Honeywell Boosts 2025 EPS Forecast to $10.65 on Aerospace Surge Despite Automation Slump

Honeywell (NASDAQ: HON) just gave a bullish nod to its aerospace segment, lifting full-year 2025 earnings and revenue projections thanks to steady demand for aircraft components and maintenance.

The industrial conglomerate outperformed Wall Street's Q2 expectations, delivering strong top-line growth primarily driven by its aerospace division, which saw sales jump 10.7% to $4.31 billion. That's no small feat considering the ongoing supply chain bottlenecks that have plagued the industry for years.

Airlines are sticking with aging fleets amid a shortage of new jets, keeping Honeywell's maintenance, repair, and overhaul services in high gear. Also, plane manufacturers like Boeing (NYSE: BA) and Airbus continue to ramp up production, which bodes well for Honeywell's avionics and flight control system units.

Following this momentum, Honeywell has raised its 2025 adjusted EPS forecast to a range of $10.45-$10.65, up from the prior $10.20-$10.50. Revenue guidance was nudged higher as well, now expected between $40.8 billion and $41.3 billion, compared to the $39.6 billion-$40.5 billion range announced earlier.

CEO Vimal Kapur is pushing ahead with a transformation plan, trimming down the company portfolio to focus more tightly on high-margin businesses. The aerospace segment is set to be spun off, leaving Kapur at the helm of Honeywell's automation division.

That automation unit, covering productivity solutions and warehouse workflow, has struggled lately-the sales in that segment dropped 5% in Q2, dragging on overall profitability. Honeywell is actively exploring strategic moves for these units, which haven't lived up to expectations.

Total Q2 sales across the board hit $10.35 billion, comfortably beating the analyst consensus of $10.07 billion. Adjusted earnings per share clocked in at $2.75, ahead of estimates calling for $2.66.

While aerospace remains the clear star of the show, the mixed performance in industrial automation highlights the balancing act Honeywell faces as it transitions into a leaner, more focused player.

With the market reacting modestly-shares edged up about 1.5% in premarket trades-there's a question hanging: Can Honeywell keep capitalizing on the aerospace upswing long enough to fully shake off the legacy drag from its other divisions?