Leidos

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Leidos Holdings, Inc.
Company typePublic
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HeadquartersReston, Virginia, U.S.
Key people
Thomas Bell (CEO)
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Total equityDecrease US$4.26 billion (2023)
Number of employees
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Websiteleidos.com
Footnotes / references
[1][2][3][4][5]

Leidos Holdings, Inc. is an American defense, aviation, information technology, and biomedical research company headquartered in Reston, Virginia, that provides scientific, engineering, systems integration, and technical services. Founded as Science Applications International Corporation (SAIC),[6] Leidos merged with Lockheed Martin's IT sector, Information Systems & Global Solutions (Lockheed Martin IS&GS), in August 2016 to create the defense industry’s largest IT services provider. The Leidos-Lockheed Martin merger is one of the biggest transactions thus far in the consolidation of the defense sector. Leidos contracts extensively with the Department of Defense, the Department of Homeland Security, and the Intelligence Community, as well as other U.S. government agencies and select commercial markets.

History

As SAIC

File:SAIC Logo.svg
SAIC company logo (2010)

The company was founded by J. Robert "Bob" Beyster in 1969 in the La Jolla neighborhood of San Diego, California, as Science Applications Incorporated (SAI).[6][7] Beyster, a former scientist for the Westinghouse Atomic Power Division[8] and Los Alamos National Laboratory,[9] who became the chairman of the Accelerator Physics Department of General Atomics in 1957,[10] raised the money to start SAI by selling stock he had received from General Atomics, combined with funds raised from the early employees who bought stock in the young enterprise.[11]

Initially, the company's focus was on projects for the U.S. government related to nuclear power and weapons effects study programs. The company was renamed Science Applications International Corporation (SAIC) as it expanded its operations. Major projects during Beyster's tenure included work on radiation therapy for the Los Alamos National Laboratory; technical support and management assistance to the development of the cruise missile in the 1970s; the cleanups of the Three Mile Island Nuclear Generating Station after its major accident, and of the contaminated community of Love Canal; design and performance evaluation of the Stars & Stripes 87, the winning ship for the 1987 America's Cup; and the design of the first luggage inspection machine to pass new Federal Aviation Administration tests following the terrorist bombing of Pan American flight 103 over Lockerbie, Scotland.[12]

Contrary to traditional business models, Beyster originally designed SAIC as an employee-owned company.[6][7] This shared ownership was accompanied by shared responsibility and freedom in business development, and allowed SAIC to attract and retain highly educated and motivated employees that helped the company to grow and diversify. After Beyster's retirement in 2003, SAIC conducted an initial public offering of common stock on October 17, 2006.[13] The offering of 86,250,000 shares of common stock was priced at $15.00 per share. The underwriters, Bear Stearns and Morgan Stanley, exercised overallotment options, resulting in 11.25 million shares. The IPO raised US$1.245 billion.[13] Even then, employee shares retained a privileged status, having ten times the voting power per share over common stock.[14]

In September 2009 SAIC relocated its corporate headquarters to their existing facilities in Tysons Corner in unincorporated Fairfax County, Virginia, near McLean.[15]

In 2012 SAIC was ordered to pay $550 million to the City of New York for overbilling the city over a period of seven years on the CityTime contract.[16] In 2014 Gerard Denault, SAIC's CityTime program manager, and his government contact were sentenced to 20 years in prison for fraud and bribery related to that contract.[17]

As Leidos

In August 2012, SAIC announced its plans to split into two publicly traded companies.[18][19] The company spun off about a third of its business, forming an approximately $4 billion-per-year service company focused on government services, including systems engineering, technical assistance, financial analysis, and program office support. The remaining part became a $7 billion-per-year IT company specializing in technology for the national security, health, and engineering sectors. The smaller company was led by Tony Moraco, who beforehand was leading SAIC's Intelligence, Surveillance and Reconnaissance group, and the bigger one was led by John P. Jumper.[20] The split has allowed both companies to pursue more business, which it could not pursue as a single company which would have resulted in conflicts of interest.[21] In February 2013, it was announced that the smaller spin-off company would get the name "Science Applications International Corporation" and stay in the current headquarters, while the larger company would change its name to Leidos,[22] (created by clipping the word kaleidoscope) and would move its headquarters to Reston, Virginia.[23] The split was structured in a way that SAIC changed its name to Leidos, then spun off the new SAIC as a separate publicly traded company. However, Leidos is the legal successor of the original SAIC and retains SAIC's pre-2013 stock price and corporate filing history.[24]

Before the split, Leidos employed 39,600 employees and reported $11.17 billion in revenue and $525 million net income for its fiscal year ended January 31, 2013,[25] making it number 240[26] on the Fortune 500 list. In 2014, Leidos reported US$5.06 billion in revenue.[3]

