BigBear.ai Wins $53M Contract and Margin Jump; C3.ai ETF Trading Surges
AI•BigBear.ai’s backlog rose 14% to $281.9 million, driven by a new $53 million sole-source intelligence contract that helped boost gross margin by 1,300 basis points to 34%. C3.ai has experienced elevated ETF-driven trading volumes since the Iran war began, despite a 0.9% year-over-year sales decline and ongoing deep operating losses.
1. BigBear.ai Contract and Backlog Growth
BigBear.ai’s backlog increased 14% to $281.9 million in Q1 2026, fueled by a sole-source intelligence contract valued at approximately $53 million. Management highlights this contract as a cornerstone for its pivot to mission-ready AI solutions for government clients.
2. Margin Expansion Through Software Integration
The integration of high-value software from recent acquisitions drove BigBear.ai’s gross margin up 1,300 basis points year-over-year to 34%. Despite this improvement, operating margin remains deeply negative at -68.3%, reflecting continued heavy investment and restructuring costs.
3. Sales Stagnation and 2026 Guidance
BigBear.ai reported a 0.9% year-over-year decline in quarterly revenue, leaving LTM sales at $127 million. Management reaffirmed full-year 2026 revenue guidance of $135 million to $165 million, implying 17% growth at midpoint despite ongoing net losses.
4. C3.ai ETF Trading Dynamics
C3.ai has seen a surge in trading volumes within AI-focused ETFs since the onset of the Iran war, driven by broader ETF flows into technology sectors. This heightened activity has yet to translate into improved sales or profitability for C3.ai, which continues to face flat revenue trends and net losses.
