Leidos, global partners to boost NATO capabilities through cloud modernization

Rhea-AI Summary

Leidos (LDOS) has secured a significant NATO contract worth up to $87 million to lead a multinational IT modernization initiative. The project focuses on implementing a private cloud-based IT solution to enhance NATO's operational network capabilities, cybersecurity, and interoperability. Partnering with major European defense contractors including Thales, CGI, Leonardo, LA International, and NEXOR, the initiative aims to strengthen NATO's digital infrastructure and improve secure information sharing across the alliance. The IT Modernization Recovery Increment 1 Systems Integration contract will be executed on indefinite delivery indefinite quantity (IDIQ) firm-fixed price terms, with Leidos serving as the primary technology partner for the NATO Communications and Information Agency (NCIA).

Positive

• Contract ceiling value of $87 million strengthens Leidos' revenue pipeline
• Strategic partnership with NATO enhances company's position in international defense market
• Collaboration with major European defense contractors expands global reach
• IDIQ contract structure provides potential for additional task orders

Negative

• None.

Insights

Defense Contracting Analyst

Leidos strengthens NATO partnership with $87M cloud contract, enhancing its defense technology portfolio and international presence.

Leidos has secured a strategic $87 million NATO contract to modernize critical IT infrastructure across the alliance's operational network. This IDIQ firm-fixed price agreement positions Leidos at the center of NATO's digital transformation efforts, with significant implications for the company's defense technology portfolio.

The contract structure is particularly favorable - IDIQ (Indefinite Delivery, Indefinite Quantity) vehicles provide a stable revenue framework while allowing for potential scope expansion beyond the initial ceiling value. The firm-fixed price component reduces execution risk for Leidos while maintaining margin predictability.

What makes this win especially noteworthy is its trans-Atlantic coalition approach. By assembling partners from four key NATO nations (Thales from France, CGI from Germany, Leonardo from Italy, and both LA International and NEXOR from the UK), Leidos demonstrates sophisticated international defense contracting expertise. This consortium structure spreads technical and political risk while potentially opening doors to additional European defense opportunities.

The cybersecurity and private cloud focus aligns perfectly with increasing defense spending priorities across NATO members, particularly as digital resilience becomes central to military readiness. For Leidos, this contract represents not just $87 million in potential revenue, but a strategic foothold in NATO's long-term digital infrastructure roadmap, with potential follow-on work as the alliance continues modernizing its networks.

RESTON, Va., June 23, 2025 /PRNewswire/ -- A Leidos-led (NYSE: LDOS) modernization initiative, involving companies from France, Germany, Italy, and the U.K., aims to enhance NATO's IT infrastructure. The project is designed to improve resilience against cyber threats and increase efficiency and scalability, in support of NATO digital transformation.

Leidos was awarded a contract from the NATO Communications and Information Agency (NCIA) for the provision of a centralized IT solution (based on private cloud technology) to support NATO's operational network, integrating core services such as service management and cybersecurity with the goal of enhancing interoperability and operational efficiency across the NATO command structure.

"This project reflects our long-standing commitment to NATO, leveraging innovative solutions aimed at delivering secure, mission-ready capabilities designed to adapt with operational needs," said Steve Hull, Leidos digital modernization sector president. "It also creates new opportunities for more integrated collaboration across trans-Atlantic defense networks, helping NATO teams stay securely connected and able to share critical information with greater speed, agility and assurance."

Thales (France), CGI (Germany), Leonardo (Italy), LA International (U.K.) and NEXOR (U.K.) are joining Leidos as a multi-national team with extensive knowledge of NATO requirements and a strong track record of delivering results. Collectively, they have supported NATO's work for decades.

The IT Modernization Recovery Increment 1 Systems Integration contract bolsters Leidos' role as a key technology partner with NCIA, supporting NATO's mission and advancing secure cloud modernization. It has a ceiling value of $87 million (€79.1 million) on indefinite delivery indefinite quantity (IDIQ) firm-fixed price terms.  

About Leidos

Leidos is an industry and technology leader serving government and commercial customers with smarter, more efficient digital and mission innovations. Headquartered in Reston, Virginia, with 47,000 global employees, Leidos reported annual revenues of approximately $16.7 billion for the fiscal year ended January 3, 2025. For more information, visit www.leidos.com.

Certain statements in this announcement constitute "forward-looking statements" within the meaning of the rules and regulations of the U.S. Securities and Exchange Commission (SEC). These statements are based on management's current beliefs and expectations and are subject to significant risks and uncertainties. These statements are not guarantees of future results or occurrences. A number of factors could cause our actual results, performance, achievements, or industry results to be different from the results, performance, or achievements expressed or implied by such forward-looking statements. These factors include, but are not limited to, the "Risk Factors" set forth in Leidos' Annual Report on Form 10-K for the fiscal year ended January 3, 2025, and other such filings that Leidos makes with the SEC from time to time. Readers are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof. Leidos does not undertake to update forward-looking statements to reflect the impact of circumstances or events that arise after the date the forward-looking statements were made.

Media Contact:

Brandon Ver Velde
(571) 526-6257
Brandon.p.vervelde@leidos.com

 

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SOURCE Leidos Holdings, Inc.

FAQ

What is the value of Leidos (LDOS) NATO cloud modernization contract?

The contract has a ceiling value of $87 million (€79.1 million) on indefinite delivery indefinite quantity (IDIQ) firm-fixed price terms.

Which companies are partnering with Leidos on the NATO modernization project?

Leidos is partnering with Thales (France), CGI (Germany), Leonardo (Italy), LA International (UK), and NEXOR (UK) on the NATO modernization project.

What is the main objective of Leidos' NATO IT modernization contract?

The main objective is to enhance NATO's IT infrastructure through a private cloud-based solution that improves cybersecurity, operational efficiency, and interoperability across the NATO command structure.

How will the Leidos contract benefit NATO's operations?

The contract will improve NATO's resilience against cyber threats, increase efficiency and scalability, enhance interoperability, and enable faster, more secure information sharing across trans-Atlantic defense networks.

What type of contract did Leidos receive from NATO?

Leidos received an IT Modernization Recovery Increment 1 Systems Integration contract on indefinite delivery indefinite quantity (IDIQ) firm-fixed price terms.