Honeywell International Inc. (HON) shares declined Monday after the industrial giant delivered a double dose of bad news: lower guidance and a substantial legal bill that's about to hit the books.

The company trimmed its fourth-quarter and full-year forecasts, citing both its upcoming business reorganization and an expensive legal settlement that's taking shape. It's the kind of update that makes investors nervous, particularly when the numbers miss by meaningful margins.

The Legal Tab

Honeywell disclosed it's in settlement discussions with Flexjet and other parties over ongoing litigation. The company anticipates recording a one-time fourth-quarter charge of roughly $310 million to sales (as contra-revenue) and $370 million to operating income within its Aerospace Technologies segment.

The silver lining, if there is one: Honeywell says this won't affect its non-GAAP metrics, meaning the company's adjusted earnings figures will exclude the legal hit.

A New Structure Takes Shape

Back in October, Honeywell announced a significant restructuring of its reporting segments, effective January 1, 2026. The new lineup includes Aerospace Technologies, Building Automation, Industrial Automation, and Process Automation and Technology.

The company also confirmed it will start reporting its Advanced Materials unit as discontinued operations beginning in the fourth quarter of 2025. This follows the successful spin-off of Solstice Advanced Materials (SOLS) on October 30, 2025.

Guidance Gets Trimmed

For the fourth quarter, Honeywell now expects adjusted earnings per share between $2.48 and $2.58, down from its previous range of $2.52 to $2.62. The Street was looking for $2.57. Revenue guidance also dropped to $9.8-$10.0 billion from $10.1-$10.3 billion, versus analyst estimates of $10.197 billion.

The full-year picture looks even more dramatic. The company now projects fiscal 2025 adjusted EPS of $9.70-$9.80, a sharp reduction from the prior guidance of $10.60-$10.70. Consensus estimates sat at $10.65. Revenue guidance fell to $37.5-$37.7 billion from $40.7-$40.9 billion, compared to the Street's expectation of $40.804 billion.

Recent Performance

The guidance cuts come despite solid recent results. In its latest quarterly report, Honeywell delivered adjusted earnings of $2.82 per share, beating analyst estimates of $2.57. Revenue climbed 7% year-over-year to $10.41 billion, topping expectations of $10.14 billion.

Price Action: Honeywell shares traded down 1.81% at $195.50 during Monday's premarket session.