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Leidos Holdings Q1 Earnings Top Estimates, Revenues Rise Y/Y
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Leidos Holdings, Inc.’s (LDOS - Free Report) first-quarter 2025 adjusted earnings of $2.97 per share beat the Zacks Consensus Estimate of $2.47 by 20.2%. The bottom line also increased 29.7% from $2.29 registered in the prior-year quarter. (See the Zacks Earnings Calendar to stay ahead of market-making news.)
LDOS reported GAAP earnings of $2.77 per share, implying an improvement from the prior-year quarter’s level of $2.07.
The year-over-year upside in the bottom line can be attributed to revenue growth and improved profitability when compared with the first quarter of 2024.
LDOS’ Total Revenues
Total revenues of $4.25 billion beat the Zacks Consensus Estimate of $4.08 billion by 4%. The top line also improved 6.8% year over year, driven by increased demand across all customer segments.
Leidos Holdings, Inc. Price, Consensus and EPS Surprise
The company recorded a total backlog of $46.30 billion, up from $43.56 billion at the end of the fourth quarter of 2024. Of this amount, $7.33 billion was funded.
Operational Statistics of LDOS
The cost of revenues increased 4.5% year over year to $3.49 billion.
LDOS reported an adjusted operating income of $565 million compared with $456 million in the year-ago quarter.
The adjusted operating margin was 13.3% compared with 11.5% in the prior-year period.
Interest expenses totaled $49 million, which came in line with the year-ago figure.
Leidos’ Segmental Performance
National Security and Digital: Net revenues in this segment improved 4.7% year over year to $1.88 billion. The increase can be attributed to contract wins and increased volumes on Sentinel and certain Information Technology and Intelligence programs.
This segment’s adjusted operating income declined to $190 million from the year-ago level of $181 million. The segment’s adjusted operating margin was 10.1%, which came in line with the prior-year figure.
Health & Civil: The segment recorded revenues of $1.29 billion, up 7.7% year over year. This improvement can be attributed to increased volumes and case complexity within the managed health services business, as well as net write-ups on certain programs.
This unit’s adjusted operating income totaled $305 million compared with $228 million in the year-ago quarter. The segment’s adjusted operating margin was 23.6%, up 460 basis points (bps) year over year.
Commercial & International: Revenues in this segment amounted to $568 million, up 11.6% year over year. The upside was driven by increased deliveries of security products and higher volumes from certain programs in the United Kingdom.
This segment recorded an adjusted operating income of $48 million compared with $42 million in the year-ago quarter. The adjusted operating margin was 8.5%, up 20 bps year over year.
Defense Systems: Revenues in this segment amounted to $508 million, up 7.2% year over year. The upside was driven by increased volumes in space sensing and hypersonics programs.
This segment recorded an adjusted operating income of $46 million compared with $38 million in the year-ago period. The adjusted operating margin was 9.1%, up 110 bps year over year.
LDOS’ Financials
Cash and cash equivalents totaled $842 million compared with $849 million as of Jan. 3, 2025.
As of April 4, 2025, the long-term debt, net of the current portion, amounted to $5.01 billion compared with $4.05 billion as of Jan. 3, 2025.
Net cash flow from operating activities totaled $58 million at the end of the first quarter of 2025 compared with $113 million recorded a year ago.
LDOS’ 2025 Guidance
Leidos Holdings reaffirmed its 2025 guidance. It continues to expect to generate adjusted earnings in the range of $10.35-$10.75 per share. The Zacks Consensus Estimate for earnings is pegged at $10.51 per share, which is lower than the midpoint of the company’s guided range.
LDOS still expects 2025 revenues in the band of $16.90-$17.30 billion. The Zacks Consensus Estimate for revenues is pegged at $17.09 billion, just below the midpoint of the company’s guided range.
It still expects to generate cash flow from operating activities to be approximately $1.45 billion in 2025.
Lockheed Martin Corporation (LMT - Free Report) reported first-quarter 2025 earnings of $7.28 per share, which beat the Zacks Consensus Estimate of $6.34 by 14.8%. The bottom line increased 15% from the year-ago quarter's reported figure of $6.33.
Net sales were $17.96 billion, which beat the Zacks Consensus Estimate of $17.76 billion by 1.1%. The top line also increased 4.5% from $17.20 billion reported in the year-ago quarter.
Northrop Grumman Corporation (NOC - Free Report) reported first-quarter 2025 adjusted earnings of $6.06 per share, which missed the Zacks Consensus Estimate of $6.21 by 2.4%.
NOC’s total sales of $9.47 billion missed the Zacks Consensus Estimate of $9.91 billion by 4.4%. The top line also declined 6.6% from $10.13 billion reported in the year-ago quarter.
RTX Corporation’s (RTX - Free Report) first-quarter 2025 adjusted earnings per share of $1.47 beat the Zacks Consensus Estimate of $1.35 by 8.9%. The bottom line also improved 9.7% from the year-ago quarter’s level of $1.34.
Its first-quarter sales totaled $20.31 billion, which surpassed the Zacks Consensus Estimate of $19.71 billion by 3%. The top line also surged a solid 5.2% from $19.31 billion recorded in the first quarter of 2024.
