Leidos Holdings Q4 Earnings Beat Estimates, Revenues Decline Y/Y

Leidos Holdings, Inc.’s LDOS fourth-quarter 2025 adjusted earnings of $2.76 per share beat the Zacks Consensus Estimate of $2.57 by 7.4%. The bottom line also improved 16.5% from $2.37 registered in the prior-year quarter.

LDOS reported GAAP earnings of $2.53 per share, implying an improvement from the prior-year quarter’s level of $2.12.

The year-over-year upside in the bottom line can be attributed to higher operating income than the prior-year level.

LDOS’ 2025 adjusted earnings of $11.99 per share beat the Zacks Consensus Estimate of $11.76. The bottom line also increased 17.4% from $10.21 registered in the prior-year quarter.

LDOS’ Total Revenues

Total revenues of $4.21 billion missed the Zacks Consensus Estimate of $4.25 billion by 1.1%. The top line also decreased 3.6% year over year, primarily due to the six-week government shutdown in the fourth quarter of 2025.

For 2025, the company reported revenues worth $17.17 billion, reflecting a solid improvement from $16.66 billion registered in 2024. The full-year top line missed the consensus estimate of $17.22 billion.

Leidos Holdings, Inc. Price, Consensus and EPS Surprise

Leidos Holdings, Inc. price-consensus-eps-surprise-chart | Leidos Holdings, Inc. Quote

LDOS’ Backlog

The company recorded a total backlog of $49.03 billion, up from $48.39 billion at the end of 2024. Of this amount, $9.69 billion was funded.

Operational Statistics of LDOS

The cost of revenues decreased 5.6% year over year to $3.65 billion.

LDOS reported an adjusted operating income of $473 million compared with $421 million in the year-ago quarter.

Interest expenses totaled $48 million, which increased from the year-ago figure of $47 million.

Leidos’ Segmental Performance

National Security and Digital: Net revenues in this segment decreased 2.5% year over year to $1.85 billion.

Adjusted operating income improved to $196 million from the year-ago level of $175 million. Adjusted operating margin was 10.6%, which increased from the prior-year figure.

Health & Civil: The segment recorded revenues of $1.21 billion, down 9.3% year over year.

Adjusted operating income totaled $264 million compared with $279 million in the year-ago quarter. The adjusted operating margin was 21.9%, which increased year over year.

Commercial & International: Revenues in this segment amounted to $610 million, up 1% year over year.

This segment recorded an adjusted operating income of $51 million compared with $40 million in the year-ago quarter. The adjusted operating margin was 8.4%, up year over year.

Defense Systems: Revenues in this segment amounted to $546 million, up 1.3% year over year.

This segment recorded an adjusted operating income of $44 million compared with $2 million in the year-ago period. The adjusted operating margin was 8.1%, up year over year.

LDOS’ Financials

Cash and cash equivalents totaled $1.11 billion as of Jan. 2, 2026, compared with $849 million as of Jan. 3, 2025.

As of Jan. 2, 2026, the long-term debt, net of the current portion, amounted to $4.63 billion compared with $4.05 billion as of Jan. 3, 2025.

Net cash flow from operating activities totaled $1.75 billion at the end of 2025 compared with $1.44 billion recorded a year ago.

LDOS’ 2026 Guidance

Leidos Holdings expects to generate adjusted earnings in the range of $12.05-$12.45 per share. The Zacks Consensus Estimate for earnings is pegged at $12.35 per share, which lies above the midpoint of the company’s guided range.

LDOS expects 2026 revenues to be in the band of $17.50-$17.90 billion. The Zacks Consensus Estimate for revenues is pegged at $17.87 billion, above the midpoint of the company’s guided range.

It still expects to generate cash flow from operating activities of approximately $1.75 billion.

LDOS’ Zacks Rank

Leidos Holdings currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Recent Defense Releases

The Boeing Company BA incurred an adjusted loss of $1.91 per share in the fourth quarter of 2025, wider than the Zacks Consensus Estimate of a loss of 40 cents. However, the bottom line improved from the year-ago quarter’s reported loss of $5.90 per share.

Revenues amounted to $23.95 billion, which outpaced the consensus estimate of $21.73 billion by 8%. The top line also surged 57.1% from the year-ago quarter’s reported figure of $15.24 billion.

RTX Corporation’s RTX fourth-quarter 2025 adjusted EPS of $1.55 beat the Zacks Consensus Estimate of $1.46 by 5.9%. The bottom line also improved 0.6% from the year-ago quarter’s level of $1.54.

RTX’s fourth-quarter sales totaled $24.24 billion, which surpassed the Zacks Consensus Estimate of $22.74 billion by 6.6%. The top line also surged a solid 12.1% from $21.62 billion recorded for the fourth quarter of 2024.

Northrop Grumman Corporation NOC reported fourth-quarter 2025 adjusted earnings of $7.23 per share, which topped the Zacks Consensus Estimate of $7 by 3.3%. The bottom line also increased 13.1% from $6.39 registered in the prior-year quarter.

NOC’s total sales of $11.71 billion in the fourth quarter beat the consensus estimate of $11.62 billion by 0.8%. The top line also rose 9.6% from $10.69 billion reported in the year-ago quarter.

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This article originally published on Zacks Investment Research (zacks.com).

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