The News: Honeywell’s revenue increased by six percent in the third quarter of 2022 to $8.95 billion, up from $8.47 billion one year ago, as the aerospace, defense, building technologies, performance materials and safety, and productivity products giant unveiled its latest earnings figures on September 30. Read the full Press Release from Honeywell website.
Honeywell Revenue Hits $8.95B in Q3 2022, Up 6% from Q3 2021
Analyst Take: Honeywell’s revenue for Q3 2022 again climbed, this time to $8.95 billion from $8.47 billion one year ago, as the diversified category-leading company continues to find success in a still challenging global marketplace.
We are impressed with Honeywell’s strong performance for Q3, which shows that the company is doing all the right things to manage itself through the lingering and challenging macroeconomic conditions exhibited around the world. We are particularly impressed with the company’s growth in the valuable and lucrative industrial technology space, where it holds a leadership position with its broad and important product portfolio.
Here are Honeywell’s revenue and other results for Q3 2022 by the numbers:
- Q3 2022 revenue of $8.95 billion, up six percent from $8.47 billion one year ago. The revenue figure was just below analyst consensus estimates of $8.98 billion for the quarter from analysts with Yahoo Finance.
- Q3 2022 basic earnings per share (EPS) of $2.30, up 27 percent from $1.82 per share one year ago. The EPS beat analyst consensus estimates of $2.16 per share from Yahoo Finance.
- Q3 2022 net income of $1.55 billion, up 21 percent from $1.27 billion one year ago.
- Q3 2022 operating income of $1.74 billion, up 11 percent from $1.58 billion one year ago.
- Q3 2022 operating income margin of 19.5 percent, compared to 18.6 percent one year ago.
- Q3 2022 operating cash flow of $2.08 billion. Up 86 percent from $1.1 billion one year ago.
Daniel Newman and his co-host of The Six Five Webcast, Patrick Moorhead of Moor Insights and Strategy, discussed the recent Honeywell earnings in their latest episode. Check it out here and be sure to subscribe to The Six Five Webcast so you never miss an episode.
Honeywell Revenue by Business Segments
By business units, Honeywell’s revenue increases in Q3 were healthy as well. Revenue for the aerospace division rose to $2.97 billion, up 8.9 percent from $2.73 billion one year ago, while the Honeywell Building Technologies unit brought in $1.5 billion in revenue, up 11 percent from $1.37 billion a year ago. The Performance Materials and Technologies unit saw revenue increase by 8.6 percent to $2.7 billion, up from $2.5 billion one year ago. The Honeywell Safety and Productivity Solutions unit saw revenue fall by seven percent to $1.7 billion, down from $1.86 billion one year ago.
Sales in the aerospace division in Q3 rose 10 percent over the same quarter in 2021 on an organic basis, led by growth in commercial aviation. In Honeywell’s commercial aftermarket segment, demand remained strong as flight hours continued to recover, the company said, with sales growing organically by more than 20 percent in the air transport aftermarket and in the business and general aviation aftermarket. In the commercial original equipment category, sales increased 30 percent for Q3 compared to one year ago, driven by higher demand from air transport customers. At the same time, higher commercial aviation sales were partially offset by lower defense volumes, according to Honeywell.
In the Honeywell Building Technologies unit, Q3 sales rose 19 percent on an organic basis compared to one year ago, which included 23 percent organic sales growth in the company’s building products portfolio. Its building solutions unit also grew double digits organically in the quarter. This area has been a high performer for the company and looks to be a long term moat for the Honeywell as businesses and government seek to utilize building data to deliver more sustainable buildings as well as healthier environments for workers and consumers.
Q3 sales in the Performance Materials and Technologies unit rose 14 percent on an organic basis compared to 2021, despite lost sales to Russia due to the war in Ukraine. Advanced materials sales led the growth by more than 30 percent organically, according to Honeywell. Refining catalyst shipments and thermal solutions sales were both up by double digits in the quarter.
Sales for the Safety and Productivity Solutions unit in Q3 fell by four percent on an organic basis since the same quarter in 2021, while sales for advanced sensing and gas detection products were offset by lower sales of warehouse and workflow solutions and personal protective equipment.
Honeywell’s backlog for Q3 stands at $29.1 billion, which up nine percent from a year ago.
Honeywell Guidance for Full Year 2022 Earnings
Also provided in Honeywell’s revenue and earnings numbers for Q3 2022 was guidance for the company’s performance through the rest of 2022.
Full-year sales are now expected to be in the range of $35.4 billion to $35.7 billion, up six percent to seven percent organically, while adjusted earnings per share is expected to be in the range of $8.70 to $8.80 per share. Operating cash flow is expected to be between $5.2 billion to $5.6 billion, while free cash flow is expected to be between $4.7 billion to $5.1 billion.
Our Overview for Honeywell
So, where is Honeywell at the end of three quarters of business in 2022?
We believe that this is a well-managed and diversified company with sustained growth, positive financial results, and a product and segment portfolio built for continuing sales gains and industrial market specialization.
Honeywell’s guidance for the rest of 2022 provides more proof of that progress, due to its impressive industrial growth and a detailed, well-executed market playbook that will continue to lead this company’s executive team to further successes in the marketplace.
As we have for more than a year, we will continue to closely follow Honeywell’s innovations and investments as it further drives its goals of helping enterprise customers transform their businesses through digital transformation — especially at the edge and in heavy industries like aerospace, manufacturing, construction, and public sector. This is a company with a mission, with deep expertise, and with solid products and services that can make things happen.
Disclosure: Futurum Research is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.
Analysis and opinions expressed herein are specific to the analyst individually and data and other information that might have been provided for validation, not those of Futurum Research as a whole.
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Author Information
Daniel is the CEO of The Futurum Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise.
From the leading edge of AI to global technology policy, Daniel makes the connections between business, people and tech that are required for companies to benefit most from their technology investments. Daniel is a top 5 globally ranked industry analyst and his ideas are regularly cited or shared in television appearances by CNBC, Bloomberg, Wall Street Journal and hundreds of other sites around the world.
A 7x Best-Selling Author including his most recent book “Human/Machine.” Daniel is also a Forbes and MarketWatch (Dow Jones) contributor.
An MBA and Former Graduate Adjunct Faculty, Daniel is an Austin Texas transplant after 40 years in Chicago. His speaking takes him around the world each year as he shares his vision of the role technology will play in our future.
