Analysis of Income Taxes
- Income Tax Expense (Benefit)
- Effective Income Tax Rate (EITR)
- Components of Deferred Tax Assets and Liabilities
- Deferred Tax Assets and Liabilities, Classification
- Adjustments to Financial Statements: Removal of Deferred Taxes
- Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)
- Adjusted Net Profit Margin
- Adjusted Total Asset Turnover
- Adjusted Financial Leverage
- Adjusted Return on Equity (ROE)
- Adjusted Return on Assets (ROA)
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Income Tax Expense (Benefit)
Honeywell International Inc., income tax expense (benefit), continuing operations
US$ in millions
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The income tax expense exhibited fluctuating behavior over the five-year period. Current tax expense generally trended upward initially, then decreased significantly in the most recent year presented. Deferred tax expense (benefit) demonstrated more volatility, shifting from an expense to a benefit and back again, with a substantial benefit recorded in 2022 and 2024. Overall tax expense followed a pattern of increase, decrease, relative stability, and then a decrease.
- Current Tax Expense
- Current tax expense increased from US$1,447 million in 2021 to US$1,592 million in 2022, representing a growth of approximately 10.0%. It then decreased to US$1,334 million in 2023, a decline of roughly 16.2%. A subsequent increase to US$1,706 million occurred in 2024, before a substantial decrease to US$990 million in 2025. This final decrease represents a significant reduction of approximately 41.9% from the 2024 level.
- Deferred Tax Expense (Benefit)
- Deferred tax expense transitioned to a benefit in 2022, recording a negative value of US$-180 million. This suggests the realization of deferred tax liabilities or the creation of deferred tax assets. In 2023, it reverted to an expense of US$153 million. A further shift occurred in 2024, with a benefit of US$-233 million, the largest benefit recorded during the period. Finally, in 2025, it returned to a small expense of US$18 million.
- Total Tax Expense
- Total tax expense initially rose from US$1,625 million in 2021 to US$1,412 million in 2022, a decrease of approximately 13.1%. It then increased to US$1,487 million in 2023, followed by a relatively stable level of US$1,473 million in 2024. A notable decrease to US$1,008 million occurred in 2025, representing a reduction of approximately 31.6% from the 2024 figure. The fluctuations in total tax expense appear to be driven by the combined effect of the current and deferred tax components.
The significant decrease in both current tax expense and total tax expense in 2025 warrants further investigation to determine the underlying causes, such as changes in taxable income, tax rates, or the utilization of tax credits or loss carryforwards. The volatility in deferred tax expense (benefit) suggests dynamic changes in temporary differences between book and tax bases of assets and liabilities.
Effective Income Tax Rate (EITR)
Honeywell International Inc., effective income tax rate (EITR) reconciliation
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| U.S. federal statutory income tax rate | ||||||
| Effective income tax rate |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
An analysis of the presented information reveals a consistent decline in the effective income tax rate over the five-year period from 2021 to 2025. This trend occurs while the U.S. federal statutory income tax rate remains constant at 21.00 percent throughout the observed timeframe.
- Effective Income Tax Rate Trend
- The effective income tax rate decreased steadily from 22.50 percent in 2021 to 18.40 percent in 2025. The rate experienced a moderate decrease from 22.50 percent to 22.10 percent between 2021 and 2022. The rate of decline accelerated between 2022 and 2023, falling to 20.80 percent, and continued to decrease to 20.40 percent in 2024. The largest single-year decrease occurred between 2024 and 2025, with the rate dropping to 18.40 percent.
The divergence between the statutory and effective rates suggests the influence of various factors impacting the company’s tax obligations. These factors could include tax credits, deductions, changes in the geographic mix of earnings, or the impact of international tax regulations. Further investigation would be required to determine the specific drivers behind this decreasing effective tax rate.
- Statutory vs. Effective Rate
- Throughout the period, the effective income tax rate consistently exceeded the U.S. federal statutory rate in 2021 and 2022. However, beginning in 2023, the effective rate fell below the statutory rate and continued to do so through 2025. This indicates that factors are reducing the company’s taxable income or providing tax benefits that lower its overall tax burden.
The observed trend warrants continued monitoring to assess its sustainability and potential implications for future financial performance and tax planning.
