Summary
BigBear.ai reported third quarter revenue of $41.5 million, up 22.1% from the prior-year quarter. Gross profit was $10.77 million, up 28.0% from the prior-year quarter. Gross margin expanded to 25.9% from 24.7%. The operating loss widened to $10.54 million from $8.21 million. Net loss was $12.2 million, compared with net income of $4.0 million a year earlier. Diluted loss per share was $0.05, compared with diluted earnings per share of $0.03. The swing to a net loss was primarily driven by a decreased benefit from changes in fair value of warrants, which was $1.3 million in the third quarter compared to $15.7 million in the third quarter of 2023. Non-GAAP Adjusted EBITDA was positive $0.9 million, compared with $0.2 million a year earlier.
For the first nine months, revenue was $114.4 million, essentially flat from $114.6 million. Gross profit increased to $28.8 million, up 4.5% from the prior-year period. Gross margin rose to 25.2% from 24.1%. Operating loss widened sharply to $125.3 million from $30.5 million, including a non-cash goodwill impairment charge. Net loss was $149.1 million, compared with $39.1 million. Diluted loss per share was $0.65, compared with $0.27. Operating cash flow was negative, with net cash used in operating activities of $23.3 million, compared with $18.2 million used in the prior-year period. In the third quarter alone, net cash used in operating activities was $1.9 million, compared with cash provided of $6.58 million a year earlier. Capital expenditures were $0.14 million in the quarter and $0.30 million year to date. Deferred revenue was $2.08 million as of September 30, 2024, down 10.3% from $2.32 million a year earlier.
Operational momentum included a five-year, $165.15 million sole source prime contract from the U.S. Army for GFIM-OE production services, which begins in the fourth quarter of 2024. The company also received a subcontract award under a Federal Aviation Administration IDIQ contract with a $2.4 billion shared ceiling over ten years. BigBear.ai installed veriScan at Denver International Airport across 14 international departure gates, affecting more than 46,600 international departing passengers. ConductorOS was recognized as a Tier 1 technology at the DoD's RDER T-REX24-2 event, and the company is participating in the U.S. Navy's MAPG exercises. Backlog ended at $437 million as of September 30, 2024. Management affirmed full-year 2024 revenue guidance between $165 million and $180 million.
Risks remain centered on government spending and contract timing. The company noted that a continuing resolution funds U.S. government operations through December 20, 2024, and that delays in new contract awards can hurt results. Geopolitical conflicts have slowed the pipeline and pace of contract awards, pushing revenue into later periods. The Senior Revolver remains undrawn, and BigBear.ai is unable to draw on it until it meets the Adjusted EBITDA requirement, though it was in compliance with the covenant as of September 30, 2024. Goodwill testing showed fair value approximated carrying value, so adverse changes in assumptions could trigger future impairment. The goodwill impairment recorded year to date was non-cash and linked to a decline in share price compared with the equity issued for the Pangiam acquisition.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q3 FY2024 | Q2 FY2024 | QoQ | Q3 FY2023 | YoY |
|---|---|---|---|---|---|
| Revenue | $41.5M | $39.8M | +4.3% | $34.0M | +22.1% |
| Gross profit | $10.8M | $11.1M | -2.7% | $8.4M | +28.0% |
| Gross margin | 25.9% | 27.8% | -1.9 pp | 24.7% | +1.2 pp |
| Sales & marketing | $17.5M | $23.4M | -25.2% | $15.5M | +12.6% |
| Operating income (loss) | -$10.5M | -$16.7M | +36.8% | -$8.2M | -28.3% |
| Operating margin | -25.4% | -41.9% | +16.5 pp | -24.2% | -1.2 pp |
| Net income (loss) | -$12.2M | -$11.7M | -3.7% | $4.0M | -404.5% |
| Net margin | -29.3% | -29.5% | +0.2 pp | 11.8% | -41.1 pp |
| Diluted EPS | -$0.05 | -$0.05 | ±$0.00 | $0.03 | -$0.08 |
Risks
The majority of revenue is derived from federal government contracts, and a continuing resolution passed in September 2024 funds U.S. Government operations only through December 20, 2024. During continuing resolutions, the company may experience delays in new contract awards that could adversely affect results.
The company recorded an $85.0 million non-cash goodwill impairment during the nine months ended September 30, 2024. In the third quarter of 2024, fair value of the reporting unit approximated its carrying value, so a negative change in key assumptions or an increase in carrying value may result in future impairment charges.
As of September 30, 2024, the company is unable to draw on its $25.0 million Bank of America Senior Revolver because it does not meet the Adjusted EBITDA requirement, leaving available borrowings at zero. This limits financial flexibility despite cash and cash equivalents of $65.6 million.
A majority of revenue comes from federal government contracts, making results sensitive to U.S. government spending levels, timely funding, and shifting funding priorities. The FY2025 budget process remains subject to debate and compromise after the November 2024 election.
Conflicts in Ukraine, the Middle East, and heightened tension in the Pacific have slowed the pipeline and pace of contract awards for government customers, pushing revenue into subsequent periods. If these conflicts worsen, business and results could be negatively impacted.
The company has $200.0 million of Convertible Notes bearing 6.0% interest and maturing December 15, 2026. Medium-term to long-term cash requirements include servicing and repaying this debt, which depends on future cash generation.
SaaS KPIs
All quarters →Total Backlog
Adjusted EBITDA
Adjusted EBITDA Margin
Priced, unexercised options
Unpriced, unexercised options
Funded
Recurring SG&A
Unfunded
Adjusted Gross Margin
Summary, forecast, risks and KPIs are extracted from BigBear.ai Holdings, Inc.'s SEC filings for Q3 FY2024 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 2, 2026.