Honeywell Q1 Results: Sales Rise, Profit Falls

Honeywell International Inc. (HON) reported on April 23, 2026, that its Q1 sales rose while reported profit declined due to restructuring and separation-related charges. Management also highlighted Middle East shipping disruptions that will reduce second-quarter revenue.

Quarter Results and Restructuring Charges

Honeywell’s first-quarter sales reached $9.1 billion, up 2% year over year on both a reported and organic basis, driven by pricing, new products, and demand in building and industrial automation. This fell short of analysts’ estimate of about $9.3 billion. Orders increased 7% organically, pushing the backlog to roughly $38 billion, a 2% sequential rise.

Reported earnings per share were $1.29, down 35% from a year earlier, while net income fell 43.3% to $821 million. Adjusted EPS rose 11% to $2.45, exceeding the $2.32 estimate. The company attributed the decline in reported EPS to separation-related charges and restructuring costs.

Operating income dropped 14%, and the operating margin narrowed by 320 basis points to 16.1%. Segment profit increased 6% to $2.1 billion, with segment margin improving to 23.3% excluding items. Free cash flow was about $100 million, pressured by timing and collections affected by the regional conflict.

Separation-related charges included a $239 million loss on debt extinguishment, a $263 million asset impairment tied to businesses held for sale, and $314 million in divestiture costs. These followed $15.8 billion in pre-separation funding and tender activity.

Honeywell announced the all-cash sale of its Warehouse & Workflow Solutions unit to American Industrial Partners and a separate agreement to sell its Process Solutions business to Brady Corp. for $1.4 billion in cash, adding about $1.1 billion in sales.

Outlook and Supply-Chain Impact

Despite these charges and operational headwinds, Honeywell reaffirmed its full-year 2026 guidance for sales between $38.8 billion and $39.8 billion and adjusted EPS of $10.35 to $10.65. Management said Middle East shipping delays reduced first-quarter revenue by roughly 1% and will soften second-quarter sales more than previously expected.

The company plans to complete the spin-off of its Aerospace business on June 29, 2026, following the announced divestitures and separation financing steps already underway. Honeywell is aligning its adjusted results and portfolio moves as it prepares for that separation.