Honeywell (NASDAQ: HON) has revealed its financial results for the fourth quarter and full year 2024, surpassing or aligning with its revised full-year expectations. The company also provided its forecast for 2025 and disclosed a major strategic shift, outlining plans for the full separation of its Automation and Aerospace divisions.
For Q4, Honeywell reported a 7% year-over-year increase in sales, with organic sales growing 2%, or 6% excluding the effects of the Bombardier agreement. The company’s backlog hit a record $35.3 billion, marking an 11% growth. Earnings per share (EPS) for Q4 were $1.96, reflecting a 3% increase from the previous year, while adjusted EPS was $2.47, down 8% but above expectations, or up 9% excluding the Bombardier agreement. Operating income saw a 10% rise, and operating margin expanded by 50 basis points to 17.3%.
For the full year, Honeywell saw a 5% increase in sales, with organic growth of 3%, or 4% excluding the Bombardier agreement. Operating income grew 5%, and EPS for 2024 reached $8.71, up 3% from the prior year. Adjusted EPS increased 4% to $9.89, or 9% to $10.34 excluding the impact of the Bombardier deal.
Vimal Kapur, Chairman and CEO of Honeywell, said, “We finished the year strong, exceeding the high end of our sales and adjusted EPS guidance despite a challenging environment. 2024 was also a pivotal year in portfolio optimization, as we completed strategic acquisitions, divestitures, and laid the groundwork for significant growth in 2025.”
Honeywell’s 2025 outlook includes projected sales between $39.6 billion and $40.6 billion, with organic sales growth between 2% and 5%. Adjusted EPS for 2025 is expected to range from $10.10 to $10.50, up 2% to 6%. Operating cash flow is forecast to be between $6.7 billion and $7.1 billion, with free cash flow ranging from $5.4 billion to $5.8 billion.
In a separate announcement, Honeywell revealed that its Board of Directors concluded a comprehensive review of the company’s portfolio and plans to fully separate its Automation and Aerospace divisions. This move, along with the planned spin-off of the Advanced Materials business, will result in three independent publicly traded companies by 2026, each pursuing its own growth strategy. Kapur noted, “This strategic shift enables each of these businesses to thrive with focused growth plans, creating significant value for our shareholders and customers.”
In the Aerospace Technologies segment, sales saw a modest organic increase of 1%, driven by strong performance in the commercial aftermarket and defense & space sectors. However, the segment’s margin experienced a significant decline of 780 basis points, largely due to challenges arising from the Bombardier agreement, as well as inflation and rising cost pressures.
The Industrial Automation segment posted flat organic sales, though process solutions experienced growth. Orders rose by 7%, reflecting positive demand in the market. Despite this, the segment’s margin declined by 200 basis points, impacted by inflation and asset write-downs that affected profitability during the quarter.
Building Automation demonstrated strong growth, with an 8% increase in organic sales, particularly driven by solid performances in North America and the Middle East. The segment margin improved by 250 basis points to 26.8%, thanks to productivity improvements and the positive impact of a recent acquisition, which helped offset some external pressures.
Energy and Sustainability Solutions saw a slight 1% growth in organic sales, with UOP leading this expansion. However, the segment margin contracted by 180 basis points, primarily due to inflationary pressures and changes in volume within advanced materials, which somewhat dampened profitability for the quarter.
During Q4, Honeywell signed a strategic deal with Bombardier, valued at $17 billion over its lifespan. The agreement focuses on providing avionics, propulsion, and satellite communications technologies for Bombardier’s aircraft, a move expected to drive long-term growth despite its short-term impact on Honeywell’s financial results.
Honeywell is a globally integrated company serving diverse industries across multiple regions. Our business is driven by three key megatrends—automation, the future of aviation, and energy transition—supported by the Honeywell Accelerator operating system and the Honeywell Connected Enterprise software platform.
As a trusted partner, we tackle the world’s most complex challenges, delivering innovative and practical solutions that enhance efficiency, safety, and sustainability. Our technology and expertise help organizations navigate evolving industry demands while shaping a smarter, safer, and more sustainable future.
