United States
Securities and Exchange Commission
Washington, D.C. 20549
Form 10-Q
__________________
☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 20212022
OR
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______ to _____
Commission file number 1-8974
hon-20220630_g1.jpg
Honeywell International Inc.Inc.
(Exact name of registrant as specified in its charter)
Delaware22-2640650
(State or other jurisdiction of
incorporation or organization)		(I.R.S. Employer
Identification No.)
300855 South TryonMint Street28202
Charlotte,NC
(Address of principal executive offices)(Zip Code)
(704)627-6200
(Registrant’s telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year,
if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, par value $1 per share*HONThe NASDAQNasdaq Stock Market LLC
1.300% Senior Notes due 2023HON 23AThe NASDAQNasdaq Stock Market LLC
0.000% Senior Notes due 2024HON 24AThe NASDAQNasdaq Stock Market LLC
2.250% Senior Notes due 2028HON 28AThe NASDAQNasdaq Stock Market LLC
0.750% Senior Notes due 2032HON 32The NASDAQNasdaq Stock Market LLC
* The common stock is also listed on the London Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x  No o☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o☐
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large Accelerated FilerxAccelerated filer☐
Non-Accelerated filer☐Smaller reporting company☐
  Emerging growth company☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  ☐ No x
There were 690,399,265673,692,317 shares of Common Stock outstanding at June 30, 2021.2022.







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Consolidated Balance Sheet (unaudited) – June 30, 20212022 and December 31, 20202021
3
Consolidated Statement of Cash Flows (unaudited) – Six Months Ended June 30, 20212022 and 20202021
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5
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ITEM 2
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ITEM 4
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ITEM 6
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TABLE OF CONTENTS
CAUTIONARY STATEMENT ABOUT FORWARD-LOOKING STATEMENTS
We describe many of the trends and other factors that drive our business and future results in the section titled Management’s Discussion and Analysis of Financial Condition and Results of Operations and in other parts of this report (including Part II, Item 1A Risk Factors). Such discussions contain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act). Forward-looking statements are those that address activities, events or developments that management intends, expects, projects, believes or anticipates will or may occur in the future. They are based on management’s assumptions and assessments in light of past experience and trends, current economic and industry conditions, expected future developments and other relevant factors. They are not guarantees of future performance, and actual results, developments and business decisions may differ significantly from those envisaged by our forward-looking statements. We do not undertake to update or revise any of our forward-looking statements. Our forward-looking statements are also subject to risks and uncertainties, including the impact of the coronavirus pandemic (COVID-19), and the Russia-Ukraine conflict, that can affect our performance in both the near- and long-term. These forward-looking statements should be considered in light of the information included in this report and our other filings with the Securities and Exchange Commission (SEC), including, without limitation, the Risk Factors, as well as the description of trends and other factors in Management’s Discussion and Analysis of Financial Condition and Results of Operations, set forth in this report and our 20202021 Annual Report on Form 10-K.




TABLE OF CONTENTS
ABOUT HONEYWELL
Honeywell International Inc. (Honeywell or the Company) invents and commercializes technologies that address some of the world’s most critical challenges around energy, safety, security, air travel, productivity, and global urbanization. We are a leading software-industrial company committed to introducing state of the art technology solutions to improve efficiency, productivity, sustainability, and safety in high growth businesses in broad-based, attractive industrial end markets. As a diversified technology and manufacturing company, we are uniquely positioned to blend physical products with software to serve customers worldwide with aerospace products and services, energy efficient products and solutions for businesses, specialty chemicals, electronic and advanced materials, process technology for refining and petrochemicals, and productivity, sensing, safety and security technologies for buildings and industries. Our products and solutions enable a safer, more comfortable, and more productive world, enhancing the quality of life of people around the globe. The Honeywell brand dates back to 1906, and the Company was incorporated in Delaware in 1985.
Our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and any amendments to those reports, are available free of charge on our website (honeywell.com) under the heading Investors (see SEC Filings) immediately after they are filed with, or furnished to, the SEC. Honeywell uses our Investor Relations website, investor.honeywell.com, as a means of disclosing information which may be of interest or material to our investors and for complying with disclosure obligations under Regulation FD. Accordingly, investors should monitor our Investor Relations website, in addition to following our press releases, SEC filings, public conference calls, webcasts, and social media. Information contained on or accessible through, including any reports available on, our website is not a part of, and is not incorporated by reference into, this Quarterly Report on Form 10-Q or any other report or document we file with the SEC. Any reference to our website in this Form 10-Q is intended to be an inactive textual reference only.


TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION 
The financial statements and related notes as of June 30, 2022, should be read in conjunction with the financial statements for the year ended December 31, 2021, contained in the Company's 2021 Annual Report on Form 10-K. 
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
HONEYWELL INTERNATIONAL INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
 Three Months Ended June 30,Six Months Ended June 30,
2022202120222021
 (Dollars in millions, except per share amounts)
Product sales$6,684 $6,639 $12,816 $13,048 
Service sales2,269 2,169 4,513 4,214 
Net sales8,953 8,808 17,329 17,262 
Costs, expenses and other
Cost of products sold4,673 4,734 9,046 9,285 
Cost of services sold1,373 1,269 2,674 2,427 
 6,046 6,003 11,720 11,712 
Selling, general and administrative expenses1,306 1,207 2,737 2,443 
Other (income) expense(190)(366)(509)(808)
Interest and other financial charges87 83 172 173 
 7,249 6,927 14,120 13,520 
Income before taxes1,704 1,881 3,209 3,742 
Tax expense441 434 812 847 
Net income1,263 1,447 2,397 2,895 
Less: Net income attributable to the noncontrolling interest2 17 2 38 
Net income attributable to Honeywell$1,261 $1,430 $2,395 $2,857 
Earnings per share of common stock - basic$1.86 $2.06 $3.51 $4.11 
Earnings per share of common stock - assuming dilution$1.84 $2.04 $3.48 $4.06 






PART I. FINANCIAL INFORMATION
The financial statements and related notes as of June 30, 2021, should be read in conjunction with the financial statements for the year ended December 31, 2020, contained in our 2020 Annual Report on Form 10-K. 

ITEM 1. FINANCIAL STATEMENTS
HONEYWELL INTERNATIONAL INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
 Three Months Ended June 30,Six Months Ended June 30,
 2021202020212020
 (Dollars in millions, except per share amounts)
Product sales$6,639 $5,743 $13,048 $12,048 
Service sales2,169 1,734 4,214 3,892 
Net sales8,808 7,477 17,262 15,940 
Costs, expenses and other
Cost of products sold4,734 4,163 9,285 8,537 
Cost of services sold1,269 1,113 2,427 2,273 
 6,003 5,276 11,712 10,810 
Selling, general and administrative expenses1,207 1,183 2,443 2,421 
Other (income) expense(366)(291)(808)(608)
Interest and other financial charges83 90 173 163 
 6,927 6,258 13,520 12,786 
Income before taxes1,881 1,219 3,742 3,154 
Tax expense (benefit)434 120 847 449 
Net income1,447 1,099 2,895 2,705 
Less: Net income attributable to the noncontrolling interest17 18 38 43 
Net income attributable to Honeywell$1,430 $1,081 $2,857 $2,662 
Earnings per share of common stock - basic$2.06 $1.54 $4.11 $3.77 
Earnings per share of common stock - assuming dilution$2.04 $1.53 $4.06 $3.74 
The Notes to Consolidated Financial Statements are an integral part of this statement.
1 Honeywell International Inc.







HONEYWELL INTERNATIONAL INC.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
(Unaudited)
 Three Months Ended June 30,Six Months Ended June 30,
 2021202020212020
 (Dollars in millions)
Net income$1,447 $1,099 $2,895 $2,705 
Other comprehensive income (loss), net of tax
Foreign exchange translation adjustment129 121 343 (155)
Pension and other postretirement benefit adjustments(21)(20)(43)(40)
Changes in fair value of available for sale investments0 0 (3)0 
Cash flow hedges recognized in other comprehensive income (loss)7 (91)15 104 
Less: Reclassification adjustment for gains (losses) included in net income6 (33)9 22 
Changes in fair value of cash flow hedges1 (58)6 82 
Other comprehensive income (loss), net of tax109 43 303 (113)
Comprehensive income1,556 1,142 3,198 2,592 
Less: Comprehensive income attributable to the noncontrolling interest17 21 39 39 
Comprehensive income attributable to Honeywell$1,539 $1,121 $3,159 $2,553 
The Notes to Consolidated Financial Statements are an integral part of this statement.

21 Honeywell International Inc.

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HONEYWELL INTERNATIONAL INC.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
(Unaudited)
 Three Months Ended June 30,Six Months Ended June 30,
2022202120222021
 (Dollars in millions)
Net income$1,263 $1,447 $2,397 $2,895 
Other comprehensive income (loss), net of tax
Foreign exchange translation adjustment(102)129 24 343 
Prior service (credit) cost recognized(17)(21)(34)(43)
Pension and other postretirement benefit adjustments(17)(21)(34)(43)
Changes in fair value of available for sale investments(3)— (9)(3)
Cash flow hedges recognized in other comprehensive income (loss)31 7 39 15 
Less: Reclassification adjustment for gains (losses) included in net income12 6 15 9 
Changes in fair value of cash flow hedges19 1 24 6 
Other comprehensive income (loss), net of tax(103)109 5 303 
Comprehensive income1,160 1,556 2,402 3,198 
Less: Comprehensive income attributable to the noncontrolling interest(5)17 (5)39 
Comprehensive income attributable to Honeywell$1,165 $1,539 $2,407 $3,159 






HONEYWELL INTERNATIONAL INC.
CONSOLIDATED BALANCE SHEET
(Unaudited)
 June 30, 2021December 31, 2020
 (Dollars in millions)
ASSETS 
Current assets:  
Cash and cash equivalents$11,427 $14,275 
Short-term investments891 945 
Accounts receivable - net6,947 6,827 
Inventories4,723 4,489 
Other current assets1,664 1,639 
Total current assets25,652 28,175 
Investments and long-term receivables1,358 685 
Property, plant and equipment - net5,520 5,570 
Goodwill17,135 16,058 
Other intangible assets - net3,748 3,560 
Insurance recoveries for asbestos related liabilities342 366 
Deferred income taxes762 760 
Other assets9,428 9,412 
Total assets$63,945 $64,586 
LIABILITIES
Current liabilities:
Accounts payable$6,139 $5,750 
Commercial paper and other short-term borrowings3,573 3,597 
Current maturities of long-term debt1,645 2,445 
Accrued liabilities6,786 7,405 
Total current liabilities18,143 19,197 
Long-term debt16,138 16,342 
Deferred income taxes2,302 2,113 
Postretirement benefit obligations other than pensions225 242 
Asbestos-related liabilities1,819 1,920 
Other liabilities7,109 6,975 
Redeemable noncontrolling interest7 7 
SHAREOWNERS’ EQUITY
Capital - common stock issued958 958 
 - additional paid-in capital7,566 7,292 
Common stock held in treasury, at cost(28,978)(27,229)
Accumulated other comprehensive loss(3,075)(3,377)
Retained earnings41,467 39,905 
Total Honeywell shareowners’ equity17,938 17,549 
Noncontrolling interest264 241 
Total shareowners’ equity18,202 17,790 
Total liabilities, redeemable noncontrolling interest and shareowners’ equity$63,945 $64,586 
The Notes to Consolidated Financial Statements are an integral part of this statement.
3 Honeywell International Inc.







HONEYWELL INTERNATIONAL INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
 Six Months Ended June 30,
 20212020
 (Dollars in millions)
Cash flows from operating activities:  
Net income$2,895 $2,705 
Less: Net income attributable to the noncontrolling interest38 43 
Net income attributable to Honeywell2,857 2,662 
Adjustments to reconcile net income attributable to Honeywell to net cash provided by operating activities:
Depreciation335 314 
Amortization290 179 
Gain on sale of non-strategic businesses and assets(90)0 
Repositioning and other charges242 342 
Net payments for repositioning and other charges(358)(309)
Pension and other postretirement income(583)(423)
Pension and other postretirement benefit payments(27)(23)
Stock compensation expense116 78 
Deferred income taxes101 (277)
Other(277)(285)
Changes in assets and liabilities, net of the effects of acquisitions and divestitures:
Accounts receivable(127)776 
Inventories(271)(331)
Other current assets(98)106 
Accounts payable402 (364)
Accrued liabilities(256)(26)
Net cash provided by (used for) operating activities2,256 2,419 
Cash flows from investing activities:
Expenditures for property, plant and equipment(406)(366)
Proceeds from disposals of property, plant and equipment14 7 
Increase in investments(1,397)(1,671)
Decrease in investments1,331 1,589 
Receipts from Garrett Motion Inc.375 0 
Receipts (payments) from settlements of derivative contracts(23)83 
Cash paid for acquisitions, net of cash acquired(1,327)0 
Proceeds from sales of businesses, net of fees paid190 0 
Net cash provided by (used for) investing activities(1,243)(358)
Cash flows from financing activities:
Proceeds from issuance of commercial paper and other short-term borrowings2,358 7,165 
Payments of commercial paper and other short-term borrowings(2,355)(7,094)
Proceeds from issuance of common stock114 97 
Proceeds from issuance of long-term debt27 7,101 
Payments of long-term debt(835)(1,218)
Repurchases of common stock(1,849)(1,985)
Cash dividends paid(1,304)(1,285)
Other(33)(40)
Net cash provided by (used for) financing activities(3,877)2,741 
Effect of foreign exchange rate changes on cash and cash equivalents16 (91)
Net increase (decrease) in cash and cash equivalents(2,848)4,711 
Cash and cash equivalents at beginning of period14,275 9,067 
Cash and cash equivalents at end of period$11,427 $13,778 
The Notes to Consolidated Financial Statements are an integral part of this statement.
4 Honeywell International Inc.








HONEYWELL INTERNATIONAL INC.
CONSOLIDATED STATEMENT OF SHAREOWNERS' EQUITY
(Unaudited)
 Three Months Ended June 30,Six Months Ended June 30,
2021202020212020
Shares$Shares$Shares$Shares$
 (In millions, except per share amounts)
Common stock, par value957.6 958 957.6 958 957.6 958 957.6 958 
Additional paid-in capital
Beginning balance7,505 7,047 7,292 6,876 
Issued for employee savings and option plans22 23 158 150 
Stock-based compensation expense39 34 116 78 
Ending balance7,566 7,104 7,566 7,104 
Treasury stock
Beginning balance(263.0)(27,975)(255.8)(25,643)(260.8)(27,229)(246.5)(23,836)
Reacquired stock or repurchases of common stock(4.6)(1,027)(0.4)(62)(8.6)(1,849)(12.1)(1,985)
Issued for employee savings and option plans0.4 24 0.4 20 2.2 100 2.8 136 
Ending balance(267.2)(28,978)(255.8)(25,685)(267.2)(28,978)(255.8)(25,685)
Retained earnings
Beginning balance40,682 38,635 39,905 37,693 
Net income attributable to Honeywell1,430 1,081 2,857 2,662 
Dividends on common stock(645)(636)(1,295)(1,275)
Ending balance41,467 39,080 41,467 39,080 
Accumulated other comprehensive income (loss)
Beginning balance(3,184)(3,353)(3,377)(3,197)
Foreign exchange translation adjustment129 121 342 (155)
Pension and other postretirement benefit adjustments(21)(20)(43)(40)
Changes in fair value of available for sale investments0 0 (3)0 
Changes in fair value of cash flow hedges1 (58)6 82 
Ending balance(3,075)(3,310)(3,075)(3,310)
Noncontrolling interest
Beginning balance266 221 241 212 
Acquisitions, divestitures, and other5 0 5 (6)
Net income attributable to noncontrolling interest17 18 38 43 
Foreign exchange translation adjustment0 3 1 (4)
Dividends paid(24)(23)(25)(26)
Contributions from noncontrolling interest holders0 0 4 0 
Ending balance264 219 264 219 
Total shareowners' equity690.4 18,202 701.8 18,366 690.4 18,202 701.8 18,366 
Cash dividends per share of common stock$0.930 $0.900 $1.860 $1.800 


The Notes to Consolidated Financial Statements are an integral part of this statement.

52 Honeywell International Inc.

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HONEYWELL INTERNATIONAL INC.
CONSOLIDATED BALANCE SHEET
(Unaudited)
 June 30, 2022December 31, 2021
 (Dollars in millions)
ASSETS 
Current assets:  
Cash and cash equivalents$8,248 $10,959 
Short-term investments411 564 
Accounts receivable, less allowances of $378 and $177, respectively7,738 6,830 
Inventories5,576 5,138 
Other current assets1,874 1,881 
Total current assets23,847 25,372 
Investments and long-term receivables797 1,222 
Property, plant and equipment - net5,342 5,562 
Goodwill17,528 17,756 
Other intangible assets - net3,385 3,613 
Insurance recoveries for asbestos related liabilities272 322 
Deferred income taxes491 489 
Other assets10,596 10,134 
Total assets$62,258 $64,470 
LIABILITIES
Current liabilities:
Accounts payable$6,245 $6,484 
Commercial paper and other short-term borrowings3,487 3,542 
Current maturities of long-term debt3,099 1,803 
Accrued liabilities7,116 7,679 
Total current liabilities19,947 19,508 
Long-term debt12,491 14,254 
Deferred income taxes2,421 2,364 
Postretirement benefit obligations other than pensions212 208 
Asbestos-related liabilities1,780 1,800 
Other liabilities7,210 7,087 
Redeemable noncontrolling interest7 7 
SHAREOWNERS’ EQUITY
Capital - common stock issued958 958 
 - additional paid-in capital8,397 8,141 
Common stock held in treasury, at cost(32,814)(30,462)
Accumulated other comprehensive loss(2,883)(2,895)
Retained earnings43,883 42,827 
Total Honeywell shareowners’ equity17,541 18,569 
Noncontrolling interest649 673 
Total shareowners’ equity18,190 19,242 
Total liabilities, redeemable noncontrolling interest and shareowners’ equity$62,258 $64,470 



The Notes to Consolidated Financial Statements are an integral part of this statement.

3Honeywell International Inc.
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HONEYWELL INTERNATIONAL INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
 Six Months Ended June 30,
 20222021
 (Dollars in millions)
Cash flows from operating activities:  
Net income$2,397 $2,895 
Less: Net income attributable to the noncontrolling interest2 38 
Net income attributable to Honeywell2,395 2,857 
Adjustments to reconcile net income attributable to Honeywell to net cash provided by operating activities:
Depreciation328 335 
Amortization277 290 
Gain on sale of non-strategic businesses and assets— (90)
Repositioning and other charges614 242 
Net payments for repositioning and other charges(220)(358)
Pension and other postretirement income(521)(583)
Pension and other postretirement benefit payments(5)(27)
Stock compensation expense113 116 
Deferred income taxes120 101 
Other81 (277)
Changes in assets and liabilities, net of the effects of acquisitions and divestitures:
Accounts receivable(904)(127)
Inventories(434)(271)
Other current assets(38)(98)
Accounts payable(240)402 
Accrued liabilities(741)(256)
Net cash provided by operating activities825 2,256 
Cash flows from investing activities:
Expenditures for property, plant and equipment(341)(406)
Proceeds from disposals of property, plant and equipment11 14 
Increase in investments(470)(1,397)
Decrease in investments646 1,331 
Receipts from Garrett Motion Inc.409 375 
Receipts (payments) from settlements of derivative contracts337 (23)
Cash paid for acquisitions, net of cash acquired(178)(1,327)
Proceeds from sales of businesses, net of fees paid— 190 
Net cash provided by (used for) investing activities414 (1,243)
Cash flows from financing activities:
Proceeds from issuance of commercial paper and other short-term borrowings2,924 2,358 
Payments of commercial paper and other short-term borrowings(2,926)(2,355)
Proceeds from issuance of common stock75 114 
Proceeds from issuance of long-term debt1 27 
Payments of long-term debt(89)(835)
Repurchases of common stock(2,437)(1,849)
Cash dividends paid(1,359)(1,304)
Other(21)(33)
Net cash used for financing activities(3,832)(3,877)
Effect of foreign exchange rate changes on cash and cash equivalents(118)16 
Net decrease in cash and cash equivalents(2,711)(2,848)
Cash and cash equivalents at beginning of period10,959 14,275 
Cash and cash equivalents at end of period$8,248 $11,427 


The Notes to Consolidated Financial Statements are an integral part of this statement.