Components of Deferred Tax Assets and Liabilities
Honeywell International Inc., components of deferred tax assets and liabilities
US$ in millions
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The composition of deferred tax assets and liabilities exhibits notable shifts between 2021 and 2025. Several components demonstrate consistent trends, while others experience significant fluctuations. Overall, the net deferred tax position remains a liability throughout the period, though the magnitude of the liability decreases over time.
- Deferred Tax Assets - Key Components
- Net operating losses consistently represent a substantial portion of the gross deferred tax assets, ranging from US$618 million to US$734 million. Capital loss carryover and outside basis differences show a marked increase from US$151 million in 2021 to US$544 million in 2025. Tax credit carryforwards also demonstrate substantial growth, rising from US$164 million to US$648 million over the same period. Capitalized research and development emerges as a significant asset component starting in 2023, growing to US$917 million by 2025. Employee compensation and benefits, postretirement benefits, and lease liabilities show a general decreasing trend, though with some year-to-year variability.
- Deferred Tax Liabilities - Key Components
- Pension obligations consistently constitute the largest deferred tax liability, decreasing from US$948 million in 2021 to US$1,339 million in 2025. Intangibles represent the second largest liability, fluctuating between US$679 million and US$883 million. Property, plant, and equipment liabilities show a decreasing trend, while right-of-use asset liabilities also decline. Unremitted earnings of foreign subsidiaries remain relatively stable, around US$500 million. A deferred revenue liability begins to appear in 2024, reaching US$175 million by 2025.
- Valuation Allowance
- The valuation allowance against deferred tax assets has increased consistently from US$857 million in 2021 to US$1,374 million in 2025. This suggests a growing uncertainty regarding the realization of a portion of the deferred tax assets. The increasing valuation allowance partially offsets the growth in gross deferred tax assets, resulting in a slower increase in net deferred tax assets.
- Net Deferred Tax Position
- The net deferred tax position, representing the difference between total deferred tax liabilities and net deferred tax assets, is a net liability throughout the period. The net liability decreases from US$1,874 million in 2021 to US$1,378 million in 2025. This reduction is driven by the combined effect of increasing deferred tax assets and decreasing deferred tax liabilities, although the increasing valuation allowance moderates the growth in net deferred tax assets.
In summary, the deferred tax asset composition is shifting towards loss carryforwards and tax credits, while the deferred tax liability composition is dominated by pension obligations and intangible assets. The increasing valuation allowance indicates a cautious approach to recognizing the full benefit of deferred tax assets. The overall trend suggests a gradual reduction in the net deferred tax liability position.
Deferred Tax Assets and Liabilities, Classification
Honeywell International Inc., deferred tax assets and liabilities, classification
US$ in millions
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Deferred tax assets | ||||||
| Deferred tax liabilities |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
Over the five-year period examined, both deferred tax assets and deferred tax liabilities exhibited directional changes. A consistent decline is observed in deferred tax assets, while deferred tax liabilities generally decreased, though with some fluctuation.
- Deferred Tax Assets
- Deferred tax assets decreased steadily from US$489 million in 2021 to US$199 million in 2025. This represents a cumulative reduction of approximately 59.4%. The most significant decrease occurred between 2021 and 2023, with a reduction of US$97 million. The rate of decline slowed between 2023 and 2025, decreasing by US$39 million.
- Deferred Tax Liabilities
- Deferred tax liabilities experienced an overall reduction from US$2,364 million in 2021 to US$1,577 million in 2025, a total decrease of approximately 33.3%. The period between 2021 and 2022 saw a substantial decrease of US$271 million. A slight increase was noted between 2022 and 2023, with liabilities rising by US$1 million. Subsequent years, 2023 to 2025, showed continued decreases, totaling US$307 million.
The consistent decrease in deferred tax assets may suggest a reduction in temporary differences that will result in future deductible amounts, or utilization of existing deferred tax assets. The decline in deferred tax liabilities indicates a lessening of future tax obligations arising from temporary differences. The larger initial decrease in liabilities, followed by a smaller increase and then continued decline, suggests potential changes in the nature or timing of those temporary differences.
- Net Deferred Tax Position
- The difference between deferred tax liabilities and deferred tax assets widened over the period. In 2021, net deferred tax liabilities were US$1,875 million (US$2,364 - US$489). By 2025, this had increased to US$1,378 million (US$1,577 - US$199). This expansion indicates a growing net future tax obligation.
