AI stock under $10 surges on defense deal optimism
The predictive analysis company is up 57% year-to-date.
BigBear.ai (BBAI) has positioned itself as a key player in artificial intelligence-driven solutions for defense.
Key takeaways:
- BigBear.ai is expanding as an AI solution for mission-based operations.
- Despite a weak quarterly report, it boasts significant cash for investments.
- The company is looking at international and domestic contracts to increase revenue.
The company's stock rose 400% over the past year, primarily due to a new defense contract that leverages its predictive analytics to enhance decision-making and threat detection in mission-based operating environments.
On Wednesday, shares rose 7.1% to $6.98.
In September, BigBear.ai collaborated with SMX, a digital solutions company, to deploy advanced AI technologies in support of the U.S. Naval Forces Southern Command/4th Fleet at UNITAS 2025.
UNITAS is one of the world’s longest-running multinational maritime exercises, and this year, 8,000 personnel from 26 allied and partner nations will participate. The announcement sent Bigbear.ai’s stock soaring 12.8%. Image source: Gorodenkoff/Shutterstock
CEO Kevin McAleenan stated, “Our participation in UNITAS 2025 underscores BigBear.ai’s commitment to equipping U.S. and allied forces with mission-ready AI that delivers real impact where it's needed most.”
Industry growth offers tailwinds
BigBear.ai is an AI-powered solutions company; essentially, it uses artificial intelligence to help companies make faster, better, and more informed decisions. With its data analytics skills, it has positioned itself as a reliable solutions provider of real-time threat assessment, especially in combat situations.
The scope of AI in the Aerospace and Defense (A&D) industry continues to grow, driven by the need for competitive advantage and customized AI solutions.
More Palantir
- Palantir lands surprise AI deal with 109-year-old titan
- Salesforce CEO sends message on Palantir after $950M deal
- Bank of America revamps Palantir stock outlook after AIPCon
A BCG report notes that “in 2024, the A&D industry spent $26.6 billion on AI, roughly 3% of total revenue. This share is expected to grow at a compound annual rate of 9%, to $44 billion, by 2030.”
The report also highlights that “the US Department of Defence and many intelligence agencies are leveraging secure, mission-ready cloud environments – without compromising mission performance or control.”
Related: Hunting Golden Dome defense stocks? Follow the jobs
BigBear.ai is steadily emerging in this space.
Political support and financial outlook
President Doland Trump’s “One Big Beautiful Bill Act” includes a $250 million boost in building the Department of Defense’s AI ecosystem, particularly in naval shipbuilding and autonomous systems.
Such initiatives make BigBear.ai’s stock appealing even amid uneven quarterly reports.
In its Q2 2025 earnings report, the company reported revenue of $32.5 million, down 18% year over year, and a net loss of $228.6 million, primarily attributed to non-cash accounting adjustments, implying that there was no corresponding cash expenditure.
Despite this, the company holds a strong cash balance of $390.8 million, which it believes will be enough to fuel organic and inorganic growth.
Related: Should You Spend $8,000 On C3.ai Stock? WallStreetBets Is Torn Up
CFO BigBear.ai Sean Ricker emphasized, “Our record cash balance will enable us to make significant investments, both organically and inorganically, in an order of magnitude that was not possible before."
The company has also projected revenue between $125 million and $140 million for the end of 2025, relying heavily on domestic and international deals to boost contract volumes.
Ricker highlighted that some international deals are already underway,
Beyond the opportunities that we’re pursuing in the U.S., this quarter, we signed a transformative partnership with leading companies in the UAE under the IHC umbrella focused on accelerating the development and adoption of AI across several domains and applications. This is just the beginning of our international expansion and demonstrates the need for Big.bear.ai’s technology and solutions across the globe.
While it does not rival the well-established names in this industry, such as Palantir and C3.ai, it is steadily expanding. With government opportunities, international support, and a strong cash balance, the stock has garnered interest.
However, it remains highly volatile and speculative, making it a risky bet.
Related: Billionaire rings alarm with one-word AI warning
What's Your Reaction?
