Leidos Holdings Reports Q2 2026 Results: Full Earnings Call Transcript

Leidos Holdings (NYSE: LDOS ) released second-quarter financial results and hosted an earnings call on Tuesday.

Read the complete transcript below.

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For comprehensive financial data and transcripts, visit The full earnings call is available at Summary Leidos Holdings reported a strong quarter with a 7% year-over-year revenue increase to $4.6 billion and an adjusted EBITDA margin of 13.8%.

The company raised its 2026 revenue guidance midpoint by $100 million, EPS guidance by $0.05, and operating cash flow guidance by $50 million, indicating confidence in its North Star 2030 growth strategy.

Defense segment showed significant strength with a 2.2 book-to-bill ratio and notable contracts, including a $1 billion framework agreement with the Department of Defense.

Health segment faced changes with the VA suspending incentive payments, but the company is confident in its positioning for the upcoming recompete.

Leidos Holdings completed a $66 million share repurchase and plans to resume repurchases under a new authorization, highlighting strong capital deployment.

Future outlook is positive with expectations of continued bookings momentum and a diversified growth strategy across defense, energy, and cyber sectors.

Full Transcript Stuart, Investor Relations Earnings conference call.

The presentation slides we'll be using are on our investor relations website.

Turning to Slide 2, today's discussion contains forward-looking statements based on the environment as we currently see it and thus includes risks and uncertainties.

Today's press release contains more information on the specific risk factors that could cause actual results to differ materially.

Finally, on Slide 3, we'll discuss GAAP and non-GAAP financial measures.

A reconciliation between the two is included in today's press release and presentation slides.

With that, I'll turn the call over to CEO Tom Bell, who will begin on Slide 4.

Tom Bell, CEO Thanks, Stuart.

I'm pleased to report another strong quarter for Leidos.

Second quarter revenue grew 7% year over year, 4% organically, to a record $4.6 billion.

Adjusted EBITDA margin remained best in class at 13.8%.

Operating cash flow reached a Q2 record of nearly $800 million, and we booked $5 billion in net awards, delivering a solid 1.1 book-to-bill ratio.

Customer procurement activity is beginning to accelerate, so we anticipate continued positive bookings momentum through the rest of this year.

Our year-to-date financial performance indicates to us that our North Star 2030 growth strategy is working and, as a result, I'm pleased we can raise the midpoint of our 2026 revenue guidance by $100 million, raise the midpoint of our EPS guidance by $0.05, and raise operating cash flow guidance by $50 million.

Now let me take a few moments to highlight some important developments in two of our segments that I know are top of mind for our investors.

Defense and Health.

In Defense, our team delivered another exceptional quarter.

Revenue growth accelerated, margins expanded, and award velocity is accelerating.

Defense posted a 2.2 book-to-bill ratio in the second quarter; over the trailing twelve months, this equates to a 1.9 book-to-bill ratio.

This level of customer traction gives us continued confidence in this segment's robust business outlook as a part of Leidos.

And importantly, these bookings do not yet reflect the benefit from several major defense tech programs begun this year.

These include our over $1 billion framework agreement with the Department of Defense to deliver 3,000 low-cost containerized munitions by 2030; our unique position in the testing phase of the Navy's next-generation Medium Unmanned Surface Vessel, which positions us for a potential production award in Q4; and our recent award to provide the sensor payloads for an additional 18 missile warning and missile tracking satellites in support of Golden Dome.

But in addition to these hardware successes, our defense team continues to leverage the unique power of One Leidos—bringing together hardware and software products and services—to win in ways few competitors can match.

To illustrate the power of this unique One Leidos capability, let me briefly highlight Leidos' role in the recent Operation Jailbreak hackathon by the U.S.

Army.

There, engineers from our Defense and Digital businesses worked side by side to rapidly develop and deploy secure, open application programming interfaces that enabled our hardware to integrate seamlessly with the Army's evolving command-and-control architecture.

And perhaps more importantly, we demonstrated those same capabilities on non-Leidos systems, validating secure interoperability using open and documented standards.