Adjustments to Financial Statements: Removal of Deferred Taxes
Honeywell International Inc., adjustments to financial statements
US$ in millions
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The financial information reveals adjustments made to reported figures, primarily concerning the removal of deferred tax assets and liabilities. These adjustments impact total assets, total liabilities, and ultimately, Honeywell shareowners’ equity and net income. A consistent pattern emerges across the five-year period, indicating a systematic approach to these adjustments.
- Total Assets
- Reported total assets decreased from 2021 to 2023, then increased significantly in 2024 and decreased slightly in 2025. The adjusted total assets follow a similar trend, consistently lower than the reported figures. The difference between reported and adjusted assets remains relatively stable in dollar terms from 2021-2023, then increases substantially in 2024 and 2025, suggesting a larger deferred tax impact in those years.
- Total Liabilities
- Reported total liabilities remained relatively flat from 2021 to 2023, then increased in 2024 and 2025. Adjusted total liabilities are consistently lower than reported liabilities, and the gap between the two widens in 2024 and 2025, mirroring the trend observed with total assets. This suggests the deferred tax adjustments primarily affect liability accounts.
- Shareowners’ Equity
- Reported shareowners’ equity experienced a decline from 2021 to 2023, followed by a recovery in 2024 and a subsequent decrease in 2025. The adjusted shareowners’ equity consistently exceeds the reported equity, and the difference between the two also increases in 2024 and 2025. This indicates that the removal of deferred tax liabilities contributes to a higher equity position than initially reported.
- Net Income
- Reported net income fluctuated over the period, with a decrease in 2022, increases in 2023 and 2024, and a decrease in 2025. Adjusted net income generally follows the same pattern, but is consistently higher than the reported net income. The difference between reported and adjusted net income is relatively small in 2021 and 2022, but becomes more pronounced in 2023, 2024, and 2025, indicating a growing impact from the deferred tax adjustments on reported earnings.
In summary, the adjustments consistently increase shareowners’ equity and net income while decreasing both total assets and total liabilities. The magnitude of these adjustments appears to be increasing over time, particularly from 2023 onwards. This suggests a potential shift in the company’s tax position or accounting practices related to deferred taxes.
Honeywell International Inc., Financial Data: Reported vs. Adjusted
Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)
Honeywell International Inc., adjusted financial ratios
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The financial performance, as indicated by a selection of key ratios, demonstrates some notable shifts when deferred tax impacts are removed from the calculations. Generally, the adjusted ratios present a slightly more conservative view of profitability and returns compared to the reported figures. Over the five-year period, several trends emerge across the examined metrics.
- Profitability
- Both reported and adjusted net profit margins experienced fluctuations. Reported net profit margin decreased from 16.11% in 2021 to 12.63% in 2025, with a low point of 14.00% in 2022. The adjusted net profit margin followed a similar pattern, declining from 16.63% to 12.68% over the same period. The difference between reported and adjusted margins remained relatively consistent, suggesting a stable impact from deferred taxes on reported profitability.
- Asset Efficiency
- Total asset turnover remained relatively stable for both reported and adjusted calculations. Both metrics showed a slight increase from 0.53 in 2021 to 0.60 in 2023, followed by a decrease to 0.51 in both 2024 and 2025. The adjustment for deferred taxes had a minimal effect on the observed asset turnover ratios.
- Financial Leverage
- Financial leverage exhibited an increasing trend throughout the period. Reported financial leverage rose from 3.47 in 2021 to 5.30 in 2025. The adjusted financial leverage also increased, though to a lesser extent, moving from 3.13 to 4.81. The removal of deferred tax assets and liabilities resulted in a lower leverage ratio, indicating a reduced reliance on debt financing when considering this adjustment.
- Return on Equity (ROE)
- Reported ROE showed volatility, peaking at 35.68% in 2023 before declining to 34.01% in 2025. Adjusted ROE followed a similar trajectory, reaching 33.10% in 2023 and 31.06% in 2025. The adjusted ROE consistently presented a lower value than the reported ROE, reflecting the impact of deferred taxes on equity.
- Return on Assets (ROA)
- Reported ROA decreased from 8.60% in 2021 to 6.42% in 2025. The adjusted ROA mirrored this downward trend, declining from 8.94% to 6.46% over the same period. Similar to ROE, the adjusted ROA was consistently lower than the reported ROA, indicating that the inclusion of deferred tax effects inflated the reported return on assets.