In August 2016, the deal to merge with the entirety of Lockheed Martin's Information Systems & Global Solutions (IS&GS) business came to a close, more than doubling the size of Leidos and its portfolio, and positioning the company as the global defense industry's largest enterprise in the federal technology sector.[27]

In January 2020, Leidos purchased defense contractor Dynetics for approximately $1.65 billion.[28][29][30] In May 2020 it purchased the Security Detection and Automation Systems division of L3Harris (notable for providing the detection screeners that all airport travelers pass through when flying).[31]

As of December 2023, the company has 47,000 employees. In 2023, Leidos reported US$15.4 billion in revenue.[32] It ranked 266 on the 2024 Fortune 500 list.[33]

Structure

Leidos has four central divisions: Civil, Health, Advanced Solutions, and Defense & Intelligence. The Civil Division focuses on integrating aviation systems, securing transportation measures, modernizing IT infrastructure, and engineering energy efficiently. The Health Division focuses on optimizing medical enterprises, securing private medical data, and improving collection and data entry methods. The Advanced Solutions Division is centered around data analysis, integrating advanced defense and intelligence systems, and increasing surveillance and reconnaissance efficiency. The Defense & Intelligence Division focuses on providing air service systems, geospatial analysis, cybersecurity, intelligence analysis, and supporting operations efforts.[34]

Management

Retired Air Force general John P. Jumper was appointed CEO in 2012, and he oversaw the restructuring of SAIC into SAIC and Leidos.[35] On July 1, 2014, Leidos announced that Roger Krone would become its CEO on July 14, 2014.[36] On February 27, 2023, Leidos announced the appointment of Thomas Bell as Chief Executive Officer starting on May 3, 2023.[37]

Subsidiaries

  • Dynetics, Inc., a wholly owned subsidiary of Leidos since Jan 2020.[38]
  • Leidos Biomedical Research, Inc., formerly SAIC - Frederick, a wholly owned subsidiary of Leidos manages Frederick National Laboratory for Cancer Research.[39]
  • Gibbs & Cox, a wholly owned subsidiary of Leidos since May 7, 2021.[40]
  • MEDPROTECT, LLC supports US government health-payer organizations[39]
  • Reveal, develops dual-energy X-ray computed tomography systems for explosives-detection at airports and similar facilities[41]
  • CloudShield Technologies a wholly owned subsidiary, specializing in cyber-security
  • Varec, Inc., liquid petroleum asset management company
  • Leidos Health
  • Leidos Canada, formerly SAIC Canada, wholly owned subsidiary, works with Canadian government.[39]
  • Leidos Australia (Leidos Pty Ltd), wholly owned subsidiary, specializing in document technologies and cyber-security.[39] Produces TeraText software.
  • Leidos UK (Leidos Innovations UK Ltd, Leidos Europe Ltd, Leidos Supply Ltd & Leidos Ltd), wholly owned subsidiary, specializing in managed IT Services, developing of bespoke products. Produces, supports & maintains the Chroma Airport Suite, also responsible for the MOD's Supply Chain.
  • Leidos Engineering, LLC, formerly SAIC Energy, Environment & Infrastructure LLC, assembles the legacy of engineering capabilities of Benham Investment Holdings, LLC, R. W. Beck Group, Inc.,[42] and Patrick Energy Services.
  • Leidos QTC Health Services (formerly QTC Management), acquired by merging with Lockheed Martin IS&GS.
  • Systems Made Simple (SMS), acquired by merging with Lockheed Martin IS&GS.

Former subsidiaries

AMSEC LLC, a business partnership between SAIC and Northrop Grumman subsidiary Newport News Shipbuilding divested on July 13, 2007.[citation needed] Network Solutions was acquired by SAIC in 1995,[43] and subsequently was acquired by VeriSign, Inc. for $21 billion.[44]Leidos Cyber, Inc., formerly Lockheed Martin Industrial Defender, acquired by merging with Lockheed Martin IS&GS, was sold to Capgemini in 2018.[45]

