Honeywell raised its financial outlook Thursday after posting higher sales and earnings in the second quarter of the year.
But declining margins in the latest quarter reportedly promoted a drop in the company’s stock price.
The company reported $10.4 billion in quarterly sales, an increase of 8% compared to the same period last year. Organic sales were up 5%, and the company also posted a 7% increase in operating income and an 8% increase in segment profit.
Operating margin and segment margin, however, were down by 30 basis points and 10 basis points, respectively, and free cash flow declined by 9% year-over-year.
Earnings came in up 4% at $2.45 per share.
Honeywell Chairman and CEO Vimal Kapur touted “outstanding results” in the company’s earnings release, and noted organic growth and adjusted earnings “exceeding guidance despite the unpredictable macroeconomic backdrop.”
The company said that it now expects full-year sales of between $40.8 billion and $41.3 billion, up from the earlier forecast of $39.6 billion to $40.5 billion. Adjusted earnings also saw a higher outlook, but Honeywell maintained its outlook for cash flow and curbed its projections for segment margin.
The longtime conglomerate is preparing to split into three separate companies next year. It recently sold its PPE business to PIP in a deal worth $1.3 billion.
