Leidos (LDOS) investor relations material

Executive summary

• Q1 2026 revenue rose 4% year-over-year to $4.4 billion, with adjusted EBITDA margin at 14%, driven by strong demand, program wins, and acquisitions including ENTRUST and Kudu Dynamics.

• Non-GAAP diluted EPS increased 5.4% to $3.13, while net income attributable to common stockholders declined 9.6% to $328 million due to acquisition and integration costs.

• Raised 2026 guidance for revenue, non-GAAP EPS, and operating cash flow, reflecting robust core performance and the ENTRUST acquisition.

• Strategic focus on NorthStar 2030 growth pillars: Defense Tech, Managed Health, Digital Infrastructure and Cyber, Energy Resilience, and Mission Software, with AI and digital innovation as key accelerants.

• Major contract wins in Defense and Health, including $456 million Military OneSource award, AI-driven My Service Treatment Record pilot, and large Army, DISA, NSA, and SEC contracts.

Financial highlights

• Q1 revenue: $4.4 billion, up 4% year-over-year; organic growth at 3%.

• Adjusted EBITDA: $614 million, up 2% year-over-year; margin at 14%.

• Non-GAAP diluted EPS: $3.13, up 5% year-over-year.

• Operating cash flow: $301 million; free cash flow: $270 million.

• Ended Q1 with $6.3 billion debt, $457 million cash, and gross leverage ratio of 2.6x.

Outlook and guidance

• 2026 revenue guidance raised to $18.0–$18.4 billion.

• Adjusted EBITDA margin guidance maintained at mid-thirteens percent.

• Non-GAAP diluted EPS guidance increased to $12.10–$12.50.

• Operating cash flow guidance raised to ~$1.8 billion.

• Revenue growth expected to accelerate in H2 2026, with Q2 as the low point for revenue and margin.