4Honeywell International Inc.
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HONEYWELL INTERNATIONAL INC.
CONSOLIDATED STATEMENT OF SHAREOWNERS' EQUITY
(Unaudited)
 Three Months Ended June 30,Six Months Ended June 30,
2022202120222021
Shares$Shares$Shares$Shares$
 (In millions, except per share amounts)
Common stock, par value957.6 958 957.6 958 957.6 958 957.6 958 
Additional paid-in capital
Beginning balance8,326 7,505 8,141 7,292 
Issued for employee savings and option plans18 22 134 158 
Stock-based compensation expense53 39 122 116 
Ending balance8,397 7,566 8,397 7,566 
Treasury stock
Beginning balance(276.9)(31,420)(263.0)(27,975)(272.8)(30,462)(260.8)(27,229)
Reacquired stock or repurchases of common stock(7.5)(1,419)(4.6)(1,027)(13.0)(2,437)(8.6)(1,849)
Issued for employee savings and option plans0.5 25 0.4 24 1.9 85 2.2 100 
Ending balance(283.9)(32,814)(267.2)(28,978)(283.9)(32,814)(267.2)(28,978)
Retained earnings
Beginning balance43,288 40,682 42,827 39,905 
Net income attributable to Honeywell1,261 1,430 2,395 2,857 
Dividends on common stock(666)(645)(1,339)(1,295)
Ending balance43,883 41,467 43,883 41,467 
Accumulated other comprehensive income (loss)
Beginning balance(2,787)(3,184)(2,895)(3,377)
Foreign exchange translation adjustment(95)129 31 342 
Pension and other postretirement benefit adjustments(17)(21)(34)(43)
Changes in fair value of available for sale investments(3)— (9)(3)
Changes in fair value of cash flow hedges19 1 24 6 
Ending balance(2,883)(3,075)(2,883)(3,075)
Noncontrolling interest
Beginning balance686 266 673 241 
Acquisitions, divestitures, and other— 5 — 5 
Net income attributable to noncontrolling interest2 17 2 38 
Foreign exchange translation adjustment(7)— (7)1 
Dividends paid(32)(24)(33)(25)
Contributions from noncontrolling interest holders— — 14 4 
Ending balance649 264 649 264 
Total shareowners' equity673.7 18,190 690.4 18,202 673.7 18,190 690.4 18,202 
Cash dividends per share of common stock$0.980 $0.930 $1.960 $1.860 





The Notes to Consolidated Financial Statements are an integral part of this statement.

5Honeywell International Inc.
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HONEYWELL INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)



NOTE 1. BASIS OF PRESENTATION
In the opinion of management, the accompanying unaudited Consolidated Financial Statements reflect all adjustments, consisting only of normal recurring adjustments, necessary to present fairly the financial position, results of operations, cash flows, and shareowners' equity of Honeywell International Inc. and its consolidated subsidiaries (Honeywell or the Company) at June 30, 2021, and December 31, 2020, the cash flows for the six months ended June 30, 2021 and 2020, theperiods presented. The interim results of operations for the three and six months ended June 30, 2021 and 2020, and the shareowners' equity for the three and six months ended June 30, 2021 and 2020. The results of operations for the three and six months ended June 30, 2021, and cash flows for the six months ended June 30, 2021, should not necessarily be taken as indicative of the entire year.
Honeywell reports its quarterly financial information using a calendar convention; the first, second, and third quarters are consistently reported as ending on March 31, June 30, and September 30.30, respectively. It has beenis Honeywell's practice to establish actual quarterly closing dates using a predetermined fiscal calendar, which requires Honeywell's businesses to close their books on a Saturday in order to minimize the potentially disruptive effects of quarterly closing on ourthe Company's business processes. The effects of this practice are generally not significant to reported results for any quarter and only exist within a reporting year. In the event that differences in actual closing dates are material to year-over-year comparisons of quarterly or year-to-date results, Honeywell will provide appropriate disclosures. Honeywell's actual closing dates for the three and six months ended June 30, 2022 and 2021, were July 2, 2022, and June 30, 2020, were July 3, 2021, and June 27, 2020, respectively. 

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies of the Company are set forth in Note 1 to the Company's Consolidated Financial Statements contained in the Company’s 20202021 Annual Report on Form 10-K. The Company includes herein certain updates to those policies.
RECLASSIFICATIONS
Certain prior year amounts have been reclassified to conform to the current year presentation.
RECENT ACCOUNTING PRONOUNCEMENTS
The Company considers the applicability and impact of all Accounting Standards Updates (ASUs) issued by the Financial Accounting Standards Board (FASB). ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on our Consolidated Financial Statements.
In December 2019, the FASB issued an ASU to simplify the accounting for income taxes. The standard’s amendments include changes in various subtopics of accounting for income taxes including, but not limited to, accounting for “hybrid” tax regimes, tax basis step-up in goodwill obtained in a transaction that is not a business combination, intraperiod tax allocation exception to incremental approach, ownership changes in investments, interim-period accounting for enacted changes in tax law, and year-to-date loss limitation in interim-period tax accounting. Effective January 1, 2021, the Company adopted this standard. The adoption of this standard did not have a material impact on the Company's Consolidated Financial Statements.
In March 2020, the FASB issued guidance thatASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by the transition away from reference rates expected to be discontinued to alternative reference rates. In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope, to expand the scope of this guidance to include derivatives. The guidance was effective upon issuance and may be applied prospectively to contract modifications made and hedging relationships entered into on or before December 31, 2022. The Company is currently evaluatingwill apply the impacts of this guidance onto impacted transactions during the Company’s Consolidated Financial Statements. transition period. The Company does not expect the adoption of this standard todoes not have a material impact on the Company’s Consolidated Financial Statements.
In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, which requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASC 606, Revenue from Contracts with Customers. This ASU should be applied prospectively to acquisitions occurring on or after the effective date of December 15, 2022, and early adoption is permitted. The Company adopted this guidance on January 1, 2022. The adoption of this standard does not have a material impact on the Company’s Consolidated Financial Statements.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
NOTE 3. ACQUISITIONS AND DIVESTITURES
ACQUISITIONS
On February 12, 2021,January 18, 2022, the Company acquired 100% of the issued and outstanding shares outstanding of Sparta Systems,US Digital Design, Inc., a leading provider of enterprise quality management softwaretechnologies for the life sciences industry,first responders, for $1,303total consideration of $185 million. Sparta Systems is expected to further strengthen the Company's leadership in industrial automation, digital transformation solutions, and enterprise performance management software. The business is included within the Performance Materials andHoneywell Building Technologies segment. The assets and liabilities acquired with Sparta SystemsUS Digital Designs, Inc. are included in the Consolidated Balance Sheet as of June 30, 2021,2022, including $383$47 million of intangible assets and $1,029$134 million allocated to goodwill, which is non-deductibledeductible for tax purposes. The purchase accounting is subject to final adjustment, primarily for the valuation of intangible assets, amounts allocated to goodwill, and tax balances, and certain pre-acquisition contingencies.balances.
On March 15, 2021,DIVESTITURES
During 2022, there were no significant divestitures that closed individually or in the aggregate.
As of June 30, 2022, the Company had no material adjustments for acquisitions or divestitures completed the saleduring 2021. See Note 2 Acquisitions and Divestitures of its retail footwear business in exchange for gross cash consideration of $230 million. The Company recognized a pre-tax gain of $90 million, which was recorded in Other (income) expense. The retail footwear business was previously includedNotes to Consolidated Financial Statements in the SafetyCompany's 2021 Annual Report on Form 10-K for discussion of acquisitions and Productivity Solutions segment.divestitures during 2021.
NOTE 4. REVENUE RECOGNITION AND CONTRACTS WITH CUSTOMERS
Honeywell generates revenue from a comprehensive offering of products and services, including software and technologies, that are sold to a variety of customers in multiple end markets. See the following table and related discussions by operatingreportable business segment for details.
Three Months Ended June 30,Six Months Ended June 30, Three Months Ended June 30,Six Months Ended June 30,
20212020202120202022202120222021
AerospaceAerospaceAerospace
Commercial Aviation Original EquipmentCommercial Aviation Original Equipment$436 $446 $867 $1,121 Commercial Aviation Original Equipment$527 $436 $1,005 $867 
Commercial Aviation AftermarketCommercial Aviation Aftermarket1,015 661 1,925 2,046 Commercial Aviation Aftermarket1,208 1,015 2,376 1,925 
Defense and SpaceDefense and Space1,315 1,436 2,606 2,737 Defense and Space1,163 1,315 2,266 2,606 
2,766 2,543 5,398 5,904 2,898 2,766 5,647 5,398 
Honeywell Building TechnologiesHoneywell Building TechnologiesHoneywell Building Technologies
ProductsProducts830 659 1,628 1,400 Products936 812 1,815 1,596 
Building SolutionsBuilding Solutions577 518 1,137 1,058 Building Solutions595 595 1,145 1,169 
1,407 1,177 2,765 2,458 1,531 1,407 2,960 2,765 
Performance Materials and TechnologiesPerformance Materials and TechnologiesPerformance Materials and Technologies
UOPUOP571 517 1,098 1,111 UOP565 571 1,045 1,098 
Process SolutionsProcess Solutions1,166 1,093 2,262 2,244 Process Solutions1,179 1,166 2,331 2,262 
Advanced MaterialsAdvanced Materials815 608 1,538 1,260 Advanced Materials950 815 1,771 1,538 
2,552 2,218 4,898 4,615 2,694 2,552 5,147 4,898 
Safety and Productivity SolutionsSafety and Productivity SolutionsSafety and Productivity Solutions
Safety and RetailSafety and Retail616 511 1,359 1,013 Safety and Retail488 616 999 1,359 
Productivity Solutions and ServicesProductivity Solutions and Services383 268 726 555 Productivity Solutions and Services442 386 833 732 
Warehouse and Workflow SolutionsWarehouse and Workflow Solutions880 554 1,724 1,012 Warehouse and Workflow Solutions640 867 1,239 1,698 
Advanced Sensing TechnologiesAdvanced Sensing Technologies204 206 392 383 Advanced Sensing Technologies259 214 502 412 
2,083 1,539 4,201 2,963 1,829 2,083 3,573 4,201 
Corporate and All OtherCorporate and All Other1 — 2 — 
Net salesNet sales$8,808 $7,477 $17,262 $15,940 Net sales$8,953 $8,808 $17,329 $17,262 
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
In July 2022, the Company realigned certain business units within the Safety and Productivity Solutions reportable business segment. See Note 18 Subsequent Events for additional information.
Aerospace – A global supplier of products, software and services for aircraftaircrafts that it sells to original equipment manufacturers (OEM)OEM and other customers in a variety of end markets including: air transport, regional, business and general aviation aircraft, airlines, aircraft operators and defense and space contractors. Aerospace products and services include auxiliary power units, propulsion engines, environmental control systems, integrated avionics, wireless connectivity services, electric power systems, engine controls, flight safety, communications, navigation hardware, data and software applications, radar and surveillance systems, aircraft lighting, management and technical services, advanced systems and instruments, satellite and space components, aircraft wheels and brakes, repair, and overhaul services and thermal systems. Aerospace also provides spare parts, repair, overhaul and maintenance services (principally to aircraft operators) for the aftermarket. Honeywell Forge solutions are leveraged by ourthe Company's customers as tools to turn data into predictive maintenance and predictive analytics to enable better fleet management and make flight operations more efficient.
Honeywell Building Technologies – A global provider of products, software, solutions, and technologies that enable building owners and occupants to ensure their facilities are safe, energy efficient, sustainable, and productive. Honeywell Building Technologies products and services include advanced software applications for building control and optimization; sensors, switches, control systems, and instruments for energy management; access control; video surveillance; fire products; remote patient monitoring systems; and installation, maintenance and upgrades of systems. Honeywell Forge solutions enable ourthe Company's customers to digitally manage buildings, connecting data from different assets to enable smart maintenance, improve building performance, and even protect from incoming security threats.
Performance Materials and Technologies – A global provider in developing and manufacturing high-quality performance chemicals and materials, process technologies, and automation solutions. The segment is comprised of Process Solutions, UOP, and Advanced Materials. Process Solutions provides automation control, instrumentation, advanced software, and related services for the oil and gas, refining, pulp and paper, industrial power generation, chemicals and petrochemicals, biofuels, life sciences, and metals, minerals, and mining industries. Through its smart energy products, Process Solutions enables utilities and distribution companies to deploy advanced capabilities to improve operations, reliability, and environmental sustainability. UOP provides process technology, products, including catalysts and adsorbents, equipment, and consulting services that enable customers to efficiently produce gasoline, diesel, jet fuel, petrochemicals and renewable fuels for the petroleum refining, gas processing, petrochemical, and other industries. Advanced Materials manufactures a wide variety of high-performance products, including materials used to manufacture end products such as bullet-resistant armor, nylon, computer chips, and pharmaceutical packaging, and provides reduced and low global-warming-potential materials based on hydrofluoro-olefin technology. In the industrial environment, Honeywell Forge solutions enable integration and connectivity to provide a holistic view of operations and turn data into clear actions to maximize productivity and efficiency. Honeywell Forge's cybersecurity capabilities help identify risks and act on cyber-related incidents, together enabling improved operations and protecting processes, people and assets.
Safety and Productivity Solutions – A global provider of products and software that improve productivity, workplace safety and asset performance to customers around the globe. Safety products include personal protective equipment (PPE),PPE, apparel, gear, and footwear designed for work, play and outdoor activities;footwear; gas detection technology; and cloud-based notification and emergency messaging. Productivity Solutions products and services include mobile devices and software for computing, data collection, and thermal printing; supply chain and warehouse automation equipment, software and solutions; custom-engineered sensors, switches and controls for sensing and productivity solutions; and software-based data and asset management productivity solutions. Honeywell Forge solutions digitally automate processes to improve efficiency while reducing downtime and safety costs.
Corporate and All Other –Corporate and All Other includes revenue from Honeywell's majority-owned investment in Quantinuum. Through Quantinuum, Honeywell provides a wide range of service offerings of fully integrated quantum computing hardware and software solutions.
For a summary by disaggregated product and services sales for each segment, refer to Note 1817 Segment Financial Data. 
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
The Company recognizes revenue from performance obligations to customers that are satisfied at a point in time and over time. The disaggregation of the Company's revenue based off timing of recognition is as follows:
Three Months Ended June 30,Six Months Ended June 30,Three Months Ended June 30,Six Months Ended June 30,
20212020202120202022202120222021
Products, transferred point in timeProducts, transferred point in time58 %61 %58 %61 %Products, transferred point in time61 %58 %60 %58 %
Products, transferred over timeProducts, transferred over time17 16 18 15 Products, transferred over time14 17 14 18 
Net product salesNet product sales75 77 76 76 Net product sales75 75 74 76 
Services, transferred point in timeServices, transferred point in time7 7 7 8 Services, transferred point in time7 7 8 7 
Services, transferred over timeServices, transferred over time18 16 17 16 Services, transferred over time18 18 18 17 
Net service salesNet service sales25 23 24 24 Net service sales25 25 26 24 
Net salesNet sales100 %100 %100 %100 %Net sales100 %100 %100 %100 %
CONTRACT BALANCES
The Company records progress on satisfying performance obligations to customers, and the related billings and cash collections, on the Consolidated Balance Sheet in Accounts receivable - net and Other assets (unbilled receivables (contract assets) and billed receivables) and Accrued liabilities and Other liabilities (customer advances and deposits (contract liabilities)). Unbilled receivables (contract assets) arise when the timing of cash collected from customers differs from the timing of revenue recognition, such as when contract provisions require specific milestones to be met before a customer can be billed. Unbilled receivable balance increases when the revenue associated with the contract is recognized prior to billing and decreases when billed in accordance with the terms of the contract. Contract liabilities increase when customers remit contractual cash payments in advance of the Company satisfying performance obligations under contractual arrangements, including those with performance obligations to be satisfied over a period of time. Contract liabilities decrease when revenue is recorded, either when a milestone is met triggering the contractual right to bill or when the performance obligation is satisfied. 
Contract balances are classified as assets or liabilities on a contract-by-contract basis at the end of each reporting period.
The following table summarizes the Company's contract assets and liabilities balances: 
20212020 20222021
Contract assets - January 1Contract assets - January 1$1,618 $1,602 Contract assets - January 1$2,060 $1,618 
Contract assets - June 30Contract assets - June 301,868 1,760 Contract assets - June 302,243 1,868 
Change in contract assets - increase (decrease)Change in contract assets - increase (decrease)$250 $158 Change in contract assets - increase (decrease)$183 $250 
Contract liabilities - January 1Contract liabilities - January 1$(4,033)$(3,501)Contract liabilities - January 1$(4,290)$(4,033)
Contract liabilities - June 30Contract liabilities - June 30(3,740)(3,574)Contract liabilities - June 30(4,329)(3,740)
Change in contract liabilities - decrease (increase)Change in contract liabilities - decrease (increase)$293 $(73)Change in contract liabilities - decrease (increase)$(39)$293 
Net changeNet change$543 $85 Net change$144 $543 
For the three and six months ended June 30, 2021,2022, the Company recognized revenue of $441$344 million and $1,561$1,271 million, respectively, that was previously included in the beginning balance of contract liabilities. For the three and six months ended June 30, 2020,2021, the Company recognized revenue of $315$441 million and $1,203$1,516 million, respectively, that was previously included in the beginning balance of contract liabilities.
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(Unaudited)
(DollarsContract assets include $2,213 million and $2,035 million of unbilled balances under long-term contracts as of June 30, 2022 and December 31, 2021, respectively. These amounts are billed in tables in millions, except per share amounts)
accordance with the terms of customer contracts to which they relate.
When contracts are modified to account for changes in contract specifications and requirements, the Company considers whether the modification either creates new or changes the existing enforceable rights and obligations. Contract modifications that are for goods or services that are not distinct from the existing contract, due to the significant integration with the original good or service provided, are accounted for as if they were part of that existing contract. The effect of a contract modification on the transaction price, and the Company's measure of progress for the performance obligation to which it relates, is recognized as an adjustment to revenue (either as an increase in or a reduction of revenue) on a cumulative catch-up basis. When the modifications include additional performance obligations that are distinct and at relative stand-alone selling price, they are accounted for as a new contract and performance obligation, which are recognized prospectively. 
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
PERFORMANCE OBLIGATIONS
A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is defined as the unit of account. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. When the Company's contracts with customers require highly complex integration or manufacturing services that are not separately identifiable from other promises in the contracts and, therefore, not distinct, then the entire contract is accounted for as a single performance obligation. In situations when the Company's contract includes distinct goods or services that are substantially the same and have the same pattern of transfer to the customer over time, they are recognized as a series of distinct goods or services. For any contracts with multiple performance obligations, the Company allocates the contract’s transaction price to each performance obligation based on the estimated relative standalone selling price of each distinct good or service in the contract. For product sales, each product sold to a customer typically represents a distinct performance obligation. In such cases, the observable standalone sales are used to determine the standalone selling price.
Performance obligations are satisfied as of a point in time or over time. Performance obligations are supported by contracts with customers, providing a framework for the nature of the distinct goods, services or bundle of goods and services. The timing of satisfying the performance obligation is typically indicated by the terms of the contract.
The following table outlines the Company's remaining performance obligations disaggregated by segment: 
 June 30, 20212022
Aerospace$8,93010,538 
Honeywell Building Technologies6,7767,502 
Performance Materials and Technologies7,5797,858 
Safety and Productivity Solutions3,7413,572 
Corporate and All Other(1)
3 
Total Performance Obligations(2)
$27,02629,473 
(1) The remaining performance obligations within Corporate and All Other relate to the Quantinuum business.
(2) Effective March 31, 2022, performance obligations exclude contracts with customers related to Russia as collectability is not reasonably assured.
Performance obligations recognized as of June 30, 2021,2022, will be satisfied over the course of future periods. The Company's disclosure of the timing for satisfying the performance obligation is based on the requirements of contracts with customers. However, from time to time, these contracts may be subject to modifications, impacting the timing of satisfying the performance obligations. Performance obligations expected to be satisfied within one year and greater than one year are 55%61% and 45%39%, respectively. 
The timing of satisfaction of the Company's performance obligations does not significantly vary from the typical timing of payment. Typical payment terms of the Company's fixed-price over time contracts include progress payments based on specified events or milestones, or based on project progress. For some contracts wethe Company may be entitled to receive an advance payment. 
The Company applied the practical expedient for certain revenue streams to exclude the value of remaining performance obligations for (i) contracts with an original expected term of one year or less, or (ii) contracts for which we recognizethe Company recognizes revenue in proportion to the amount we havethe Company has the right to invoice for services performed.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
NOTE 5. REPOSITIONING AND OTHER CHARGES
A summary of repositioning and other charges follows:
Three Months Ended June 30,Six Months Ended June 30,Three Months Ended June 30,Six Months Ended June 30,
2021202020212020 2022202120222021
SeveranceSeverance$32 $254 $60 $320 Severance$25 $32 $32 $60 
Asset impairmentsAsset impairments45 4 87 6 Asset impairments25 45 148 87 
Exit costsExit costs15 15 64 30 Exit costs41 15 58 64 
Reserve adjustmentsReserve adjustments(22)(18)(21)(31)Reserve adjustments(37)(22)(52)(21)
Total net repositioning chargeTotal net repositioning charge70 255 190 325 Total net repositioning charge54 70 186 190 
Asbestos related litigation charges, net of insurance and reimbursementsAsbestos related litigation charges, net of insurance and reimbursements23 9 44 20 Asbestos related litigation charges, net of insurance and reimbursements40 23 86 44 
Probable and reasonably estimable environmental liabilities, net of reimbursementsProbable and reasonably estimable environmental liabilities, net of reimbursements6 6 11 14 Probable and reasonably estimable environmental liabilities, net of reimbursements2 6 16 11 
OtherOther2 10 (3)(17)Other131 2 326 (3)
Total net repositioning and other chargesTotal net repositioning and other charges$101 $280 $242 $342 Total net repositioning and other charges$227 $101 $614 $242 