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Leidos Holdings Q1 Earnings Top Estimates, Revenues Rise Y/Y
Leidos Holdings, Inc.’s (LDOS - Free Report) first-quarter 2025 adjusted earnings of $2.97 per share beat the Zacks Consensus Estimate of $2.47 by 20.2%. The bottom line also increased 29.7% from $2.29 registered in the prior-year quarter. (See the Zacks Earnings Calendar to stay ahead of market-making news.)
LDOS reported GAAP earnings of $2.77 per share, implying an improvement from the prior-year quarter’s level of $2.07.
The year-over-year upside in the bottom line can be attributed to revenue growth and improved profitability when compared with the first quarter of 2024.
LDOS’ Total Revenues
Total revenues of $4.25 billion beat the Zacks Consensus Estimate of $4.08 billion by 4%. The top line also improved 6.8% year over year, driven by increased demand across all customer segments.
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 $46.30 billion, up from $43.56 billion at the end of the fourth quarter of 2024. Of this amount, $7.33 billion was funded.
Operational Statistics of LDOS
The cost of revenues increased 4.5% year over year to $3.49 billion.
LDOS reported an adjusted operating income of $565 million compared with $456 million in the year-ago quarter.
The adjusted operating margin was 13.3% compared with 11.5% in the prior-year period.
Interest expenses totaled $49 million, which came in line with the year-ago figure.
Leidos’ Segmental Performance
National Security and Digital: Net revenues in this segment improved 4.7% year over year to $1.88 billion. The increase can be attributed to contract wins and increased volumes on Sentinel and certain Information Technology and Intelligence programs.
This segment’s adjusted operating income declined to $190 million from the year-ago level of $181 million. The segment’s adjusted operating margin was 10.1%, which came in line with the prior-year figure.
Health & Civil: The segment recorded revenues of $1.29 billion, up 7.7% year over year. This improvement can be attributed to increased volumes and case complexity within the managed health services business, as well as net write-ups on certain programs.
This unit’s adjusted operating income totaled $305 million compared with $228 million in the year-ago quarter. The segment’s adjusted operating margin was 23.6%, up 460 basis points (bps) year over year.
Commercial & International: Revenues in this segment amounted to $568 million, up 11.6% year over year. The upside was driven by increased deliveries of security products and higher volumes from certain programs in the United Kingdom.
This segment recorded an adjusted operating income of $48 million compared with $42 million in the year-ago quarter. The adjusted operating margin was 8.5%, up 20 bps year over year.
Defense Systems: Revenues in this segment amounted to $508 million, up 7.2% year over year. The upside was driven by increased volumes in space sensing and hypersonics programs.
This segment recorded an adjusted operating income of $46 million compared with $38 million in the year-ago period. The adjusted operating margin was 9.1%, up 110 bps year over year.
LDOS’ Financials
Cash and cash equivalents totaled $842 million compared with $849 million as of Jan. 3, 2025.
As of April 4, 2025, the long-term debt, net of the current portion, amounted to $5.01 billion compared with $4.05 billion as of Jan. 3, 2025.
Net cash flow from operating activities totaled $58 million at the end of the first quarter of 2025 compared with $113 million recorded a year ago.
LDOS’ 2025 Guidance
Leidos Holdings reaffirmed its 2025 guidance. It continues to expect to generate adjusted earnings in the range of $10.35-$10.75 per share. The Zacks Consensus Estimate for earnings is pegged at $10.51 per share, which is lower than the midpoint of the company’s guided range.
LDOS still expects 2025 revenues in the band of $16.90-$17.30 billion. The Zacks Consensus Estimate for revenues is pegged at $17.09 billion, just below the midpoint of the company’s guided range.
It still expects to generate cash flow from operating activities to be approximately $1.45 billion in 2025.
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 Q1 Defense Releases
Lockheed Martin Corporation (LMT - Free Report) reported first-quarter 2025 earnings of $7.28 per share, which beat the Zacks Consensus Estimate of $6.34 by 14.8%. The bottom line increased 15% from the year-ago quarter's reported figure of $6.33.
Net sales were $17.96 billion, which beat the Zacks Consensus Estimate of $17.76 billion by 1.1%. The top line also increased 4.5% from $17.20 billion reported in the year-ago quarter.
Northrop Grumman Corporation (NOC - Free Report) reported first-quarter 2025 adjusted earnings of $6.06 per share, which missed the Zacks Consensus Estimate of $6.21 by 2.4%.
NOC’s total sales of $9.47 billion missed the Zacks Consensus Estimate of $9.91 billion by 4.4%. The top line also declined 6.6% from $10.13 billion reported in the year-ago quarter.
RTX Corporation’s (RTX - Free Report) first-quarter 2025 adjusted earnings per share of $1.47 beat the Zacks Consensus Estimate of $1.35 by 8.9%. The bottom line also improved 9.7% from the year-ago quarter’s level of $1.34.
Its first-quarter sales totaled $20.31 billion, which surpassed the Zacks Consensus Estimate of $19.71 billion by 3%. The top line also surged a solid 5.2% from $19.31 billion recorded in the first quarter of 2024.