Significant Contract Modifications ($10M+) — September 22, 2026

Leidos subsidiary QTC Medical Services secured a $240.6M firm-fixed-price delivery order from the VA for physician-based medical evaluation/screening services (FY24). With $233.6M already outlayed (97% of total), the contract is near completion, signaling strong execution but limited upside from this specific award.

Leidos’s reliance on a single, fully funded one-year VA contract with no options creates a revenue cliff after September 2024. The absence of follow-on task orders or extensions raises execution risk for maintaining VA healthcare services revenue.

Awarded under full and open competition with no set-aside, this contract signals that Leidos faces direct competition from other healthcare services providers. Any re-compete could erode margins or result in loss of the contract.

The VA’s sustained $240M+ annual spending on medical evaluation services under NAICS 621111 suggests a stable, recurring budget line. Leidos can leverage its incumbent position to bid on future VA task orders or expand into other civilian agency healthcare contracts (e.g., HHS, DOL).

The VA’s full funding of a $240.6M medical evaluation contract with 97% outlayed demonstrates predictable, non-discretionary spending on physician-based services. This contrasts with defense procurement volatility under continuing resolutions.

{"entity" => "Leidos Holdings (LDOS)", "reason" => "The $240.6M VA contract is a material civilian revenue stream, but its one-year duration and near-complete funding create a gap in forward visibility. Any re-compete win or new VA award would be a positive catalyst.", "trigger" => "VA announcement of follow-on contract for medical evaluation services (expected post-Sep 2024)"}

{"entity" => "Department of Veterans Affairs healthcare services budget", "reason" => "VA’s continued spending on medical evaluations is a bellwether for civilian healthcare procurement trends. A budget cut or shift to in-house services would negatively impact contractors like Leidos.", "trigger" => "FY25 VA budget request or appropriations bill"}