See also

References

  1. ↑ "Leidos Holdings, Inc. 2023 Annual Report (Form 10-K)". U.S. Securities and Exchange Commission. February 13, 2024. https://www.sec.gov/ix?doc=/Archives/edgar/data/1336920/000133692024000008/ldos-20231229.htm. 
  2. ↑ Aitoro, Jill R. (September 27, 2013). "What to expect from Leidos and SAIC when they start trading Sept. 30". American City Business Journals. https://www.bizjournals.com/washington/blog/fedbiz_daily/2013/09/what-to-expect-from-leidos-and-saic.html. 
  3. ↑ Jump up to: 3.0 3.1 Aitoro, Jill R. (September 27, 2013). "Exclusive: John Jumper explains why the Leidos-SAIC split had to happen". American City Business Journals. https://www.bizjournals.com/washington/blog/fedbiz_daily/2013/09/the-saic-split-is-done-leidos-ceo.html. 
  4. ↑ "www.leidos.com". http://www.leidos.com. 
  5. ↑ "SAIC, Inc.'s Board of Directors Approves Spin-Off of its Services Business". September 9, 2013. http://investors.leidos.com/phoenix.zhtml?c=193857&p=irol-newsArticle&ID=1853224. 
  6. ↑ Jump up to: 6.0 6.1 Dr. J. Robert Beyster with Peter Economy, The SAIC Solution: How We Built an $8 Billion Employee-Owned Technology Company, John Wiley & Sons (2007) p.xiii
  7. ↑ Jump up to: 7.0 7.1 Glass, Jon W. (April 3, 2007). "SAIC creator's book touts employee ownership". The Virginian-Pilot. http://hamptonroads.com/node/245611. "Beyster, 82, retired as SAIC's chairman in July 2004. A nuclear physicist by training and a self-described "evangelist" for employee-owned companies, Beyster said he wrote the book to provide entrepreneurs and business executives a model. He wrote it with Peter Economy, an author or co-author of several business books." 
  8. ↑ "SAIC, Leidos founder dead at 90". December 23, 2014. https://federalnewsnetwork.com/acquisition/2014/12/saic-leidos-founder-dead-at-90/. 
  9. ↑ report, Daily Transcript staff (December 23, 2014). "SAIC founder J. Robert Beyster dies at age 90". http://www.sddt.com/news/article.cfm?SourceCode=20141223cza. 
  10. ↑ "The Solutions Man". https://www.leidos.com/feature/the-solutions-man. 
  11. ↑ "SAIC founder J. Robert Beyster dies". December 23, 2014. https://www.sandiegouniontribune.com/lifestyle/people/sdut-beyster-saic-dies-2014dec22-htmlstory.html. 
  12. ↑ "Our History". Leidos. http://www.leidos.com/about/history. 
  13. ↑ Jump up to: 13.0 13.1 SAIC - News & Media - "SAIC, Inc. Announces Closing of Initial Public Offering" Archived October 9, 2007, at the Wayback Machine. Investors.saic.com. Retrieved on August 17, 2013.
  14. ↑ Bigelow, Bruce V (2 September 2005). "Long owned by employees, SAIC says it's going public". San Diego Union-Tribune. http://legacy.sandiegouniontribune.com/uniontrib/20050902/news_1n2saic.html. 
  15. ↑ "SAIC Moves Corporate Headquarters to McLean, Virginia" Archived October 1, 2009, at the Wayback Machine
  16. ↑ Paul McDougall (March 15, 2012). "SAIC Pays $500 Million In Record Settlement With NYC". InformationWeek. https://www.informationweek.com/it-strategy/saic-pays-$500-million-in-record-settlement-with-nyc/d/d-id/1103390?. 
  17. ↑ Calder, Rich (29 April 2014). "CityTime head, accomplices sentenced to 20 years in prison". New York Post. https://nypost.com/2014/04/29/citytime-head-accomplices-sentenced-to-20-years-in-prison/. 
  18. ↑ Censer, Marjorie (August 30, 2012). "SAIC to split into two public companies". Washington Post. https://www.washingtonpost.com/business/capitalbusiness/saic-to-split-into-two-public-companies/2012/08/30/c880f140-f2e5-11e1-a612-3cfc842a6d89_story.html. 
  19. ↑ "SAIC, Inc. (SAI) to Spin Off Services Business". streetinsider.com. September 9, 2013. http://www.streetinsider.com/Hot+Corp.+News/SAIC,+Inc.+%28SAI%29+to+Spin+Off+Services+Business/8671506.html. 
  20. ↑ Censer, Marjorie (November 5, 2012). "When SAIC splits, Jumper and Moraco will head companies". Washington Post. https://www.washingtonpost.com/blogs/capital-business/post/when-saic-splits-jumper-and-moraco-will-head-companies/2012/11/05/83880944-2750-11e2-9972-71bf64ea091c_blog.html. 
  21. ↑ Censer, Marjorie (March 3, 2013). "SAIC to name technology business Leidos". Washington Post. https://www.washingtonpost.com/business/capitalbusiness/saic-to-name-technology-business-leidos/2013/03/01/e1be6b20-7d3b-11e2-82e8-61a46c2cde3d_story.html. 