The following table summarizes the pretax distribution of total net repositioning and other charges by classification:
Three Months Ended June 30,Six Months Ended June 30, Three Months Ended June 30,Six Months Ended June 30,
2021202020212020 2022202120222021
Cost of products and services soldCost of products and services sold$87 $175 $185 $195 Cost of products and services sold$145 $87 $344 $185 
Selling, general and administrative expensesSelling, general and administrative expenses14 105 57 147 Selling, general and administrative expenses25 14 213 57 
Other (income) expenseOther (income) expense57 — 57 — 
$227 $101 $614 $242 
$101 $280 $242 $342 

The following table summarizes the pretax impact of total net repositioning and other charges by segment:segment. These amounts are excluded from segment profit as described in Note 17 Segment Financial Data:
Three Months Ended June 30,Six Months Ended June 30,Three Months Ended June 30,Six Months Ended June 30,
2021202020212020 2022202120222021
AerospaceAerospace$9 $107 $57 $118 Aerospace$15 $9 $36 $57 
Honeywell Building TechnologiesHoneywell Building Technologies(1)33 4 58 Honeywell Building Technologies23 (1)37 4 
Performance Materials and TechnologiesPerformance Materials and Technologies2 84 7 105 Performance Materials and Technologies88 2 247 7 
Safety and Productivity SolutionsSafety and Productivity Solutions59 11 96 17 Safety and Productivity Solutions15 59 142 96 
Corporate32 45 78 44 
Corporate and All OtherCorporate and All Other86 32 152 78 
$101 $280 $242 $342  $227 $101 $614 $242 

In the three months ended June 30, 2022, the Company recognized gross repositioning charges totaling $91 million, including severance costs of $25 million related to workforce reductions of 468 manufacturing and administrative positions primarily in our Safety and Productivity Solutions segment. The workforce reductions were primarily related to our productivity and ongoing functional transformation initiatives. The repositioning charge included asset impairments of $25 million related to the write-down of certain manufacturing equipment. The repositioning charge also included exit costs of $41 million primarily related to current period exit costs incurred for new and previously approved repositioning projects and closure obligations associated with site transitions in our Performance Materials and Technologies and Aerospace segments. Also, $37 million of previously established reserves, primarily for severance, were returned to income due to adjustments to the scope of previously announced repositioning actions.
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
In the three months ended June 30, 2021, wethe Company recognized gross repositioning charges totaling $92 million, including severance costs of $32 million related to workforce reductions of 3,628 manufacturing and administrative positions mainly in our Safety and Productivity Solutions segment. The workforce reductions were primarily related to the re-alignment of a product line in our Safety and Productivity Solutions segment and to our productivity and ongoing functional transformation initiatives. The repositioning charge included asset impairments of $45 million primarily related to the write-down of certain manufacturing equipment. The repositioning charge also included exit costs of $15 million primarily for current period exit costs incurred for previously approved repositioning projects. Also, $22 million of previously established reserves, primarily for severance, were returned to income due to adjustments to the scope of previously announced repositioning actions.
In the threesix months ended June 30, 2020, we2022, the Company recognized gross repositioning charges totaling $273$238 million includingprimarily related to closing and relocating the production of certain respiratory manufacturing from a U.S.-based facility to a non-U.S facility in our Safety Productivity and Solutions segment, productivity and ongoing functional transformation initiatives, and other site transitions. The repositioning charge included asset impairments of $148 million related to the write-down of certain manufacturing equipment. The repositioning charge included exit costs of $58 million primarily related to current period exit costs incurred for new and previously approved repositioning projects and closure obligations associated with site transitions in our Performance Materials and Technologies and Aerospace segments. The repositioning charge also included severance costs of $254$32 million related to workforce reductions of 7,8051,664 manufacturing and administrative positions across all of our segments, with a majority of the workforce reductions in Aerospace and Performance Materials and Technologies.segments. The workforce reductions were primarily related to the Company aligning its cost structuresavings actions taken in connection with the current and anticipated slowdown in demand for many of our products and services due to the global recession, and our productivity and ongoing functional transformation initiatives.
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(Unaudited)
(Dollars in tables in millions, except per share amounts)
initiatives and to site transitions to more cost-effective locations. Also, $52 million of previously established reserves, primarily for severance, were returned to income due to adjustments to the scope of previously announced repositioning actions.
In the six months ended June 30, 2021, wethe Company recognized gross repositioning charges totaling $211 million including severance costs of $60 million related to workforce reductions of 4,649 manufacturing and administrative positions mainly in ourthe Company's Safety and Productivity Solutions and Aerospace segments. The workforce reductions were primarily related to the re-alignment of a product line in our Safety and Productivity Solutions segment, site transitions, mainly in Aerospace, to more cost-effective locations, and our productivity and ongoing functional transformation initiatives. The repositioning charge included asset impairments of $87 million primarily related to the write-down of certain manufacturing and other equipment. The repositioning charge included exit costs of $64 million primarily for current period exit costs incurred for previously approved repositioning projects, closure obligations associated with site transitions, and lease obligations for equipment. Also, $21 million of previously established reserves, primarily for severance, were returned to income due to adjustments to the scope of previously announced repositioning actions.
In the six months ended June 30, 2020, we recognized gross repositioning charges totaling $356 million including severance costs of $320 million related to workforce reductions of 9,929 manufacturing and administrative positions across our segments, with a majority of the reductions in Aerospace and Performance Materials and Technologies. The workforce reductions primarily related to the Company aligning its cost structure with the current and anticipated slowdown in demand for many of our products and services due to the global recession, and our productivity and ongoing functional transformation initiatives. Also, $31 million of previously established reserves, primarily for severance, were returned to income mainly as a result of higher attrition than anticipated in prior severance programs resulting in lower severance payments.
The following table summarizes the status of the Company's total repositioning reserves:
Severance
Costs		Asset
Impairments		Exit
Costs		TotalSeverance
Costs		Asset
Impairments		Exit
Costs		Total
Balance at December 31, 2020$527 $0 $74 $601 
Balance at December 31, 2021Balance at December 31, 2021$289 $— $122 $411 
ChargesCharges60 87 64 211 Charges32 148 58 238 
Usage - cashUsage - cash(162)0 (40)(202)Usage - cash(79)— (78)(157)
Usage - noncashUsage - noncash0 (89)0 (89)Usage - noncash— (140)— (140)
Foreign currency translationForeign currency translation(1)0 (2)(3)Foreign currency translation4 — — 4 
AdjustmentsAdjustments(19)2 (4)(21)Adjustments(38)(8)(6)(52)
Balance at June 30, 2021$405 $0 $92 $497 
Balance at June 30, 2022Balance at June 30, 2022$208 $— $96 $304 
Certain repositioning projects will recognize exit costs in future periods when the actual liability is incurred. Such exit costs incurred in the six months ended June 30, 2022 and 2021, were $31 million and 2020, were $20 million, respectively.
During the three and $19six months ended June 30, 2022, the Company recognized Other charges of $124 million and $307 million, respectively. The Other charges included costs related to the initial suspension of substantially all of our sales, distribution and service activities in Russian and Belarus (the Suspension) and the Company’s plan to wind down existing businesses and operations in Russia due to the ongoing Russia-Ukraine conflict (the Wind down). Through the Wind down of our businesses and operations, we will seek to collect outstanding accounts receivables, liquidate our inventory and fixed assets, negotiate and settle existing contractual obligations, trade payables and guarantees, and terminate and payout severance to impacted employees.
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
Other charges include costs recorded by all segments, with the most significant impact within the Performance Materials and Technologies segment. The Other charges include costs recorded in Cost of products sold, Selling, general and administrative expenses, or Other (income) expense on the Consolidated Statement of Operations, based on the nature of each specific charge or accrual of reserve. For the three months ended June 30, 2022, Cost of products and services sold includes $60 million primarily related to inventory reserves and the write-down of other assets, Selling, general and administrative includes $7 million primarily related to employee severance, and Other (income) expense includes $57 million related to foreign exchange revaluation on an intercompany loan with a Russian affiliate and impairment of property, plant and equipment. For the six months ended June 30, 2022, Cost of products and services sold includes $60 million primarily related to inventory reserves and the write-down of other assets, Selling, general and administrative includes $190 million primarily related to reserves against outstanding accounts receivable and contract assets, impairment of intangible assets, the write-down of other assets, and employee severance, and Other (income) expense includes $57 million related to foreign exchange revaluation on an intercompany loan with a Russian affiliate and impairment of property, plant and equipment. For the three and six months ended June 30, 2022, the Other charges does not include a $2 million tax valuation allowance recorded to Tax expense on the Consolidated Statement of Operations, directly attributable to our Wind down of businesses and operations in Russia.
Given the uncertainty inherent in our remaining obligations related to our contracts with Russian counterparties, we do not believe it is possible to develop estimates of reasonably possible loss in excess of current accruals for these matters (other than as specifically set forth above). Based on available information to date, the Company’s estimate of potential future losses or other contingencies related to Suspension and Wind down activities, including any guarantee payments or any litigation costs or as otherwise related to our Wind down in Russia, could adversely affect the Company's consolidated results of operations in the periods recognized but would not be material with respect to the Company's consolidated financial position. See Note 14 Commitments and Contingencies for a discussion of the recognition and measurement of estimate for contingencies.
NOTE 6. INCOME TAXES
The effective tax rate was higher than the U.S. federal statutory rate of 21% and increased during 20212022 compared to 20202021 primarily fromdue to charges and accrual of reserves directly attributable to the absenceinitial Suspension and Wind down of our businesses and operations in Russia with no corresponding tax benefits realized in the prior year as a result of the favorable resolution of a foreign tax matterbenefit, an expense related to the spin-off transactions,UOP matters with no corresponding tax law changes in India and the resolution of certain U.S. tax matters, partially offset by increasedbenefit, lower tax benefits for employee share-based compensation, and incremental tax reserves and state taxes, partially offset by the favorable resolution of certain foreign tax matters in the current year.matters.
NOTE 7. ACCOUNTS RECEIVABLE - NETINVENTORIES
June 30, 2021December 31, 2020
Trade$7,150 $7,029 
Less - Allowance for doubtful accounts(203)(202)
 $6,947 $6,827 
Trade receivables include $1,830 million and $1,589 million of unbilled balances under long-term contracts as of June 30, 2021, and December 31, 2020. These amounts are billed in accordance with the terms of the customer contracts to which they relate. 
 June 30, 2022December 31, 2021
Raw materials$1,507 $1,352 
Work in process1,003 861 
Finished products3,066 2,925 
 $5,576 $5,138 
1213 Honeywell International Inc.

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HONEYWELL INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
NOTE 8. INVENTORIES
 June 30, 2021December 31, 2020
Raw materials$1,211 $1,079 
Work in process801 798 
Finished products2,711 2,612 
 $4,723 $4,489 

NOTE 9.8. LONG-TERM DEBT AND CREDIT AGREEMENTS
 June 30, 2021December 31, 2020
4.25% notes due 2021$0 $800 
1.85% notes due 20211,500 1,500 
0.483% notes due 20222,500 2,500 
2.15% notes due 2022600 600 
Floating rate notes due 20221,100 1,100 
1.30% Euro notes due 20231,478 1,534 
3.35% notes due 2023300 300 
0.00% Euro notes due 2024591 614 
2.30% notes due 2024750 750 
1.35% notes due 20251,250 1,250 
2.50% notes due 20261,500 1,500 
2.25% Euro notes due 2028887 920 
2.70% notes due 2029750 750 
1.95% notes due 20301,000 1,000 
0.75% Euro notes due 2032591 614 
5.70% notes due 2036441 441 
5.70% notes due 2037462 462 
5.375% notes due 2041417 417 
3.812% notes due 2047445 445 
2.80% notes due 2050750 750 
Industrial development bond obligations, floating rate maturing at various dates through 203722 22 
6.625% debentures due 2028201 201 
9.065% debentures due 203351 51 
Other (including capitalized leases and debt issuance costs), 8.1% weighted average interest rate maturing at various dates through 2025197 266 
 17,783 18,787 
Less-current portion(1,645)(2,445)
 $16,138 $16,342 
13 Honeywell International Inc.

HONEYWELL INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(Unaudited)
(Dollars in tables in millions, except per share amounts)
 June 30, 2022December 31, 2021
0.483% notes due 2022$500 $500 
2.15% notes due 2022600 600 
Floating rate notes due 2022600 600 
1.30% Euro notes due 20231,304 1,416 
3.35% notes due 2023300 300 
0.00% Euro notes due 2024522 566 
2.30% notes due 2024750 750 
1.35% notes due 20251,250 1,250 
2.50% notes due 20261,500 1,500 
1.10% notes due 20271,000 1,000 
2.25% Euro notes due 2028783 849 
2.70% notes due 2029750 750 
1.95% notes due 20301,000 1,000 
1.75% notes due 20311,500 1,500 
0.75% Euro notes due 2032522 566 
5.70% notes due 2036441 441 
5.70% notes due 2037462 462 
5.375% notes due 2041417 417 
3.812% notes due 2047445 445 
2.80% notes due 2050750 750 
Industrial development bond obligations, floating rate maturing at various dates through 203722 22 
6.625% debentures due 2028201 201 
9.065% debentures due 203351 51 
Other (including capitalized leases), 8.7% weighted average interest rate maturing at various dates through 2027123 332 
Debt issuance costs(203)(211)
 15,590 16,057 
Less-current portion(3,099)(1,803)
 $12,491 $14,254 
On March 1, 2021, the Company repaid its 4.25% notes due 2021.
On March 31, 2021,24, 2022, the Company entered into a $4.0 billion Amended and Restated Five Year Credit Agreement (the 5-Year Credit Agreement) and a $1.5 billion 364-Day Credit Agreement (the 364-Day Credit Agreement). The 5-Year Credit Agreement amended and restated the previously reported $4.0 billion amended and restated five-year credit agreement dated as of April 26, 2019.March 31, 2021. Commitments under the 5-Year Credit Agreement can be increased pursuant to the terms of the 5-Year Credit Agreement to an aggregate amount not to exceed $4.5 billion. The 364-Day Credit Agreement replaced the $1.5 billion 364-day credit agreement dated as of April 10, 2020,March 31, 2021, which was terminated in accordance with its terms effective March 31, 2021.24, 2022. Amounts borrowed under the 364-Day Credit Agreement are required to be repaid no later than March 30, 2022,23, 2023, unless (i) Honeywell elects to convert all then outstanding amounts into a term loan, upon which such amounts shall be repaid in full on March 30, 2023,23, 2024, or (ii) the 364-Day Credit Agreement is terminated earlier pursuant to its terms. The 5-Year Credit Agreement and the 364-Day Credit Agreement are maintained for general corporate purposes.
As of June 30, 2021,2022, there were no outstanding borrowings under the 5-Year Credit Agreement or the 364-Day Credit Agreement.
14Honeywell International Inc.
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
NOTE 10.9. LEASES
The Company's operating and finance lease portfolio is described in Note 1110 Leases of Notes to Consolidated Financial Statements in our 2020the 2021 Annual Report on Form 10-K.
Supplemental cash flow information related to leases was as follows:
Six Months Ended June 30,Six Months Ended June 30,
2021202020222021
Net right-of-use assets obtained in exchange for lease obligations:Net right-of-use assets obtained in exchange for lease obligations:Net right-of-use assets obtained in exchange for lease obligations:
Operating leasesOperating leases$243 $100 Operating leases$64 $243 
Finance leasesFinance leases8 17 Finance leases28 8 

Supplemental balance sheet information related to leases was as follows:
June 30, 2021December 31, 2020
Operating leases
Other assets$923 $773 
Accrued liabilities186 187 
Other liabilities815 641 
Total operating lease liabilities$1,001 $828 
Financing leases
Property, plant and equipment$341 $357 
Accumulated depreciation(186)(180)
Property, plant and equipment - net$155 $177 
Current maturities of long-term debt57 60 
Long-term debt105 124 
Total financing lease liabilities$162 $184 



June 30, 2022December 31, 2021
Operating leases
Other assets$908 $947 
Accrued liabilities200 185 
Other liabilities798 847 
Total operating lease liabilities$998 $1,032 
Financing leases
Property, plant and equipment$322 $325 
Accumulated depreciation(160)(177)
Property, plant and equipment - net$162 $148 
Current maturities of long-term debt64 57 
Long-term debt102 99 
Total financing lease liabilities$166 $156 
1415 Honeywell International Inc.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
NOTE 11.10. DERIVATIVE INSTRUMENTS AND HEDGING TRANSACTIONS
OurHoneywell's credit, market, foreign currency, and interest rate risk management policies are described in Note 1211 Derivative Instruments and Hedging Transactions of Notes to Consolidated Financial Statements in our 2020the Company's 2021 Annual Report on Form 10-K. During March 2022, the Company entered into certain commodity contracts. The Company's risk management policy related to commodity contracts is described in the below section. All derivative assets are presented in Other current assets or Other assets. All derivative liabilities are presented in Accrued liabilities or Other liabilities.
COMMODITY CONTRACTS RISK MANAGEMENT
The Company's operations subject us to risk related to the price volatility of certain commodities. To mitigate the commodity price risk associated with the Company's operations, the Company may enter into commodity derivative instruments. In March 2022, the Company entered into various contracts to mitigate commodity price volatility. The Company elected to apply hedge accounting to these contracts.
The following table summarizes the notional amounts amounts and fair values of the Company’s outstanding derivatives by risk category and instrument type within the Consolidated Balance Sheet as of June 30, 2021,2022, and December 31, 2020:2021:
NotionalFair Value AssetFair Value (Liability)NotionalFair Value AssetFair Value (Liability)
June 30, 2021December 31, 2020June 30, 2021December 31, 2020June 30, 2021December 31, 2020June 30, 2022December 31, 2021June 30, 2022December 31, 2021June 30, 2022December 31, 2021
Derivatives in Fair Value Hedging Relationships:Derivatives in Fair Value Hedging Relationships:   Derivatives in Fair Value Hedging Relationships:   
Interest rate swap agreementsInterest rate swap agreements$3,150 $3,950 $115 $194 $0 $0 Interest rate swap agreements$3,150 $3,150 $— $60 $(108)$— 
Derivatives in Cash Flow Hedging Relationships:Derivatives in Cash Flow Hedging Relationships:Derivatives in Cash Flow Hedging Relationships:
Foreign currency exchange contractsForeign currency exchange contracts411 488 18 65 0 (58)Foreign currency exchange contracts3,637 647 34 4 (3)— 
Commodity contractsCommodity contracts9 — — — (1)— 
Derivatives in Net Investment Hedging Relationships:Derivatives in Net Investment Hedging Relationships:Derivatives in Net Investment Hedging Relationships:
Foreign currency exchange contractsForeign currency exchange contracts772 806 63 45 0 (1)Foreign currency exchange contracts278 746 124 92 — — 
Cross currency swap agreementsCross currency swap agreements1,200 1,200 0 0 (15)(50)Cross currency swap agreements1,200 1,200 135 39 — — 
Total Derivatives Designated as Hedging InstrumentsTotal Derivatives Designated as Hedging Instruments5,533 6,444 196 304 (15)(109)Total Derivatives Designated as Hedging Instruments8,274 5,743 293 195 (112)— 
Derivatives Not Designated as Hedging Instruments:Derivatives Not Designated as Hedging Instruments:Derivatives Not Designated as Hedging Instruments:
Foreign currency exchange contractsForeign currency exchange contracts13,196 14,829 192 92 (193)(91)Foreign currency exchange contracts9,374 11,278 384 278 (379)(282)
Total Derivatives at Fair ValueTotal Derivatives at Fair Value$18,729 $21,273 $388 $396 $(208)$(200)Total Derivatives at Fair Value$17,648 $17,021 $677 $473 $(491)$(282)
In addition to the derivative instruments listed above, certain of the Company's foreign currency denominated debt instruments are designated as net investment hedges. The carrying value of those debt instruments designated as net investment hedges, which includes the adjustment for the foreign currency transaction gain or loss on those instruments, was $4,252$2,449 million and $4,414$4,074 million as of June 30, 2021,2022, and December 31, 2020.2021, respectively.
The following table sets forth the amounts recorded on the Consolidated Balance Sheet related to cumulative basis adjustments for fair value hedges:
Line in the Consolidated Balance
Sheet of Hedged Item		Carrying Amount of the Hedged ItemCumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Item
June 30, 2021December 31, 2020June 30, 2021December 31, 2020
Long-term debt$3,265 $4,144 $115 $194 
15 Honeywell International Inc.

