78390X101 Filings — Leidos Holdings, Inc. - FilingSpy
78390X101
Leidos Holdings, Inc.
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A technology and engineering firm that builds mission software, cybersecurity, and health systems for U.S. government agencies, plus defense hardware like unmanned maritime vehicles. It also makes the airport baggage and body scanners used at checkpoints around the world. Born in 1969 as the employee-owned science consultancy SAIC, it split into Leidos in 2013, taking a name clipped from "kaleidoscope" to echo the way it blends solutions from many angles.
Leidos Q2 operating income fell 10% as a $49M increase in corporate costs offset 7.2% revenue growth.
grew, but profit did not follow. Revenue rose 7.2% to $4.6 billion, driven by the Homeland and the Entrust acquisition, yet fell 10% to $514 million as a $49 million increase in corporate costs—tied to prior-year insurance reimbursements not repeating and current acquisition expenses—compressed to 11.3% from 13.4% a year ago. The company's top line is expanding, but the cost of that expansion is now weighing on the .
Key takeaways
rose 7.2% to $4,558 million, led by a 32% increase in the Homeland from Entrust acquisition contributions and volume growth, while the Health segment declined 7.6% on lower volumes.
fell 10% to $514 million, as a $49 million increase in the Corporate 's operating loss—driven by the absence of a prior-year $25 million insurance reimbursement and current acquisition, integration, and restructuring costs—more than offset profit growth in the operating segments.
Section summaries
Management's Discussion and Analysis
Leidos Q2 FY2026 revenue grew 7.2% to $4.6B driven by Homeland and acquisitions, but operating income fell 10% on higher corporate costs.
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Total Q2 revenues rose 7.2% to $4,558M, led by a 32% surge in the Homeland from Entrust acquisition contributions and volume growth.
Health revenues declined 7.6% to $1,086M and fell 16.2% due to a net decrease in volumes.
contracted 0.5 points to 17.9%, and fell 2.1 points to 11.3%, reversing the expansion trend seen in the prior four quarters.
fell 9.5% to $354 million, with down 6.6% to $2.81, pressured by higher non-operating expenses including increased interest from new senior notes and a UK pension settlement loss.
rose 63.2% to $793 million, and rose 66.5% to $761 million, driven by favorable changes and the timing of payroll and tax payments.
Net reached $4.9 billion, up from $3.9 billion a year ago, and total grew to $48.7 billion, including $371 million from the Entrust acquisition.
What changed
The Health & Civil 's , flagged for sustainability concerns after staying above 23% for multiple quarters, can no longer be tracked directly: the segment was restructured. The new Health segment's fell 16.2% on a 7.6% decline, a clear inflection from the growth and margin strength of the prior structure.
The $25 million insurance reimbursement that aided Q2 FY2025 did not repeat, contributing to the $49 million increase in the Corporate 's operating loss and confirming it was a one-time item.
The Q1 FY2026 flag about program write-downs in Homeland and Defense was not repeated in Q2, suggesting those charges were isolated to the first quarter.
The Entrust integration costs, flagged in Q1 FY2026 as a potential multi-quarter expense cycle, continued in Q2 as acquisition, integration, and restructuring costs remained elevated within the Corporate 's results.
rose as flagged, driven by the $1.4 billion debt issuance to fund the Entrust acquisition, with now at $6.0 billion compared to $5.0 billion a year ago.
What to watch
Whether the new Health 's decline and 16.2% drop represent a one-quarter volume reset or the start of a sustained contraction in the company's historically highest-margin business.
The trajectory of the Corporate 's operating loss after the $49 million increase, and whether acquisition and integration costs begin to decline as Entrust is absorbed.
Whether the $4.9 billion in quarterly net and the $48.7 billion translate into growth that outpaces the rising from $6.0 billion in .
The pace of generation for the remainder of the year after the $793 million Q2 result, and whether the favorable timing that aided the quarter reverses in subsequent periods.
Consolidated contracted to 11.3% from 13.4%, pressured by a $49M increase in Corporate operating loss tied to prior-year insurance reimbursements and current acquisition costs.
decreased 9.4% to $356M, with non-operating expense rising to $63M on higher interest from new senior notes and a UK pension settlement loss.
Net reached $4.9B in Q2, up from $3.9B a year ago, and total grew to $48.7B, including $371M from the Entrust acquisition.
more than doubled to $793M in Q2, driven by favorable changes and timing of payroll and tax payments.
We have furnished information relating to legal proceedings, and any investigations and reviews that we are involved with in "Note 11–Commitments and Contingencies" of the notes to the condensed consolidated financial statements contained within this Quarterly Report on Form 10-…
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We have furnished information relating to legal proceedings, and any investigations and reviews that we are involved with in "Note 11–Commitments and Contingencies" of the notes to the condensed consolidated financial statements contained within this Quarterly Report on Form 10-Q.
There were no material changes to the risks described in Part I, Item 1A "Risk Factors" in our Annual Report on Form 10-K for the year ended January 2, 2026.
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There were no material changes to the risks described in Part I, Item 1A "Risk Factors" in our Annual Report on Form 10-K for the year ended January 2, 2026.