LEIDOS HOLDINGS, INC.

UNAUDITED NON-GAAP FINANCIAL MEASURES [CONTINUED]

(in millions, except per share amounts)

Nine Months Ended September 30, 2016

As reported

Acquisition and integration costs

Amortization of intangibles

Restructuring expenses

Loss (gain) on sale of assets and businesses

Non-GAAP results

Operating income

$

265

$

68

$

30

$

6

$

—

$

369

Non-operating
  expense, net

(52)

—

—

—

(5)

(57)

Income from
  continuing
  operations, before
  income taxes

213

68

30

6

(5)

312

Income tax expense¹

(27)

(21)

(12)

(2)

1

(61)

Net income

186

47

18

4

(4)

251

Less: net income
  attributable to non-
  controlling interest

1

—

—

—

—

1

Net income
  attributable to
  Leidos common
  stockholders

$

185

$

47

$

18

$

4

$

(4)

$

250

Diluted EPS

$

2.13

$

0.54

$

0.21

$

0.05

$

(0.05)

$

2.87

Diluted shares

87

87

87

87

87

87

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