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Honeywell's Q2 Earnings & Revenues Beat Estimates, 25' View Up
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Key Takeaways
HON's Q2 adjusted EPS rose 10% to $2.75, beating estimates; revenues climbed 8% to $10.35B.
Strength in Aerospace, Building Automation and Energy drove organic sales growth of 5%.
HON raised 2025 EPS outlook to $10.45-$10.65 and expects up to 5% organic sales growth.
Honeywell International Inc. (HON - Free Report) reported second-quarter 2025 adjusted earnings of $2.75 per share, which surpassed the Zacks Consensus Estimate of $2.64. The bottom line increased 10% year over year on an adjusted basis. On a reported basis, the company’s earnings were $2.45 per share, up 4% year over year.
Total revenues of $10.35 billion beat the consensus estimate of $10.02 billion. The top line increased 8% from the year-ago quarter, driven by strength in the Aerospace Technologies segment. Organic sales increased 5% year over year.
Honeywell Q2 Performance by Business Segment
Beginning in the second quarter of 2024, the company started operating under the segments discussed below.
Aerospace Technologies’ quarterly revenues were $4.31 billion, up 11% year over year. Organic sales increased 6% year over year. Strength in both commercial aftermarket and defense and space markets, driven by increased flight activity, augmented the top line. Our estimate for the segment’s revenues was $4.28 billion.
Industrial Automation revenues declined 5% year over year to $2.38 billion. Organic sales were flat year over year. The sales decline was attributable to softness in the warehouse and workflow solutions business, which was partially offset by growth in the sensing and safety technologies business. Our estimate for segmental revenues was pegged at $2.36 billion.
Building Automation revenues totaled $1.83 billion, up 16% year over year. Organic sales increased 8% year over year. The upside was driven by ongoing strength in both the building solutions and building products businesses. Our estimate for the segment’s revenues was $1.71 billion.
Energy and Sustainability Solutions’ revenues increased 15% to $1.84 billion. Organic sales rose 6% year over year. The results were driven by strength across UOP, specialty chemicals and materials businesses. However, weakness in the fluorine products business offset the gains. Our estimate for the segment’s revenues was $1.63 billion.
Honeywell International Inc. Price, Consensus and EPS Surprise
The company’s total cost of sales (cost of products and services) was about $6.33 billion, up 8.1% year over year. Selling, general and administrative expenses were $1.43 billion, up 4.9%. Interest expenses and other financial charges were $330 million, reflecting an increase of 32% year over year.
Operating income was $2.11 billion, up 7% year over year. The operating income margin was 20.4% compared with 20.7% in the year-ago period.
HON’s Balance Sheet & Cash Flow
Exiting second-quarter 2025, Honeywell had cash and cash equivalents of $10.3 billion compared with $10.6 billion at the end of December 2024. Long-term debt was $30.2 billion, higher than $25.5 billion at 2024-end.
In the second quarter, it generated net cash of $1.3 billion from operating activities compared with $1.4 billion in the prior-year quarter. Capital expenditure totaled $303 million compared with $259 million in the previous year quarter.
Free cash flow in the quarter was $1 billion, down 8.6% from the year-ago quarter’s level.
Honeywell’s 2025 Guidance
For 2025, Honeywell expects sales to be in the range of $40.8-$41.3 billion, higher than $39.6-$40.5 billion projected previously. Organic sales are now expected to increase in the range of 4-5% compared with its earlier projection of 2-5%.
HON expects a segment margin of 23.0-23.2% compared with 22.6% in 2024. Adjusted earnings per share (EPS) are expected to be between $10.45 and $10.65, higher than $10.20-$10.50 guided earlier. The metric indicates an increase of 6-8% on a year-over-year basis.
It continues to expect operating cash flow in the range of $6.7-$7.1 billion. Free cash flow is still expected to be in the band of $5.4-$5.8 billion.
Some better-ranked stocks from the same space are discussed below:
Huntington Ingalls Industries (HII - Free Report) presently sports a Zacks Rank of 1. HII’s earnings surpassed the consensus estimate twice and missed in the other two occasions in the trailing four quarters. The average earnings surprise was 4.2%. In the past 60 days, the Zacks Consensus Estimate for Huntington Ingalls’ 2025 earnings has increased 0.8%.
Howmet Aerospace (HWM - Free Report) currently carries a Zacks Rank #2 (Buy). HWM has an impressive earnings surprise history, having outperformed the consensus estimate in each of the preceding four quarters, the average surprise being 8.8%. In the past 60 days, the Zacks Consensus Estimate for Howmet Aerospace’s 2025 earnings has increased 0.9%.
ITT Inc. (ITT - Free Report) currently carries a Zacks Rank of 2. ITT has an impressive earnings surprise history, having outperformed the consensus estimate in each of the preceding four quarters, the average surprise being 1.7%. In the past 60 days, the Zacks Consensus Estimate for ITT’s 2025 earnings has increased 0.9%.
