Honeywell: ‘Building Automation leading the way’

CHARLOTTE, N.C.—Honeywell CEO Vimal Kapur credited the Building Automation segment as the catalyst for the company’s $10.4 billion in sales in the second quarter, an 8% increase year over year. 

"With Building Automation leading the way, three out of four segments grew sales at better than 5% in the quarter, demonstrating the power of our Accelerator operating system to adapt quickly and drive growth even as business conditions change,” Kapur told investors. “During the quarter, we also saw promising results from our increased focus on new product innovation, which further supported the growth of our record backlog.”   

Honeywell raises outlook for Building Automation 

As a result, Honeywell is raising its 2025 sales outlook in Building Automation for the second consecutive quarter. With second-half prospects improving from April given “solid order trends,” Senior VP and Chief Financial Officer Mike Stepniak projects mid-single-digit to high-single-digit organic sales growth in the segment.  

Strategic turnaround: Focus on high-growth verticals 

One investor asked Kapur about Building Automation’s impressive turnaround” over the past year, and what company-specific actions Honeywell has taken to drive that turnaround. Kapur cited a three-pronged strategy that Honeywell plans to officially unveil in late 2026.  

“First is how we make our mix toward higher growth verticals,” he said. “So, in the case of buildings, we are focused on three or four markets - hospitals, hotels, data centers, airports in high-growth regions. Action 2 is mining an installed base. We have a large installed base - how we mine it higher and deliver high single-digit growth in services. And finally, the new product acceleration - we have elevated R&D even in Building Automation, and they are the most ahead in delivering higher growth with new products.”  

Tuck-in acquisition boosts presence in data center end markets 

Kapur also touched on how Honeywell’s July 1 acquisition of Li-ion Tamer, a provider of off-gas detection solutions for lithium-ion batteries that detect thermal runaway events, enhances the company's building automation capabilities.  

“(The) tuck-in acquisition of Li-ion Tamer enhances our building automation capability in high-growth energy storage and data center end markets,” he said. “While such smaller deals do not often get much investor attention, in aggregate, they can accelerate our strategic road map and boost growth with a lower risk profile.” 

Restructuring and future growth strategy 

In addition, Kapur provided an update to investors on the continued companywide restructuring, while announcing that Honeywell is “in position” to deliver strong sales profit and cash flow growth in 2025.  

“As our business leaders have been solely focused on meeting and exceeding our financial commitment, management and the board have been fulfilling our promise to transform our portfolio ahead of our upcoming separation to best position each of the future independent company’s success,” he stated. “We continue to make great progress along with the path to separate into three independent companies. As independent entities with clear alignment and purpose, increased organization agility and customized capital allocation priorities, each will be better positioned to accelerate future growth opportunities.”