Leidos Holdings Q4 Earnings Beat Estimates, Revenues Rise Y/Y

Leidos Holdings, Inc.’s LDOS fourth-quarter 2024 adjusted earnings of $2.37 per share beat the Zacks Consensus Estimate of $2.18 by 8.7%. The bottom line also increased 19.1% from $1.99 registered in the prior-year quarter. Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.LDOS reported GAAP earnings of $2.12 per share, implying an improvement from the prior-year level of $1.66.The year-over-year upside in the bottom line can be attributed to increased volumes from managed health services programs, along with improved program execution and cost control across the company.LDOS’ 2024 adjusted earnings of $10.21 per share beat the Zacks Consensus Estimate of $10.03. The bottom line also increased 39.9% from $7.30 registered in the prior-year quarter.Leidos Holdings, Inc. Price, Consensus and EPS Surprise Leidos Holdings, Inc. price-consensus-eps-surprise-chart | Leidos Holdings, Inc. QuoteTotal RevenuesTotal revenues of $4.37 billion beat the Zacks Consensus Estimate of $4.12 million by 5.9%.The top line also improved 9.7% year over year, driven by increased demand across all customer segments, especially for managed health services.For 2024, the company reported revenues worth $16.66 billion, reflecting a solid improvement from $15.44 billion registered in 2023. The full-year top line also surpassed the consensus estimate of $16.42 billion. BacklogThe company recorded a total backlog of $43.55 billion, up from $40.56 billion in the third quarter of 2024. Of this amount, $8.41 billion was funded.Operational StatisticsThe cost of revenues increased 8.5% year over year to $3,672 million.LDOS reported an adjusted operating income of $465 million compared with $420 million in the year-ago quarter.The adjusted operating margin was 10.7% compared with 10.6% in the prior-year period.Interest expenses totaled $47 million, down 4.1% year over year.Segmental PerformanceNational Security and Digital: Net revenues in this segment improved 5.5% year over year to $1.89 billion. The increase can be attributed to higher volumes from digital modernization programs as well as increased activity on the Sentinel contract. This segment’s adjusted operating income declined to $184 million from the year-ago level of $197 million. The segment’s adjusted operating margin was 9.7%, down 130 basis points (bps) from the prior-year figure of 11%.Health & Civil: The segment recorded revenues of $1.33 billion, up 16.4% year over year. This improvement can be attributed to increased volumes and case complexity within the managed health services business as well as net write-ups on certain programs.This unit’s adjusted operating income totaled $287 million compared with $172 million in the year-ago quarter. The segment’s adjusted operating margin was 21.6%, up 650 bps year over year.Commercial & International: Revenues in this segment amounted to $604 million, up 12.3% year over year. The upside was driven by increased deliveries of security products and higher volumes within commercial energy, Australian IT and airborne solutions businesses.This segment recorded an adjusted operating income of $48 million compared with $47 million in the year-ago quarter. The adjusted operating margin was 7.9%, down 80 bps year over year.Defense Systems: Revenues in this segment amounted to $539 million, up 6.7% year over year. The upside was driven by increased scope and new business awards.This segment recorded an adjusted operating income of $19 million compared with $39 million in the year-ago period. The adjusted operating margin was 3.5%, down 420 bps year over year.FinancialsCash and cash equivalents as of Jan. 3, 2025, totaled $943 million compared with $777 million as of Dec. 29, 2023.As of Jan. 3, 2025, the long-term debt, net of the current portion, amounted to $4.05 billion compared with $4.66 billion as of Dec. 29, 2023.Net cash flow from operating activities totaled $1.39 billion at the end of 2024 compared with $1.17 billion recorded a year ago.2025 GuidanceLeidos Holdings initiated its 2025 guidance. It expects to generate adjusted earnings in the range of $10.35-$10.75 per share. The Zacks Consensus Estimate for earnings is pegged at $10.29 per share, lower than the company’s guided range.LDOS currently expects 2025 revenues to be in the band of $16.90-$17.30 billion. The Zacks Consensus Estimate for revenues is pegged at $16.92 billion, lower than the midpoint of the company’s guided range.It also expects cash flow from operating activities to be $1.45 billion in 2025. Zacks RankLeidos Holdings currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Recent Defense ReleasesHuntington Ingalls Industries, Inc.’s HII fourth-quarter 2024 earnings of $3.15 per share declined 54.3% from $6.90 in the prior-year quarter. The bottom line also missed the Zacks Consensus Estimate of $3.28 by 4%.Revenues for the quarter totaled $3 billion, which missed the Zacks Consensus Estimate of $3.03 billion by 0.9%. The top line also declined 5.4% from $3.18 billion recorded in the year-ago quarter due to lower sales volume from all its business segments.The Boeing Company BA incurred an adjusted loss of $5.90 per share in the fourth quarter of 2024, wider than the Zacks Consensus Estimate of a loss of $3.22. The bottom line deteriorated from the year-ago quarter’s reported loss of 47 cents per share.BA’s revenues amounted to $15.24 billion, which beat the Zacks Consensus Estimate of $15.19 billion by 0.4%. The top line also decreased 31% from the year-ago quarter’s reported figure of $22.02 billion.Teledyne Technologies Inc. TDY reported fourth-quarter 2024 adjusted earnings of $5.52 per share, which surpassed the Zacks Consensus Estimate of $5.23 by 5.5%. The bottom line also improved 1.5% from $5.44 recorded a year ago.The company’s total sales were $1.50 billion, which beat the Zacks Consensus Estimate of $1.45 billion by 3.7%. The top line also rose 5.4% from $1.43 billion reported a year ago. Only $1 to See All Zacks' Buys and SellsWe're not kidding.Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent.Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators,and more, that closed 256 positions with double- and triple-digit gains in 2024 alone.See Stocks Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Boeing Company (BA): Free Stock Analysis Report Huntington Ingalls Industries, Inc. 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