v3.26.1
Business Combinations
 3 Months Ended
Mar. 31, 2026
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
Business Combinations Business Combinations
Ask Sage Acquisition

On December 31, 2025, pursuant to the agreement and plan of merger (“Ask Sage Merger Agreement”), dated November 10, 2025, by and among Atlas 2025 Merger Sub, Inc., a Delaware corporation and a direct wholly-owned subsidiary of the Company (“Ask Sage Merger Sub”) and Ask Sage, Inc., a Delaware corporation (“Ask Sage” or “Seller”) and Shareholder Representative Services LLC, a Colorado limited liability company solely in its capacity as the representative of the Ask Sage securityholders, pursuant to which, among other matters, Ask Sage Merger Sub merged with and into Ask Sage with Ask Sage Merger Sub ceasing to exist and Ask Sage surviving as a wholly-owned subsidiary of the Company (“Ask Sage Merger”).

Purchase consideration for the Ask Sage Merger and the related transactions as contemplated by the Ask Sage Merger Agreement of $272.1 million, which was subject to customary adjustments for indebtedness, cash, working capital and transaction expenses, was comprised of $262.4 million of cash paid at closing of the Ask Sage Merger, $5.2 million of cash paid shortly after closing, and $4.5 million withheld under the terms of the Ask Sage Merger Agreement at the time of the closing to cover any post-closing adjustments to the purchase price (“Adjustment Escrow Amount”). The Company is required to segregate the Adjustment Escrow Amount from its corporate funds and is restricted from using it for operating expenses or any other corporate purposes. The cash withheld for the Adjustment Escrow Amount is presented in restricted cash on the Company’s condensed consolidated balance sheets at March 31, 2026. The Adjustment Escrow Amount is presented in other current liabilities on the Company’s condensed consolidated balance sheets at March 31, 2026.

The following table summarizes the fair value of the consideration transferred and the fair values of the major classes of assets acquired and liabilities assumed as of the acquisition date. These fair values were based on management’s estimates and assumptions; however, certain working capital amounts, income taxes, and residual goodwill remain preliminary and are subject to adjustment as additional information is obtained about the facts and circumstances that existed as of the acquisition date. The final determination of the fair values, related income tax impacts and residual goodwill will be completed as soon as practicable, and within the measurement period of up to one year from the acquisition date as permitted under GAAP. Any adjustments to provisional amounts that are identified during the measurement period will be recorded in the reporting period in which the
adjustment is determined.
December 31, 2025
Measurement period adjustments(1)
December 31, 2025, as reported at March 31, 2026
Cash paid at closing
$262,443 $— $262,443 
Deferred consideration5,183 — 5,183 
Adjustment Escrow Amount
4,000 515 4,515 
Purchase consideration$271,626 $515 $272,141 
Assets:
Cash
$33,418 $— $33,418 
Accounts receivable
1,331 (553)778 
Prepaid expenses and other current assets
256 92 348 
Intangible assets
84,290 — 84,290 
Total assets acquired$119,295 $(461)$118,834 
Liabilities:
Accounts payable3,354 105 3,459 
Accrued expenses3,675 (3,410)265 
Contract liabilities11,622 (34)11,588 
Other current liabilities13 — 13 
Deferred tax liabilities21,660 — 21,660 
Total liabilities acquired$40,324 $(3,339)$36,985 
Fair value of net identifiable assets acquired78,971 2,878 81,849 
Goodwill$192,655 $(2,363)$190,292 
(1) Includes adjustments to net working capital and the estimated income tax provision.

The following table summarizes the intangible assets acquired by class and the weighted-average estimated useful lives:

December 31
2025		Weighted-average estimated useful lives
Technology
$65,220 7 years
Licenses and certifications5,990 7 years
Customer relationships
12,785 3 years
Trade names295 1 year
Total intangible assets$84,290 

The fair value of the acquired technology and trade name was determined using the relief from royalty (“RFR”) method. The fair value of the acquired customer relationships was determined using the excess earnings method. The fair value of the acquired licenses and certifications was determined using the cost replacement method.

The acquisition was accounted for as a business combination, whereby the excess of the purchase consideration over the fair value of identifiable net assets was allocated to goodwill. The goodwill reflects the potential synergies and expansion of the Company’s offerings across product lines and markets complementary to its existing products and markets. For tax purposes, the goodwill related to the acquisition is not deductible.
The following table presents the net revenues, net loss and transaction expenses related to the Ask Sage Merger included in the results of operations for the following period:
Three Months Ended March 31, 2026
Revenues$6,144 
Net loss(551)
Transaction expenses related to the Ask Sage Merger
388 

Pro Forma Financial Data (Unaudited)

The following table presents the pro forma consolidated results of operations of BigBear.ai for the three months ended March 31, 2025, as though the acquisition of Ask Sage had been completed as of January 1, 2024.
Three Months Ended March 31, 2025
Revenues
$36,320 
Net loss(66,685)

The amounts included in the pro forma information are based on the historical results and do not necessarily represent what would have occurred if the Ask Sage business combination had taken place as of January 1, 2024, nor do they represent the results that may occur in the future. Accordingly, the pro forma financial information should not be relied upon as being indicative of the results that would have been realized had the acquisition occurred as of the date indicated or that may be achieved in the future.

Transaction expenses of $2.2 million attributable to the acquisition of Ask Sage have been recorded in the pro forma results for the three months ended March 31, 2025.

Acquisition of CargoSeer

On January 16, 2026, the Company acquired certain assets and liabilities of CargoSeer Ltd (“CargoSeer”), an Israel-based leader in unified AI decision support technology for customs and border operations. Purchase consideration for the acquisition of CargoSeer of $5.0 million, which was subject to net working capital adjustments for indebtedness, was paid in cash during the three months ended March 31, 2026. The acquisition was accounted for as a business combination, whereby the excess of the purchase consideration over the fair value of identifiable net assets was allocated to goodwill. The preliminary fair value of the assets acquired and liabilities assumed is primarily comprised of acquired technology intangible assets of $4.5 million with an estimated useful life of seven years and customer relationships intangible assets of $0.5 million with an estimated useful life of four years. The acquired net working capital balances and goodwill are immaterial.

The net revenues and net loss included in the results of operations are immaterial for the three months ended March 31, 2026. The pro forma results of operations of the Company would not be materially different as a result of the acquisition of CargoSeer and therefore are not presented. Transaction expenses of $0.6 million attributable to the acquisition of CargoSeer have been recorded in the condensed consolidated statements of operations and comprehensive loss for the three months ended March 31, 2026.