Honeywell International Inc. (NASDAQ:HON) reported strong third-quarter 2026 results as a standalone pure-play automation company, exceeding internal targets with broad-based organic growth and margin expansion. Net sales reached $5.0 billion, up 1% reported and 7% organically, driven by demand across all segments. Adjusted earnings per share (EPS) increased 34% to $2.27, supported by higher segment profit and organic sales growth.
The company's Building Automation segment saw 8% organic growth, led by an 11% increase in building products, particularly in fire and security. Process Automation and Technology (PA&T) also grew 8% organically, fueled by a 14% rise in project sales for LNG and petrochemicals. Industrial Automation achieved 4% organic growth, with a 16% increase in solutions despite flat product sales in sensing and utilities.
Honeywell's segment margin expanded by 370 basis points to 21.3%, thanks to productivity and strategic pricing actions. The backlog neared $19 billion, up 7% year over year excluding divestitures, while free cash flow increased 15% to $688 million with a 95% conversion rate. The company raised its full-year 2026 guidance, projecting sales of $20.0 billion to $20.1 billion and organic growth of 4% to 5%, up from previous expectations.
CEO Vimal Kapur highlighted the company's successful transformation, noting that the first quarter as a standalone pure-play automation company demonstrated the value creation strategy outlined in June. CFO Michal Stepniak cautioned about persistent inflationary pressures and mix headwinds from higher project growth, which could impact segment margins. Despite these challenges, Honeywell remains optimistic about its growth prospects, particularly in low-carbon energy projects and international data center expansion.