Honeywell Sees Growth Ahead as It Prepares for 2026 Breakup

Honeywell delivered solid Q3 2025 results despite volatile markets. The company continues to reshape itself ahead of its planned 2026 split into three focused entities — including an automation pure-play.

Q3 2025 Snapshot

Honeywell reported $10.4 billion in sales, up 6% organically year over year.
Building automation reached $1.88 billion, growing 7% organically.
Energy and sustainability solutions slipped 2% to $1.74 billion.

Reshaping the Portfolio

Honeywell is deep into its portfolio transformation.
It will separate into three companies by mid-2026.
The Solstice Advanced Materials spinoff comes first in early 2026.
Then Aerospace Technologies will follow.

The RemainCo will focus on automation, combining building, process, and industrial automation into three cohesive segments.
Honeywell said each unit will align with its “automation pure-play” vision.
In July, the company began reviewing its productivity and warehouse solutions businesses within industrial automation.

Industrial Automation Returns to Growth

Industrial automation edged back into growth this quarter.
Warehouse automation and sensing fueled the rebound.
Sensing grew 6%, driven by strong healthcare demand.
Warehouse and workflow solutions rose 2%.

However, process solutions stayed flat, while productivity solutions and services dropped 3%.
Honeywell noted margin pressure from inflation and weak product mix.
It expects low single-digit losses in 2025 but sees upside if market conditions stabilize.

CEO Vimal Kapur expressed confidence:
“Our automation portfolio delivers mission-critical reliability and long-term growth tied to reshoring trends,” he said.

Building Automation Keeps Rising

Building automation remains a bright spot.
Q3 marked its fourth straight quarter of organic growth.
Fire systems led the charge with double-digit gains.

Orders climbed 10%, boosted by demand from data centers, healthcare, and hospitality.
North America and the Middle East led geographically.

In October, Honeywell partnered with LS Electric to develop power management systems for data centers.
Earlier this year, it launched Connected Solutions, an AI-powered platform that unifies building control under one interface.

Yet challenges remain. A cybersecurity firm recently exposed vulnerabilities in Honeywell’s Niagara Framework, a separate platform.

Sustainability Segment Faces Pressure

Honeywell’s $2.2 billion acquisition of Sundyne expanded its sustainability reach.
But the segment struggled in Q3, with a 2% organic sales decline.
The UOP unit fell 13%, hit by a weak energy market.

Advanced materials grew 5%, supported by strong refrigerant demand.
UOP’s order book improved, hinting at recovery ahead.

CFO Mike Stepniak said, “Energy headwinds weigh on near-term results, but the long-term outlook remains strong.”

Looking Ahead

Honeywell remains focused on executing its 2026 transformation.
Its future “RemainCo” aims to become a global automation powerhouse, blending software, services, and control technologies for the built environment.