.
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Ricker said the company finished the quarter with $410 million in total cash and investments. Management plans to use those resources to invest in capabilities and pursue what McAleenan described as accretive merger-and-acquisition opportunities involving technologies that can be deployed rapidly at scale.
McAleenan said the company has fully integrated Ask Sage and CargoSeer, the two acquisitions completed during the prior six months. He said the businesses are now participating in the company's day-to-day operations and performing well.
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The company reported a net loss of $25.7 million in the second quarter, compared with a net loss of $228.6 million a year earlier. Ricker said the year-over-year reduction primarily reflected non-cash fair-value changes in derivatives and a non-cash goodwill impairment charge recorded in the second quarter of 2025 that did not recur this year.
Adjusted EBITDA was negative $11.6 million, compared with negative $8.5 million in the prior-year period. Ricker said the change reflected increased spending on sales, go-to-market capabilities and research and development, partly offset by the higher gross margin.
CargoSeer Deployment in El Salvador
McAleenan highlighted a five-year commercial deployment agreement for CargoSeer in El Salvador, signed with a regional customs specialist after a 12-month pilot program. He described it as CargoSeer's first deployment in Central America.
The CargoSeer platform combines cargo X-ray imagery, import and export documents, and structured trade data in a single workflow. According to McAleenan, the system is designed to help customs officials identify potential contraband, assess duties and keep legitimate shipments moving.
He said the technology uses AI and computer vision to compare cargo scans against declarations and trade information, flagging anomalies for inspection officers. McAleenan said the platform can be configured to a country's data and inspection workflows, with models updated as trade patterns and risks change.
Management said the El Salvador deployment has generated interest from customs agencies in other countries. McAleenan also cited the scale of global merchandise trade and operational constraints at ports and border crossings as factors supporting demand for the product.
Generative AI and Autonomous Systems Initiatives
The company also discussed expansion of its Ask Sage generative AI offering for secure and disconnected environments. McAleenan said Naval Air Systems Command, or NAVAIR, was among the company's second-quarter Ask Sage customers, though he did not provide financial terms or specific application details. He said the use case includes rapid software deployment and agentic coding capabilities.
Two weeks before the call, BigBear.ai expanded its offering with local hardware intended for deployments up to the top-secret level for Department of War customers and customers in other departments. McAleenan said the portable device can operate in locally connected or fully air-gapped environments, allowing users to access AI capabilities without an external network connection.
He said the platform is model-agnostic and multimodal, supporting text, images, video and other data. Customers can purchase tokens through BigBear.ai, bring their own models and tokens, or white-label the platform, according to management.
BigBear.ai also highlighted ConductorOS, its software for coordinating drones, sensors and other systems from different vendors. McAleenan said that during recent military exercises, the software enabled one soldier to command multiple drones from multiple vendors in a simulated degraded communications environment.
At the U.S. Army's Jailbreak event at Fort Carson in May, ConductorOS integrated a sensor and missile system that had not previously been able to communicate, according to McAleenan. He said the software received "jailbroken" status, signifying that it had approved interfaces and documentation for other systems to connect through it as part of a broader interoperable network.
Cybersecurity Certification
Ricker said BigBear.ai achieved Cybersecurity Maturity Model Certification Level 2 in July, ahead of schedule. The certification addresses security controls for protecting Controlled Unclassified Information and is a U.S. federal cybersecurity standard.
Management said the certification supports its work with government customers and strengthens trust with international partners. McAleenan said the company's strategy remains focused on national security and trade-and-travel markets, where it aims to provide mission-ready AI products and services.
About BigBear.ai (NYSE:BBAI)
BigBear.ai is a provider of artificial intelligence (AI) and data analytics solutions designed to deliver actionable insights for public sector and commercial clients. Headquartered in Columbia, Maryland, the company specializes in advanced analytics, machine learning, predictive modeling and network analysis to support decision-making in complex, data-rich environments. Its clientele spans defense and intelligence agencies, civil government organizations and enterprise businesses seeking to enhance mission outcomes and operational efficiency.
The company's flagship offerings include an AI-driven analytics platform that integrates data engineering, algorithm development and visualization tools.
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The article "BigBear.ai Q2 Earnings Call Highlights" was originally published by MarketBeat.
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