Quarter Ended July 1, 2016

As reported

Acquisition and integration costs

Amortization of intangibles

Restructuring expenses

Loss (gain) on sale of assets and businesses

Non-GAAP results

Income from continuing operations, before income taxes

$

60

$

15

$

2

$

1

$

(3)

$

75

Depreciation expense

7

—

—

—

—

7

Amortization expense

2

—

(2)

—

—

—

Interest expense, net

13

—

—

—

—

13

EBITDA

$

82

$

15

$

—

$

1

$

(3)

$

95

EBITDA margin

6.4

%

7.4

%

LEIDOS HOLDINGS, INC.

UNAUDITED NON-GAAP FINANCIAL MEASURES [CONTINUED]

(in millions, except per share amounts)

Six Months Ended June 30, 2017

As reported

Acquisition and integration costs

Amortization of intangibles

Restructuring expenses

Amortization of equity method investments

Loss (gain) on sale of assets and businesses

Non-GAAP results

Operating income

$

307

$

35

$

136

$

19

$

9

$

—

$

506

Non-operating expense, net

(64)

—

—

—

—

1

(63)

Income from continuing operations, before income taxes

243

35

136

19

9

1

443

Income tax expense ¹

(71)

(14)

(53)

(7)

(4)

—

(149)

Net income

172

21

83

12

5

1

294

Less: net income attributable to non-controlling interest

2

—

—

—

—

—

2

Net income attributable to Leidos common stockholders

$

170

$

21

$

83

$

12

$

5

$

1

$

292

Diluted EPS attributable to Leidos common stockholders

$

1.11

$

0.14

$

0.54

$

0.08

$

0.03

$

0.01

$

1.91

Diluted shares

153

153

153

153

153

153

153

⁽¹⁾ Calculation uses an estimated statutory tax rate on non-GAAP tax deductible adjustments.