Earnings Per Share (EPS)

6 Months Ended

Jul. 01, 2016

Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]

Basic EPS is computed by dividing income less earnings allocable to participating securities by the basic weighted average number of shares outstanding. Diluted EPS is computed similar to basic EPS, except the weighted average number of shares outstanding is increased to include the dilutive effect of outstanding stock options and other stock-based awards. The Company is required to allocate a portion of its earnings to its unvested stock awards containing nonforfeitable rights to dividends or dividend equivalents (participating securities) in calculating EPS using the two-class method.

The following table provides a reconciliation of the weighted average number of shares outstanding used to compute basic and diluted EPS for the periods presented:



	Three Months Ended		Six Months Ended
	July 1, 2016	July 3, 2015	July 1, 2016	July 3, 2015
	(in millions)
Basic weighted average number of shares outstanding	73	73	72	73
Dilutive common share equivalents—stock options and other stock awards	1	1	2	2
Diluted weighted average number of shares outstanding	74	74	74	75

Anti-dilutive stock-based awards are excluded from the weighted average number of shares outstanding used to compute basic and diluted EPS. For the quarter and six months ended July 1, 2016, there were a total of 1 million outstanding stock options and vesting stock awards that were antidilutive. For both the quarter and six months ended July 3, 2015, there were 2 million and 1 million of outstanding stock options and vesting stock awards, respectively, that were antidilutive. As a result of the adoption of ASU 2016-09 during the quarter ended July 1, 2016, the excess tax benefit was removed from the assumed proceeds under the treasury stock method used to calculate the dilutive effect of outstanding stock options and other stock-based awards (see "Note 1–Summary of Significant Accounting Policies"). This resulted in an immaterial increase in diluted weighted average shares outstanding.

In May 2015, the Company entered into an Accelerated Share Repurchase ("ASR") agreement with a financial institution to repurchase shares of the Company's outstanding common stock for an aggregate purchase price of $100 million. During the second quarter ended July 3, 2015, the Company paid $100 million to the financial institution and received a total delivery of 2.4 million shares of its outstanding shares of common stock. All shares delivered were immediately retired. The final value of the total shares delivered of $100 million was allocated to additional paid in capital for the second quarter ended July 3, 2015. The total amount of shares delivered by the financial institution was adjusted by the volume weighted average price of the Company's stock over the valuation period specified in the ASR.

The delivery of Leidos common stock for the ASR purchase reduced the Company's outstanding shares used to determine the weighted average shares outstanding for purposes of calculating basic and diluted EPS for the periods presented.

Leidos, Inc.

Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]

Earnings Per Share (EPS)

The following table provides a reconciliation of the weighted average number of shares outstanding used to compute basic and diluted EPS for the periods presented:



	Three Months Ended		Six Months Ended
	July 1, 2016	July 3, 2015	July 1, 2016	July 3, 2015
	(in millions)
Basic weighted average number of shares outstanding	73	73	72	73
Dilutive common share equivalents—stock options and other stock awards	1	1	2	2
Diluted weighted average number of shares outstanding	74	74	74	75