Why BigBear.ai Holdings (BBAI) Is Plunging in 2025?

We recently published a list of Why These 15 Cybersecurity Stocks Are Plunging In 2025. In this article, we are going to take a look at where BigBear.ai Holdings, Inc. (NYSE:BBAI) stands against other cybersecurity stocks that are plunging in 2025.

Cybersecurity stocks ranked among the hottest names on the stock market for years as these companies have been riding a wave of cyber threats and have easily acquired clients. Moreover, AI made them even hotter. These companies delivered jaw-dropping growth as businesses scrambled to protect their data from extremely sophisticated attacks.

Even in this environment, many are still posting very impressive revenue figures. Their services remain in high demand because cybercrime shows no signs of slowing down. Yet despite this strength, their stock prices have taken a nosedive this year. Unfortunately, there’s a lot of pessimism surrounding AI and connected themes like cybersecurity.

Wall Street is pulling back on these names, and the shift has dragged down some stocks that were market darlings just a few months before. It’s a good idea to look into the cybersecurity stocks that have been sold off the most, as there are likely buying opportunities here.

For this article, I screened the worst-performing cybersecurity stocks year-to-date.

I will also mention the number of hedge fund investors in these stocks. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

A closeup of a computer server rack surrounded by a CAT5 network of cables.

Number of Hedge Fund Holders In Q4 2024: 13

BigBear.ai Holdings, Inc. (NYSE:BBAI) is an AI company that partners with government agencies and commercial enterprises.

The stock is down significantly so far in 2025, as BigBear.ai (NYSE:BBAI) reported a net loss of $108 million for Q4 2024. This was five times higher than the previous year’s loss. This translated to a loss of 43 cents per share and exceeded analysts’ expectations of a 4-cent loss.

Revenue for the quarter was $43.8 million, below market expectations. BigBear.ai (NYSE:BBAI) projected 2025 revenue between $160 million and $180 million. This fell short of analysts’ estimates of $190 million.

The announcement of a $50 billion reduction in the Department of Defense budget directly impacted BigBear.ai’s core business.