HONEYWELL INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(Unaudited)
(Dollars in tables in millions, except per share amounts)
Line in the Consolidated Balance Sheet of Hedged ItemCarrying Amount of the Hedged ItemCumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Item
June 30, 2022December 31, 2021June 30, 2022December 31, 2021
Long-term debt$3,042 $3,210 $(108)$60 
The following tables summarize the location and impact to the Consolidated Statement of Operations related to derivative instruments:
 Three Months Ended June 30, 2021
RevenueCost of Products and Services SoldSG&AOther (Income) ExpenseInterest and Other Financial Charges
$8,808 $6,003 $1,207 $(366)$83 
Gain or (loss) on cash flow hedges:
Foreign Currency Exchange Contracts:
Amount reclassified from accumulated other comprehensive income into income1 3 2 0 0 
Gain or (loss) on fair value hedges:
Interest Rate Swap Agreements:
Hedged items0 0 0 0 (14)
Derivatives designated as hedges0 0 0 0 14 
Gain or (loss) on net investment hedges:
Foreign Currency Exchange Contracts:
Amount excluded from effectiveness testing recognized in earnings using an amortization approach0 0 0 0 4 
Gain or (loss) on derivatives not designated as hedging instruments: 
Foreign currency exchange contracts0 0 0 (71)0 
16 Honeywell International Inc.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
Three Months Ended June 30, 2020Three Months Ended June 30, 2022
RevenueCost of Products and Services SoldSG&AOther (Income) ExpenseInterest and Other Financial ChargesNet SalesCost of
Products Sold		Cost of
Services Sold		Selling, general and administrative expensesOther
(Income)
Expense		Interest and Other
Financial Charges
$7,477 $5,276 $1,183 $(291)$90 $8,953 4,673 $1,373 $1,306 $(190)$87 
Gain or (loss) on cash flow hedges:Gain or (loss) on cash flow hedges:Gain or (loss) on cash flow hedges:
Foreign Currency Exchange Contracts:
Foreign currency exchange contracts:Foreign currency exchange contracts:
Amount reclassified from accumulated other comprehensive income into incomeAmount reclassified from accumulated other comprehensive income into income(1)3 (3)(42)0 Amount reclassified from accumulated other comprehensive income into income2 11 3 (1)— — 
Amount excluded from effectiveness testing recognized in earnings using an amortization approach0 4 0 9 0 
Gain or (loss) on fair value hedges:Gain or (loss) on fair value hedges:Gain or (loss) on fair value hedges:
Interest Rate Swap Agreements:
Interest rate swap agreements:Interest rate swap agreements:
Hedged itemsHedged items0 0 0 0 (14)Hedged items— — — — — 31 
Derivatives designated as hedgesDerivatives designated as hedges0 0 0 0 14 Derivatives designated as hedges— — — — — (31)
Gain or (loss) on net investment hedges:Gain or (loss) on net investment hedges:Gain or (loss) on net investment hedges:
Foreign Currency Exchange Contracts:Foreign Currency Exchange Contracts:Foreign Currency Exchange Contracts:
Amount excluded from effectiveness testing recognized in earnings using an amortization approachAmount excluded from effectiveness testing recognized in earnings using an amortization approach0 0 0 0 4 Amount excluded from effectiveness testing recognized in earnings using an amortization approach— — — — — 3
Gain or (loss) on derivatives not designated as hedging instruments:Gain or (loss) on derivatives not designated as hedging instruments:Gain or (loss) on derivatives not designated as hedging instruments:
Foreign currency exchange contractsForeign currency exchange contracts0 0 0 (217)0 Foreign currency exchange contracts— — — — 281 — 

Six Months Ended June 30, 2021Three Months Ended June 30, 2021
RevenueCost of Products and Services SoldSG&AOther (Income) ExpenseInterest and Other Financial ChargesNet SalesCost of
Products Sold		Cost of
Services Sold		Selling, general and administrative expensesOther
(Income)
Expense		Interest and Other
Financial Charges
$17,262 11,712 $2,443 (808)$173 $8,808 $4,734 $1,269 $1,207 $(366)$83 
Gain or (loss) on cash flow hedges:Gain or (loss) on cash flow hedges:Gain or (loss) on cash flow hedges:
Foreign currency exchange contracts:Foreign currency exchange contracts:Foreign currency exchange contracts:
Amount reclassified from accumulated other comprehensive income into incomeAmount reclassified from accumulated other comprehensive income into income2 4 4 0 0 Amount reclassified from accumulated other comprehensive income into income1 2 1 2 — — 
Gain or (loss) on fair value hedges:Gain or (loss) on fair value hedges:Gain or (loss) on fair value hedges:
Interest rate swap agreements:Interest rate swap agreements:Interest rate swap agreements:
Hedged itemsHedged items0 0 0 0 80 Hedged items— — — — — (14)
Derivatives designated as hedgesDerivatives designated as hedges0 0 0 0 (80)Derivatives designated as hedges— — — — — 14 
Gain or (loss) on net investment hedges:Gain or (loss) on net investment hedges:Gain or (loss) on net investment hedges:
Foreign Currency Exchange Contracts:Foreign Currency Exchange Contracts:Foreign Currency Exchange Contracts:
Amount excluded from effectiveness testing recognized in earnings using an amortization approachAmount excluded from effectiveness testing recognized in earnings using an amortization approach0 0 0 0 8 Amount excluded from effectiveness testing recognized in earnings using an amortization approach— — — — — 4 
Gain or (loss) on derivatives not designated as hedging instruments:Gain or (loss) on derivatives not designated as hedging instruments:Gain or (loss) on derivatives not designated as hedging instruments:
Foreign currency exchange contractsForeign currency exchange contracts0 0 0 (11)0 Foreign currency exchange contracts— — — — (71)— 
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HONEYWELL INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
Six Months Ended June 30, 2020Six Months Ended June 30, 2022
RevenueCost of Products and Services SoldSG&AOther (Income) ExpenseInterest and Other Financial ChargesNet SalesCost of
Products Sold		Cost of
Services Sold		Selling, general and administrative expensesOther
(Income)
Expense		Interest and Other
Financial Charges
$15,940 $10,810 $2,421 $(608)$163 $17,329 $9,046 $2,674 $2,737 $(509)$172 
Gain or (loss) on cash flow hedges:Gain or (loss) on cash flow hedges:Gain or (loss) on cash flow hedges:
Foreign currency exchange contracts:Foreign currency exchange contracts:Foreign currency exchange contracts:
Amount reclassified from accumulated other comprehensive income into incomeAmount reclassified from accumulated other comprehensive income into income(1)30 (3)(2)0 Amount reclassified from accumulated other comprehensive income into income3 12 3 — — — 
Amount excluded from effectiveness testing recognized in earnings using an amortization approach0 8 0 17 0 
Gain or (loss) on fair value hedges:Gain or (loss) on fair value hedges:Gain or (loss) on fair value hedges:
Interest rate swap agreements:Interest rate swap agreements:Interest rate swap agreements:
Hedged itemsHedged items0 0 0 0 (219)Hedged items— — — — — 168 
Derivatives designated as hedgesDerivatives designated as hedges0 0 0 0 219 Derivatives designated as hedges— — — — — (168)
Gain or (loss) on net investment hedges:Gain or (loss) on net investment hedges:Gain or (loss) on net investment hedges:
Foreign Currency Exchange Contracts:Foreign Currency Exchange Contracts:Foreign Currency Exchange Contracts:
Amount excluded from effectiveness testing recognized in earnings using an amortization approachAmount excluded from effectiveness testing recognized in earnings using an amortization approach0 0 0 0 9 Amount excluded from effectiveness testing recognized in earnings using an amortization approach— — — — — 7
Gain or (loss) on derivatives not designated as hedging instruments:Gain or (loss) on derivatives not designated as hedging instruments:Gain or (loss) on derivatives not designated as hedging instruments:
Foreign currency exchange contractsForeign currency exchange contracts0 0 0 67 0 Foreign currency exchange contracts— — — — 347 — 

Six Months Ended June 30, 2021
Net SalesCost of
Products Sold		Cost of
Services Sold		Selling, general and administrative expensesOther
(Income)
Expense		Interest and Other
Financial Charges
$17,262 $9,285 $2,427 $2,443 $(808)$173 
Gain or (loss) on cash flow hedges:
Foreign currency exchange contracts:
Amount reclassified from accumulated other comprehensive income into income2 3 1 4 — — 
Gain or (loss) on fair value hedges:
Interest rate swap agreements:
Hedged items— — — — — 80 
Derivatives designated as hedges— — — — — (80)
Gain or (loss) on net investment hedges:
Foreign Currency Exchange Contracts:
Amount excluded from effectiveness testing recognized in earnings using an amortization approach— — — — — 8 
Gain or (loss) on derivatives not designated as hedging instruments:
Foreign currency exchange contracts— — — — (11)— 
18Honeywell International Inc.
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HONEYWELL INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
The following table summarizes the amounts of gain or (loss) on net investment hedges recognized in Accumulated other comprehensive income (loss):
Derivatives Net Investment Hedging RelationshipsDerivatives Net Investment Hedging RelationshipsThree Months Ended June 30,Six Months Ended June 30,Derivatives Net Investment Hedging RelationshipsThree Months Ended
June 30, 2022		Six Months Ended June 30,
20212020202120202022202120222021
Euro-denominated long-term debtEuro-denominated long-term debt$(15)$(62)$135 $62 Euro-denominated long-term debt$184 $(15)$267 $135 
Euro-denominated commercial paperEuro-denominated commercial paper(3)(15)27 55 Euro-denominated commercial paper36 (3)53 27 
Cross currency swapCross currency swap(16)7 28 (19)Cross currency swap63 (16)80 28 
Foreign currency exchange contractsForeign currency exchange contracts14 (102)12 (18)Foreign currency exchange contracts31 14 31 12 

18 Honeywell International Inc.

HONEYWELL INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(Unaudited)
(Dollars in tables in millions, except per share amounts)
NOTE 12.11. FAIR VALUE MEASUREMENTS
The accounting guidance for fair value measurements and disclosures establishes a three-level fair value hierarchy:
•Level 1 - Inputs are based on quoted prices in active markets for identical assets and liabilities.
•Level 2 - Inputs are based on observable inputs other than quoted prices in active markets for identical or similar assets and liabilities.
•Level 3 - One or more inputs are unobservable and significant.
Financial and nonfinancial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.
The following table sets forth the Company’s financial assets and liabilities accounted for at fair value on a recurring basis:
 June 30, 2021December 31, 2020
Assets:  
Foreign currency exchange contracts$273 $202 
Available for sale investments1,026 1,118 
Interest rate swap agreements115 194 
Investments in equity securities54 11 
Liabilities:
Foreign currency exchange contracts$193 $150 
Cross currency swap agreements15 50 
 June 30, 2022December 31, 2021
Level 1Level 2TotalLevel 1Level 2Total
Assets:  
Foreign currency exchange contracts$— $542 $542 $— $374 $374 
Available for sale investments71 476 547 176 566 742 
Interest rate swap agreements— — — — 60 60 
Cross currency swap agreements— 135 135 — 39 39 
Investments in equity securities23 34 57 34 23 57 
Total assets$94 $1,187 $1,281 $210 $1,062 $1,272 
Liabilities:
Foreign currency exchange contracts$— $382 $382 $— $282 $282 
Interest rate swap agreements— 108 108 — — — 
Commodity contracts— 1 1 — — — 
Total liabilities$— $491 $491 $— $282 $282 
The foreign currency exchange contracts, interest rate swap agreements, and cross currency swap agreements and commodity contracts are valued using broker quotations or market transactions in either the listed or over-the-counter markets. As such, these derivative instruments are classified within level 2. The Company also holds investments in commercial paper, certificates of deposits, and time deposits, and corporate debt securities that are designated as available for sale, as well as investments in equity securities, which includes holdings of Garrett Motion Inc. (Garrett) Series A Preferred Stock. These investments are valued using published prices based off observable market data. As such, these investments are classified within level 2.
The Company holds certain available for sale investments in U.S. government and corporate debt securities, as well asand investments in equity securities, which includes holdings of Garrett common stock. These investments are valued utilizing published prices based on quoted market pricing, which are classified within level 1. 
The carrying value of cash and cash equivalents, trade accounts and notes receivables, payables, commercial paper, and short-term borrowings approximates fair value.
As of June 30, 2022, the Company does not consider any assets or liabilities measured at fair value as level 3.
19Honeywell International Inc.
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
The following table sets forth the Company’s financial assets and liabilities that were not carried at fair value:
 June 30, 2021December 31, 2020
 Carrying
Value		Fair
Value		Carrying
Value		Fair
Value
Assets    
Long-term receivables$186 $178 $137 $132 
Long-term investment584 584 0 0 
Liabilities
Long-term debt and related current maturities$17,783 $19,044 $18,787 $20,176 
 June 30, 2022December 31, 2021
 Carrying
Value		Fair
Value		Carrying
Value		Fair
Value
Assets    
Short-term investment$— $— $34 $34 
Long-term receivables156 128 170 152 
Long-term investment— — 366 366 
Liabilities
Long-term debt and related current maturities$15,590 $18,344 $16,057 $17,022 
The Company determined the fair value of the long-term receivables by utilizing transactions in the listed markets for identical or similar assets. As such, the fair values of these receivables are considered level 2.
19 Honeywell International Inc.

HONEYWELL INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(Unaudited)
(DollarsOn April 30, 2021, the Company received shares of Garrett Series B Preferred Stock in tables in millions, except per share amounts)
Thefull and final satisfaction of the Garrett Indemnity and Tax Matters Agreement. As of December 31, 2021, the fair value of the short-term and long-term investment isinvestments were based on the present value of the mandatory redemptions as reflected within Garrett Motion Inc.'s (Garrett)Garrett's Second and Amended and Restated Series B Preferred Stock (Series B Preferred Stock) Certificate of Designation. The present value reflected amortized cost determined by the present value of the mandatory redemptions discounted at 7.25%, which was the rate reflected in the Second Amended and Restated Series B Preferred Stock Certificate of Designation. The discount accreted to interest income over the mandatory redemption period. The investment iswas designated as held to maturity and was initially recognized at fair value. The fair value of Garrett's Series B Preferred Stock was determined using observable market data and iswas considered level 2. Refer to Note 15 Commitments and Contingencies for further discussionFair Value of the Company’s investment in Garrett's Series B Preferred Stock.Stock was not impacted by early redemptions until receipt of payment.
On February 18, 2022, Garrett early redeemed $197 million of the Series B Preferred Stock, pursuant to the terms and conditions of the Second Amended and Restated Series B Preferred Stock Certificate of Designation. Immediately following the early redemption, the fair value of the Series B Preferred Stock was $207 million.
On June 28, 2022, Garrett early redeemed all remaining shares of the Series B Preferred Stock in the amount of $212 million, pursuant to the terms and conditions of the Second Amended and Restated Series B Preferred Stock Certificate of Designation. Following the redemption, the Series B Preferred Stock were no longer outstanding.
The Company determined the fair value of the long-term debt and related current maturities utilizing transactions in the listed markets for identical or similar liabilities. As such, the fair value of the long-term debt and related current maturities is considered level 2. 

20Honeywell International Inc.
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
NOTE 13.12. EARNINGS PER SHARE
Three Months Ended June 30,Six Months Ended June 30,Three Months Ended June 30,Six Months Ended June 30,
BasicBasic2021202020212020Basic2022202120222021
Net income attributable to HoneywellNet income attributable to Honeywell$1,430 $1,081 $2,857 $2,662 Net income attributable to Honeywell$1,261 $1,430 $2,395 $2,857 
Weighted average shares outstandingWeighted average shares outstanding693.8 702.3 695.0 705.9 Weighted average shares outstanding679.0 693.8 681.8 695.0 
Earnings per share of common stock - basicEarnings per share of common stock - basic$2.06 $1.54 $4.11 $3.77 Earnings per share of common stock - basic$1.86 $2.06 $3.51 $4.11 
Three Months Ended June 30,Six Months Ended June 30, Three Months Ended June 30,Six Months Ended June 30,
Assuming DilutionAssuming Dilution2021202020212020Assuming Dilution2022202120222021
Net income attributable to HoneywellNet income attributable to Honeywell$1,430 $1,081 $2,857 $2,662 Net income attributable to Honeywell$1,261 $1,430 $2,395 $2,857 
Average SharesAverage SharesAverage Shares
Weighted average shares outstandingWeighted average shares outstanding693.8 702.3 695.0 705.9 Weighted average shares outstanding679.0 693.8 681.8 695.0 
Dilutive securities issuable - stock plansDilutive securities issuable - stock plans8.7 5.8 8.5 6.7 Dilutive securities issuable - stock plans6.0 8.7 6.3 8.5 
Total weighted average diluted shares outstandingTotal weighted average diluted shares outstanding702.5 708.1 703.5 712.6 Total weighted average diluted shares outstanding685.0 702.5 688.1 703.5 
Earnings per share of common stock - assuming dilutionEarnings per share of common stock - assuming dilution$2.04 $1.53 $4.06 $3.74 Earnings per share of common stock - assuming dilution$1.84 $2.04 $3.48 $4.06 
The diluted earnings per share calculations exclude the effect of stock options when the options’ exercise price exceed the average market price of the common shares during the period. For the three and six months ended June 30, 2022, the weighted average number of stock options excluded from the computations were 5.6 million and 3.4 million, respectively. For the three and six months ended June 30, 2021, the weighted average number of stock options excluded from the computations were 1.9 million and 1.4 million, respectively. These stock options were outstanding at the end of each of the respective periods. For the three and six months ended June 30, 2020, the weighted average number of stock options excluded from the computations were 7.8 million and 6.1 million, respectively.
As of June 30, 2022 and 2021, and 2020,the total shares outstanding were 690.4673.7 million and 701.8690.4 million, respectively, and as of June 30, 20212022 and 2020,2021, total shares issued were 957.6 million.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
NOTE 14.13. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) BY COMPONENT
Foreign
Exchange
Translation
Adjustment		Pension
and Other
Postretirement
Benefits
Adjustments		Changes in Fair
Value of
 Available for Sale
 Investments		Changes in
Fair Value
of Cash Flow
Hedges  		Total Foreign
Exchange
Translation
Adjustment		Pension
and Other
Postretirement
Benefits
Adjustments		Changes in Fair
Value of
 Available for Sale
 Investments		Changes in
Fair Value
of Cash Flow
Hedges  		Total
Balance at December 31, 2020$(2,780)$(601)$4 $0 $(3,377)
Balance at December 31, 2021Balance at December 31, 2021$(2,478)$(415)$1 $(3)$(2,895)
Other comprehensive income (loss) before reclassificationsOther comprehensive income (loss) before reclassifications345 0 (3)15 357 Other comprehensive income (loss) before reclassifications34 — (9)39 64 
Amounts reclassified from accumulated other comprehensive incomeAmounts reclassified from accumulated other comprehensive income(3)(43)0 (9)(55)Amounts reclassified from accumulated other comprehensive income(3)(34)— (15)(52)
Net current period other comprehensive income (loss)Net current period other comprehensive income (loss)342 (43)(3)6 302 Net current period other comprehensive income (loss)31 (34)(9)24 12 
Balance at June 30, 2021$(2,438)$(644)$1 $6 $(3,075)
Balance at June 30, 2022Balance at June 30, 2022$(2,447)$(449)$(8)$21 $(2,883)
 Foreign
Exchange
Translation
Adjustment		Pension
and Other
Postretirement
Benefits
Adjustments  		Changes in Fair
Value of
 Available for Sale
 Investments		Changes in
Fair Value
of Cash Flow
Hedges		Total
Balance at December 31, 2019$(2,566)$(675)$0 $44 $(3,197)
Other comprehensive income (loss) before reclassifications(148)0 0 104 (44)
Amounts reclassified from accumulated other comprehensive income(7)(40)0 (22)(69)
Net current period other comprehensive income (loss)(155)(40)0 82 (113)
Balance at June 30, 2020$(2,721)$(715)$0 $126 $(3,310)

