Leidos receives three DISA awards to launch the next phase of IT transformation and end user migrations to the modernized DoDNet

Rhea-AI Summary

Leidos (NYSE: LDOS) has secured three new awards from the Defense Information Systems Agency (DISA) under the $11.5 billion Defense Enclave Services (DES) program to advance IT transformation and user migration to the Department of Defense Network (DoDNet). The first task order focuses on DoDNet Generation 2 Release 2, implementing cloud-based management and Zero Trust cybersecurity. The second and third awards initiate migrations for the Defense Contract Management Agency and Defense Contract Audit Agency.

Working with 14 Defense Agencies and Field Activities (DAFAs), Leidos expects to migrate approximately 100,000 users to DoDNet by end-2025, with a final target of 370,000 users. These three awards, valued at over $30 million, complement Leidos' recent $823 million task order for DoDNet operations and sustainment.

Positive

• Secured three new awards under the $11.5B DES contract
• Won additional $823M five-year task order for DoDNet operations
• Project scope includes migration of 370,000 users upon completion
• Current awards valued at over $30M

Negative

• None.

Insights

Financial Analyst

The three new DISA awards, combined with the recent $823 million task order, significantly strengthen Leidos' position in defense IT modernization. The total DES contract value of $11.5 billion over 10 years provides substantial revenue visibility. With plans to migrate approximately 100,000 users by 2025 and ultimately support 370,000 DAFA users, this represents a major growth opportunity. The contract's scope expansion through these new task orders, valued at over $30 million, demonstrates strong execution and customer satisfaction. This systematic expansion of the DoDNet program enhances Leidos' competitive moat in defense IT services and provides a stable, long-term revenue stream.

Tech Expert

The DoDNet Generation 2 Release 2 represents a significant technological advancement, incorporating important elements like cloud-based management services, automation tools and Zero Trust cybersecurity. The migration of legacy systems to a modernized, consolidated network is a complex undertaking that positions Leidos at the forefront of defense IT transformation. The focus on data-driven services and enhanced user experience, while maintaining stringent security protocols, showcases advanced technical capabilities. The systematic approach to migrating multiple agencies demonstrates a well-architected solution that can scale effectively. This comprehensive modernization effort will likely serve as a blueprint for future large-scale government IT transformations.

RESTON, Va., Dec. 5, 2024 /PRNewswire/ -- Leidos (NYSE: LDOS) received three new awards from the Defense Information Systems Agency (DISA) to begin the next phase of IT transformation and migrate an expanded user base to the Department of Defense Network (DoDNet) under the Defense Enclave Services (DES) program. DISA is working with Leidos through the single-award, $11.5 billion, 10-year indefinite delivery, indefinite quantity DES contract to optimize network services for Fourth Estate Defense Agencies and Field Activities (DAFAs) as they migrate from their legacy systems to the modernized, consolidated DoDNet.

"Under these awards, Leidos will begin to integrate new technologies and services into DoDNet with the goal of enabling DAFA migrations and enhancing user experience," said Bryan Jolly, Leidos senior vice president of digital modernization for the DISA IT business area. "We are proud to continue our work with DISA to create a more efficient, modern, secure, and resilient common IT computing environment. This will help defense agencies focus on their mission and support our nation's warfighters around the world."

The first task order supports DoDNet Generation 2 Release 2, which positions the network for large-scale DAFA migrations, delivering data-driven, cloud-based management services, automation tools, Zero Trust cybersecurity enhancements, and an optimized user experience. These new capabilities aim to provide the DoDNet user community with access to highly reliable, available, secure, and scalable network operations to empower their unique missions.

The second and third awards launch the migration process to DoDNet for two DAFAs, the Defense Contract Management Agency and the Defense Contract Audit Agency.

In collaboration with DISA, Leidos is working with 14 DAFAs through various stages of DoDNet onboarding and expects to have approximately 100,000 users migrated to the new network by the end of 2025. DoDNet is projected to support approximately 370,000 DAFA users and endpoints once implementation is complete.

With a combined total contract value of more than $30 million, these three awards build upon Leidos' recent win of an $823 million, five-year task order from DISA to provide the long-term operations and sustainment construct for DoDNet.

Leidos has been leading operations for the DES DoDNet program since February 2022.

About Leidos

Leidos is a Fortune 500® innovation company rapidly addressing the world's most vexing challenges in national security and health. The company's global workforce of 48,000 collaborates to create smarter technology solutions for customers in heavily regulated industries. Headquartered in Reston, Virginia, Leidos reported annual revenues of approximately $15.4 billion for the fiscal year ended December 29, 2023. 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 December 29, 2023, 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.

Contact:

Alyssa Pettus
(571) 526-6743
alyssa.t.pettus@leidos.com

Brandon VerVelde
(571) 526-6257
brandon.p.vervelde@leidos.com

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SOURCE Leidos Holdings, Inc.

FAQ

What is the total value of Leidos (LDOS) recent DoDNet contract awards?

The three new awards are valued at over $30 million, plus an additional $823 million five-year task order for DoDNet operations and sustainment.

How many users will Leidos (LDOS) migrate to DoDNet by 2025?

Leidos expects to migrate approximately 100,000 users to DoDNet by the end of 2025.

What is the total user target for Leidos (LDOS) DoDNet implementation?

DoDNet is projected to support approximately 370,000 DAFA users and endpoints once implementation is complete.

What new features will Leidos (LDOS) implement in DoDNet Generation 2 Release 2?

The release will include data-driven cloud-based management services, automation tools, Zero Trust cybersecurity enhancements, and an optimized user experience.