Quarter Ended October 2, 2015

As reported

Asset impairment charges

Amortization of intangibles¹

Restructuring expenses

Non-GAAP results

Income from continuing operations, before income taxes

$

80

$

(4)

$

(2)

$

(1)

$

87

Depreciation expense

9

—

—

—

9

Amortization expense

2

—

2

—

—

Interest expense, net

14

—

—

—

14

EBITDA

$

105

$

(4)

$

—

$

(1)

$

110

⁽¹⁾ Prior period has been recast to reflect amortization of acquired intangible assets as a non-GAAP adjustment.

LEIDOS HOLDINGS, INC.

UNAUDITED NON-GAAP FINANCIAL MEASURES

(in millions, except per share amounts)

Nine Months Ended September 30, 2016

As reported

Acquisition and integration costs

Amortization of intangibles

Restructuring expenses

Gains (losses) on sale of assets

Non-GAAP results

Revenue

$

4,468

$

—

$

—

$

—

$

—

$

4,468

Cost of revenues

3,925

—

—

—

—

3,925

Selling, general and administrative expenses ¹

204

—

30

—

—

174

Acquisition and integration costs

68

68

—

—

—

—

Restructuring expenses

6

—

—

6

—

—

Operating income

265

(68)

(30)

(6)

—

369

Non-operating (expense) income, net

(52)

—

—

—

5

(57)

Income from continuing operations, before income taxes

213

(68)

(30)

(6)

5

312

Income tax (expense) benefit ²

(27)

21

12

2

(1)

(61)

Income from continuing operations

186

(47)

(18)

(4)

4

251

Less: net income attributable to non-controlling interest, net of taxes

1

—

—

—

—

1

Net income attributable to Leidos Holdings, Inc.

$

185

$

(47)

$

(18)

$

(4)

$

4

$

250

Diluted EPS from continuing operations attributable to Leidos Holdings, Inc. ³

$

2.13

$

(0.54)

$

(0.21)

$

(0.05)

$

0.05

$

2.87

Diluted shares

87

87

87

87

87

87

⁽¹⁾ Selling, general and administrative expenses includes bad debt expense of $1 million.

⁽²⁾ Calculation uses an estimated statutory tax rate on non-GAAP tax deductible adjustments.

⁽³⁾ Earnings per share is computed independently for each of the non-GAAP adjustment presented and therefore may not sum to the total
     non-GAAP earnings per share due to rounding.