 Foreign
Exchange
Translation
Adjustment		Pension
and Other
Postretirement
Benefits
Adjustments 		Changes in Fair
Value of
 Available for Sale
 Investments		Changes in
Fair Value
of Cash Flow
Hedges		Total
Balance at December 31, 2020$(2,780)$(601)$4 $— $(3,377)
Other comprehensive income (loss) before reclassifications345 — (3)15 357 
Amounts reclassified from accumulated other comprehensive income(3)(43)— (9)(55)
Net current period other comprehensive income (loss)342 (43)(3)6 302 
Balance at June 30, 2021$(2,438)$(644)$1 $6 $(3,075)
NOTE 15.14. COMMITMENTS AND CONTINGENCIES
ENVIRONMENTAL MATTERS
OurHoneywell's environmental matters are described in Note 2019 Commitments and Contingencies of Notes to Consolidated Financial Statements in our 2020the Company's 2021 Annual Report on Form 10-K.
The following table summarizes information concerning ourthe Company's recorded liabilities for environmental costs:
Balance at December 31, 20202021$660618 
Accruals for environmental matters deemed probable and reasonably estimable83107 
Environmental liability payments(112)(58)
Other1 
Balance at June 30, 20212022$632667 
Environmental liabilities are included in the following balance sheet accounts: 
June 30, 2022December 31, 2021
Accrued liabilities$218 $225 
Other liabilities449 393 
 $667 $618 
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
Environmental liabilities are included in the following balance sheet accounts: 
June 30, 2021December 31, 2020
Accrued liabilities$225 $225 
Other liabilities407 435 
 $632 $660 
The Company does not currently possess sufficient information to reasonably estimate the amounts of environmental liabilities to be recorded upon future completion of studies, litigation or settlements, and neither the timing nor the amount of the ultimate costs associated with environmental matters can be determined although they could be material to ourthe Company's consolidated results of operations and operating cash flows in the periods recognized or paid. However, considering ourthe Company's past experience and existing reserves, the Company does not expect that environmental matters will have a material adverse effect on its consolidated financial position.
In conjunction with the Resideo Technologies, Inc. (Resideo) spin-off, the Company entered into an indemnification and reimbursement agreement with a Resideo subsidiary, pursuant to which Resideo’s subsidiary has an ongoing obligation to make cash payments to Honeywell in amounts equal to 90% of Honeywell’s annual net spending for environmental matters at certain sites as defined in the agreement. The amount payable to Honeywell in any given year is subject to a cap of $140 million, and the obligation will continue until the earlier of December 31, 2043, or December 31, of the third consecutive year during which the annual payment obligation is less than $25 million.
Reimbursements associated with this agreement are collected from Resideo quarterly and were $35 million and $70 million in the three and six months ended June 30, 2021,2022, respectively, and offset operating cash outflows incurred by the Company. As the Company incurs costs for environmental matters deemed probable and reasonably estimable related to the sites covered by the indemnification and reimbursement agreement, a corresponding receivable from Resideo for 90% of such costs is also recorded. This receivable amount recorded in the six months ended June 30, 2021,2022, was $72$86 million. As of June 30, 2021,2022, Other current assets and Other assets included $140 million and $453$473 million, respectively, for the short-term and long-term portion of the receivable amount due from Resideo under the indemnification and reimbursement agreement.
ASBESTOS MATTERS
Honeywell is named in asbestos-related personal injury claims related to North American Refractories Company (NARCO), which was sold in 1986, and the Bendix Friction Materials (Bendix) business, which was sold in 2014. 
The following tables summarize information concerning NARCO and Bendix asbestos-related balances:
ASBESTOS-RELATED LIABILITIES
BendixNARCOTotal BendixNARCOTotal
December 31, 2020$1,441 $779 $2,220 
December 31, 2021December 31, 2021$1,372 $689 $2,061 
Accrual for update to estimated liabilityAccrual for update to estimated liability24 14 38 Accrual for update to estimated liability31 34 65 
Change in estimated cost of future claimsChange in estimated cost of future claims15 — 15 
Asbestos-related liability paymentsAsbestos-related liability payments(71)(68)(139)Asbestos-related liability payments(100)(25)(125)
June 30, 2021$1,394 $725 $2,119 
June 30, 2022June 30, 2022$1,318 $698 $2,016 
INSURANCE RECOVERIES FOR ASBESTOS-RELATED LIABILITIES
 BendixNARCOTotal
December 31, 2020$148 $254 $402 
Probable insurance recoveries related to estimated liability0 0 0 
Insurance receipts for asbestos-related liabilities(8)(17)(25)
Insurance receivables settlements0 0 0 
June 30, 2021$140 $237 $377 
 BendixNARCOTotal
December 31, 2021$142 $221 $363 
Insurance receipts for asbestos-related liabilities(4)(46)(50)
June 30, 2022$138 $175 $313 
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HONEYWELL INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
NARCO and Bendix asbestos-related balances are included in the following balance sheet accounts:
June 30, 2021December 31, 2020June 30, 2022December 31, 2021
Other current assetsOther current assets$35 $36 Other current assets$41 $41 
Insurance recoveries for asbestos-related liabilitiesInsurance recoveries for asbestos-related liabilities342 366 Insurance recoveries for asbestos-related liabilities272 322 
$377 $402 $313 $363 
Accrued liabilitiesAccrued liabilities$300 $300 Accrued liabilities$236 $261 
Asbestos-related liabilitiesAsbestos-related liabilities1,819 1,920 Asbestos-related liabilities1,780 1,800 
$2,119 $2,220  $2,016 $2,061 
NARCO Products – NARCO manufactured high-grade, heat-resistant, refractory products for various industries. Honeywell’s predecessor, Allied Corporation, owned NARCO from 1979 to 1986. Allied Corporation sold the NARCO business in 1986 and entered into a cross-indemnity agreement which included an obligation to indemnify the purchaser for asbestos claims. Such claims, arisearising primarily from alleged occupational exposure to asbestos-containing refractory brick and mortar for high-temperature applications. NARCO ceased manufacturing these products in 1980 and ultimately filed for bankruptcy in January 2002, at which point in time all then current and future NARCO asbestos claims were stayed against both NARCO and Honeywell pending the reorganization of NARCO. The Company established its initial liability for NARCO asbestos claims in 2002.
NARCO emerged from bankruptcy in April 2013, at which time a federally authorized 524(g) trust was established to evaluate and resolve all existing NARCO asbestos claims (the Trust). Both Honeywell and NARCO are protected by a permanent channeling injunction barring all present and future individual actions in state or federal courts and requiring all asbestos-related claims based on exposure to NARCO asbestos-containing products to be made against the Trust. The NARCO Trust Agreement (TA) and the NARCO Trust Distribution Procedures (TDP) are the principal documents settingset forth the structure and operating rules of the Trust, establishingand established Honeywell’s evergreen funding obligations and the material operating rules for the Trust.obligations.
PerIn accordance with the TA, the Trust is eligible to receive cash dividends from Harbison-Walker International Inc. (HWI), the reorganized and renamed entity that emerged fully operational, from the NARCO bankruptcy. TheHWI cash dividends are required to be used to pay asbestos-related claims which qualify for payment under the TDP (Annual Contribution Claims) until those funds are exhausted, at which point Honeywell’sthe Company’s funding obligation, is triggered. Honeywell's funding obligation, together with any HWI dividends used to pay claims, is subject to an annual cap of $145 million. In Julymillion, is triggered. The Trust received dividend payments from HWI in 2021 HWI paid a dividend of $47 million to the NARCO Trust.and 2022. The Company is also required to fund amounts owed pursuant to settlement agreements reached during the pendency of the NARCO bankruptcy proceedings that provide for the right to submit claims to the Trust subject to qualification under the terms of the settlement agreements and TDP (Pre-Established Unliquidated Claims), as well as fund the annual operating costs of the Trust. There is no annual funding cap relative to Pre-Established Unliquidated Claims.
The operating rules per the TDP include Honeywell’s audit rights and thedefine criteria claimants must meet for a claim to be considered valid and paid, which include adequate medical evidence of the claimant’s asbestos-related condition and credible evidence of exposure to a specific NARCO asbestos-containing product. The TDP allows Honeywell to audit claim support documents against these criteria. Once operational in 2014, the Trust began to receive, process and pay claims, at which point the Company began to assert its audit rights to review and monitor the claims processor’s adherence to the established requirements of the TDP. While doing so, theclaims. The Company identified several issues with the way the Trust was adhering to the TDP in audits subsequent to the Trust becoming operational. The Company consistently raised with the Trust concern that the Trust adopted an improper practice of paying claimants who have not demonstrated the requisite exposure. The Trust refused to alter its practices for payment of claims, and in September 2021, Honeywell filed suit against the Trust in the United States Bankruptcy Court for the Western District of Pennsylvania (Bankruptcy Court) alleging that the Trust has breached its duties in managing the Trust, including breaches of certain provisions of the TA and TDP. Honeywell's lawsuit seeks appropriate relief preventing the Trust from continuing these practices. The Trust also filed suit against Honeywell, alleging Honeywell has breached its obligations under the Trust's governing documents. Honeywell moved to dismiss the Trust’s suit, and on December 15, 2021, the Bankruptcy Court granted Honeywell’s motion to dismiss subject to granting the Trust leave to file an amended complaint. On December 28, 2021, the Trust filed an answer with counterclaims in response to Honeywell’s complaint and in lieu of filing an amended complaint. The Bankruptcy Court conducted a trial on these matters during May 2022; the Bankruptcy Court's ruling is pending. At this time, the Company continues to identify and disputecannot predict the outcome of these matters, as further claims are processed. Althoughor the Company is attempting to resolve instances where it believespotential impact on the Trust is not processing claims in accordance with the established TDP, the Company reserves the right to seek judicial intervention should it fail to resolve the disputed issues.asbestos-related liabilities.
Due to the bankruptcy filing in 2002, claimants were not permitted to file additional claims until the Trust became operative in 2014. As a consequence, there was a large backlog of claims that were filed with the Trust upon it becoming operative in 2014 through December 31, 2017, the date by which these claims had to be filed or else be barred by the expiration of the statute of limitations (subject to tolling exceptions in the TDP).limitations. Therefore, the claims filing rate did not start to normalize until 2018 and thereafter. As a result, between 2002 and 2018, the Company lacked a history of sufficiently reliable claims data to derive a reasonable estimate of its NARCO asbestos-related liability, and the Company continued to update its original estimate, as appropriate, using all available information.
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
InBeginning in 2020, with three years of sufficiently reliable claims data, the Company updated its estimate of the NARCO asbestos-related liability utilizing claims data from January 1, 2018 through December 31, 2020. The Company utilized an asbestos liability valuation specialist to support our preparation of the NARCO asbestos-related liability estimates. Our estimates, which involve significant management judgment, include consideration of multiple scenarios, including a scenario adjusting for the impact of the COVID-19 pandemic on the Trust's ability to process claims during 2020.liability. The estimate for the resolution of asserted Annual Contribution Claims and Pre-Established Unliquidated Claims uses average payment values for the relevant historical period. ForThe estimate for unasserted claims the estimate is based on historic and anticipated claims filing experience and payment rates, disease classifications and type of claim, and average payment values by the Trust for the relevant historical period. The Company utilizes an asbestos liability valuation specialist to support the preparation of the NARCO asbestos-related liability estimates during the fourth quarter each year. The Company's estimate also includesestimates, which involve significant management judgment, and consider multiple scenarios, include all years of epidemiological disease projection through 2059.
The NARCO asbestos-related liability reflects an estimate for the resolution of Annual Contribution Claims and Pre-Established Unliquidated Claims filed with the Trust, as well as for unasserted Annual Contribution Claims and Pre-Established Unliquidated Claims. The NARCO asbestosasbestos-related liability excludes the annual operating expenses of the Trust which are expensed as they are incurred.
The Company's NARCO-related insurance receivable reflects coverage which reimburses Honeywell for portions of NARCO-related claims and defense costs. This coverage is provided by a large number of insurance policies written by dozens of insurance companies in both the domestic insurance market and the London excess market. Honeywell's NARCO-related insurance receivable is an estimate of the probable amount of insurance that is recoverable for asbestos claims. Most of our insurance carriers remain solvent. However, select individual insurance carriers are now insolvent, which we have considered in our analysis of probable recoveries. OurThe Company's judgments related to ourthe Company's insurance carriers and insurance coverages are reasonable and consistent with Honeywell's historical dealings and Honeywell's knowledge of any pertinent solvency issues surrounding insurers.
Bendix Products – Bendix manufactured automotive brake linings that contained chrysotile asbestos in an encapsulated form. Claimants consist largely of individuals who allege exposure to asbestos from brakes from either performing or being in the vicinity of individuals who performed brake replacements. The following tables present information regarding Bendix-related asbestos claims activity: 
Six Months Ended
June 30,		Years Ended 
December 31,		Six Months Ended
June 30,		Years Ended
December 31,
Claims ActivityClaims Activity202120202019Claims Activity202220212020
Claims unresolved at the beginning of periodClaims unresolved at the beginning of period6,242 6,480 6,209 Claims unresolved at the beginning of period6,401 6,242 6,480 
Claims filedClaims filed1,205 2,233 2,659 Claims filed1,078 2,611 2,233 
Claims resolvedClaims resolved(921)(2,471)(2,388)Claims resolved(1,467)(2,452)(2,471)
Claims unresolved at the end of periodClaims unresolved at the end of period6,526 6,242 6,480 Claims unresolved at the end of period6,012 6,401 6,242 
June 30,December 31,June 30,December 31,
Disease Distribution of Unresolved ClaimsDisease Distribution of Unresolved Claims202120202019Disease Distribution of Unresolved Claims202220212020
Mesothelioma and other cancer claimsMesothelioma and other cancer claims3,735 3,422 3,399 Mesothelioma and other cancer claims3,413 3,760 3,422 
Nonmalignant claimsNonmalignant claims2,791 2,820 3,081 Nonmalignant claims2,599 2,641 2,820 
Total claimsTotal claims6,526 6,242 6,480 Total claims6,012 6,401 6,242 

Honeywell has experienced average resolution values per claim excluding legal costs as follows:
Years Ended December 31, Years Ended December 31,
20202019201820172016 20212020201920182017
(in whole dollars) (in whole dollars)
Malignant claimsMalignant claims$61,500 $50,200 $55,300 $56,000 $44,000 Malignant claims$56,000 $61,500 $50,200 $55,300 $56,000 
Nonmalignant claimsNonmalignant claims$550 $3,900 $4,700 $2,800 $4,485 Nonmalignant claims$400 $550 $3,900 $4,700 $2,800 
It is not possible to predict whether resolution values for Bendix-related asbestos claims will increase, decrease or stabilize in the future. 
24 Honeywell International Inc.

HONEYWELL INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(Unaudited)
(Dollars in tables in millions, except per share amounts)
The Consolidated Financial Statements reflect an estimated liability for resolution of asserted (claims filed as of the financial statement date) and unasserted Bendix-related asbestos claims, which exclude the Company’s ongoing legal fees to defend such asbestos claims which will continue to be expensed as they are incurred.
The Company reflects the inclusion of all years of epidemiological disease projection through 2059 when estimating the liability for unasserted Bendix-related asbestos claims. Such liability for unasserted Bendix-related asbestos claims is based on historic and anticipated claims filing experience and dismissal rates, disease classifications, and resolution values in the tort system for the previous five years. The Company has valued Bendix asserted and unasserted claims using average resolution values for the previous five years. The Company updates the resolution values used to estimate the cost of Bendix asserted and unasserted claims during the fourth quarter each year.
25Honeywell International Inc.
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HONEYWELL INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
The Company's insurance receivable corresponding to the liability for settlement of asserted and unasserted Bendix asbestos claims reflects coverage which is provided by a large number of insurance policies written by dozens of insurance companies in both the domestic insurance market and the London excess market. Based on ourthe Company's ongoing analysis of the probable insurance recovery, insurance receivables are recorded in the financial statements simultaneous with the recording of the estimated liability for the underlying asbestos claims. This determination is based on ourthe Company's analysis of the underlying insurance policies, our historical experience with our insurers, our ongoing review of the solvency of our insurers, judicial determinations relevant to our insurance programs, and our consideration of the impacts of any settlements reached with ourthe Company's insurers.
On October 31, 2018, David Kanefsky (Plaintiff), a Honeywell shareholder, filed a putative class action complaint in the U.S. District Court for the District of New Jersey (the Court) alleging violations of the Securities Exchange Act of 1934 and Rule 10b-5 related to the prior accounting for Bendix asbestos claims. An Amended Complaint was filed on December 30, 2019, and on February 7, 2020, wethe Company filed a Motion to Dismiss. On May 18, 2020, the courtCourt denied ourthe Motion to Dismiss. WeOn December 7, 2021, the parties filed a Stipulation of Settlement (Settlement Agreement) and Plaintiff filed a motion for preliminary approval of the Settlement Agreement, which included payment by Honeywell of $10 million to settle the claims in dispute. On January 18, 2022, the Court approved the motion for preliminary approval of the Settlement Agreement. On May 3, 2022, the Court entered a final judgment and order approving the Settlement Agreement and dismissed the action. Honeywell continues to believe the claims have no merit.
GARRETT LITIGATION AND BANKRUPTCY PROCEEDINGS
In conjunction withlacked merit and has denied wrongdoing as well as any liability for the Garrett spin-off, the Company entered into a binding indemnification and reimbursement agreement (Garrett Indemnity) and a binding tax matters agreement (Tax Matters Agreement) with Garrett and a Garrett subsidiary. On December 2, 2019, Garrett and Garrett ASASCO Inc. filed a Summons with Notice and commenced a lawsuitclaims made against Honeywell in the Commercial Division of the Supreme Court of the State of New York, County of New York (the State Court), seeking to invalidate the Garrett Indemnity. Garrett sought damages and a declaratory judgment based on various claims set forth in the Summons with Notice. On July 17, 2020, the Company received a notice from Garrett asserting that the Company had caused material breaches of the Tax Matters Agreement and that the Tax Matters Agreement was unenforceable.action.
On September 20, 2020, Garrett and 36 of its affiliates filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York (the Bankruptcy Court). On September 24, 2020, Garrett moved the existing State Court litigation against Honeywell to the Bankruptcy Court. On April 26, 2021, the Bankruptcy Court confirmed Garrett’s amended Chapter 11 plan of reorganization (the Confirmed Plan), and on April 30, 2021 (the Effective Date), Garrett emerged from bankruptcy. On the Effective Date, and in accordance with the Confirmed Plan, (i) the Company received from Garrett an initial payment of $375 million and 834.8 million shares of Garrett's Series B Preferred Stock in full and final satisfaction of the Garrett Indemnity and Tax Matters Agreement, (ii) the Garrett Indemnity and Tax Matters Agreement were terminated, (iii) the Company and Garrett mutually released each other from the claims asserted in all pending legal actions related to the Garrett Indemnity and Tax Matters Agreement, and (iv) all pending litigation between the Company and Garrett in connection with those agreements was resolved.
The Series B Preferred Stock Certificate of Designation provides for mandatory redemptions by Garrett of $35 million in 2022 and $100 million per year from 2023 to 2030 (inclusive) at the anniversary of the Effective Date, unless (i) Garrett’s consolidated EBITDA as of the end of the most recently completed fiscal year is less than $425 million, or (ii) Garrett does not have sufficient funds available to pay the redemption, at which point the redemption amounts past due will accrue interest. The Series B Preferred Stock Certificate of Designation also includes rights which allow (a) the Company to put the Series B Preferred Stock to Garrett if certain EBITDA conditions are met, and (b) Garrett to call the Series B Preferred Stock in whole or in part if certain EBITDA conditions are met.
25 Honeywell International Inc.

