Honeywell International Inc. (NASDAQ:HON) posted first-quarter results that topped profit expectations but came in below revenue forecasts, sending the stock down 5.5% in premarket trading as investors focused on the weaker top line and reduced cash flow outlook.
The industrial group reported adjusted earnings per share of $2.45, surpassing analyst estimates of $2.32 by $0.13. However, revenue reached $9.14 billion, missing the $9.28 billion consensus, although still marking a 2% increase from $8.93 billion a year earlier. The company pointed to disruptions linked to the Middle East conflict, which affected collections and delayed shipments, particularly within its Process Automation and Technology division.
Guidance held, but cash flow outlook trimmed
Honeywell reaffirmed its full-year revenue guidance of $38.8 billion to $39.8 billion and adjusted EPS guidance of $10.35 to $10.65. The midpoint of the revenue range, at $39.3 billion, sits below the analyst consensus of $39.51 billion, while the EPS midpoint of $10.50 is slightly under the $10.52 estimate.
The company lowered its operating cash flow forecast to a range of $4.4 billion to $4.7 billion, down from a previous outlook of $4.7 billion to $5.0 billion. It maintained its free cash flow guidance at $5.3 billion to $5.6 billion.
Orders and margins show resilience
“Honeywell delivered a strong start to the year while navigating a challenging geopolitical environment,” said Vimal Kapur, chairman and chief executive officer. “Orders were up 7% with growth in all segments, pushing backlog to over $38 billion, led by buildings and industrial automation.”
Segment margins expanded by 90 basis points to 23.3%, supported by pricing actions and the earlier-than-expected elimination of stranded costs tied to the planned Aerospace spin-off. Organic order growth of 7% helped lift the backlog to roughly $38 billion.
Portfolio moves and spin-off timeline
Honeywell also announced the divestment of its Warehouse and Workflow Solutions unit to American Industrial Partners, with the transaction expected to close in the second half of 2026.
In addition, the company updated the timeline for the planned spin-off of its Aerospace business, which is now expected to be completed on June 29, 2026.