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Industrials · IT Services · NYSE

LDOSLeidos

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The 10-K against last year's

118 changes: 37 added, 14 removed, 65 reworded, 2 quiet changes

10-K Feb 17, 2026 vs Feb 11, 2025
Risk FactorsRedline ↓
15.1%
of the text changed · 20,043 words now
33.4%
of the text changed · 5,595 words now
Legal ProceedingsRedline ↓
21.2%
of the text changed · 401 words now
Accounting PoliciesRedline ↓
7.9%
of the text changed · 5,547 words now

10-K 0001336920-26-000030 (2026-02-17) vs 10-K 0001336920-25-000006 (2025-02-11)

The redline

The paragraph that changed most in each section

Marked against last year's 10-K: cut words struck through, new words highlighted and underlined.

Risk Factors 332 words changed in this paragraph; it is 33% similar to last year's version.
As a government contractor and a provider of information technology services operating in multiple regulated industries and geographies, we and our service providers, suppliers and subcontractors collect, store, transmit, and otherwise process personal, confidential, proprietary, and sensitive information, including protected health information, personnel information, personal information, classified information, controlled unclassified information, intellectual property and financial information, concerning our business, employees, and customers. Therefore, we are continuously exposed to unauthorized attempts to compromise access, release or otherwise compromise such information through cyber-attacks and other information security threats, including, among other things, physical break-ins, theft, denial-of-service attacks, worms, computer viruses, software bugs, malicious or destructive code, social engineering, phishing attacks and impersonating authorized users, credential stuffing, account takeovers, insider threats, malfeasance or improper access by employees or service providers, human error, fraud, use of AI, “bots” or other automation software, or other similar disruptions. We are also exposed to hackers who have requested “ransom” in exchange for not disclosing information or restoring access to information or systems. These techniques may be perpetrated by internal bad actors, such as employees or contractors, or by third parties (including traditional computer hackers, persons involved with well-funded organized crime or state-sponsored actors). Any electronic or physical break-in or other security breach or compromise of our information technology systems and networks or facilities, or those of our service providers, suppliers, joint ventures or subcontractors, may jeopardize the confidentiality, integrity or availability of information, including personal, confidential, proprietary or sensitive information, stored or transmitted through these systems and networks or stored in those facilities. This could lead to disruptions in mission-critical systems, unauthorized access to or release of personal, confidential, proprietary, sensitive or otherwise protected information and corruption of data or systems. We could also be subject to operational downtimes, delays and other detrimental impacts on our operations or ability to provide products and services to our customers. We are also increasingly subject to customer-driven cybersecurity certification requirements, including but not limited to CMMC, which are expected to be necessary to win future contracts. Security incidents could also result in liability, trigger other obligations under such contracts, or increase the difficulty of winning future contracts. Many statutory requirements, both in the U.S. and abroad, also include different obligations for companies to provide notice of information security incidents involving certain types of information (including obligations to notify affected individuals and regulators in the event of cybersecurity breaches involving certain personal information), which could result from breaches of our service providers, our suppliers or subcontractors.

Source: Item 1A, 10-K 0001336920-26-000030 vs Item 1A, 10-K 0001336920-25-000006

MD&A 193 words changed in this paragraph; it is 35% similar to last year's version.
On FFP For contracts requiring which involve complex deliverables, such as system integration and cost-plus integration, we usually recognize revenue over time as the work is completed. For contracts with an FFP component or variable consideration, revenue is generally recognized over time fees, we measure progress using a method that measures the extent of progress towards completion of a performance obligation, principally using a cost-input method (referred to as the cost-to-cost method). Under the cost-to-cost an input method, whereby revenue is recognized based on the proportion percentage of total costs incurred to estimated date compared to total costs-at-completion (“EAC”), which require us to use estimates costs we anticipate by the end of the contract. Commonly referred to as the “cost-to-cost” method. To do this, we must estimate both the total revenue and cost associated with the total costs needed to design, manufacture build, and delivery of deliver our offerings products and services. A performance obligation’s EAC includes These cost estimates include all direct costs costs, such as materials, labor, subcontract costs, subcontractors, overhead and a ratable portion of general and administrative costs. expenses. If we determine that the estimated total expected cost of completing a performance obligation whose associated contract will be more than the total revenue is recognized using the cost-to-cost method exceeds the estimated transaction price, we expect to receive, we record the entire amount of the expected loss is recognized in operations in the period the loss is known. when identified.

Source: Item 7, 10-K 0001336920-26-000030 vs Item 7, 10-K 0001336920-25-000006

Accounting Policies 93 words changed in this paragraph; it is 51% similar to last year's version.
Our cash equivalents are primarily comprised of investments in several large institutional money market accounts, with original maturity of three months or less. Outstanding Effective fiscal 2025, we changed our policy to exclude outstanding payments are included within from “Cash and cash equivalents” and “Accounts payable and accrued liabilities” correspondingly on the consolidated balance sheets. At To reflect the change in accounting policy, we recast "Cash and cash equivalents" and "Accounts payable and accrued liabilities" on the consolidated balance sheet as of January 3, 2025, reducing both balances by $94 million from the previously reported amounts. The recast of the consolidated statement of cash flows for the year ended January 3, 2025, and December 29, 2023, $94 resulted in an increase of $43 million and $136 $22 million, respectively, of outstanding payments were included within “Cash and to net cash equivalents.” provided by operations.

