Honeywell Beats Q3 EPS at $2.27, Raises 2026 Outlook
Honeywell beat Q3 adjusted EPS estimates as organic sales grew 7% and segment margin expanded 370 basis points to 21.3%, while revenue of $4.99 billion narrowly missed. It raised its 2026 outlook.
Honeywell Technologies (HON) reported third-quarter adjusted earnings of $2.27 a share, $0.10 above the $2.17 consensus, on sales of $4.99 billion that narrowly missed the $5.00 billion estimate. Organic sales grew 7%, segment profit rose 23% to $1.06 billion, and segment margin expanded 370 basis points to 21.3%. The company raised its 2026 outlook, now expecting adjusted EPS of $8.40–$8.45 against an $8.30 consensus. Figures come from Honeywell's results release on Honeywell Investor Relations; it was the first quarter reported as a standalone company, per CEO Vimal Kapur.
Q3 results
| Measure | Q3 2026 | Q3 2025 | Change |
|---|---|---|---|
| Sales | $4,994M | $4,929M | +1% (+7% organic) |
| Segment profit | $1,062M | $866M | +23% |
| Segment margin | 21.3% | 17.6% | +370 bps |
| Operating income | $740M | $413M | +79% |
| Adjusted EPS | $2.27 | $1.70 | +34% |
| GAAP EPS (continuing operations) | $2.40 | $2.99 | −20% |
| Operating cash flow | $607M | $2,306M | −74% |
| Free cash flow | $688M | $599M | +15% |
Adjusted EPS beat the consensus by about 4.6%, and revenue missed it by about 0.1%, by our calculation. Honeywell said the declines in GAAP EPS and operating cash flow were mainly due to a one-time Resideo termination gain and settlement in the prior-year quarter. Operating income growth included the elimination of stranded costs from prior spin-offs and divestitures. Backlog was nearly $19 billion, up 7% excluding the WWS and PSS divestitures.
Segment results
| Segment | Sales | Organic growth | Segment profit | Margin |
|---|---|---|---|---|
| Building Automation | $2,020M (+8%) | +8% | $546M (+9%) | 27.0% (+30 bps) |
| Process Automation & Technology | $1,859M (+16%) | +8% | $412M (+6%) | 22.2% (−210 bps) |
| Industrial Automation | $1,115M (−23%) | +4% | $205M (−5%) | 18.4% (+350 bps) |
In Building Automation, building products grew 11%, led by fire and security, and building solutions grew 4%. In Process Automation & Technology, project sales grew 14%, led by LNG and petrochemicals, and aftermarket grew 4%; the margin decline reflected project mix and dilution from the Johnson Matthey Catalyst Technologies acquisition. In Industrial Automation, solutions grew 16% and products were flat, as utility meter deployment deferrals offset double-digit sensing growth. The segment's reported sales decline reflects divestitures.
Raised 2026 outlook
| Item | Previous | Current | Consensus |
|---|---|---|---|
| Sales | $19.8B–$20.0B | $20.0B–$20.1B | $20.13B |
| Organic growth | 3%–4% | 4%–5% (Q4: 5%–6%) | — |
| Segment margin | 20.1%–20.5% | About 20.5% | — |
| Adjusted EPS | $8.05–$8.35 | $8.40–$8.45 | $8.30 |
| Operating cash flow | About $2.1B | About $2.1B | — |
| Free cash flow | About $2.0B | About $2.1B | — |
The adjusted EPS midpoint rose $0.23, to $8.425 from $8.20, and sits about 1.5% above the consensus, by our calculation. The sales range midpoint of $20.05 billion is about 0.4% below the $20.13 billion consensus, by our calculation, which is why the revenue guide reads as light even though it was raised. Segment margin is now expected to expand about 290 basis points, and adjusted EPS to rise 30%–31%.
Capital deployment
Honeywell repurchased no shares in the third quarter and $1.0 billion year to date, compared with $3.70 billion in the first nine months of 2025. It paid $1.74 billion in cash for acquisitions in the quarter, received $1.45 billion in divestiture proceeds and paid $240 million in dividends. Free cash flow conversion was 95%.
Sources: Honeywell Technologies Q3 2026 results release, with consensus estimates as shown in the summary supplied. This is informational, not a recommendation to buy or sell.
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