Is Leidos Strengthening Its Position in the Growing AI Market?

Leidos Holdings, Inc. LDOS is expanding its Artificial Intelligence (AI) capabilities as government agencies and defense organizations increasingly adopt AI to improve decision-making, automate processes and manage large volumes of data. The company is integrating AI across defense, cybersecurity, logistics and other mission-critical applications, creating opportunities to benefit from the growing demand for secure and reliable AI solutions.

Leidos is using AI to support national security and defense operations by helping military customers analyze complex information and make faster, data-driven decisions. Its AI capabilities are also being applied to cybersecurity, where the company is developing solutions that can identify vulnerabilities and help organizations respond to emerging threats more efficiently.

The company is further expanding AI into military logistics, using predictive technologies to help customers anticipate requirements, improve resource planning and strengthen operational readiness. These efforts complement Leidos’ broader focus on digital modernization and mission-critical technology.

Leidos is also working with leading technology companies to accelerate the adoption of generative and agentic AI across government workflows. Its partnership with OpenAI, announced in January 2026, supports the company’s efforts to integrate advanced AI into areas such as national security, defense and digital modernization.

As AI adoption continues to grow across the defense sector, Leidos’ expanding AI capabilities and focus on secure, mission-critical applications position it well to benefit from the long-term shift toward AI-enabled government and military operations.

Other Companies Benefiting From AI Demand

Other companies that are likely to benefit from the expanding AI market are discussed below:

Northrop Grumman Corporation NOC: The company is integrating AI and machine learning into complex mission systems, including decision-support, autonomous systems and edge-processing applications. In March 2026, its Talon IQ autonomous testbed successfully flew with Shield AI’s Hivemind software, demonstrating the ability to integrate third-party AI systems into an open architecture.

Lockheed Martin Corporation LMT: The company is expanding AI across defense applications, including space-based systems and decision-support technologies. Its AI Fight Club provides a simulated environment for testing AI systems across air, land, sea and space, while recent efforts are focused on using AI to help warfighters process complex information and make faster decisions.

The Zacks Rundown for LDOS

Shares of LDOS have surged 15.4% in the past three months compared with the industry’s 4.5% growth.

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The company shares are trading at a discount on a relative basis, with its forward 12-month Price/Sales being 0.96X compared with its industry’s average of 11.87X.

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The Zacks Consensus Estimate for LDOS’ 2026 earnings has moved north over the past 60 days.

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LDOS stock currently carries a Zacks Rank #3 (Hold).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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