BigBear.ai Stock Crashes: What Triggered This Week’s Bloodbath?

Another AI darling bites the dust—BigBear.ai shares just got mauled by the bears. Here's why the algorithms turned against their own kind.

The selloff spiral

No fancy charts needed—when an AI stock drops this hard, even the trading bots panic-sell. Perfect storm of earnings misses, guidance cuts, and that classic 'growth-at-all-costs' hangover hitting tech portfolios.

Institutional carnage

Hedge funds that piled in during the AI hype cycle are now scrambling for exits. Turns out 'disruptive potential' doesn't pay the bills when quarterly numbers underwhelm. Another case study in why you shouldn't confuse buzzwords with business models.

The irony? An AI company getting outmaneuvered by old-school market forces. Maybe next they'll develop an algorithm to predict their own stock crashes—if there's any cash left to fund it.

BigBear.ai Q2 earnings disappoint

Wall Street was expecting a small net loss of $0.06 per share on $40.6 million in revenue. BigBear.ai missed these targets by a significant margin, reporting a much larger $0.71 loss per share on just $32.5 million in revenue.

The company's full-year guidance range was also cut heavily, from $160 million-$180 million down to $125 million-$140 million. CEO Kevin McAleenan said that the company's federal contracts had been disrupted, but he also pointed to imminent growth potential from newly authorized Department of Homeland Security (DHS) funding.

Image source: Getty Images

,, and the rest of big tech have been reporting blowout quarters, but BigBear and other end-user AI companies have not had the same luck, withbucking the trend, delivering massive growth.

BigBear.ai remains a risky bet

BigBear's losses are growing, sales are soft, and the company's stock carries a hefty premium, one that doesn't leave a lot of room for these trends to continue. BigBear has a lot to prove in the next two quarters, but I'm not convinced we'll see a major reversal. For investors with a high tolerance for risk and high confidence in AI in the near term, BigBear could be a good option. But for most, I WOULD advise avoiding the stock.