HONEYWELL INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(Unaudited)
(Dollars in tables in millions, except per share amounts)
We recorded the Series B Preferred Stock at fair value at the Effective Date. We believe the present value of the mandatory redemptions is an appropriate basis for determining the fair value of the Series B Preferred Stock. Our present value reflects amortized cost determined by the present value of the mandatory redemptions discounted at 7.25%, which is the rate reflected in the Series B Preferred Stock Certificate of Designation. The discount amount will accrete into interest income over the mandatory redemption period. In addition to the Series B Preferred Stock, the Company subscribed for 4.2 million shares of Garrett's Series A Preferred Stock (Series A Preferred Stock), which are convertible into Garrett’s Common Stock if certain conditions are met. Prior to and following Garrett’s emergence from bankruptcy, the Company also held 2.9 million shares of Garrett’s Common Stock. As of June 30, 2021, Short-term investments included $35 million and Investments and long-term receivables included $604 million, respectively, for the short-term and long-term portion of the Company's investment in Garrett's Series B Preferred Stock, Series A Preferred Stock and Common Stock investments.
The Garrett matter and bankruptcy proceedings are described in further detail in Note 20 Commitments and Contingencies of Notes to Consolidated Financial Statements in our 2020 Annual Report on Form 10-K.
OTHER MATTERS
The Company is subject to a number of other lawsuits, investigations and disputes (some of which involve substantial amounts claimed) arising out of the conduct of ourthe Company's business, including matters relating to commercial transactions, government contracts, product liability, prior acquisitions and divestitures, employee benefit plans, intellectual property, and environmental, health and safety matters (including the matter described below). We recognize a liabilityThe Company recognizes liabilities for any contingency that is probable of occurrence and reasonably estimable. WeThe Company continually assessassesses the likelihood of adverse judgments or outcomes in such matters, as well as potential ranges of possible losses (taking into consideration any insurance recoveries), based on a careful analysis of each matter with the assistance of outside legal counsel and, if applicable, other experts.
Such matters include:
•Petrobras and Unaoil – The Company continues to cooperate with investigations by the U.S. Department of Justice (DOJ), the Securities and Exchange Commission (SEC), and the Brazilian authorities relating to the Company's use of third parties who previously worked for the Company's UOP business in Brazil in relation to Petróleo Brasileiro S.A. (Petrobras) in connection with a project awarded in 2010. The investigations focus on compliance with the U.S. Foreign Corrupt Practices Act and similar Brazilian laws (UOP Matters), and involve, among other things, document production and interviews with former and current management and employees. The DOJ and the SEC are also examining a matter involving a foreign subsidiary’s prior contract with Unaoil S.A.M. in Algeria executed in 2011. The Company continues to be engaged in discussions with the authorities with respect to a potential comprehensive resolution of these matters.
As the discussions are both ongoing and at different stages with regards to each respective authority, there can be no assurance as to whether the Company will reach a resolution with such authorities or as to the potential timing, terms, or collateral consequences of any such resolution. As a result, the Company cannot predict the ultimate outcome of these UOP Matters or the potential impact on the Company. Based on available information to date, the Company estimates that a potential comprehensive resolution of these UOP Matters would result in a probable loss of approximately $210 million. During 2021, the Company recorded a charge of $160 million related to these UOP Matters in the Company's Consolidated Statement of Operations, and accrued a corresponding liability on the Consolidated Balance Sheet. Based on ongoing discussions with the authorities, during the three months ended June 30, 2022, the Company recorded an additional $50 million related to these UOP Matters in the Company's Consolidated Statement of Operations, and accrued a corresponding liability on the Consolidated Balance Sheet. Amounts payable to authorities pursuant to any potential final comprehensive resolution could differ from the amount recorded in the Company's consolidated financial statements. Based on available information to date, the Company does not expect that any such difference would be material with respect to the Company's consolidated financial position.
Given the uncertainty inherent in litigation and investigations, we dothe Company does not believe it is possible to develop estimates of reasonably possible losses (or a range of possible losses) in excess of current accruals for such matters. Considering ourthe Company's past experience and existing accruals, we dothe Company does not expect the outcome of such matters, either individually or in the aggregate, to have a material adverse effect on ourthe Company's consolidated financial position. Because most contingencies are resolved over long periods of time, potential liabilities are subject to change due to new developments, changes in settlement strategy or the impact of evidentiary requirements, which could cause usthe Company to pay damage awards or settlements (or become subject to equitable remedies) that could have a material adverse effect on ourthe Company's consolidated results of operations or operating cash flows in the periods recognized or paid.
Petrobras and Unaoil – We have been cooperating with certain investigations by the U.S. Department of Justice (DOJ), the Securities and Exchange Commission (SEC) and the Brazilian authorities relating to our use of third parties who previously worked for our UOP business in Brazil in relation to Petróleo Brasileiro S.A. (Petrobras). The investigations are focused on compliance with the U.S. Foreign Corrupt Practices Act and similar Brazilian laws, and involve, among other things, document production and interviews with former and current management and employees. The DOJ and the SEC are also examining a matter involving a foreign subsidiary’s prior engagement of Unaoil S.A.M. in Algeria. We have begun discussions with the authorities with respect to a potential resolution of these matters. As the discussions are ongoing, there can be no assurance as to whether we will reach a resolution with such authorities or as to the potential timing, terms, or collateral consequences of any such resolution. As a result, we cannot predict the outcome of these matters, the potential impact on the Company, or a reasonable estimate of losses or range of losses at this time.

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HONEYWELL INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
NOTE 16.15. PENSION BENEFITS
Net periodic pension benefit costs for the Company's significant defined benefit plans include the following components: 
U.S. Plans
Three Months Ended June 30,Six Months Ended June 30,
2021202020212020
Net Periodic Benefit CostNet Periodic Benefit CostU.S. Plans
Three Months Ended June 30,Six Months Ended June 30,
2022202120222021
Service costService cost$27 $24 $53 $49 Service cost$22 $27 $43 $53 
Interest costInterest cost76 115 153 230 Interest cost95 76 190 153 
Expected return on plan assetsExpected return on plan assets(305)(283)(610)(567)Expected return on plan assets(321)(305)(641)(610)
Amortization of prior service (credit)Amortization of prior service (credit)(11)(10)(22)(21)Amortization of prior service (credit)(11)(11)(21)(22)
$(213)$(154)$(426)$(309) $(215)$(213)$(429)$(426)

 Non-U.S. Plans
 Three Months Ended June 30,Six Months Ended June 30,
 2021202020212020
Service cost$6 $5 $13 $11 
Interest cost21 26 40 52 
Expected return on plan assets(89)(81)(176)(165)
Amortization of prior service (credit)0 0 0 0 
 $(62)$(50)$(123)$(102)

Net Periodic Benefit CostNon-U.S. Plans
Three Months Ended June 30,Six Months Ended June 30,
2022202120222021
Service cost$5 $6 $10 $13 
Interest cost26 21 54 40 
Expected return on plan assets(71)(89)(146)(176)
 $(40)$(62)$(82)$(123)
NOTE 17.16. OTHER (INCOME) EXPENSE
 Three Months Ended June 30,Six Months Ended June 30,
 2021202020212020
Interest income$(23)$(22)$(42)$(66)
Pension ongoing income – non-service(309)(236)(619)(473)
Other postretirement income – non-service(18)(14)(35)(27)
Equity income of affiliated companies(18)(15)(32)(27)
(Gain) loss on sale of non-strategic businesses and assets1 0 (89)0 
Foreign exchange13 (3)18 (15)
Other (net)(12)(1)(9)0 
 $(366)$(291)$(808)$(608)

 Three Months Ended June 30,Six Months Ended June 30,
 2022202120222021
Interest income$(20)$(23)$(40)$(42)
Pension ongoing income – non-service(283)(309)(568)(619)
Other postretirement income – non-service(10)(18)(20)(35)
Equity income of affiliated companies(10)(18)(24)(32)
(Gain) loss on sale of non-strategic businesses and assets— 1 — (89)
Foreign exchange22 13 20 18 
Expense related to UOP Matters50 — 50 — 
Expense related to Russia-Ukraine Conflict57 — 57 — 
Other (net)4 (12)16 (9)
 $(190)$(366)$(509)$(808)

See Note 14 Commitments and Contingencies for further discussion of the UOP Matters. See Note 5 Repositioning and Other Charges for further discussion of the expense related to the Russia-Ukraine Conflict.
NOTE 18.17. SEGMENT FINANCIAL DATA
Honeywell globally manages its business operations through 4 reportable operatingbusiness segments. Segment information is consistent with how management reviews the businesses, makes investing and resource allocation decisions and assesses operating performance.
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HONEYWELL INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
Honeywell’s senior management evaluates segment performance based on segment profit. Each segment’s profit is measured as segment income (loss) before taxes excluding general corporate unallocated expense, interest and other financial charges, stock compensation expense, pension and other postretirement income (expense), repositioning and other charges, and other items within Other (income) expense. 
27 Honeywell International Inc.
 Three Months Ended June 30,Six Months Ended June 30,
 2022202120222021
Net sales    
Aerospace    
Products$1,574 $1,571 $3,035 $3,086 
Services1,324 1,195 2,612 2,312 
Total2,898 2,766 5,647 5,398 
Honeywell Building Technologies
Products1,179 1,042 2,261 2,051 
Services352 365 699 714 
Total1,531 1,407 2,960 2,765 
Performance Materials and Technologies
Products2,210 2,055 4,166 3,924 
Services484 497 981 974 
Total2,694 2,552 5,147 4,898 
Safety and Productivity Solutions
Products1,721 1,971 3,354 3,987 
Services108 112 219 214 
Total1,829 2,083 3,573 4,201 
Corporate and All Other
Services1 — 2 — 
Total1 — 2 — 
 $8,953 $8,808 $17,329 $17,262 
Segment profit
Aerospace$767 $710 $1,520 $1,472 
Honeywell Building Technologies360 315 696 620 
Performance Materials and Technologies601 530 1,111 964 
Safety and Productivity Solutions231 292 484 595 
Corporate and All Other(92)(54)(178)(83)
Total segment profit1,867 1,793 3,633 3,568 
Interest and other financial charges(87)(83)(172)(173)
Stock compensation expense(a)
(53)(39)(113)(116)
Pension ongoing income(b)
250 272 501 548 
Other postretirement income(b)
10 18 20 35 
Repositioning and other charges(c)
(227)(101)(614)(242)
Other(d)
(56)21 (46)122 
Income before taxes$1,704 $1,881 $3,209 $3,742 

HONEYWELL INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(Unaudited)
(Dollars in tables in millions, except per share amounts)
 Three Months Ended June 30,Six Months Ended June 30,
 2021202020212020
Net sales    
Aerospace    
Products$1,571 $1,633 $3,086 $3,712 
Services1,195 910 2,312 2,192 
Total2,766 2,543 5,398 5,904 
Honeywell Building Technologies
Products1,042 865 2,051 1,835 
Services365 312 714 623 
Total1,407 1,177 2,765 2,458 
Performance Materials and Technologies
Products2,055 1,793 3,924 3,707 
Services497 425 974 908 
Total2,552 2,218 4,898 4,615 
Safety and Productivity Solutions
Products1,971 1,452 3,987 2,794 
Services112 87 214 169 
Total2,083 1,539 4,201 2,963 
 $8,808 $7,477 $17,262 $15,940 
Segment profit
Aerospace$710 $528 $1,472 $1,465 
Honeywell Building Technologies315 250 620 512 
Performance Materials and Technologies530 419 964 931 
Safety and Productivity Solutions292 213 595 391 
Corporate(54)(25)(83)(66)
Total segment profit1,793 1,385 3,568 3,233 
Interest and other financial charges(83)(90)(173)(163)
Stock compensation expense(a)
(39)(34)(116)(78)
Pension ongoing income(b)
272 198 548 396 
Other postretirement income(b)
18 14 35 27 
Repositioning and other charges(c)
(101)(280)(242)(342)
Other(d)
21 26 122 81 
Income before taxes$1,881 $1,219 $3,742 $3,154 

(a)     Amounts included in Selling, general and administrative expenses.
(b)     Amounts included in Cost of products and services sold and Selling, general and administrative expenses (service cost component) and Other (income) expense (non-service cost component).
(c)     Amounts included in Cost of products and services sold, Selling, general and administrative expenses, and Other (income) expense.
(d)     Amounts include the other components of Other (income) expense not included within other categories in this reconciliation. Equity income of affiliated companies is included in segment profit. 

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HONEYWELL INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Dollars in tables in millions, except per share amounts)
NOTE 18. SUBSEQUENT EVENTS
In July 2022, the Company realigned certain business units within the Safety and Productivity Solutions reportable business segment. This realignment does not impact the four reportable business segments identified by the Company. The Company intends to report financial performance based on this realignment effective with the reporting of third quarter 2022 results.
Business units are used in our annual goodwill impairment test. The Company completes its annual goodwill impairment test on March 31 of each year. Based on the results of the annual goodwill impairment test as of March 31, 2022, fair values of the impacted reporting units were in excess of their carrying values.

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Dollars in tables and graphs in millions)

The following Management Discussion and Analysis is intended to help the reader understand the results of operations and financial condition of Honeywell International Inc. and its consolidated subsidiaries (Honeywell or the Company) for the three and six months ended June 30, 2021.2022. The financial information as of June 30, 2021,2022, should be read in conjunction with the Consolidated Financial Statements for the year ended December 31, 2020,2021, contained in our 20202021 Annual Report on Form 10-K. See Note 3 Acquisitions and Divestitures of Notes to Consolidated Financial Statements for a discussion of acquisition and divestiture activity during the six months ended June 30, 2021.2022.
COVID-19BUSINESS UPDATE
Our business faced significant disruptions due to the COVID-19 pandemic in 2020 and the resulting global recession, causing a slow-down in demand for many of our products and services. Although many jurisdictions worldwide authorized the use of vaccines as a method to limit and control infections, new variants of the virus continue to emerge. We remain cautious as many factors remain unpredictable. We actively monitor and respond to the changing conditions created by the pandemic, with focus on prioritizing the health and safety of our employees, dedicating resources to support our communities, and innovating to address our customers’ needs. We continue to monitor several macroeconomic and geopolitical trends, that have impacted our business, including changing conditions from the COVID-19 infection rates globallypandemic, the on-going Russia-Ukraine conflict, inflationary cost pressures, supply chain disruptions, and respondlabor shortages.
In July 2022, we will realign certain business units within the Safety and Productivity Solutions reportable business segment. This realignment will not impact the four reportable business segments identified by the Company. We intend to report financial performance based on this realignment effective with the reporting of third quarter 2022 results. See Note 18 Subsequent Events of Notes to the risk of new surgesConsolidated Financial Statements for additional information.
COVID-19 UPDATE
The COVID-19 pandemic continues to impact our business operations, and our customers' and suppliers' ability to operate at normal levels. Disruptions in COVID-19 infections. See section titled Risk Factors innormal operating levels continue to create supply chain disruptions and inflationary cost pressures within our 2020 Annual Report on Form 10-K for discussion of risks associated withend-markets. We anticipate supply chain constraints, and the COVID-19 pandemic. A discussion ofinflationary environment will continue during 2022. As such, we implemented short-term and long-term strategies to reduce the impact of current and future effects.
During the first half of 2022, governments around the world removed many restrictions on businesses and the general public. We continue to operate our manufacturing sites at normal production levels. As of June 30, 2022, we have returned nearly all of our non-manufacturing employees to the workplace.
We continue to actively monitor regional COVID-19 can also be foundoutbreaks, and the related government restrictions and lockdown activities in the Resultsareas we operate. To date, the impacts of Operationsthese actions have not been material.
See the section titled Review of Business Segments for additional information on the impacts of COVID-19, inflationary cost pressures, supply chain disruptions, and labor shortages, to our businesses.
RUSSIA-UKRAINE CONFLICT
In response to the Russian invasion of Ukraine, in March 2022, we suspended substantially all of our sales, distribution, and service activities in Russia and Belarus (the Suspension), and in June 2022, we decided to wind down our existing businesses and operations in Russia (the Wind down). Through the Wind down of our businesses and operations, we will seek to collect outstanding accounts receivables, liquidate our inventory and fixed assets, negotiate and settle existing contractual obligations, trade payables and guarantees, and terminate and payout severance to impacted employees. The Suspension and Wind down impacts all of our reportable business segments, with the most significant impact to our Performance Materials and Technologies segment. In early 2022, we created a Ukraine Relief Fund, allowing employees to make donations to support organizations that are providing direct assistance to Ukrainians and those that are assisting them in the midst of this Management Discussion and Analysis.



humanitarian crisis.
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During the three and six months ended June 30, 2022, we recognized $126 million and $309 million, respectively, of charges and the accrual of reserves due to the initial Suspension and Wind down of our businesses and operations. The charges and accrual of reserves during the second quarter of 2022 were primarily related to foreign exchange revaluation on an intercompany loan with a Russian affiliate, inventory reserves, the write-down of other assets, impairment of property, plant and equipment, employee severance, and a tax valuation allowance. The respective impacts to revenues, net income, net assets, cash flow from operations, or our global workforce are not material for the periods recognized. For the year ended December 31, 2021, revenues from sales in Russia represented approximately 1% of our global revenues, while assets in Russia represented less than 1% of our total assets. Based on available information to date, the Company’s estimate of potential future losses or other contingencies related to the Suspension and Wind down activities, including any guarantee payments or any litigation costs or as otherwise related to our Wind down in Russia, could adversely affect the Company's consolidated results of operations in the periods recognized but would not be material with respect to the Company's consolidated financial position. As the conflict continues to evolve, existing conditions may worsen or other impacts that are unknown at this time may arise that could have a material adverse effect on our consolidated financial position.
The Russia-Ukraine conflict caused certain commodity prices to spike, adding to the inflationary pressures in the global economy. We considered the impacts of the conflict on oil and gas prices in our short-term and long-term strategies discussed in the above. Additionally, we continue to assess the current and future impacts of the conflict on already constrained supply chains.
See Item 1A. Risk Factors for additional information on potential risks to our business.

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RESULTS OF OPERATIONS
Consolidated Financial Results
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Net Sales by Segment
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Segment Profit by Segment
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CONSOLIDATED OPERATING RESULTS
Net Sales
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The change in net sales was attributable to the following:
Q2 2021 vs. Q2 2020Year to Date 2021 vs. 2020Q2 2022 vs. Q2 2021Year to Date 2022 vs. 2021
VolumeVolume12 %4 %Volume(5)%(5)%
PricePrice3 %2 %Price9 %8 %
Foreign Currency TranslationForeign Currency Translation3 %2 %Foreign Currency Translation(2)%(3)%
18 %8 % 2 %— %
Q2 20212022 compared towith Q2 20202021
Net sales increased due to the following:
•HigherFavorable pricing to offset higher direct and indirect material costs and higher labor costs,
•Partially offset by lower sales volumes due to an increase in demand for certain productsour Safety and services as the global economy showed signs of recovery from the COVID-19 pandemic,Productivity Solutions segment, and
•The favorableunfavorable impact of foreign currency translation, driven by the weakeningstrengthening of the U.S. Dollar against the currencies of the majority of our international markets, primarily the Euro, Canadian Dollar, Chinese Renminbi, British Pound, andTurkish Lira, Australian Dollar, and Canadian Dollar.
•Favorable pricing.
YTD 20212022 compared towith YTD 20202021
Net sales increased due to the following:
•HigherFavorable pricing to offset higher direct and indirect material costs and higher labor costs,
•Partially offset by lower sales volumes due to an increase in demand for certain productsour Safety and services as the global economy showed signs of recovery from the COVID-19 pandemic,Productivity Solutions segment, and
•The favorableunfavorable impact of foreign currency translation, driven by the weakeningstrengthening of the U.S. Dollar against the currencies of the majority of our international markets, primarily the Euro, Chinese Renminbi, British Pound, Canadian Dollar,Turkish Lira, and Australian Dollar, and
•Favorable pricing,
•Partially offset by lower sales volumes in Aerospace due to weakness in global travel and lower flight hours due to the COVID-19 pandemic.


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Cost of Products and Services Sold
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Q2 20212022 compared towith Q2 20202021
Cost of products and services sold increased due to the following:
•Higher direct and indirect material costs of approximately $690 million and higher labor costs, of approximately $90 million driven by higher volumes due to an increase in demand in certain of our productsand
•Higher repositioning and services and the unfavorable impact of foreign currency translation,other charges,
•Partially offset by lower repositioningsales volumes in our Safety and other chargesProductivity Solutions segment, and favorable impact of approximately $90 million.foreign currency translation.

YTD 20212022 compared towith YTD 20202021
Cost of products and services sold increased due to the following:
•Higher direct and indirect material costs of approximately $860 million drivenand higher labor costs, and
•Higher repositioning and other charges,
•Partially offset by higherlower sales volumes due to an increase in demand in certain of our productsSafety and servicesProductivity Solutions segment, and the unfavorablefavorable impact of foreign currency translation.
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Gross Margin
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Q2 20212022 compared with Q2 2021
Gross margin as a percentage of net sales increased due to Q2 2020the following:
•Favorable pricing,
•Partially offset by lower gross margins due to higher direct and indirect material costs and higher labor costs, higher repositioning and other charges and lower sales volumes in our Safety and Productivity Solutions segment.

YTD 2022 compared with YTD 2021
Gross margin and Gross margin as a percentage of net sales increased due to the following:
•Higher gross margins due to an increase in demand for certain products and services as the global economy showed signs of recovery from the COVID-19 pandemic,
34 Honeywell International Inc.