  22. ↑ Censer, Marjorie (February 25, 2013). "SAIC to name solutions business Leidos". Washington Post. https://www.washingtonpost.com/blogs/capital-business/post/saic-to-name-solutions-business-leidos/2013/02/25/a0a2d9ba-755b-11e2-8f84-3e4b513b1a13_blog.html. 
  23. ↑ SAIC (August 12, 2013). "Leidos Headquarters To Be In Reston, VA" (Press release). PR Newswire. https://www.prnewswire.com/news-releases/leidos-headquarters-to-be-in-reston-va-219241991.html. Retrieved August 15, 2013. 
  24. ↑ SEC Edgar database
  25. ↑ Science Applications International Corporation. "Fiscal Year 2013 annual report on Form 10-K". http://www.saic.com/news/pdf/AnnualReport2013.pdf. 
  26. ↑ SAIC. "Industry Rankings". http://www.saic.com/news/rankings.html. 
  27. ↑ "Leidos Deal Closes, Spawning Vast Solutions Enterprise". https://www.forbes.com/sites/lorenthompson/2016/08/17/leidos-deal-closes-spawning-vast-solutions-enterprise/#cb8f2bc5a063. 
  28. ↑ "Leidos completes acquisition of Dynetics, expanding company's portfolio with new offerings and technical capabilities" (Press release). Leidos. January 31, 2020. https://www.leidos.com/insights/leidos-completes-acquisition-dynetics-expanding-companys-portfolio-new-offerings. Retrieved February 1, 2020. 
  29. ↑ Thompson, Loren. "Leidos Discovers Its Business Model Adapts Surprisingly Well To Coronavirus" (in en). https://www.forbes.com/sites/lorenthompson/2020/04/22/leidos-discovers-its-business-model-adapts-surprisingly-well-to-coronavirus/. 
  30. ↑ Pound, Jesse (2020-03-07). "Analysts say the coronavirus outbreak won't hurt the stock that Stifel calls 'The Terminator'" (in en). https://www.cnbc.com/2020/03/07/analysts-say-the-coronavirus-outbreak-wont-hurt-leidos-stock.html. 
  31. ↑ "Leidos Completes Acquisition of L3Harris Technologies' Security Detection and Automation Businesses Creating a Comprehensive, Global Security and Detection Portfolio". https://investors.leidos.com/news-and-events/news-releases/press-release-details/2020/Leidos-Completes-Acquisition-of-L3Harris-Technologies-Security-Detection-and-Automation-Businesses-Creating-a-Comprehensive-Global-Security-and-Detection-Portfolio/default.aspx. 
  32. ↑ "Leidos Holdings, Inc. Reports Fourth Quarter and Fiscal Year 2023 Results". 13 February 2024. https://investors.leidos.com/news-releases/news-release-details/leidos-holdings-inc-reports-fourth-quarter-and-fiscal-year-2023. 
  33. ↑ "Fortune 500 Full List (2024)". https://www.50pros.com/fortune500. 
  34. ↑ "Defense & Intelligence". Leidos. https://www.leidos.com/defense-intelligence. 
  35. ↑ Censer, Marjorie (August 30, 2012). "SAIC to split into two public companies". The Washington Post. https://www.washingtonpost.com/business/capitalbusiness/saic-to-split-into-two-public-companies/2012/08/30/c880f140-f2e5-11e1-a612-3cfc842a6d89_story.html. 
  36. ↑ "Leidos Announces Roger A. Krone As CEO". wspa.com. 1 July 2014. http://www.wspa.com/story/25913407/leidos-announces-roger-a-krone-as-ceo. 
  37. ↑ "Leidos selects Thomas Bell as incoming CEO" (Press release). Leidos. 27 Feb 2023. https://leidos.com/insights/leidos-selects-thomas-bell-incoming-ceo. 
  38. ↑ "Leidos Subsidiaries". Leidos. https://www.leidos.com/company/subsidiaries. 
  39. ↑ Jump up to: 39.0 39.1 39.2 39.3 "Companies". Leidos. http://www.leidos.com/about/companies. 
  40. ↑ "Leidos completes acquisition of Gibbs & Cox". May 7, 2021. https://www.gibbscox.com/leidos-completes-acquisition-of-gibbs-cox/. 
  41. ↑ "Reveal CT-800 Baggage Inspection System". http://www.leidos.com/products/security/reveal-ct-800/. 
  42. ↑ "R. W. Beck Is Now SAIC Energy, Environment & Infrastructure, LLC". http://www2.saic.com/announcement/r-w-beck-now-saic-energy-environment-infrastructure-llc. 
  43. ↑ "Science Applications International Corporation vs. Comptroller of the Treasury". txcrt.state.md.us. http://www.txcrt.state.md.us/decisions/pdf/saic.pdf. 
  44. ↑ "Company History". networksolutions.com. http://about-networksolutions.com/corporate-history.php. 
  45. ↑ Wilkers, Ross (February 21, 2019). "Leidos closes sale of commercial cyber business -" (in en-US). https://washingtontechnology.com/articles/2019/02/21/leidos-cyber-sale-closed.aspx. 

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