BigBear.ai Stock Faces Headwinds Amid Government Spending Cuts

BigBear.ai, a provider of AI solutions for national security and infrastructure, has seen its shares surge nearly 40% in 2025 despite recent volatility. The stock remains well below its 52-week high of $10.36, raising questions about its investment potential.

The company's revenue growth trajectory hit a snag after the TRUMP administration announced spending cuts. Q2 revenue plummeted 18% year-over-year to $32.5 million, prompting a downward revision of 2025 revenue targets to $125-$140 million from $158.2 million in 2024.

BigBear.ai's Core business includes AI-powered shipbuilding software for the U.S. Navy and biometric technology for airports. With federal contracts constituting the majority of its income, the company remains vulnerable to political budget fluctuations.