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Honeywell's Q2 Earnings & Revenues Beat Estimates, 25' View Up
Key Takeaways
Honeywell International Inc. (HON - Free Report) reported second-quarter 2025 adjusted earnings of $2.75 per share, which surpassed the Zacks Consensus Estimate of $2.64. The bottom line increased 10% year over year on an adjusted basis. On a reported basis, the company’s earnings were $2.45 per share, up 4% year over year.
Total revenues of $10.35 billion beat the consensus estimate of $10.02 billion. The top line increased 8% from the year-ago quarter, driven by strength in the Aerospace Technologies segment. Organic sales increased 5% year over year.
Honeywell Q2 Performance by Business Segment
Beginning in the second quarter of 2024, the company started operating under the segments discussed below.
Aerospace Technologies’ quarterly revenues were $4.31 billion, up 11% year over year. Organic sales increased 6% year over year. Strength in both commercial aftermarket and defense and space markets, driven by increased flight activity, augmented the top line. Our estimate for the segment’s revenues was $4.28 billion.
Industrial Automation revenues declined 5% year over year to $2.38 billion. Organic sales were flat year over year. The sales decline was attributable to softness in the warehouse and workflow solutions business, which was partially offset by growth in the sensing and safety technologies business. Our estimate for segmental revenues was pegged at $2.36 billion.
Building Automation revenues totaled $1.83 billion, up 16% year over year. Organic sales increased 8% year over year. The upside was driven by ongoing strength in both the building solutions and building products businesses. Our estimate for the segment’s revenues was $1.71 billion.
Energy and Sustainability Solutions’ revenues increased 15% to $1.84 billion. Organic sales rose 6% year over year. The results were driven by strength across UOP, specialty chemicals and materials businesses. However, weakness in the fluorine products business offset the gains. Our estimate for the segment’s revenues was $1.63 billion.
Honeywell International Inc. Price, Consensus and EPS Surprise
Honeywell International Inc. price-consensus-eps-surprise-chart | Honeywell International Inc. Quote
Costs & Margins of HON
The company’s total cost of sales (cost of products and services) was about $6.33 billion, up 8.1% year over year. Selling, general and administrative expenses were $1.43 billion, up 4.9%. Interest expenses and other financial charges were $330 million, reflecting an increase of 32% year over year.
Operating income was $2.11 billion, up 7% year over year. The operating income margin was 20.4% compared with 20.7% in the year-ago period.
HON’s Balance Sheet & Cash Flow
Exiting second-quarter 2025, Honeywell had cash and cash equivalents of $10.3 billion compared with $10.6 billion at the end of December 2024. Long-term debt was $30.2 billion, higher than $25.5 billion at 2024-end.
In the second quarter, it generated net cash of $1.3 billion from operating activities compared with $1.4 billion in the prior-year quarter. Capital expenditure totaled $303 million compared with $259 million in the previous year quarter.
Free cash flow in the quarter was $1 billion, down 8.6% from the year-ago quarter’s level.
Honeywell’s 2025 Guidance
For 2025, Honeywell expects sales to be in the range of $40.8-$41.3 billion, higher than $39.6-$40.5 billion projected previously. Organic sales are now expected to increase in the range of 4-5% compared with its earlier projection of 2-5%.
HON expects a segment margin of 23.0-23.2% compared with 22.6% in 2024. Adjusted earnings per share (EPS) are expected to be between $10.45 and $10.65, higher than $10.20-$10.50 guided earlier. The metric indicates an increase of 6-8% on a year-over-year basis.
It continues to expect operating cash flow in the range of $6.7-$7.1 billion. Free cash flow is still expected to be in the band of $5.4-$5.8 billion.
HON’s Zacks Rank & Key Picks
The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks from the same space are discussed below:
Huntington Ingalls Industries (HII - Free Report) presently sports a Zacks Rank of 1. HII’s earnings surpassed the consensus estimate twice and missed in the other two occasions in the trailing four quarters. The average earnings surprise was 4.2%. In the past 60 days, the Zacks Consensus Estimate for Huntington Ingalls’ 2025 earnings has increased 0.8%.
Howmet Aerospace (HWM - Free Report) currently carries a Zacks Rank #2 (Buy). HWM has an impressive earnings surprise history, having outperformed the consensus estimate in each of the preceding four quarters, the average surprise being 8.8%. In the past 60 days, the Zacks Consensus Estimate for Howmet Aerospace’s 2025 earnings has increased 0.9%.
ITT Inc. (ITT - Free Report) currently carries a Zacks Rank of 2. ITT has an impressive earnings surprise history, having outperformed the consensus estimate in each of the preceding four quarters, the average surprise being 1.7%. In the past 60 days, the Zacks Consensus Estimate for ITT’s 2025 earnings has increased 0.9%.