Leidos Holdings (LDOS) 2Q26 First Take Solid quarter

Equity Research 4 August 2026 | 8:11AM EDT

Leidos Holdings (LDOS): 2Q26 First Take: Solid quarter; 2026 guidance raised

Bottom Line: LDOS 2Q26 revenue, adjusted EBITDA and EPS are ahead of FactSet Noah Poponak, CFA | consensus. Revenue is up 4% organically in the quarter and is above consensus in Goldman Sachs & Co. LLC three of four segments (with Health below). Total company EBITDA margin is 13.8%, Connor Dessert which is 30bps above our estimate. Segment EBIT is 6% above our estimate. Funded | book-to-bill in the quarter is 1.14X (1.17X on TTM basis). The company updated Goldman Sachs & Co. LLC

2026 guidance, raising the lower end of its revenue and EPS ranges. Nizar Mesani | Details: Adjusted EPS of $3.26 is above FactSet consensus of $2.91. Revenue of Goldman Sachs India SPL $4.6bn (up 4% organically) is 3% above consensus and our estimate. Total EBITDA is Amanda Fenenbock, CFA | $631mn; 6% ahead of consensus on a 13.8% EBITDA margin. Company-reported Goldman Sachs & Co. LLC book-to-bill in the quarter is 1.1X, and TTM book-to-bill is 1.1X. Funded book-to-bill is 1.14X (1.17X on TTM basis). Total backlog was up 1% qoq and up 5% yoy. Tomas Russo | Reported free cash flow is $761mn compared to consensus at $371mn. LDOS Goldman Sachs & Co. LLC updated 2026 guidance, which includes revenue of $18.2-$18.4bn ($18.0-$18.4bn prior, vs. consensus at $18.24bn), adjusted EPS of $12.20-$12.50 ($12.10-$12.50 prior, vs. consensus at $12.33), adjusted EBITDA margin of mid 13% (reiterated, vs. consensus at 13.6%) and CFO of ~$1.85bn (~$1.80bn prior, vs. consensus at $1.92bn).

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Goldman Sachs Leidos Holdings (LDOS)

Exhibit 1: LDOS 2Q26 adjusted results vs GS estimates $mn, except EPS

YoY change Adjusted Actual GS Estimate $ Variance % Variance EPS Impact 2Q25 Growth REVENUE Intelligence & Digital 1,499 1,449 49.8 3.4% 0.03 1,408 6.5% Health 1,086 1,157 (71.4) -6.2% (0.10) 1,175 -7.6% Homeland 1, % % Defense % 0.03 899 6.2% Total sales 4,558 4, % $0.09 4,253 7.2%

OPERATING PROFIT Intelligence & Digital % 0.04 142 6.3% Health % ( % Homeland % 0.24 72 70.8% Defense % 0.07 90 5.6% Segment Operating Profit % 0.24 613 2.4% Corporate ( % (0.06) (8) 450.0% Total operating income % $0.18 605 -3.5% Total EBITDA % $0.19 647 -2.5%

MARGIN Intelligence & Digital 10.1% 9.9% 10.1% 0 bp Health 23.8% 24.0% 26.3% -250 bp Homeland 12.1% 9.0% 9.3% 280 bp Defense 9.9% 9.2% 10.0% -10 bp Segment Operating Margin 13.8% 13.3% 50 bp 14.4% -60 bp Total operating margin 12.8% 12.5% 30 bp 14.2% -140 bp Total EBITDA margin 13.8% 13.5% 30 bp 15.2% -140 bp

Net interest expense ( % (0.04) (55) 25.5% Other income (expense), net 6 0 6.0 0.04 2 nm EBT % 552 -5.6% Income tax expense ( % % Effective income tax rate 20.7% 24.0% (0.0) -330 bp 24.1% -340 bp Minority Interest 2 2 0.0 -- 0.00 2 nm Net income continuing ops % 417 -1.4% Adjusted Diluted EPS $3.26 $2.90 $0.36 12.3% $0.36 $3.21 1.7% Diluted Shares % 0.05 130 -3.1%

Source: Company data, Goldman Sachs Global Investment Research

Exhibit 2: LDOS 2026 guidance $bn, except EPS 2026 Outlook February May August

Revenue $17.5-$17.9bn $18.0-$18.4bn $18.2-$18.4bn Adj EBITDA margin Mid 13% -- -- Adjusted EPS $12.05-$12.45 $12.10-$12.50 $12.20-$12.50 Cash from Operations ~$1.75bn ~$1.80bn ~$1.85bn

Our 12-month $152 price target is based on a target 5-8 quarter EV/EBITDA multiple of 9.3X 5-8Q EV/EBITDA. Key risks include (1) DoD spending priorities, (2) core company bookings, and (3) pace of organic growth.