Source: Item 8, Note 3 – Summary of Significant Accounting Policies, 10-K 0001336920-26-000030 vs Item 8, Note 3 – Summary of Significant Accounting Policies, 10-K 0001336920-25-000006

Every change, by type

Sentences and paragraphs added, removed or reworded

Sentences and paragraphs of LDOS's Risk Factors and MD&A, 10-K 2026-02-17 against 10-K 2025-02-11. Each links to the text at sec.gov.

RewordedRisk Factors
In addition, negative publicity, including reports from the press sustained or recurring media coverage, social media coverage, commentary, or other public communications that criticize our business practices, the nature of our products or services, or the defense industry more broadly, regardless of accuracy or completeness, and which could pertain to employee or subcontractor misconduct, conflicts of interest, poor contract performance, deficiencies in investment, prioritization, and production, deficiencies in services, reports, products or other deliverables, security breaches or other security incidents or other aspects of our business, could harm our reputation with these agencies and with certain non-U.S. customers.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedRisk Factors
While we have established policies, procedures, training programs, and other compliance controls designed to prevent and detect misconduct, individuals may circumvent these measures and we may not be effective, unable to prevent our employees, subcontractors, agents, suppliers, business partners or joint ventures and others working on our behalf from engaging in misconduct, fraud or other improper activities, exposing us to unforeseen risks or losses.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedRisk Factors
We will may also be subject to numerous additional emerging and as yet unspecified cybersecurity requirements under the FAR and through other federal regulation, to include the DOD Cybersecurity Maturity Model Certification (“CMMC”) program, which, once implemented, will require successful assessment by a third party against specified cyber controls. regulations.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedRisk Factors
For additional background on the regulations data privacy and security laws that apply to our business and the related compliance risks, see “Regulation” within Item 1 of this Annual Report on Form 10-K and the risk factor “Our business is subject to governmental review and investigation, which could adversely affect our financial position, operating results and growth prospects.” 10-K.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedRisk Factors
Intelligence Community, either as a prime contractor or subcontractor to other contractors, represented approximately 49% of our total revenues for fiscal 2025 and 2023, and 48% of our total revenues for fiscal 2024, 49% of our total revenues for fiscal 2023 and 44% of our total revenues for fiscal 2022. 2024.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedRisk Factors
In addition, our offerings cannot be tested and proven in all situations and are otherwise subject to unforeseen problems that could negatively affect revenue and profitability, such as problems with quality and workmanship, country of origin, delivery of subcontractor components or services, unplanned degradation of product performance, and unauthorized use or modifications of our products and services.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedRisk Factors
We also may be limited in our ability to disclose or license such information and intellectual property to third parties and the U.S. government may also decline to make the intellectual property of others available to us under acceptable terms.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedRisk Factors
See also the risk factor “Internal system or service failures, or failures in the systems or services of third parties on which we rely, could disrupt our business and impair our ability to effectively provide our services and products to our customers, which could damage our reputation and adversely affect our revenues and profitability.”

Read it in 10-K 2026-02-17 at sec.gov ↗

Show the other 16
RewordedRisk Factors
For example, In Europe, the EU’s Artificial Intelligence Act (the “AI Act”), AI Act, which entered into force on August 1, 2024, began phasing-in 2025, establishes, among other things, a risk-based governance framework for regulating AI systems operating in the EU.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedRisk Factors
Any failure or perceived failure by us, our service providers, suppliers, subcontractors, or other business partners to comply with applicable laws, regulations, our public privacy policies and other public statements about data privacy and security and other obligations in these areas could result in regulatory or government actions lawsuits against us (including civil claims, such as representative actions and other class action-type litigation), legal liability, monetary penalties, fines, sanctions, damages and other costs, orders to cease or change our processing of data, changes to our business practices, diversion of internal resources, and harm to our reputation, all of which could adversely affect our business, financial condition and results of operations.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedRisk Factors
The FCPA or other applicable laws and regulations also require that we keep accurate books and records and maintain internal controls and compliance procedures designed to prevent any such actions.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedRisk Factors
A finding of significant control deficiencies material weakness in our business system audits or other reviews can result in the suspension of payments or lower billing rates to our U.S. government customers until the control deficiencies are material weakness is corrected and the DCMA accepts our remediations.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedMD&A
Year Ended 2024 to 2023 2023 to 2022 (dollars in millions) January 2, January 3, December 29, December 30, Percent Percent 2026 2025 2023 2022 change change Revenues $ 17,174 $ 16,662 $ 15,438 $ 14,396 8% 7% 3% Cost of revenues 14,075 13,864 13,194 12,312 5% 7% 2% Selling, general and administrative expenses 999 983 942 951 4% (1)% 2% Acquisition, integration and restructuring costs 18 16 24 17 (33)% 41% Goodwill impairment charges — 596 — NM NM 13% Asset impairment charges 5 11 91 40 (88)% 128% (55)% Equity earnings of non-consolidated subsidiaries (32) (39) (30) (12) (30)% (150)% (18)% Operating income 2,109 1,827 621 1,088 194% (43)% 15% Non-operating expense, net (200) (188) (218) (202) (14)% (8)% (6)% Income before income taxes 1,909 1,639 403 886 NM (55)% 16% Income tax expense (447) (388) (195) (193) 99% 1% 15% Net income 1,462 1,251 208 693 NM (70)% 17% Less: net income (loss) income attributable to non-controlling interest 14 (3) 9 8 (133)% 13% (567)% Net income attributable to Leidos common stockholders $ 1,448 $ 1,254 $ 199 $ 685 NM (71)% 15% Operating margin 12.3 % 11.0 % 4.0 % 7.6 %