In summary, the adjustments related to deferred taxes generally resulted in lower, but consistently related, values for profitability and return ratios. The impact on asset turnover and financial leverage was less pronounced. The observed trends suggest a potential increase in financial leverage and a decline in profitability and returns over the analyzed period, even after accounting for deferred tax effects.
Honeywell International Inc., Financial Ratios: Reported vs. Adjusted
Adjusted Net Profit Margin
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
2025 Calculations
1 Net profit margin = 100 × Net income attributable to Honeywell ÷ Net sales
= 100 × ÷ =
2 Adjusted net profit margin = 100 × Adjusted net income attributable to Honeywell ÷ Net sales
= 100 × ÷ =
The period between 2021 and 2025 demonstrates fluctuations in both reported and adjusted net income attributable to Honeywell, which consequently impacts associated profit margins. While both net income measures generally move in similar directions, the adjusted figures consistently present a slightly different profitability picture than the reported results.
- Reported Net Income & Margin
- Reported net income attributable to Honeywell decreased from US$5,542 million in 2021 to US$4,966 million in 2022, representing a decline of approximately 10.2%. It then recovered to US$5,658 million in 2023 and further increased to US$5,705 million in 2024. However, a decrease is observed in 2025, with reported net income falling to US$4,729 million. Correspondingly, the reported net profit margin decreased from 16.11% in 2021 to 14.00% in 2022, increased to 15.43% in 2023 and 14.82% in 2024, before declining to 12.63% in 2025. This indicates a correlation between net income and profit margin, with margin fluctuations mirroring changes in net income.
- Adjusted Net Income & Margin
- Adjusted net income attributable to Honeywell followed a similar pattern, decreasing from US$5,720 million in 2021 to US$4,786 million in 2022, a decrease of approximately 16.0%. It then increased to US$5,811 million in 2023 and decreased to US$5,472 million in 2024, before falling to US$4,747 million in 2025. The adjusted net profit margin exhibited a comparable trend, moving from 16.63% in 2021 to 13.49% in 2022, increasing to 15.85% in 2023 and 14.21% in 2024, and then decreasing to 12.68% in 2025. The adjusted margin consistently remains slightly higher than the reported margin throughout the observed period.
- Margin Comparison
- The difference between the reported and adjusted net profit margins remained relatively stable across the period, generally ranging between 0.52% and 0.64%. This suggests that the adjustments made to net income consistently contribute to a modestly higher profitability metric. The year 2025 saw both margins converge to 12.63% and 12.68% respectively, indicating a similar impact of adjustments in that year.
- Overall Trend
- A general downward trend in both reported and adjusted net profit margins is observed from 2021 to 2025. While there are interim periods of recovery, the ultimate trend suggests increasing pressure on profitability over the five-year period. The decline in 2025 is particularly notable, with both margins reaching their lowest points within the observed timeframe.
Adjusted Total Asset Turnover
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
2025 Calculations
1 Total asset turnover = Net sales ÷ Total assets
= ÷ =
2 Adjusted total asset turnover = Net sales ÷ Adjusted total assets
= ÷ =
The analysis reveals consistent trends in both reported and adjusted total asset turnover ratios over the five-year period. Reported total assets experienced a decrease from 2021 to 2023, followed by a substantial increase in 2024, with a slight decrease in 2025. Adjusted total assets mirrored this pattern. The adjusted total asset turnover ratio demonstrates a period of stability followed by a decline.
- Adjusted Total Asset Turnover
- The adjusted total asset turnover ratio remained stable at 0.54 in 2021 and 0.57 in both 2022 and 2023. A decrease to 0.51 is observed in both 2024 and 2025, indicating a reduced efficiency in generating sales from each dollar of adjusted assets. This suggests a potential weakening in the company’s ability to utilize its assets effectively to produce revenue during those years.
- Asset Base
- Adjusted total assets decreased from US$63,981 million in 2021 to US$61,133 million in 2023. A significant increase to US$74,958 million occurred in 2024, followed by a modest decrease to US$73,482 million in 2025. The fluctuations in the asset base may contribute to the observed changes in the turnover ratio, although the ratio’s decline in 2024 and 2025 occurs despite the increased asset level.