•Lower repositioning and other charges of approximately $90 million, and
•Favorable pricing,
•Partially offset by a larger portion of ourlower gross margins due to higher direct and indirect material costs and higher labor costs, higher repositioning and other charges and lower sales being driven byvolumes in our Safety and Productivity Solutions segment.
YTD
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Selling, General and Administrative Expenses
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Q2 2022 compared with Q2 2021 compared to YTD 2020
Gross marginSelling, general and Gross margin as a percentage of net salesadministrative expenses increased due to the following:
•Higher gross margins due to an increase in demand for certain products and services as the global economy showed signs of recovery from the COVID-19 pandemic,repositioning costs, and
•Favorable pricing,Higher labor costs.
•Partially offset by a larger portion of our sales being driven by our Safety and Productivity Solutions segment.
Selling, General and Administrative Expenses
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Q2 2021YTD 2022 compared to Q2 2020YTD 2021
Selling, general and administrative expenses and Selling, general and administrative expenses as a percentage of net sales changed due to the following:
•Cost savings from repositioning actions resulted in lower expenses,
•Partially offset by higher expenses due to increased sales volumes and the unfavorable impact of foreign currency translation.
YTD 2021 compared to YTD 2020
Selling, general and administrative expenses and Selling, general and administrative expenses as a percentage of net sales changed due to the following:
•Cost savings from repositioning actions resulted in lower expenses,
•Partially offset by higher expenses due to increased sales volumes and the unfavorable impact of foreign currency translation.


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Other (Income) Expense
 Three Months Ended June 30,Six Months Ended June 30,
 2021202020212020
Other (income) expense$(366)$(291)$(808)$(608)
Q2 2021 compared to Q2 2020
Other income increased due to the following:
•Higher pension income,repositioning costs,
•Partially offset by foreign exchange expense.Higher labor costs, and
YTD•Charges and accrual of reserves directly attributable to the initial Suspension and Wind down of businesses and operations in Russia.
Other (Income) Expense
Three Months Ended June 30,Six Months Ended June 30,
2022202120222021
Other (Income) Expense$(190)$(366)$(509)$(808)
Q2 2022 compared with Q2 2021 compared to YTD 2020
Other income increaseddecreased due to the following:
•HigherCharges and accrual of reserves directly attributable to the initial Suspension and Wind down of businesses and operations in Russia,
•Recognition of an expense related to UOP matters, and
•Lower pension income.

YTD 2022 compared with YTD 2021
Other income anddecreased due to the following:
•Prior year gain on sale of the retail footwear business,
•Partially offset by foreign exchangeCharges and accrual of reserves directly attributable to the initial Suspension and Wind down of businesses and operations in Russia,
•Lower pension income, and
•Recognition of an expense and lower interest income.related to UOP matters.
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Tax Expense
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Q2 20212022 compared towith Q2 20202021
The effective tax rate increased, due to the absence of tax benefits realized in the prior year as a result of the favorable resolution of a foreign tax matter related to the spin-off transactions partially offset by increased tax benefits for employee share-based compensation and the resolution of certain foreign tax matters in the current year.
The effective tax rate for the three months ended June 30, 2021, was higher than the U.S. federal statutory rate of 21% primarily, due to incrementalthe following:
•Charges and accrual of reserves directly attributable to the initial Suspension and Wind down of our businesses and operations in Russia with no corresponding tax reserves and state taxes, partially offset bybenefit,
•Expense related to UOP matters with no corresponding tax benefit,
•Lower tax benefits for employee share-based compensation, and
•Incremental tax reserves and state taxes,
•Partially offset by the favorable resolution of certain foreign tax matters.
For further discussion of changes in the effective tax rate, see Note 6 Income Taxes of Notes to Consolidated Financial Statements.

YTD 2022 compared with YTD 2021
The effective tax rate for the three months ended June 30, 2020, was lower than the U.S. federal statutory rate of 21% primarily from foreign earnings taxed at lower foreign tax ratesincreased, and the favorable resolution of a foreign tax matter related to the spin-off transactions, partially offset by incremental tax reserves and state taxes.
YTD 2021 compared to YTD 2020
The effective tax rate increased due to the absence of tax benefits realized in the prior year as a result of the favorable resolution of a foreign tax matter related to the spin-off transactions, tax law changes in India and the resolution of certain U.S. tax matters, partially offset by increased tax benefits for employee share-based compensation and the resolution of certain foreign tax matters in the current year.
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The effective tax rate for the six months ended June 30, 2021, was higher than the U.S. federal statutory rate of 21% primarily, due to incrementalthe following:
•Charges and accrual of reserves directly attributable to the initial Suspension and Wind down of our businesses and operations in Russia with no corresponding tax reserves and state taxes, partially offset bybenefit,
•Expense related to UOP matters with no corresponding tax benefit,
•Lower tax benefits for employee share-based compensation, and
•Incremental tax reserves and state taxes,
•Partially offset by the favorable resolution of certain foreign tax matters.
TheFor further discussion of changes in the effective tax rate, for the six months ended June 30, 2020, was lower than the U.S. federal statutory ratesee Note 6 Income Taxes of 21% primarily from foreign earnings taxed at lower foreign tax rates, the favorable resolution of a foreign tax matter relatedNotes to the spin-off transactions, tax law changes in India and the resolution of certain U.S. tax matters, partially offset by incremental tax reserves and state taxes.Consolidated Financial Statements.
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Net Income Attributable to Honeywell
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Q2 20212022 compared to Q2 20202021
Earnings per share of common stock–assuming dilution increased,decreased, driven by the following:
•Higher segment profit,repositioning and other charges, including charges and accrual of reserves directly attributable to the initial Suspension and Wind down of businesses and operations in Russia,
•The recognition of an expense related to UOP matters, and
•Lower repositioning and other charges, and
•Higher pension income,
•Partially offset by higher income taxes.segment profit and the favorable impact of lower share count.

YTD 20212022 compared to YTD 20202021
Earnings per share of common stock–assuming dilution increased,decreased, driven by the following:
•Higher segment profit,repositioning and other charges, including charges and accrual of reserves directly attributable to the initial Suspension and Wind down of businesses and operations in Russia,
•Higher pension income,Prior year gain on sale of the retail footwear business,
•The recognition of an expense related to UOP matters, and
•Lower repositioning and other charges, and
•Favorable impact of lower share count,pension income,
•Partially offset by higher income taxes.


segment profit, and the favorable impact of lower share count.

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REVIEW OF BUSINESS SEGMENTS
We globally manage our business operations through four segments: Aerospace, Honeywell Building Technologies, Performance Materials and Technologies, and Safety and Productivity Solutions.
AEROSPACE
NET SALESNet Sales
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Three Months Ended
June 30,		Six Months Ended
June 30,		Three Months Ended
June 30,		Six Months Ended
June 30,
20212020%
Change		20212020%
Change		20222021%
Change		20222021%
Change
Net salesNet sales$2,766 $2,543 9 %$5,398 $5,904 (9)%Net sales$2,898 $2,766 5 %$5,647 $5,398 5 %
Cost of products and services soldCost of products and services sold1,846 1,795 3,502 3,994 Cost of products and services sold1,922 1,846 3,681 3,502 
Selling, general and administrative and other expensesSelling, general and administrative and other expenses210 220 424 445 Selling, general and administrative and other expenses209 210 446 424 
Segment profitSegment profit$710 $528 34 %$1,472 $1,465 — %Segment profit$767 $710 8 %$1,520 $1,472 3 %
2022 vs. 2021
Three Months Ended
June 30,		Six Months Ended
June 30,
Factors Contributing to Year-Over-Year ChangeNet
Sales		Segment
Profit		Net
Sales		Segment
Profit
Organic(1)
5 %8 %5 %4 %
Foreign currency translation— %— %— %(1)%
Acquisitions, divestitures and other, net— %— %— %— %
Total % Change5 %8 %5 %3 %

(1)
 2021 vs. 2020
 Three Months Ended
June 30,		Six Months Ended
June 30,
Factors Contributing to Year-Over-Year ChangeSalesSegment
Profit		SalesSegment
Profit
Organic(1)
7 %33 %(9)%— %
Foreign currency translation1 %1 %— %— %
Acquisitions, divestitures and other, net1 %— %— %— %
Total % change9 %34 %(9)%— %
(1) Organic sales % change, presented for all of our reportable business segments, is defined as the change in net sales, excluding the impact on sales from foreign currency translation and acquisitions, net of divestitures, for the first 12 months following the transaction date. We believe this non-GAAP measure is useful to investors and management in understanding ourthe ongoing operations and in analysis of ongoing operating trends.
38 Honeywell International Inc.



Q2 20212022 compared to Q2 20202021
Sales increased due to favorable pricing, higher sales volumes as domestic travel and flight hours began to show signs of recovery from the COVID-19 pandemic, in addition to the favorable impact of pricing and foreign currency translation. Sales ofdemand for our aftermarket products and services increased, whileas flight hours increase from pandemic lows, and higher demand from commercial OEMs, andpartially offset by lower volumes in domestic and international defense decreased.defense.
•Commercial Aviation Original Equipment sales decreased 2% (decreased 3%increased 21% (increased 22% organic) due to lowerhigher demand fromin air transport partially offset by increases inand regional and business aviation.
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•Commercial Aviation Aftermarket sales increased 54%19% (increased 53%19% organic) due to higher demand and favorable pricing in air transport and regional and business aviation.
•Defense and Space sales decreased 8%12% (decreased 10%11% organic) driven bydue to lower demandsales volumes in U.S.domestic and international defense.
Cost of products and services sold increased due to higher sales volumes, partially offset bydirect and indirect material costs and higher productivity.labor costs.
Segment profit increased due to favorable pricing, partially offset by higher sales volumes of aftermarket products, increased productivity,direct and favorable pricing. indirect material costs and higher labor costs.

YTD 20212022 compared to YTD 20202021
Sales decreasedincreased due to weakness in global travelfavorable pricing, and lower flight hours due to the COVID-19 pandemic, resulting in lowerhigher demand for our aftermarket products and services, as flight hours increase from pandemic lows, and commercial OEMs, and aftermarket customers, and as demand frompartially offset by lower volumes in domestic and international defense spend decreased.defense.
•Commercial Aviation Original Equipment sales decreased 23% (decreased 23%increased 16% (increased 16% organic) due to lowerhigher demand fromin air transport and regional and business aviation.transport.
•Commercial Aviation Aftermarket sales decreased 6% (decreased 6%increased 23% (increased 24% organic) due to lowerhigher demand, and favorable pricing in air transport partially offset by higher demand inand regional and business aviation.
•Defense and Space sales decreased 5%13% (decreased 6%13% organic) driven bydue to lower demandsales volumes in U.Sdomestic and international defense.
Cost of products and services sold decreasedincreased due to lower sales volumeshigher direct and indirect material costs and higher productivity.labor costs and higher sales volumes.
Segment profit was flatincreased due to favorable pricing and higher productivity,sales volumes, partially offset by lower sales volumes.offset by higher direct and indirect material costs and higher labor costs.
HONEYWELL BUILDING TECHNOLOGIES
NET SALESNet Sales
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Three Months Ended
June 30,		Six Months Ended
June 30,
20222021%
Change		20222021%
Change
Net sales$1,531 $1,407 9 %$2,960 $2,765 7 %
Cost of products and services sold884 822 1,723 1,611 
Selling, general and administrative and other expenses287 270 541 534 
Segment profit$360 $315 14 %$696 $620 12 %
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Three Months Ended
June 30,		Six Months Ended
June 30,
 20212020% Change20212020% Change
Net sales$1,407 $1,177 20 %$2,765 $2,458 12 %
Cost of products and services sold822 699 1,611 1,453 
Selling, general and administrative and other expenses270 228 534 493 
Segment profit$315 $250 26 %$620 $512 21 %

2021 vs. 2020 2022 vs. 2021
Three Months Ended
June 30,		Six Months Ended
June 30,		 Three Months Ended
June 30,		Six Months Ended
June 30,
Factors Contributing to Year-Over-Year ChangeFactors Contributing to Year-Over-Year ChangeSalesSegment
Profit		SalesSegment
Profit		Factors Contributing to Year-Over-Year ChangeNet
Sales		Segment
Profit		Net
Sales		Segment
Profit
OrganicOrganic13 %20 %7 %15 %Organic14 %20 %11 %17 %
Foreign currency translationForeign currency translation7 %8 %5 %7 %Foreign currency translation(6)%(7)%(5)%(6)%
Acquisitions, divestitures and other, netAcquisitions, divestitures and other, net— %(2)%— %(1)%Acquisitions, divestitures and other, net1 %1 %1 %1 %
Total % change20 %26 %12 %21 %
Total % ChangeTotal % Change9 %14 %7 %12 %
Q2 20212022 compared to Q2 20202021
Sales increased due to favorable pricing and higher sales volumes, andpartially offset by the favorableunfavorable impact of foreign currency translation. Customer demand increased as the global economy began to show signs of recovery.
•Sales in Products increased 26%15% (increased 20% organic) due to higher sales volumes, an increase infavorable pricing and higher demand for certain product offerings, partially offset by the favorableunfavorable impact of foreign currency translation.
•Sales in Building Solutions increased 11%were flat (increased 5%6% organic) due to the favorable impact of foreign currency translation, higher sales volumes, and an increase in pricing.
Cost of products and services sold increased primarily due to higher sales volumes and the unfavorable impact of foreign currency translation, partially offset by higher productivity.
Segment profit increased primarily due to higher sales volumes and the favorable impact of foreign currency translation.
YTD 2021 compared to YTD 2020
Sales increased due to higher sales volumes and the favorable impact of foreign currency translation. Customer demand increased as the global economy began to show signs of recovery.
•Sales in Products increased 16% (increased 11% organic) due to higher sales volumes, favorable pricing, and the favorable impact of foreign currency translation.
•Sales in Building Solutions increased 7% (increased 2% organic) due to the favorable impact of foreign currency translation, higher sales volumes, and favorable pricing.
Cost of products and services sold increased primarily due to higher sales volumes and the unfavorable impact of foreign currency translation, partially offset by higher productivity.
Segment profit increased primarily due to favorable pricing, the favorable impact of foreign currency translation, and higher sales volumes.
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PERFORMANCE MATERIALS AND TECHNOLOGIES
NET SALES
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 Three Months Ended
June 30,		Six Months Ended
June 30,
 20212020%
Change		20212020%
Change
Net sales$2,552 $2,218 15 %$4,898 $4,615 6 %
Cost of products and services sold1,696 1,490 3,287 3,049  
Selling, general and administrative and other expenses326 309 647 635  
Segment profit$530 $419 26 %$964 $931 4 %

 2021 vs. 2020
 Three Months Ended June 30,Six Months Ended June 30,
Factors Contributing to Year-Over-Year ChangeSalesSegment
Profit		SalesSegment
Profit
Organic10 %23 %2 %1 %
Foreign currency translation4 %4 %3 %4 %
Acquisitions, divestitures, and other, net1 %(1)%1 %(1)%
Total % change15 %26 %6 %4 %
 
Q2 2021 compared to Q2 2020
Sales increased due to higher sales volumes, the favorable impact of foreign currency translation, and an increase in pricing. Increased investment in the oil and gas industry and higher demand within Advanced Materials resulted in higher sales of our products and services.
•UOP sales increased 10% (increased 8% organic) due to higher demand for oil and gas products and the favorable impact of foreign currency translation.
•Process Solutions sales increased 7% (decreased 1% organic) drivenoffset by the favorable impact of foreign currency translation as well as the acquisition of Sparta Systems.
•Advanced Materials sales increased 34% (increased 30% organic) driven by increased demand in fluorine and specialty products and the favorableunfavorable impact of foreign currency translation.
Cost of products and services sold increased due to higher direct and indirect material costs and higher labor costs and higher volumes of lower margin products, partially offset by the favorable impact of foreign currency translation.
Segment profit increased due to favorable pricing and higher demand for certain product offerings, partially offset by higher direct and indirect material costs and higher labor costs, and the unfavorable impact of foreign currency translation.

YTD 2022 compared to YTD 2021
Sales increased due to favorable pricing and higher sales volumes, partially offset by the unfavorable impact of foreign currency translation.
•Sales in Products increased 14% (increased 17% organic) due to favorable pricing and higher demand for certain product offerings, partially offset by the unfavorable impact of foreign currency translation.
•Sales in Building Solutions decreased 2% (increased 3% organic) due to the unfavorable impact of foreign currency translation and lower sales volumes, partially offset by favorable pricing.
Cost of products and services sold increased due to higher direct and indirect material costs and higher labor costs, lower productivity, and higher sales volumes of lower margin products, partially offset by the favorable impact of foreign currency translation.
Segment profit increased due to favorable pricing, partially offset by higher direct and indirect material costs and higher labor costs and the unfavorable impact of foreign currency translation.
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Segment profit increased due to higher productivity, higher sales volumes, and the favorable impact of foreign currency translation.PERFORMANCE MATERIALS AND TECHNOLOGIES
YTD 2021Net Sales
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Three Months Ended
June 30,		Six Months Ended
June 30,
20222021%
Change		20222021%
Change
Net sales$2,694 $2,552 6 %$5,147 $4,898 5 %
Cost of products and services sold1,734 1,696 3,335 3,287  
Selling, general and administrative and other expenses359 326 701 647  
Segment profit$601 $530 13 %$1,111 $964 15 %
2022 vs. 2021
Three Months Ended
June 30,		Six Months Ended
June 30,
Factors Contributing to Year-Over-Year ChangeNet
Sales		Segment
Profit		Net
Sales		Segment
Profit
Organic10 %18 %8 %19 %
Foreign currency translation(4)%(5)%(3)%(4)%
Acquisitions, divestitures and other, net— %— %— %— %
Total % Change6 %13 %5 %15 %
Q2 2022 compared to YTD 2020Q2 2021
Sales increased due to favorable pricing, partially offset by the favorableunfavorable impact of foreign currency translation and an increase in pricing. Higher demand within Advanced Materials was partially offset by decreased investment inlower sales volumes due to the oil and gas industry which negatively impacted manyimpact of our customers.the Russia-Ukraine conflict.
•UOP sales decreased 1% (decreased 4%1% organic) due to lower demand for new oil and gas productsprojects and servicesthe impact of the Russia-Ukraine conflict, partially offset by the favorable impact of foreign currency translation.pricing.
•Process Solutions sales increased 1% (decreased 5%(increased 7% organic) drivendue to favorable pricing and higher demand for certain products and services, partially offset by the favorableunfavorable impact of foreign currency translation, partially offset by lower demand for products and services.the impact of the Russia-Ukraine conflict.
•Advanced Materials sales increased 22%17% (increased 18%21% organic) driven by increaseddue to favorable pricing and higher demand in fluorine andfor specialty products, andpartially offset by the favorableunfavorable impact of foreign currency translation.
Cost of products and services sold increased due to higher direct and indirect material costs and higher labor costs, partially offset by lower sales volumes due to the impact of lower margin productsthe Russia-Ukraine conflict and the unfavorablefavorable impact of foreign currency translation.
Segment profit increased due to higher productivity,favorable pricing, partially offset by higher direct and indirect material costs and higher labor costs and lower sales volumes of lowerhigher margin products.


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YTD 2022 compared to YTD 2021
Sales increased due to favorable pricing, partially offset by the unfavorable impact of foreign currency translation and lower sales volumes primarily due to the impact of the Russia-Ukraine conflict.
•UOP sales decreased 5% (decreased 5% organic) due to lower demand for new oil and gas projects and the impact of the Russia-Ukraine conflict, partially offset by favorable pricing.