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedMD&A
The increase in operating income for fiscal 2024 2025 as compared to fiscal 2023, 2024, was primarily driven by impairment and restructuring charges of $689 million at the SES reporting unit in fiscal 2023, prior year write-downs on certain programs within our UK operations, program wins and a net increase in volumes, partially offset by the impact of write-downs on certain programs within our UK operations for which cost and schedule were rebaselined as well as the completion of certain programs. programs and increased in indirect expenses.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedMD&A
The increase in revenues for fiscal 2024 2025 as compared to fiscal 2023, 2024, was primarily attributable to program wins and a net increase in volumes on certain programs, partially offset by the impact of wins, prior year write-downs on certain programs within our UK operations for which cost and schedule were rebaselined as well as the a $13 million favorable impact from exchange rate movements, partially offset by completion of certain programs.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedMD&A
The increase was primarily due to a $625 $50 million increase in stock repurchases, a $35 $11 million increase in shares withheld for tax obligations, partially offset by a decrease of $291 million in net payments made on debt activities. activities, a $10 million increase in net capital distributions to our non-controlling interest, partially offset by a $12 million decrease in shares withheld for tax obligations.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedMD&A
Year Ended 2024 to 2023 2023 to 2022 Commercial & International January 3, December 29, December 30, Percent change January 3, Percent change (dollars in millions) 2025 2023 2022 2025 Revenues $ 2,315 $ 2,252 $ 2,126 $ 1,900 6% 12% 3% Operating income (loss) 166 104 (560) 131 119% NM 60% Operating margin 7.2 % 4.6 % (26.3) % 6.9 %

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedMD&A
Year Ended 2024 to 2023 2023 to 2022 National Security & Digital January 2, January 3, December 29, December 30, Percent Percent (dollars in millions) 2026 2025 2023 2022 change change Revenues $ 7,611 $ 7,365 $ 7,196 $ 6,745 2% 7% 3% Operating income 760 720 672 606 7% 11% 6% Operating margin 10.0 % 9.8 % 9.3 % 9.0 %

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedMD&A
The increase in revenues operating income for fiscal 2024 2025 as compared to fiscal 2023, 2024, was primarily attributable due to operational efficiencies on certain programs and a net increase in volumes and case complexity write-ups primarily within the managed health services business, an increase in net write-ups on certain programs partially offset by increased general and program wins. administrative expenses.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedMD&A
Non-operating expense, net increased by $16 $12 million for fiscal 2023 2025 as compared to fiscal 2022, 2024, primarily due to driven by a net increase in interest expense driven on borrowings, partially offset by higher interest rates and refinancing activities. a gain on an immaterial divested business that was not aligned to the Company's long term strategy.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedMD&A
The increase in revenues for fiscal 2023 2025 as compared to fiscal 2022, 2024, was primarily attributable to program wins, a net increase in volumes on certain programs and program wins, $60 million recognized from the acquisition of Kudu Dynamics, partially offset by program completions and a net decrease in contract write-ups in the completion of certain contracts. current year.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedMD&A
During In fiscal 2023, the SES reporting unit refined restructured its portfolio by discontinuing select product offerings and made strategic business decisions to exit certain product offerings, as well as cease ceasing operations in certain countries in order to better align the operations of the reporting unit with its strategic business plan.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedMD&A
The increase in operating income for fiscal 2024 2025 as compared to fiscal 2023, 2024, was primarily attributable to program wins and improved program execution on certain programs, a net increase in volumes, partially offset by program completions and a one-time write-down related to program assets. net decrease in contract write-ups in the current year.

Read it in 10-K 2026-02-17 at sec.gov ↗

RewordedMD&A
The increase in operating income for fiscal 2024 2025 as compared to fiscal 2023, 2024, was primarily attributable to program wins and improved program execution on certain programs, partially offset by a net increase in volumes, a prior year one-time write-down related to program assets. assets, program wins and lower amortization expense.

Read it in 10-K 2026-02-17 at sec.gov ↗

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