Honeywell lifts 2025 profit outlook despite Solstice spinoff on sturdy demand

By Utkarsh Shetti (Reuters) -Honeywell on Thursday raised its 2025 profit forecast despite the impact of a planned separation of its advanced materials unit, signaling robust growth prospects fueled by strong aerospace demand, sending its shares up nearly 5% in premarket trading. The business, now named Solstice, is set to start trading independently on the Nasdaq from October 30 and is part of Honeywell's plan to split into three independent companies. The Charlotte, North Carolina-based company also surpassed Wall Street expectations for its third-quarter results. Aerospace suppliers are enjoying robust demand for parts, benefiting from planemakers ramping up production at a time of booming new jet demand. An existing shortage of new jets has also bolstered the company's maintenance and repair services, as airlines are forced to fly older, cost-intensive aircraft. Honeywell now expects full-year adjusted earnings per share between $10.60 and $10.70, which includes a 21 cent hit from the Solstice separation. It previously expected between $10.24 and $10.44, also adjusted for the spinoff. The aerospace business, its biggest revenue driver, saw sales rise 15% to $4.51 billion in the third quarter, as supply chain snags also appeared to ease. That unit is also set to be carved out from Honeywell in the second half of 2026, with the remaining company focusing on its automation businesses. What is left of Honeywell will be led by current CEO Vimal Kapur, who can now turn his attention on sprucing up the industrial automation business, which has been a drag on results of late. In the reported quarter, the business saw sales decline 9% to $2.27 billion, weighed down by higher costs and slowing demand. Honeywell reported overall sales of $10.41 billion in the quarter, up 7%, and above analysts' average estimate of $10.14 billion, per data compiled by LSEG. Its adjusted profit per share came in at $2.82, also surpassing expectations of $2.57. (Reporting by Utkarsh Shetti in Bengaluru; Editing by Shailesh Kuber)

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