The consistency between the reported and adjusted total asset turnover ratios suggests that adjustments to total assets do not materially impact the overall assessment of asset utilization efficiency. The decline in the adjusted total asset turnover ratio in the latter two years warrants further investigation to determine the underlying causes, such as changes in sales volume, pricing strategies, or asset composition.
Adjusted Financial Leverage
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
2025 Calculations
1 Financial leverage = Total assets ÷ Total Honeywell shareowners’ equity
= ÷ =
2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted total Honeywell shareowners’ equity
= ÷ =
An examination of the financial information reveals trends in total assets, shareowners’ equity, and associated leverage ratios over a five-year period. Both reported and adjusted total assets experienced a decline from 2021 to 2023, followed by increases in 2024 and a slight decrease in 2025. Shareowners’ equity, both reported and adjusted, generally decreased from 2021 to 2025, though with some fluctuation.
- Total Assets
- Reported total assets decreased from US$64,470 million in 2021 to US$61,525 million in 2023, representing a cumulative decline of approximately 4.8%. A subsequent increase to US$75,196 million in 2024 was observed, followed by a modest decrease to US$73,681 million in 2025. Adjusted total assets mirrored this pattern, declining from US$63,981 million in 2021 to US$61,133 million in 2023, then increasing to US$74,958 million in 2024 and decreasing to US$73,482 million in 2025.
- Shareowners’ Equity
- Reported total shareowners’ equity exhibited a consistent downward trend from US$18,569 million in 2021 to US$15,856 million in 2023. This was followed by a recovery to US$18,619 million in 2024, but then a further decline to US$13,904 million in 2025. Adjusted total shareowners’ equity followed a similar trajectory, decreasing from US$20,443 million in 2021 to US$17,558 million in 2023, increasing to US$20,168 million in 2024, and decreasing to US$15,282 million in 2025. The adjusted equity values are consistently higher than the reported values throughout the period.
- Financial Leverage
- Reported financial leverage increased steadily from 3.47 in 2021 to 4.04 in 2024, before rising significantly to 5.30 in 2025. Adjusted financial leverage also increased over the period, though at a slower pace, moving from 3.13 in 2021 to 3.72 in 2024 and then to 4.81 in 2025. The adjusted leverage ratio consistently presents a lower value than the reported leverage ratio, indicating that the adjustments to equity reduce the calculated leverage. The accelerated increase in both reported and adjusted financial leverage in 2025 warrants further investigation.
The divergence between reported and adjusted figures suggests the presence of items impacting the reported equity that are being adjusted for in the analysis. The increasing leverage ratios, particularly the substantial increase in 2025, could indicate a higher reliance on debt financing or a decrease in equity relative to assets, potentially increasing financial risk.
Adjusted Return on Equity (ROE)
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
2025 Calculations
1 ROE = 100 × Net income attributable to Honeywell ÷ Total Honeywell shareowners’ equity
= 100 × ÷ =
2 Adjusted ROE = 100 × Adjusted net income attributable to Honeywell ÷ Adjusted total Honeywell shareowners’ equity
= 100 × ÷ =
Analysis of the presented financial information reveals fluctuations in reported and adjusted net income, shareowners’ equity, and resulting return on equity (ROE) over the five-year period. Both reported and adjusted net income experienced variability, while shareowners’ equity demonstrated a more complex pattern of change. Consequently, both reported and adjusted ROE exhibited corresponding fluctuations.
- Net Income
- Reported net income attributable to Honeywell decreased from US$5,542 million in 2021 to US$4,966 million in 2022, before increasing to US$5,658 million in 2023 and US$5,705 million in 2024. A subsequent decline to US$4,729 million was observed in 2025. Adjusted net income followed a similar trend, beginning at US$5,720 million in 2021, decreasing to US$4,786 million in 2022, increasing to US$5,811 million in 2023 and US$5,472 million in 2024, and then decreasing to US$4,747 million in 2025. The adjusted net income consistently exceeded the reported net income throughout the period.
