Leidos Holdings Q1 Earnings Top Estimates, Revenues Rise Y/Y

Core Viewpoint - Leidos Holdings, Inc. reported strong financial performance in Q1 2025, with adjusted earnings per share significantly exceeding expectations and showing substantial year-over-year growth [1][2]. Financial Performance - Adjusted earnings per share for Q1 2025 were $2.97, surpassing the Zacks Consensus Estimate of $2.47 by 20.2% and increasing 29.7% from $2.29 in the prior-year quarter [1] - GAAP earnings were $2.77 per share, up from $2.07 in the same quarter last year [1] - Total revenues reached $4.25 billion, exceeding the Zacks Consensus Estimate of $4.08 billion by 4% and reflecting a 6.8% year-over-year increase [3] Operational Statistics - Cost of revenues increased by 4.5% year over year to $3.49 billion [5] - Adjusted operating income rose to $565 million from $456 million in the previous year [5] - Adjusted operating margin improved to 13.3% compared to 11.5% in the prior-year period [5] Backlog and Segment Performance - Total backlog increased to $46.30 billion from $43.56 billion at the end of Q4 2024, with $7.33 billion funded [4] - National Security and Digital segment revenues grew 4.7% year over year to $1.88 billion, while adjusted operating income slightly declined to $190 million [6] - Health & Civil segment revenues rose 7.7% to $1.29 billion, with adjusted operating income increasing to $305 million [7] - Commercial & International segment revenues reached $568 million, up 11.6% year over year, with adjusted operating income at $48 million [8] - Defense Systems segment revenues were $508 million, up 7.2%, with adjusted operating income increasing to $46 million [10] Financial Position - Cash and cash equivalents totaled $842 million, a slight decrease from $849 million at the beginning of the year [11] - Long-term debt increased to $5.01 billion from $4.05 billion [11] - Net cash flow from operating activities was $58 million, down from $113 million a year ago [11] 2025 Guidance - Leidos reaffirmed its 2025 guidance, expecting adjusted earnings in the range of $10.35-$10.75 per share, with the Zacks Consensus Estimate at $10.51 [12] - The company anticipates revenues between $16.90-$17.30 billion, with the Zacks Consensus Estimate at $17.09 billion [12] - Expected cash flow from operating activities for 2025 is approximately $1.45 billion [13]