01—Abstract
Summary
Summary of the 10-Q filed October 23, 2025. Cited figures are marked; the original filing is the authoritative source.
Honeywell International Inc. (HON) reported strong financial results for the third quarter and nine months ended September 30, 2025.
Net sales increased by 7%a in the third quarter and 8% year-to-date, driven by a combination of higher pricing to offset inflation, increased sales volumes, and favorable foreign currency translation. The company also saw a significant boost in net income, largely attributable to a substantial gain from the termination of the Resideo indemnification and reimbursement agreement, which significantly offset increased divestiture-related costs and adjustments to environmental liabilities. The company is actively managing its portfolio through strategic acquisitions, including the pending acquisition of Johnson Matthey's Catalyst Technologies business, and divestitures, such as the recent sale of its PPE business.
Furthermore, Honeywell is progressing with its plan to separate into three independent public companies, with the spin-off of its Advanced Materials business expected by October 30, 2025. Despite inflationary pressures and supply chain challenges, Honeywell's proactive mitigation strategies have helped to minimize disruptions, and the company maintains a strong liquidity position with substantial cash reserves and access to credit facilities.
02—Key points
Key Highlights
- Net sales increased by 7% year-over-year to $10.4 billion in Q3 2025 and by 8% year-over-year to $30.6 billion year-to-date.
- Net income attributable to Honeywell increased significantly to $1.825 billion in Q3 2025, a 29% increase year-over-year, driven by a $0.8 billion gain from the Resideo termination agreement.
- Diluted EPS grew to $2.86 in Q3 2025, up from $2.16 in Q3 2024, with the Resideo gain contributing $1.23 per share (after tax).
- The company is undergoing significant portfolio transformation with the planned spin-off of its Advanced Materials business (Solstice) by October 30, 2025, and the ongoing separation of its Automation and Aerospace Technologies businesses.
- Aerospace Technologies segment showed robust growth with a 15% increase in net sales in Q3 2025, driven by strong performance in Commercial Aviation Aftermarket and Defense and Space.
- The company reported a substantial increase in cash and cash equivalents, totaling $12.9 billion as of September 30, 2025, supported by strong operating cash flows and strategic financial activities.
- Goodwill increased by $1.9 billion year-to-date to $23.7 billion, primarily due to acquisitions such as Sundyne and Air Products' LNG business.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2025, Honeywell International kept $0.37.
- Revenue$4.93B100.0%
- Cost of revenue−$1.70B34.4%
- Gross profit$3.23B65.6%
- Operating costs−$2.37B48.0%
- Operating income$866.0M17.6%
- Interest, other & tax$959.0M19.5%
- Net income$1.82B37.0%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2025filed October 23, 2025Financial Statements
Q3 FY2025 against Q3 FY2024
| Line item | Q3 FY2025Q3 FY2024 | Change |
|---|---|---|
| Revenue | $4.93B$8.82B | −44.1% |
| Cost of Revenue | $3.15B$5.98B | −47.2% |
| Gross Profit | $3.23B$3.42B | −5.4% |
| R&D Expenses | $268.00M$368.00M | −27.2% |
| SG&A Expenses | $1.09B$1.40B | −21.8% |
| Operating Income | $866.00M$2.30B | −62.3% |
| Net Income | $1.82B$1.41B | +29.2% |
| EPS (Basic) | $5.74$2.17 | +164.5% |
| EPS (Diluted) | $5.71$2.16 | +164.4% |
| Shares Outstanding (Basic) | 317.70M650.40M | −51.2% |
| Shares Outstanding (Diluted) | 319.40M654.10M | −51.2% |
05—Questions
Frequently Asked Questions
What are the key drivers of Honeywell's sales growth in the third quarter of 2025?
Honeywell's net sales increased by 7% year-over-year to $10.4 billion in the third quarter of 2025. This growth was driven by a combination of increased pricing to offset inflation, higher sales volumes across various segments, and a favorable impact from foreign currency translation due to the weakening U.S. dollar against the euro.
How did the Resideo indemnification and reimbursement agreement termination impact Honeywell's earnings?
The termination of the Resideo indemnification and reimbursement agreement resulted in a significant one-time cash payment of $1.59 billion to Honeywell. This generated a pre-tax gain of $802 million, which substantially boosted net income and earnings per share for the third quarter and year-to-date periods. This gain helped offset other factors like increased divestiture-related costs and environmental liability adjustments.
What are Honeywell's strategic portfolio changes and their expected impact?
Honeywell is actively reshaping its portfolio. Key actions include the planned spin-off of its Advanced Materials business (Solstice) by October 30, 2025, and the ongoing separation of its Automation and Aerospace Technologies businesses into independent companies. These strategic moves are aimed at simplifying the business structure, enhancing focus on core strengths, and ultimately creating shareholder value.
What is the current status of Honeywell's debt and liquidity?
As of September 30, 2025, Honeywell's total borrowings increased to $37.0 billion. However, the company maintains a strong liquidity position with $12.9 billion in cash and cash equivalents. It has access to credit facilities and is managing its debt strategically to fund acquisitions and other corporate needs, while also returning capital to shareholders through dividends and share repurchases.
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