Honeywell International Inc. (HON) Q3 2025 Financial Results Summary

2025-10-23 · Stocks · QuoteReporter

Honeywell (HON) Q3 2025 Financial Results Summary

Honeywell (NASDAQ: HON) released its third quarter 2025 financial results on October 23, 2025. Below is a summary of key highlights from the report:

Financial Highlights

Sales Growth:
Total sales: $10.4 billion, an increase of 7% year-over-year.
Organic sales growth: 6%, driven by strengths in commercial aftermarket and defense and space.
Earnings Per Share (EPS):
Reported EPS: $2.86, up 32% from $2.16 in the same quarter last year.
Adjusted EPS: $2.82, up 9% from $2.58 year-over-year.
Operating Income:
Operating income: $1.754 billion, a 6% decrease compared to the previous year (from $1.858 billion).
Operating margin contracted by 220 basis points to 16.9%.
Segment Performance:
Aerospace Technologies:
- Sales grew 15%, with organic growth of 12%.
- Segment profit increased 9%.
Industrial Automation:
- Sales decreased 9%, with organic growth of 1%.
- Segment profit dropped 16%.
Building Automation:
- Sales increased 8%, with organic growth of 7%.
- Segment profit increased 11%.
Energy and Sustainability Solutions:
- Sales grew 11%, but organic sales decreased 2%.
- Segment profit increased 11%.

Operational Highlights

Orders:
Total orders rose by 22%, reflecting strengths in aerospace technologies and energy solutions.
Cash Flow:
Operating cash flow increased significantly by 65% year-over-year to $3.288 billion.
Free cash flow decreased by 16% compared to the previous year, totaling $1.450 billion.

Guidance Updates

The company raised its full-year organic growth and adjusted EPS guidance due to strong Q3 performance, now expected to be:
Full-year sales forecast: $40.7 billion to $40.9 billion, reflecting organic growth of approximately 6%.
Adjusted earnings per share expected in the range of $10.60 to $10.70, a 10-cent increase from prior guidance.
Operating cash flow guidance increased to $6.4 billion to $6.8 billion, and free cash flow projected at $5.2 billion to $5.6 billion.

Changes to Corporate Structure

Honeywell announced a new segmentation strategy aimed at simplifying operations, focusing on cohesive business models aligned to a post-separation strategy anticipated in the first quarter of 2026.
Progress is being made on the spin-off of Solstice Advanced Materials, scheduled for October 30, 2025.

Dividend and Share Repurchase

Honeywell paid $735 million in cash dividends during Q3 2025.
The company repurchased $100 million worth of its common stock.

Conclusion

Overall, Honeywell’s Q3 2025 results demonstrate robust sales and EPS growth, alongside strategic steps towards a simplified corporate structure. The impressive order growth and cash flow figures hint at a solid performance heading into the final quarter of the year, despite challenges in certain segments.

	3Q 2025	3Q 2024	Change
Product sales	7,086	6,590
Service sales	3,322	3,138
Net sales	10,408	9,728	7%
Costs, expenses and other
Cost of products sold	4,734	4,166
Cost of services sold	2,127	1,813
Total Cost of products and services	6,861	5,979
Research and development expenses	497	368
Selling, general and administrative expenses	1,296	1,398
Impairment of assets held for sale	—	125
Other (income) expense	-822	-263
Interest and other financial charges	354	297
Total costs, expenses and other	8,186	7,904
Income before taxes	2,222	1,824
Tax expense	363	409
Net income	1,859	1,415
Less: Net income attributable to noncontrolling interest	34	2
Net income attributable to Honeywell	1,825	1,413
Earnings per share of common stock – basic	2.87	2.17
Earnings per share of common stock – assuming dilution	2.86	2.16
Weighted average number of shares outstanding – basic	635.3	650.4
Weighted average number of shares outstanding – assuming dilution	638.8	654.1

	September 30, 2025	December 31, 2024
ASSETS
Current assets
Cash and cash equivalents	12,930	10,567
Short-term investments	429	386
Accounts receivable, less allowances of $320 and $314, respectively	8,923	7,819
Inventories	7,118	6,442
Assets held for sale	—	1,365
Other current assets	1,347	1,329
Total current assets	30,747	27,908
Investments and long-term receivables	1,568	1,394
Property, plant and equipment—net	6,681	6,194
Goodwill	23,720	21,825
Other intangible assets—net	7,149	6,656
Insurance recoveries for asbestos-related liabilities	159	171
Deferred income taxes	239	238
Other assets	10,654	10,810
Total assets	80,917	75,196
LIABILITIES
Current liabilities
Accounts payable	7,314	6,880
Commercial paper and other short-term borrowings	6,873	4,273
Current maturities of long-term debt	72	1,347
Accrued liabilities	8,380	8,348
Liabilities held for sale	—	408
Total current liabilities	22,639	21,256
Long-term debt	30,092	25,479
Deferred income taxes	1,900	1,787
Postretirement benefit obligations other than pensions	105	112
Asbestos-related liabilities	1,369	1,325
Other liabilities	7,058	6,076
Redeemable noncontrolling interest	7	7
Shareowners’ equity	17,747	19,154
Total liabilities, redeemable noncontrolling interest and shareowners’ equity	80,917	75,196