Leidos Achieves Record Revenue and Upgrades Guidance

Leidos Reports Impressive Revenue Growth

Leidos Holdings, Inc. (NYSE: LDOS) has shared its financial results for the second quarter, showcasing strong performances and a promising outlook for the fiscal year ahead. The company reported revenues of $4.3 billion, reflecting a 3% organic increase year-over-year, highlighting the effectiveness of their operational strategies and market demand.

Financial Highlights

Key Metrics

During the quarter, Leidos achieved net income of $393 million, or $3.01 per diluted share. This marks a substantial increase of 21% and 27% in net income and diluted EPS, respectively, as compared to the same period last year. Notably, the adjusted EBITDA reached a record of $647 million, coupled with an adjusted EBITDA margin of 15.2%, representing a significant improvement from previous results.

Operating Insights

Leidos' solid performance can be attributed to its robust portfolio in high-demand sectors, particularly in Defense Systems. This sector saw increased revenue owing to innovative military products. The firm experienced strong cash flows from operations totaling $486 million, demonstrating effective cash management strategies. The Free Cash Flow (non-GAAP) also showed an impressive figure of $457 million for this quarter.

Recent Acquisitions and Strategic Moves

This quarter marked the acquisition of Kudu Dynamics for a preliminary purchase price of $291 million. This acquisition aligns with Leidos' NorthStar 2030 strategy, focusing on enhancing artificial intelligence-enabled cyber capabilities for governmental and commercial clients in defense and intelligence sectors.

New Business Awards

Leidos reported significant new business awards in the latest quarter totaling $3.9 billion, which translates to a book-to-bill ratio of 0.9. The total backlog now stands at $46.2 billion, which includes notable contracts such as:

• Major Intelligence Contracts: Two substantial Intelligence Community contracts worth $1.3 billion and $390 million solidify Leidos' position in national defense.
• Air Force Support: A new $350 million IDIQ subcontract with Huntington Ingalls Industries to deliver electronic warfare solutions, showing the company’s depth in this specialized area.
• FBI Fingerprint Analysis: Awarded a $128 million task order to assist in modernizing biometric services for the FBI, highlighting Leidos' capability in law enforcement technology.
• NATO IT Modernization: Secured a contract worth $87 million to revamp NATO’s IT infrastructure, aiming at enhancing operational efficiency.

Forward Guidance

Given the robust performance over the first half of the fiscal year, Leidos has raised its full-year 2025 guidance. The company expects revenues in the range of $17 billion to $17.25 billion, with an improved adjusted EBITDA margin targeted in the mid-13% range and guidance for Non-GAAP diluted EPS now set between $11.15 and $11.45.

Company Overview

Leidos is positioned as a technology and services leader, driving advancements for both government and commercial entities. With approximately 47,000 global employees, the company reported annual revenues close to $16.7 billion for the last fiscal year.

Frequently Asked Questions

What were Leidos' revenues for the second quarter?

Leidos reported revenues of $4.3 billion for the second quarter of fiscal year 2025.

How did Leidos perform in terms of net income?

The company achieved a net income of $393 million, or $3.01 per diluted share, marking increases of 21% and 27% respectively compared to the previous year.

What acquisitions did Leidos make recently?

Leidos acquired Kudu Dynamics for a preliminary purchase price of $291 million to enhance its capabilities in cybersecurity.

What is the current backlog for Leidos?

Leidos has a total backlog of approximately $46.2 billion, which includes significant new business awards.

What changes were made to Leidos' guidance for 2025?

Leidos increased its fiscal 2025 guidance to a revenue range of $17 billion to $17.25 billion and updated EPS guidance to $11.15 - $11.45.

About The Author

My name is Dylan Bailey, and I am 28 years old. I am an author and an expert on the stock market who specializes in publicly traded companies. Early fascination with the stock market inspired me to seek a finance degree and then delve deeply into the world of stocks. I have developed over the years my abilities to spot investment prospects, assess business performance, and analyze market trends.

My books and articles try to help regular investors understand the nuances of the stock market. Anyone can, in my opinion, make wise investment choices and succeed financially if they have the correct information and resources. In my writing, I combine in-depth research with practical insights and advice that can be put into action. This is done with the intention of assisting readers in navigating the constantly shifting landscape of publicly traded companies.

In addition to writing, I also host webinars and workshops, where I give presentations and share my knowledge with a wider audience. I also write for top financial journals and show up as a guest analyst on financial news shows. I like to travel, spend time with my family, and keep active by playing different sports when I'm not buried in market research.

My goal is to enable people to choose wisely and consciously in their investments, so taking charge of their financial futures. By my work, I hope to create a community of informed and self-assured investors prepared to take advantage of the chances presented by the stock market.

Contact Dylan Bailey privately here. Or send an email with ATTN: Dylan Bailey as the subject to contact@investorshangout.com.

About Investors Hangout

Investors Hangout is a leading online stock forum for financial discussion and learning, offering a wide range of free tools and resources. It draws in traders of all levels, who exchange market knowledge, investigate trading tactics, and keep an eye on industry developments in real time. Featuring financial articles, stock message boards, quotes, charts, company profiles, and live news updates. Through cooperative learning and a wealth of informational resources, it helps users from novices creating their first portfolios to experts honing their techniques. Join Investors Hangout today: https://investorshangout.com/

The content of this article is based on factual, publicly available information and does not represent legal, financial, or investment advice. Investors Hangout does not offer financial advice, and the author is not a licensed financial advisor. Consult a qualified advisor before making any financial or investment decisions based on this article. This article should not be considered advice to purchase, sell, or hold any securities or other investments. If any of the material provided here is inaccurate, please contact us for corrections.