Honeywell shares slip on first quarter revenue miss

Honeywell International Inc (NYSE:HON, XETRA:ALD) shares fell almost 3% in early trading on Thursday after the industrial conglomerate delivered mixed first quarter 2026 results, with investors weighing stronger-than-expected earnings against a revenue miss.

Honeywell International Inc. (HON) reported adjusted earnings per share of $2.45 for the quarter, ahead of analyst expectations of $2.32.

However, revenue came in at $9.14 billion, slightly below the $9.28 billion forecast, despite a 2% year-on-year increase on both reported and organic terms.

Orders rose 7% organically during the quarter, lifting backlog to about $38.3 billion. Segment profit increased 6% to $2.1 billion, supported by gains across all divisions, while adjusted segment margins improved to 23.3% due to pricing actions and early benefits from cost realignment tied to planned structural changes.

The company noted that it continues to reshape its portfolio, announcing an agreement to sell its Warehouse and Workflow Solutions business in an all-cash deal. This follows the previously announced divestiture of Productivity Solutions and Services, with both transactions expected to close in the second half of 2026.

Honeywell also confirmed updated timing for the planned spin-off of its aerospace division, now scheduled for June 29, 2026, pending board approval and other conditions.

“All of the acquisitions, divestitures, spin-offs and simplification efforts over the last several years have positioned both aerospace and automation for bright futures as independent, leading companies, and we look forward to sharing more at the upcoming investor days in June,” Honeywell CEO Vimal Kapur said.

Despite near-term pressure, management reiterated its full-year 2026 outlook. It continues to forecast sales of $38.8 billion to $39.8 billion, with organic growth of 3% to 6%. Segment margins are expected in a range of 22.7% to 23.1%, representing expansion of 20 to 60 basis points year over year. Adjusted earnings per share are projected between $10.35 and $10.65, up 6% to 9%.

Operating cash flow is now expected to be between $4.4 billion and $4.7 billion, while free cash flow guidance remains unchanged at $5.3 billion to $5.6 billion. Management noted that the outlook factors in ongoing uncertainty related to geopolitical conditions in the Middle East.