Q2 2026 Honeywell Aerospace Inc Earnings Call Transcript
Key Points
- Record selectable equipment win with Indigo for over 800 Airbus A320 aircraft, expanding content in a fast-growing market.
- Strong demand across all end markets, with orders up 8% year-over-year and a book-to-bill of 1.1.
- Continued momentum in commercial aftermarket, with 8% growth driven by robust business aviation flight hours.
- International defense orders up strong double-digit with a book-to-bill of 1.5, providing a strong runway for future growth.
- Reiterated 2030 targets, with confidence in 2027 growth driven by supply chain investments and output recovery.
- Supply chain constraints persist, with output growth only 4% in Q2, below expectations, leading to a guidance cut.
- Revised 2026 organic sales growth down to 4-5% from prior guidance, with EBIT reduced by $300 million at midpoint.
- Inventory obsolescence charge of $50 million in Q2, primarily in Engine and Power Systems, impacting margins.
- Mix shift towards lower-margin OE and domestic defense, away from higher-margin aftermarket and international defense, pressuring profitability.
- Commercial aftermarket growth expected to slow to low-to-mid single digits in H2 due to supply constraints and tough comps.
Thank you for standing by and welcome to the H1ywell Aerospace Second Quarter 2026 Earnings Conference Call.
At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. Please be advised that today's call is being recorded.
I'll now turn the call over to Sean Mecham, Vice President of Investor Relations. Please go ahead.
Thank you.
Good afternoon, and welcome to H1ywell Aerospace's second quarter 2026 earnings call.
On the call with me today are Chief Executive Officer, Jim Currier, and Chief Financial Officer, Josh Jepson.
This webcast and the presentation materials, including non-GAAP reconciliations, are available on our investor relations website.
Our forward-looking statements are based on our best view of the world and our business as we see it today, and subject to risks and uncertainties, including the ones described in our SEC filings.
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