Defense contractor Leidos raises 2026 forecast on strong demand

May 5 (Reuters) – Defense contractor Leidos Holdings raised its profit and revenue forecast for 2026 on Tuesday, betting on strong demand for its IT and military intelligence services.

Efforts by the Pentagon to replenish weapons stockpile, strained by operations linked to Iran and the long-drawn Russia-Ukraine conflict, have boosted demand for military equipment and services.

Sales in Leidos’ intelligence and digital business, which provides military software, as well as intelligence analysis and global logistics services, rose 7% to $1.51 billion.

Last week, the company bagged a $869 million army contract to build AI-enabled systems to enhance military decision-making by turning large volumes of data into actionable insights.

Defense supplier L3Harris also said last week production in its intelligence, surveillance and reconnaissance systems business for classified and international aircraft programs has increased.

Reston, Virginia-based Leidos posted an adjusted profit of $3.13 per share for the first quarter, up from $2.97 a year earlier.

It expects full-year adjusted profit to be between $12.10 and $12.50 per share, compared with $12.05 to $12.45 forecast previously.

The company also raised its 2026 revenue forecast to $18 billion to $18.4 billion, from its earlier range of $17.5 billion to $17.9 billion.

(Reporting by Aishwarya Jain in Bengaluru; Editing by Shilpi Majumdar)