New York, Jan 6, 2026, 10:59 EST — Regular session
- BBAI shares were up about 4% in morning trade, extending recent gains.
- The company plans to eliminate about $125 million of convertible-note debt, largely via conversions into stock.
- Investors are watching conversions through mid-January ahead of a Jan. 16 redemption date.
Shares of BigBear.ai Holdings rose about 4.3% to $6.13 on Tuesday, after closing at $5.88 in the previous session. The stock traded between $5.81 and $6.21, with about 22 million shares changing hands.
The move keeps attention on BigBear.ai’s plan to redeem its 6.00% convertible senior secured notes due 2029, a step the company said would remove roughly $125 million of debt from its balance sheet. BigBear.ai said it expects most of the reduction to come from noteholders converting debt into shares, limiting any cash drain, though it expects to issue about 38 million shares, which would increase the public float — the stock available to trade. 1
A filing showed noteholders who do not convert by the Jan. 16 redemption date will be repurchased for cash at principal plus accrued interest, leaving the company exposed to a larger cash payout if conversions fall short. The company also lifted the conversion rate — the number of shares issued per $1,000 of principal — to 305.5254 shares for conversions through Jan. 15, from 281.4491 shares as of the redemption notice date. 2
“Today’s announcement represents an important step in strengthening BigBear.ai’s long-term financial foundation,” Chief Executive Kevin McAleenan said in the debt-reduction announcement. He said the company expects the move to improve financial flexibility as it balances acquisitions with organic growth. 3
The debt work comes days after BigBear.ai said it completed its $250 million cash acquisition of Ask Sage, a secure generative AI platform aimed at defense and other regulated customers. The company said Ask Sage supports more than 100,000 users across 16,000 government teams, and McAleenan called the deal “a significant milestone” for BigBear.ai. 4
The broader market was modestly higher, and some AI-linked names also gained, with Palantir up about 2.6% and C3.ai up about 0.3%. The SPDR S&P 500 ETF was up about 0.3%.
Still, the trade-off is clear: issuing millions of shares to retire debt can weigh on the stock even as leverage falls. If fewer noteholders convert than the company expects, cash redemptions could pressure liquidity and revive balance-sheet concerns.
