Leidos Holdings, Inc.
For the period ended Apr 4, 2025. Filed May 6, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Apr 4, 2025 · Filed May 6, 2025
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Item 2. Results of Operations
The following table summarizes our condensed consolidated results of operations for the periods presented:
| Three Months Ended | |||
|---|---|---|---|
| (dollars in millions) | April 4,2025 | March 29,2024 | Percent change |
| Revenues | $4,245 | $3,975 | 6.8% |
| Operating income | 530 | 415 | 27.7% |
| Non-operating expense, net | (52) | (47) | 10.6% |
| Income before income taxes | 478 | 368 | 29.9% |
| Income tax expense | (113) | (85) | 32.9% |
| Net income | 365 | 283 | 29.0% |
| Net income attributable to Leidos common stockholders | $363 | $284 | 27.8% |
| Operating margin | 12.5% | 10.4% | |
SEGMENT AND CORPORATE RESULTS
| Three Months Ended | |||
|---|---|---|---|
| National Security & Digital(dollars in millions) | April 4,2025 | March 29,2024 | Percent change |
| Revenues | $1,878 | $1,793 | 4.7% |
| Operating income | 185 | 175 | 5.7% |
| Operating margin | 9.9% | 9.8% | |
The increase in revenues and operating income for the three months ended April 4, 2025, as compared to the three months ended March 29, 2024, was primarily attributable to a net increase in volumes on certain programs and program wins, partially offset by the completion of certain contracts.
| Leidos Holdings, Inc. | 21 |
|---|
| Three Months Ended | |||
|---|---|---|---|
| Health & Civil(dollars in millions) | April 4,2025 | March 29,2024 | Percent change |
| Revenues | $1,291 | $1,199 | 7.7% |
| Operating income | 299 | 222 | 34.7% |
| Operating margin | 23.2% | 18.5% | |
The increase in revenues and operating income for the three months ended April 4, 2025, as compared to the three months ended March 29, 2024, was primarily attributable to a net increase in volumes and case complexity within the managed health services business.
| Three Months Ended | |||
|---|---|---|---|
| Commercial & International(dollars in millions) | April 4,2025 | March 29,2024 | Percent change |
| Revenues | $568 | $509 | 11.6% |
| Operating income | 37 | 34 | 8.8% |
| Operating margin | 6.5% | 6.7% | |
The increase in revenues and operating income for the three months ended April 4, 2025, as compared to the three months ended March 29, 2024, was primarily attributable to a net increase in volumes and program wins, partially offset by the completion of certain programs.
| Three Months Ended | |||
|---|---|---|---|
| Defense Systems(dollars in millions) | April 4,2025 | March 29,2024 | Percent change |
| Revenues | $508 | $474 | 7.2% |
| Operating income | 34 | 21 | 61.9% |
| Operating margin | 6.7% | 4.4% | |
The increase in revenues for the three months ended April 4, 2025, as compared to the three months ended March 29, 2024, was primarily attributable to program wins, partially offset by the completion of certain contracts.
The increase in operating income for the three months ended April 4, 2025, as compared to the three months ended March 29, 2024, was primarily attributable to program wins and a decrease in amortization expense.
| Three Months Ended | |||
|---|---|---|---|
| Corporate(dollars in millions) | April 4,2025 | March 29,2024 | Percent change |
| Operating loss | $(25) | $(37) | (32.4%) |
The decrease in operating loss for the three months ended April 4, 2025, as compared to the three months ended March 29, 2024, was primarily attributable to decreased general and administrative expenses and legal fees.
NON-OPERATING EXPENSE, NET
Non-operating expense, net for the three months ended April 4, 2025, was $52 million as compared to $47 million for the three months ended March 29, 2024. The increase was primarily driven by unfavorable exchange rate movements.
| 22 | Leidos Holdings, Inc. |
PROVISION FOR INCOME TAXES
For the three months ended April 4, 2025, our effective tax rate was 23.6% compared to 23.1% for the three months ended March 29, 2024. The increase to the effective tax rate was primarily due to a decrease in excess tax benefits related to employee stock-based payment transactions.
In December 2021, the Organization for Economic Cooperation and Development enacted model rules for a new 15% global minimum tax framework (“Pillar Two”). Many governments around the world have enacted or are in the process of enacting Pillar Two legislation. The Pillar Two legislation became effective for certain jurisdictions beginning in fiscal 2024. We will continue to evaluate the impact of the rules as additional legislation gets enacted; however, there has been no material impact from jurisdictions where Pillar Two rules are currently in effect.
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