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

Core Insights - Leidos Holdings, Inc. (LDOS) reported fourth-quarter 2025 adjusted earnings of $2.76 per share, exceeding the Zacks Consensus Estimate of $2.57 by 7.4% and showing a year-over-year increase of 16.5% from $2.37 [1] - The company’s total revenues for Q4 2025 were $4.21 billion, missing the Zacks Consensus Estimate of $4.25 billion by 1.1% and reflecting a 3.6% decrease year-over-year, primarily due to a six-week government shutdown [3][8] - LDOS ended 2025 with a total backlog of $49.03 billion, an increase from $48.39 billion at the end of 2024, with $9.69 billion of this amount being funded [4][8] Financial Performance - For the full year 2025, adjusted earnings were reported at $11.99 per share, surpassing the Zacks Consensus Estimate of $11.76 and increasing 17.4% from $10.21 in the previous year [2] - The company’s GAAP earnings for Q4 2025 were $2.53 per share, up from $2.12 in the prior-year quarter [1] - Cash and cash equivalents as of January 2, 2026, totaled $1.11 billion, compared to $849 million a year earlier, while long-term debt increased to $4.63 billion from $4.05 billion [10] Operational Statistics - The cost of revenues decreased by 5.6% year-over-year to $3.65 billion, while adjusted operating income rose to $473 million from $421 million in the year-ago quarter [5] - Interest expenses increased slightly to $48 million from $47 million in the previous year [5] Segment Performance - In the National Security and Digital segment, net revenues decreased by 2.5% year-over-year to $1.85 billion, but adjusted operating income improved to $196 million from $175 million [6] - The Health & Civil segment reported revenues of $1.21 billion, down 9.3% year-over-year [6] - The Commercial & International segment saw revenues of $610 million, up 1% year-over-year, with adjusted operating income totaling $51 million compared to $40 million in the prior year [7][9] Guidance for 2026 - Leidos Holdings expects adjusted earnings for 2026 to be in the range of $12.05-$12.45 per share, with the Zacks Consensus Estimate at $12.35, and revenues projected between $17.50-$17.90 billion, with the consensus at $17.87 billion [11]