(LDOS) Leidos Holdings - Ratings and Ratios

Leidos Holdings, Inc. (NYSE:LDOS) is a diversified technology and engineering firm that serves government and commercial customers in the U.S. and abroad, organized into four primary operating segments: National Security & Digital, Health & Civil, Commercial & International, and Defense Systems.

The **National Security & Digital** segment delivers software, AI/ML-enabled services, cyber-operations, intelligence analysis, logistics, biometrics, CBRNE (chemical, biological, radiological, nuclear, explosives) solutions, training, and IT modernization for warfighters. In FY 2023 the segment generated roughly **$5.5 billion in revenue**, with a **backlog exceeding $10 billion**, reflecting strong demand for AI-driven defense tools. A key macro driver is the U.S. defense budget, which has risen **≈3 % YoY** and is increasingly earmarked for autonomous and cyber capabilities (source: DoD budget request FY 2025). *Assumption: FY 2024 revenue will track FY 2023 growth unless a major procurement cycle shift occurs.*

The **Health & Civil** segment provides air-traffic-control (ATC) systems, health-mission software, managed health services, infrastructure management, logistics support, and life-science R&D. FY 2023 revenue was about **$2.2 billion**, buoyed by a **12 % increase in ATC modernization contracts** and expanding Medicare Advantage enrollment, which drives demand for health-IT platforms. Sector-wide, the aging U.S. population and federal infrastructure spending (e.g., the 2021 Infrastructure Investment and Jobs Act) are expected to sustain growth in health-service outsourcing. *Uncertainty: potential policy shifts in healthcare reimbursement could alter the segment’s trajectory.*

The **Commercial & International** segment focuses on power-grid engineering, grid-modernization, utility consulting, energy-efficiency solutions, security-screening hardware (e.g., baggage scanners, explosive trace detectors), open-architecture airport-security platforms, biometric border-protection, IT service transformation, and aerial surveillance. Revenue for this segment was roughly **$2.0 billion** in FY 2023, with **grid-modernization contracts growing ~15 % YoY** as utilities upgrade aging infrastructure to meet renewable-energy targets. A broader driver is the global push toward smart-grid investments, projected to reach **$150 billion** in annual spend by 2027 (IEA). *Assumption: continued regulatory incentives for clean-energy upgrades will keep demand robust.*

The **Defense Systems** segment supplies airborne, air-and-missile defense, maritime, aerospace, and cyber-threat systems. It contributed about **$1.5 billion** to FY 2023 revenue, supported by new missile-defense contracts worth **$1.1 billion** announced in 2023. Geopolitical tensions in Eastern Europe and the Indo-Pacific region are accelerating procurement cycles for integrated air-and-missile defense solutions, a trend that underpins the segment’s outlook. *Uncertainty: any abrupt de-escalation in these regions could compress defense spending growth.*

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