AI Takeaway
Honeywell (HON) delivered FY2025 revenue growth of 7.8% to $37.4B, but net income fell 17.1% to $4.7B, pressured by higher costs, a 24.6% surge in R&D spending, and a significant decline in stockholders' equity amid aggressive share buybacks.
Revenue
$37.44B
++7.85% YoY
EPS (Basic)
$7.40
-15.53% YoY
Gross Margin
9.3%
-0.42% YoY
Operating Income
$8.13B
++6.00% YoY
Filed · Analysis updated · Source: SEC EDGAR 10-K filing
HON grew total revenue 7.8% year-over-year to $37.4B in FY2025 (vs. $34.7B in FY2024), reflecting continued demand across its diversified industrial portfolio. This top-line expansion outpaced the prior year's growth trajectory.
Source: Source: 10-K Income Statement
Despite operating income rising 6.0% to $8.1B, net income fell 17.1% to $4.7B (from $5.7B), suggesting significant below-the-line headwinds such as higher interest expense on $29.0B in long-term debt and/or tax-related items.
Source: Source: 10-K Income Statement & Balance Sheet
R&D expense jumped 24.6% year-over-year to $1.8B in FY2025, indicating Honeywell is meaningfully accelerating investment in new technologies and product development, which pressured margins in the near term.
Source: Source: 10-K Income Statement
2 more insights available
Upgrade to unlockLong-term debt increased 8.3% to $29.0B in FY2025, while stockholders' equity fell 25.3% to $13.9B, implying a materially higher debt-to-equity ratio. Rising interest obligations likely contributed to the 17.1% net income decline despite solid operating performance, and any further rate increases or refinancing needs could amplify this pressure.
Source: Source: 10-K Balance Sheet & Income Statement
Unlock 4 more detailed risk analysis
Upgrade to unlockReported EPS of $2.59 versus the $2.57 analyst consensus — a +1.0% beat for FY2025.
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $37.44B | $34.72B | +7.85% |
Cost of Revenue | $23.61B | $21.36B | +10.55% |
Gross Profit | $3.47B | $3.37B | +3.12% |
Operating Income | $8.13B | $7.67B | +6.00% |
Net Income | $4.73B | $5.71B | -17.11% |
EPS (Basic) | $7.40 | $8.76 | -15.53% |
EPS (Diluted) | $7.36 | $8.71 | -15.50% |
R&D Expense | $1.81B | $1.45B | +24.62% |
SG&A Expense | $5.45B | $5.24B | +4.11% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $73.68B | $75.2B | -2.01% |
Current Assets | $30.39B | $27.91B | +8.88% |
Current Liabilities | $23.41B | $21.26B | +10.15% |
Stockholders' Equity | $13.9B | $18.62B | -25.32% |
Cash & Equivalents | $12.49B | $9.91B | +26.05% |
Long-Term Debt | $29.05B | $26.83B | +8.28% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $6.41B | $6.1B | +5.10% |
Investing Cash Flow | $-2.71B | $-10.16B | +73.31% |
Financing Cash Flow | $-1.95B | $6.84B | -128.56% |
Share Buybacks | $3.8B | $1.66B | +129.85% |
D&A | $1.39B | $1.15B | +20.38% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Gross Margin | 9.3% | 9.7% | -0.42% |
Operating Margin | 21.7% | 22.1% | -0.38% |
Net Margin | 12.6% | — | — |
ROE | 34.0% | — | — |
ROA | 6.4% | — | — |
Current Ratio | $1.298 | — | — |
Other companies in Industrial Conglomerates
Honeywell grew FY2025 revenue 7.8% to $37.4B, but net income fell 17.1% to $4.7B due to rising costs and higher interest expense. Diluted EPS declined 15.5% to $7.36 from $8.71 in the prior year.
HON's net income fell 17.1% to $4.7B even as operating income rose 6.0% to $8.1B, suggesting significant below-the-line headwinds such as higher interest costs on $29.0B of long-term debt. Additionally, cost of revenue grew 10.5% — faster than revenue — and R&D spending surged 24.6% to $1.8B, all compressing profitability.
HON ended FY2025 with $12.5B in cash (up 26.1%) and $6.4B in operating cash flow, reflecting solid liquidity. However, long-term debt stands at $29.0B and stockholders' equity declined 25.3% to $13.9B due to $3.8B in share buybacks, resulting in a leveraged balance sheet with a debt-to-equity ratio of approximately 2.1x.
Yes, Honeywell more than doubled its share repurchases to $3.8B in FY2025, compared to $1.7B in FY2024 — a 129.8% increase. This aggressive capital return contributed to the 25.3% decline in stockholders' equity and helped partially offset the EPS impact of lower net income.
Key risks include elevated financial leverage with $29.0B in long-term debt and a declining equity base, gross margin compression as cost of revenue grew faster than revenue (10.5% vs. 7.8%), and the near-term earnings drag from a 24.6% surge in R&D spending to $1.8B. These factors collectively pressured net income and margins in FY2025.