BigBear.ai Closes $250 Million Acquisition of Ask Sage, Cementing Lead in Classified AI

The race to bring generative AI inside the Pentagon’s secure networks just got a new front-runner. BigBear.ai (NYSE: BBAI) announced today that it has finalized its $250 million acquisition of Ask Sage, officially merging two of the most prominent players in the national security AI space as 2025 comes to a close.

The deal, originally announced in November, was completed this morning, marking a significant consolidation in the "GovTech" sector. By absorbing Ask Sage, BigBear.ai moves from being a predictive analytics specialist to a full-stack provider of "agentic" AI—autonomous systems capable of executing complex tasks within highly classified environments.

The "Mission-Ready" Merger
While Silicon Valley giants fight for consumer dominance, BigBear.ai is betting on the lucrative—and restrictive—world of defense contracting.

The Price Tag: The all-cash deal is valued at $250 million, a significant bet for BigBear.ai that represents roughly 10% of its market cap at the time of the initial announcement.

The Asset: Ask Sage is not a typical startup. It is already deployed across 16,000 government teams and serves over 100,000 users, including units within the U.S. Space Force, the Defense Health Agency, and the Office of the Secretary of Defense.

The "Secret Sauce": Ask Sage’s primary value is its "sovereign" architecture. Unlike standard ChatGPT instances which can leak data, Ask Sage is designed to be cloud-agnostic and secure enough for FedRAMP High and classified networks, allowing soldiers and analysts to use Large Language Models (LLMs) without violating security protocols.

Why It Matters: The "Agentic" Shift
Kevin McAleenan, CEO of BigBear.ai, emphasized that this deal is about moving beyond simple chatbots. "We are responding directly to what our customers have been asking for: AI that is not only powerful but trusted, scalable, and ready for real-world missions," McAleenan said in a statement released Wednesday.

The acquisition brings "agentic capabilities" under BigBear's roof. This means the AI doesn't just answer questions; it can connect to other government software systems to perform workflows—like analyzing satellite imagery or processing logistics forms—automatically.

Market Reaction & Financial Impact
The market has reacted warmly to the strategy.

Stock Performance: BigBear.ai shares (BBAI) had already surged nearly 20% in November when the deal was first revealed, driven by the synergy of BigBear's existing federal contracts with Ask Sage's rapid growth.

Revenue Boost: Ask Sage is projected to generate approximately $25 million in annual recurring revenue (ARR) for 2025—a six-fold increase from the previous year—proving that the government's appetite for AI tools is growing exponentially.

With the deal now closed, BigBear.ai enters 2026 as a formidable entity in the defense industrial base, positioned to challenge larger incumbents like Leidos and SAIC for the next generation of multibillion-dollar AI contracts.