Leidos Holdings, Inc. Reports Third Quarter 2024 Financial Results
Leidos Holdings, Inc. (NYSE: LDOS) announced its financial results for the third quarter of fiscal year 2024, showing notable improvements across several key metrics.
Key Financial Metrics
| Metric | Q3 2024 | YoY Change | Consensus Estimate | Variance |
|---|---|---|---|---|
| Revenue | $4.2B | +7% | $4.07B | Beat by $0.13B |
| Net Income | $362M | N/A | N/A | N/A |
| GAAP EPS | $2.68 | N/A | N/A | N/A |
| Non-GAAP EBITDA | $596M | +32% | N/A | N/A |
| Non-GAAP Diluted EPS | $2.93 | +44% | $2.02 | Beat by $0.91 |
| Cash Flow from Operations | $656M | N/A | N/A | N/A |
| Free Cash Flow (Non-GAAP) | $633M | N/A | N/A | N/A |
Leidos demonstrated strong financial performance with revenue exceeding expectations, driven by increased demand across customer segments, particularly managed health services. Notable profitability was observed with a significant rise in adjusted EBITDA, underpinned by improved program execution and cost control.
Segment Revenue Performance
| Segment | Revenue (Q3 2024) | YoY Change | Operating Margin | Non-GAAP Operating Margin |
|---|---|---|---|---|
| National Security & Digital | $1.87B | +1% | 10.0% | 10.5% |
| Health & Civil | $1.23B | +16% | 23.4% | 24.2% |
| Commercial & International | $578M | +5% | 7.1% | 8.8% |
| Defense Systems | $522M | +13% | 7.1% | 10.2% |
The Health & Civil segment notably outperformed, benefiting from increased volumes and case complexity in managed health services. National Security & Digital saw modest growth, whereas Commercial & International recovered from last year’s impairments, improving its operating margins substantially.
Key Developments and Operational Highlights
- Achieved net bookings of $8.1 billion with a book-to-bill ratio of 1.9.
- Signed several significant contracts, including:
- $331 million contract for Army Global Unified Network (AGUN).
- $303 million contract for Advanced Battle Management System-Digital Infrastructure (ABMS-DI).
- $249 million contract for Automated Installation Entry (AIE) Next Generation Support.
Comments from Company Officers
Tom Bell, CEO of Leidos, highlighted the quarter's success attributable to excellent execution and innovation by their workforce. Emphasizing a 'North Star' strategy, Bell expressed confidence in continued robust and sustainable returns for customers and shareholders.
Dividends and Share Repurchase Program
The Leidos Board declared a cash dividend of $0.40 per share, representing a 5.3% increase over the previous quarter, payable on December 31, 2024. Also, Leidos repurchased $203 million in shares during the third quarter.
Forward Guidance
The company updated its fiscal year 2024 guidance but did not provide specific figures. Leidos stated the difficulty in forecasting GAAP results due to the variability in deductions for non-GAAP exclusions.
Stock Price Movement
Post-earnings release, Leidos stock experienced an approximate 3.69% increase.
In summary, Leidos Holdings displayed strong performance in the third-quarter 2024 financial results, with robust revenue growth and strategic investments in key areas contributing to improved segment profitability.
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