Headline: "Honeywell Falls Short of Sales Targets Amid Supply Chain Challenges"

Honeywell International Inc. (NASDAQ:HON) today reported lower-than-expected annual sales projections as it continues to face challenges related to supply chain disruptions, missing its quarterly revenue forecasts. The industrial conglomerate highlighted weakness in its industrial automation segment, which experienced a 5% decline in organic sales in the third quarter, mainly due to reduced warehouse demand.

The company’s industrial automation business, which assists factories in mechanizing their production processes, is under pressure partially due to a downturn following a boom in warehouse construction spurred by the pandemic. Jake Levinson, an analyst from Melius Research, noted that Honeywell's Intelligrated warehouse automation business had previously benefited from this surge, especially with customers like Amazon (NASDAQ:AMZN), but is now going through a challenging phase.

Shares of Honeywell (NASDAQ:HON) dropped by 4% in morning trading. During a post-earnings call, company executives identified specific supply chain issues in the aerospace sector and disruptions arising from Hurricane Helene as factors leading to the revision of the year's outlook. These remarks came after GE Aerospace had earlier in the week attributed a decline in jet engine deliveries to supply chain constraints.

CEO Vimal Kapur also commented on the recent strike by Boeing (NYSE:BA) workers, describing the situation as "very challenging" following a vote the previous night. Despite the strike, Honeywell indicated that demand from Boeing had not significantly diminished compared to the period before the labor dispute began.

Honeywell set its 2024 sales forecast between $38.6 billion and $38.8 billion, which is below the average analyst estimate of $39.20 billion compiled by LSEG. Total sales for the quarter ending September 30 increased by 5.6% to reach $9.73 billion, falling short of the expected $9.90 billion.

In an effort to streamline operations, Honeywell announced today its intention to exit the personal protective equipment business. This move aligns with CEO Kapur's strategic focus on major trends such as automation, the future of aviation, and transitioning to more sustainable energy solutions.