Honeywell to Split into Three Publicly Traded Companies by 2026

Honeywell

The Move Will Create Three Distinct Entities Focused on Aerospace, Automation, and Advanced Materials

US-based engineering giant Honeywell announced plans to split into three independent publicly traded companies by the end of 2026. The decision marks a major shift in the company’s structure, with each new entity focusing on a different industry segment, including automation, aerospace, and advanced materials.

Honeywell Automation: The Largest Entity Focused on Industrial Automation

Honeywell Automation will be the largest of the three new companies, expected to generate $18 billion in revenue in 2024. This segment will continue its emphasis on automating industrial processes, with a focus on technological innovations that streamline operations across various sectors.

The company aims to expand its reach in the automation space, which is seeing rapid growth due to increasing demands for efficiency in industrial production. Honeywell Automation's size and revenue projections underline its dominant role in this evolving market.

Honeywell Aerospace: A Pure-Play Aerospace Technology Provider

The second company, Honeywell Aerospace, will operate as a pure-play aerospace technology and components supplier. It is expected to generate $15 billion in revenue in 2024. Honeywell Aerospace has a rich history, having delivered 72,000 engines since 1959. The division is currently focused on providing software and components for business jets, which is a growing market segment.

The aerospace sector remains a critical pillar of Honeywell’s portfolio, and the company’s emphasis on innovation in aerospace technology will likely continue to drive revenue growth. This division will now operate independently, allowing for more targeted investments and strategic growth in the aerospace field.

Honeywell Advanced Materials: A Focus on Sustainability and Innovation

The third company, Honeywell Advanced Materials, will focus on manufacturing chemicals and materials, including metals and composites, with a sustainability-driven approach. The division earned $4 billion in revenue in 2024 and will continue to drive advancements in materials science.

Honeywell plans to spin off Advanced Materials by the end of 2025 or early 2026, creating an entity that is dedicated to meeting growing global demand for sustainable materials, particularly in the fields of energy, construction, and manufacturing. This move will allow the division to focus solely on creating and supplying innovative materials for industries aiming to reduce their environmental footprint.

Financial Outlook and Industry Response

Honeywell forecasts revenues of $39.6 billion to $40.6 billion for 2025, reflecting a potential 5% increase from its 2024 results. The company’s total sales reached $38.5 billion in 2024, up from $36.7 billion in 2023. Aerospace sales rose by 13% to $15.46 billion in 2024, while building automation grew by 8% to $6.54 billion. However, industrial automation saw a 7% decline, with total sales falling to $10.05 billion.

Despite fluctuations in its industrial automation sector, Honeywell’s overall performance reflects growth in key areas, particularly in aerospace and building automation. The upcoming restructuring is expected to allow each division to target its core markets more effectively, potentially driving further growth.