- Shareowners’ Equity
- Reported total Honeywell shareowners’ equity decreased from US$18,569 million in 2021 to US$16,697 million in 2022 and further to US$15,856 million in 2023. An increase was then noted in 2024, reaching US$18,619 million, followed by a substantial decrease to US$13,904 million in 2025. Adjusted total Honeywell shareowners’ equity mirrored this pattern, starting at US$20,443 million in 2021, decreasing to US$18,369 million in 2022 and US$17,558 million in 2023, increasing to US$20,168 million in 2024, and decreasing to US$15,282 million in 2025. The adjusted equity values were consistently higher than the reported equity values.
- Reported Return on Equity (ROE)
- Reported ROE began at 29.85% in 2021, decreased slightly to 29.74% in 2022, then increased significantly to 35.68% in 2023. It subsequently decreased to 30.64% in 2024 and rose again to 34.01% in 2025. These fluctuations appear to be influenced by the interplay between reported net income and reported shareowners’ equity.
- Adjusted Return on Equity (ROE)
- Adjusted ROE followed a similar pattern to the reported ROE, starting at 27.98% in 2021, decreasing to 26.05% in 2022, increasing to 33.10% in 2023, decreasing to 27.13% in 2024, and increasing to 31.06% in 2025. The adjusted ROE values were consistently lower than the reported ROE values, reflecting the impact of adjustments to net income and equity. The largest difference between reported and adjusted ROE occurred in 2023.
The substantial decrease in both reported and adjusted shareowners’ equity in 2025 warrants further investigation to understand the underlying causes. The variations in ROE suggest a sensitivity to changes in both profitability and equity base.
Adjusted Return on Assets (ROA)
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
2025 Calculations
1 ROA = 100 × Net income attributable to Honeywell ÷ Total assets
= 100 × ÷ =
2 Adjusted ROA = 100 × Adjusted net income attributable to Honeywell ÷ Adjusted total assets
= 100 × ÷ =
The period between 2021 and 2025 demonstrates fluctuating performance in reported and adjusted net income, alongside changes in total assets, impacting both reported and adjusted return on assets. A general observation is that while both reported and adjusted ROA move in similar directions, the adjusted figures consistently present a slightly different picture, suggesting the impact of specific adjustments to net income and total assets.
- Reported Net Income & Assets
- Reported net income attributable to Honeywell decreased from US$5,542 million in 2021 to US$4,966 million in 2022, before recovering to US$5,658 million in 2023. A further increase to US$5,705 million occurred in 2024, followed by a decline to US$4,729 million in 2025. Reported total assets experienced a decrease from US$64,470 million in 2021 to US$62,275 million in 2022, continuing to US$61,525 million in 2023. A significant increase was observed in 2024, reaching US$75,196 million, before decreasing slightly to US$73,681 million in 2025.
- Adjusted Net Income & Assets
- Adjusted net income attributable to Honeywell followed a similar pattern to the reported figures, decreasing from US$5,720 million in 2021 to US$4,786 million in 2022, increasing to US$5,811 million in 2023, decreasing to US$5,472 million in 2024, and finally decreasing to US$4,747 million in 2025. Adjusted total assets mirrored the trend of reported assets, decreasing from US$63,981 million in 2021 to US$61,854 million in 2022, continuing to US$61,133 million in 2023. A substantial increase occurred in 2024, reaching US$74,958 million, followed by a slight decrease to US$73,482 million in 2025.
- Reported Return on Assets (ROA)
- Reported ROA began at 8.60% in 2021, decreased to 7.97% in 2022, and then increased to 9.20% in 2023. It subsequently decreased to 7.59% in 2024 and further to 6.42% in 2025. This indicates a general decline in profitability relative to assets over the period, despite the intermediate peak in 2023.
- Adjusted Return on Assets (ROA)
- Adjusted ROA exhibited a similar trend, starting at 8.94% in 2021, decreasing to 7.74% in 2022, increasing to 9.51% in 2023, decreasing to 7.30% in 2024, and finally decreasing to 6.46% in 2025. The adjusted ROA consistently showed a slightly higher value than the reported ROA in 2021, 2023, and 2025, and a slightly lower value in 2022 and 2024. The overall trend mirrors the reported ROA, indicating a decline in profitability relative to adjusted assets by the end of the period.
The convergence of reported and adjusted ROA towards the end of the period suggests that the adjustments made to net income and total assets have a diminishing effect on the overall profitability picture. The significant asset increase in 2024, coupled with a relatively smaller increase in net income, contributed to the decline in both reported and adjusted ROA in both 2024 and 2025.