Honeywell raises full-year outlook after adjusted earnings per share rise 34% in third quarter
Key Facts
Honeywell Technologies reported adjusted earnings per share of $2.27 in the third quarter of 2026, up 34% from the same period a year earlier, as it raised its full-year financial outlook. The company said in its earnings release that quarterly sales totaled about $5.0 billion, with organic growth supported by segment performance, pricing and demand. Organic sales growth reached 7% during the quarter, after 4% in the second quarter excluding aerospace, according to the previous earnings release. Growth accelerated in the period following the aerospace spinoff, as Honeywell shifted to reporting results for its standalone automation operations. In building automation, the company recorded organic sales growth of 8% in the third quarter, supported by fire and security products and services, according to its statement.
In process automation and technology, project sales rose 14% during the third quarter, led by liquefied natural gas and petrochemical projects, according to Honeywell. Industrial automation posted organic sales growth of 4% in the same period, led by industrial measurement and utility solutions. Alongside sales growth, backlog rose 7% year on year, excluding the warehouse and workflow solutions and productivity solutions and services businesses, which the company sold. Operating cash flow, however, fell 74% from the corresponding quarter a year earlier, according to the earnings release. Honeywell attributed the decline primarily to the impact of the one-time settlement with Resideo in the comparison year, related to the agreement terminating the indemnification relationship between the companies.
The reshaping of the company's business portfolio dates to the spinoff of Honeywell Aerospace on June 29, 2026, which preceded the presentation of results for the automation business alone. Honeywell said on its quarterly results page that, starting with the third quarter, earnings materials cover only Honeywell Technologies following that spinoff. As part of completing its portfolio changes, the company announced on July 27, 2026, that it had completed the sale of its warehouse and workflow solutions business to American Industrial Partners in an all-cash transaction. It then announced on August 3, 2026, that it had completed the sale of its productivity solutions and services business to Brady, also for cash. Vimal Kapur said when the latter transaction closed: "Closing the sale of the productivity solutions and services business is the final step toward completing our transformation into a pure-play automation company."
For the full year 2026, Honeywell raised its sales forecast to a range of $20.0 billion to $20.1 billion, according to its third-quarter earnings release. That compares with a range of $19.8 billion to $20.0 billion in its July outlook, issued alongside second-quarter results. It also raised its full-year adjusted earnings per share forecast to between $8.40 and $8.45, compared with a previous range of $8.05 to $8.35 in July. The revision thus increased both the lower and upper ends of the full-year sales and adjusted earnings per share ranges. The company also raised its full-year free cash flow forecast to about $2.1 billion, alongside its updated sales and earnings estimates.
As part of the updated outlook, Honeywell raised its full-year 2026 organic sales growth forecast to a range of 4% to 5%, according to the earnings release. For the fourth quarter, the company expects organic sales growth of between 5% and 6%. The final-quarter estimates imply a slower pace than the organic growth recorded in the third quarter and a faster pace than in the second quarter excluding aerospace. The company scheduled its third-quarter earnings conference call for October 22, 2026, according to its investor relations page. The call is scheduled to begin at 8:30 a.m. Eastern Daylight Time.