•Process Solutions sales increased 3% (increased 7% organic) due to favorable pricing and higher demand for certain products and services, partially offset by the unfavorable impact of foreign currency translation and the impact of the Russia-Ukraine conflict.
•Advanced Materials sales increased 15% (increased 19% organic) due to favorable pricing and higher demand for specialty products, partially offset by the unfavorable impact of foreign currency translation and lower demand for fluorine products.
Cost of products and services sold increased due to higher direct and indirect material costs and higher labor costs, partially offset by lower sales volumes primarily due to the impact of the Russia-Ukraine conflict and the favorable impact of foreign currency translation.
Segment profit increased due to favorable pricing, partially offset by higher direct and indirect material costs and higher labor costs.
SAFETY AND PRODUCTIVITY SOLUTIONS
NET SALESNet Sales
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Three Months Ended
June 30,		Six Months Ended
June 30,		Three Months Ended
June 30,		Six Months Ended
June 30,
20212020%
Change		20212020%
Change		20222021%
Change		20222021%
Change
Net salesNet sales$2,083 $1,539 35 %$4,201 $2,963 42 %Net sales$1,829 $2,083 (12)%$3,573 $4,201 (15)%
Cost of products and services soldCost of products and services sold1,523 1,079  3,073 2,051 Cost of products and services sold1,310 1,523  2,528 3,073 
Selling, general and administrative and other expensesSelling, general and administrative and other expenses268 247  533 521 Selling, general and administrative and other expenses288 268  561 533 
Segment profitSegment profit$292 $213 37 %$595 $391 52 %Segment profit$231 $292 (21)%$484 $595 (19)%
2021 vs. 20202022 vs. 2021
Three Months Ended
June 30,		Six Months Ended
June 30,		Three Months Ended
June 30,		Six Months Ended
June 30,
Factors Contributing to Year-Over-Year ChangeFactors Contributing to Year-Over-Year ChangeSalesSegment
Profit		SalesSegment
Profit		Factors Contributing to Year-Over-Year ChangeNet
Sales		Segment
Profit		Net
Sales		Segment
Profit
OrganicOrganic35 %32 %41 %48 %Organic(10)%(18)%(12)%(16)%
Foreign currency translationForeign currency translation3 %6 %3 %5 %Foreign currency translation(2)%(3)%(2)%(2)%
Acquisitions, divestitures, and other, net(3)%(1)%(2)%(1)%
Total % change35 %37 %42 %52 %
Acquisitions, divestitures and other, netAcquisitions, divestitures and other, net— %— %(1)%(1)%
Total % ChangeTotal % Change(12)%(21)%(15)%(19)%
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Q2 20212022 compared to Q2 20202021
Sales increaseddecreased due to higherlower sales volumes favorable pricing, and the favorableunfavorable impact of foreign currency translation, partially offset by the sale of the retail footwear business. The higher sales volumes in the quarter were primarily driven by warehouse automation services, Productivity Solutions and Services, and respiratory PPE.favorable pricing.
•Sales in Safety and Retail increaseddecreased 21% (increased 25%(decreased 18% organic) due to higher sales volumes and the favorable impact of foreign currency translation,lower demand for personal protective equipment, partially offset by the sale of the retail footwear business.favorable pricing.
•Sales in Productivity Solutions and Services increased 43%14% (increased 38%19% organic) due to favorable pricing and higher demand andsales volumes (driven by a licensing agreement executed in the favorablesecond quarter of 2022, discussed below), partially offset by the unfavorable impact of foreign currency translation.
•Sales in Warehouse and Workflow Solutions increased 59% (increased 57%decreased 26% (decreased 25% organic) due to higher sales volumeslower demand and the favorable impacttiming of foreign currency translation. Sales volume growth was driven by strong demand for our warehouse automation services.projects.
43 Honeywell International Inc.



•Sales in Advanced Sensing Technologies decreased 1% (decreased 4%increased 21% (increased 25% organic) due to lower sales volumes,higher demand and favorable pricing, partially offset by the favorableunfavorable impact of foreign currency translation.
Cost of products and services sold increaseddecreased due to higher sales volumes and the unfavorable impact of foreign currency translation.
Segment profit increased primarily due to higher sales volumes, favorable pricing, and higher productivity, partially offset by higher sales of lower margin products.
YTD 2021 compared to YTD 2020
Sales increased due to higher sales volumes, favorable pricing, and the favorable impact of foreign currency translation, partially offset by the sale of the retail footwear business. The higher sales volumes in the six months were primarily driven by warehouse automation services, respiratory PPE, and Productivity Solutions and Services.
•Sales in Safety and Retail increased 34% (increased 36% organic) due to higher sales volumes and the favorable impact of foreign currency translation, partially offset by higher direct and indirect material costs and higher labor costs and lower productivity including a write-down of mask inventory.
Segment profit decreased primarily due to lower productivity and lower sales volumes, partially offset by favorable pricing.

YTD 2022 compared to YTD 2021
Sales decreased due to lower sales volumes, the unfavorable impact of foreign currency translation, and the sale of the retail footwear business.business, partially offset by favorable pricing.
•Sales in Safety and Retail decreased 27% (decreased 22% organic) due to lower demand for personal protective equipment and the sale of the retail footwear business, partially offset by favorable pricing.
•Sales in Productivity Solutions and Services increased 31%14% (increased 27%17% organic) due to favorable pricing and higher demand andsales volumes (driven by a licensing agreement executed in the favorablesecond quarter of 2022, discussed below), partially offset by the unfavorable impact of foreign currency translation.
•Sales in Warehouse and Workflow Solutions increased 70% (increased 69%decreased 27% (decreased 26% organic) due to higher sales volumeslower demand and the favorable impacttiming of foreign currency translation. Sales volume growth was driven by strong demand for our warehouse automation services.projects.
•Sales in Advanced Sensing Technologies increased 2% (decreased 1%22% (increased 25% organic) due to higher demand and favorable pricing, partially offset by the unfavorable impact of foreign currency translation.
Cost of products and services sold decreased due to lower sales volumes and the favorable impact of foreign currency translation, partially offset by higher direct and indirect material costs and higher labor costs and lower organic sales volumes.
Costproductivity including a write-down of products and services sold increased due to higher sales volumes and the unfavorable impact of foreign currency translation.mask inventory.
Segment profit increaseddecreased primarily due to higherlower productivity and lower sales volumes, higher productivity, and favorable pricing, partially offset by higher salesfavorable pricing.
During the second quarter of lower margin products.2022, our Productivity Solutions and Services business entered into a license and settlement agreement (the Agreement). Under the Agreement, we will receive up to $360 million, paid in equal quarterly installments over eight quarters, beginning with the second quarter of 2022. The Agreement provides each party a license to its existing patent portfolio for use by the other party’s existing products and, resolves all patent-related litigation between the parties.
CORPORATE AND ALL OTHER
Corporate and All Other primarily includes unallocated corporate costs, interest expense on holding-company debt, and the controlling majority-owned interest in Quantinuum. Corporate and All Other is not considered a separate reportable business segment as segment reporting criteria is not met for the activities reported with Corporate and All Other. The Company continues to monitor the activities in Corporate and All Other to determine the need for further reportable business segment disaggregation.
REPOSITIONING CHARGES
See Note 5 Repositioning and Other Charges of Notes to Consolidated Financial Statements for a discussion of our repositioning actions and related charges incurred in the six months ended June 30, 20212022 and 2020.2021. Cash spending related to our repositioning actions was $202$157 million in the six months ended June 30, 2021,2022, and was funded through operating cash flows.
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LIQUIDITY AND CAPITAL RESOURCES
(Dollars in tables in millions)
We continue to manage our businesses to maximize operating cash flows as the primary source of liquidity. Each of our businesses is focused on increasing operating cash flows through revenue growth, margin expansion, and improved working capital turnover. Additional sources of liquidity include committed credit lines, short-term debt from the commercial paper market, long-term borrowings, access to the public debt and equity markets, U.S. cash balances, and the ability to access non-U.S. cash as a result of the U.S. Tax Cuts and Jobs Act.balances.
CASH
We monitor the third-party depository institutions that hold our cash and cash equivalents on a daily basis. Our emphasis is primarily safety of principal and secondarily maximizing yield of those funds. We diversify our cash and cash equivalents among counterparties to minimize exposure to any one of these entities. As of June 30, 2021,2022, and December 31, 2020,2021, we held $12.3$8.7 billion and $15.2$11.5 billion, respectively, of cash and cash equivalents, including our short-term investments.

44 Honeywell International Inc.



BORROWINGS
Consolidated total borrowings were $21.4$19.1 billion and $22.4$19.6 billion as of June 30, 2021,2022, and December 31, 2020.2021.
June 30, 2021December 31, 2020June 30, 2022December 31, 2021
Commercial paper and other short-term borrowingsCommercial paper and other short-term borrowings$3,573 $3,597 Commercial paper and other short-term borrowings$3,487 $3,542 
Variable rate notesVariable rate notes1,1221,122Variable rate notes622622
Fixed rate notesFixed rate notes16,46417,399Fixed rate notes15,04815,314
OtherOther197 266 Other123332
Debt issuance costs
Debt issuance costs
(203)(211)
Total borrowingsTotal borrowings$21,356 $22,384 Total borrowings$19,077 $19,599 

A source of liquidity is our ability to access the commercial paper market. Commercial paper notes are sold at a discount or premium and have a maturity of not more than 365 days from date of issuance. Borrowings under the commercial paper program are available for general corporate purposes as well as for financing acquisitions.
We also have the following revolving credit agreements, which can provide financing for general corporate purposes:agreements:
•A $1.5 billion 364-Day Credit Agreement (the 364-Day Credit Agreement) with a syndicate of banks, dated March 31, 2021.24, 2022. Amounts borrowed under the 364-Day Credit Agreement are required to be repaid no later than March 30, 2022,23, 2023, unless (i) we elect to convert all then outstanding amounts into a term loan, upon which such amounts shall be repaid in full on March 30, 2023,23, 2024, or (ii) the 364-Day Credit Agreement is terminated earlier pursuant to its terms. The 364-Day Credit Agreement replacesreplaced the previously reported $1.5 billion 364-day credit agreement dated as of April 10, 2020,March 31, 2021, which was terminated in accordance with its terms effective March 31, 2021.24, 2022. As of June 30, 2021,2022, there were no outstanding borrowings under our 364-Day Credit Agreement.
•A $4.0 billion Five Year Credit Agreement (the 5-Year Credit Agreement) with a syndicate of banks, dated March 31, 2021.24, 2022. Commitments under the 5-Year Credit Agreement can be increased pursuant to the terms of the 5-Year Credit Agreement to an aggregate amount not to exceed $4.5 billion. The 5-Year Credit Agreement amended and restated the previously reported $4.0 billion amended and restated five year credit agreement dated as of April 26, 2019.March 31, 2021. As of June 30, 2021,2022, there were no outstanding borrowings under our 5-Year Credit Agreement.
We also have a current shelf registration statement filed with the SECSecurities and Exchange Commission (SEC) under which we may issue additional debt securities, common stock, and preferred stock that may be offered in one or more offerings on terms to be determined at the time of the offering. We anticipate that net proceeds of any offering would be used for general corporate purposes, including repayment of existing indebtedness, share repurchases, capital expenditures and acquisitions.
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CREDIT RATINGS
Our ability to access the global debt capital markets and the related cost of these borrowings is affected by the strength of our credit rating and market conditions. Our credit ratings are periodically reviewed by the major independent debt-rating agencies. As of June 30, 2021, Standard & Poor's2022, S&P Global Inc. (S&P), Fitch Ratings Inc. (Fitch), and Moody’s Investor Service (Moody's) have ratings on our debt set forth in the table below:
S&PFitchMoody's
OutlookStableStableStable
Short-termA-1F1P1
Long-termAAA2




45 Honeywell International Inc.



CASH FLOW SUMMARY
Our cash flows from operating, investing, and financing activities, as reflected in the Consolidated Statement of Cash Flows, are summarized as follows:
Six Months Ended June 30,Six Months Ended June 30,
2021202020222021Variance
Cash provided by (used for):  
Cash and cash equivalents at beginning of periodCash and cash equivalents at beginning of period$10,959 $14,275 $(3,316)
Operating activitiesOperating activities$2,256 $2,419 Operating activities
Investing activities(1,243)(358)
Financing activities(3,877)2,741 
Net income attributable to HoneywellNet income attributable to Honeywell2,395 2,857 (462)
Noncash adjustmentsNoncash adjustments931 411 520 
Changes in working capitalChanges in working capital(1,578)4 (1,582)
Other operating activitiesOther operating activities(923)(1,016)93 
Net cash provided by operating activitiesNet cash provided by operating activities825 2,256 (1,431)
Net cash provided by (used for) investing activitiesNet cash provided by (used for) investing activities414 (1,243)1,657 
Net cash used for financing activitiesNet cash used for financing activities(3,832)(3,877)45 
Effect of exchange rate changes on cashEffect of exchange rate changes on cash16 (91)Effect of exchange rate changes on cash(118)16 (134)
Net increase (decrease) in cash and cash equivalentsNet increase (decrease) in cash and cash equivalents$(2,848)$4,711 Net increase (decrease) in cash and cash equivalents(2,711)(2,848)137 
Cash and cash equivalents at end of periodCash and cash equivalents at end of period$8,248 $11,427 $(3,179)

Cash provided byrelated to operating activities decreased by $163 million due to a net unfavorable impact of changes in assets and liabilities, which resulted in a $350 million use of cash during the six months ended June 30, 2021, compared to providing cash of $161 million during the six months ended June 30, 2020. The change included an unfavorable impact to working capital of $77 million, which wasand a decrease in net income, partially offset by an increase in net incomenoncash adjustments, primarily driven by an increase in repositioning and other charges, and a gain from the 2021 sale of $195 million.the retail footwear business.
Cash used forrelated to investing activities increased by $885$1,657 million primarily due to $1,327a $1,149 million decrease in cash paid for acquisitions, and a $106$360 million decreaseincrease in cash receipts from settlements of derivative contracts, partially offset by a $375$242 million cash receipt from Garrett Motion Inc. (Garrett)net increase in investments, and $190 million in proceeds from the 2021 sale of the retail footwear business.
Cash used forrelated to financing activities increased by $6,618$45 million primarily due to $7,101 of proceeds from the issuance$746 million decrease in payments of long-term debt, during the six months ended June 30, 2020, partially offset by a $383$588 million decrease in repayments of long-term debt and a $136 million decreaseincrease in repurchases of common stock during the six months ended June 30, 2021.
The effect of the exchange rate changes onand $55 million increase in cash reflects an overall weakening of the U.S. Dollar against the currencies of the majority of our international markets during the six months ended June 30, 2021 as compared to an overall strengthening of the U.S. Dollar during the six months ended June 30, 2020.dividends paid.
CASH REQUIREMENTS AND ASSESSMENT OF CURRENT LIQUIDITY
In addition to our normal operating cash requirements, our principal future cash requirements will be to fund capital expenditures, share repurchases, dividends, strategic acquisitions and debt repayments. On February 12, 2021, the Board of Directors authorized the repurchase of up to a total of $10 billion of Honeywell common stock, which included amounts remaining under, and replaced, the previously approved share repurchase program. During the six months ended June 30, 2021,2022, the Company repurchased common stock of $1,849$2,437 million. Refer to the section titled Liquidity and Capital Resources of our 20202021 Form 10-K for a discussion of our expected capital expenditures, share repurchases, and dividends for 2021.2022.
We continue to identify opportunities to improve our liquidity and working capital efficiency, which includes the extension of payment terms with our suppliers and sales of our trade receivables to unaffiliated financial institutions without recourse. The impact of these programs areis not material to our overall liquidity.
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We continue to assess the relative strength of each business in our portfolio as to strategic fit, market position, profit, and cash flow contribution in order to identify target investment and acquisition opportunities in order to upgrade our combined portfolio. We identify acquisition candidates that will further our strategic plan and strengthen our existing core businesses. We also identify businesses that do not fit into our long-term strategic plan based on their market position, relative profitability, or growth potential. These businesses are considered for potential divestiture, restructuring, or other repositioning actions, subject to regulatory constraints.
Based on past performance and current expectations, we believe that our operating cash flows will be sufficient to meet our future operating cash needs. Our available cash, committed credit lines and access to the public debt and equity markets provide additional sources of short-term and long-term liquidity to fund current operations, debt maturities, and future investment opportunities.
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See Note 98 Long-term Debt and Credit Agreements of Notes to Consolidated Financial Statements for additional discussion of items impacting our liquidity.
OTHER MATTERS
LITIGATION
We are subject to a number of lawsuits, investigations, and claims (some of which involve substantial amounts) arising out of the conduct of our business. See Note 1514 Commitments and Contingencies of Notes to Consolidated Financial Statements for further discussion of environmental, asbestos and other litigation matters.
CRITICAL ACCOUNTING ESTIMATES
Other than as noted below, thereThere have been no material changes to our Critical Accounting Estimates presented in our 20202021 Annual Report on Form 10-K. For a discussion of the Company’s Critical Accounting Estimates, see the section titled Critical Accounting Estimates in our 20202021 Annual Report on Form 10-K.
On April 26, 2021, the United States Bankruptcy Court for the Southern District of New York (the Bankruptcy Court) confirmed Garrett's amended Chapter 11 plan of reorganization (the Confirmed Plan) and on April 30, 2021, Garrett emerged from bankruptcy. In accordance with Garrett’s emergence from bankruptcy and the Confirmed Plan, the Company received from Garrett an initial payment of $375 million and 834.8 million shares of Series B Preferred Stock in full satisfaction of our indemnification and reimbursement agreement and tax matters agreement. As a result, we updated our Critical Accounting Estimate for Reimbursement Receivables to exclude receivable amounts from Garrett which were satisfied in full. See Note 15 Commitments and Contingencies of Notes to the Consolidated Financial Statements for further discussion on Garrett.
Reimbursement Receivables—In conjunction with the Resideo Technologies, Inc. (Resideo) spin-off, the Company entered into a reimbursement agreement under which Honeywell receives cash payments as reimbursement primarily related to net spending for environmental matters at certain sites as defined in the reimbursement agreement. Accordingly, the Company recorded receivables based on estimates of the underlying reimbursable Honeywell environmental spend, and we monitor the recoverability of such receivables, which are subject to the terms of applicable credit agreements and general ability to pay.
RECENT ACCOUNTING PRONOUNCEMENTS
See Note 2 Summary of Significant Accounting Policies of Notes to Consolidated Financial Statements for a discussion of recent accounting pronouncements.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS
For a discussion of the Company’s quantitative and qualitative disclosures about market risks, see the section titled Quantitative and Qualitative Disclosures About Market Risks in our 20202021 Annual Report on Form 10-K. As of June 30, 2021,2022, there has been no material change in this information.
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ITEM 4. CONTROLS AND PROCEDURES
Honeywell management, including the Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended (Exchange Act)) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based upon that evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that such disclosure controls and procedures were effective as of the end of the period covered by this Quarterly Report on Form 10-Q to ensure information required to be disclosed in the reports that Honeywell files or submits under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission'sSEC's rules and forms, and that it is accumulated and communicated to our management, including our Chief Executive Officer, our Chief Financial Officer, and our Controller, as appropriate, to allow timely decisions regarding required disclosure. There were no changes that materially affected, or are reasonably likely to materially affect, Honeywell’s internal control over financial reporting that occurred during the period covered by this Quarterly Report on Form 10-Q.
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PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
We are subject to a number of lawsuits, investigations and claims (some of which involve substantial amounts) arising out of the conduct of our business. See Note 1514 Commitments and Contingencies of Notes to Consolidated Financial Statements for a discussion of environmental, asbestos and other litigation matters.
There were no matters requiring disclosure pursuant to the requirement to disclose certain environmental matters involving potential monetary sanctions in excess of $300,000.
ITEM 1A. RISK FACTORS
Other than as noted below, there have been no material changes to our Risk Factors presented in our 20202021 Annual Report on Form 10-K under the section titled Risk Factors. For further discussion of our Risk Factors, refer to the section titled Risk Factors in our 20202021 Annual Report on Form 10-K.
On April 26, 2021,A significant percentage of our sales and operations is in non-U.S. jurisdictions and is subject to the Bankruptcy Court confirmed Garrett's amended Chapter 11 planeconomic, political, regulatory, foreign exchange, and other risks of reorganizationinternational operations, including those from the ongoing Russia-Ukraine conflict.
Our international operations, including U.S. exports, represent more than half of the Company’s sales. Risks related to international operations include exchange control regulations, wage and on April 30, 2021, Garrett emergedprice controls, antitrust regulations, employment regulations, foreign investment laws, import, export and other trade restrictions (such as sanctions and embargoes), differing levels of protection of intellectual property, acts of industrial espionage, violations by our employees of anti-corruption laws (despite our efforts to mitigate such risk), changes in regulations regarding transactions with state-owned enterprises, nationalization of private enterprises, acts of terrorism, acts of war, civil strife, and our ability to hire and maintain qualified staff and maintain the safety of our employees in these regions. Instability and uncertainties arising from bankruptcy. As such, the risk factor discussing Garrettglobal geopolitical environment and the evolving international and domestic political, regulatory, and economic landscape, including the potential outcomefor changes in global trade policies, such as sanctions and trade barriers, and trends such as populism, economic nationalism and negative sentiment toward multinational companies, as well as the cost of Garrett's bankruptcy proceedingscompliance with increasingly complex and often conflicting regulations worldwide, can impair our flexibility in modifying product, marketing, pricing or other strategies for growing our businesses, as well as our ability to improve productivity and maintain acceptable operating margins.
Existing free trade laws and regulations provide certain beneficial duties and tariffs for qualifying imports and exports. Changes in laws or policies governing the terms of foreign trade, and in particular increased trade restrictions, tariffs or taxes on imports from countries where we manufacture products or from where we import products or raw materials, either directly or through our suppliers, could have an impact on our competitive position and financial results.
The U.S. continues to implement certain trade actions, including imposing tariffs on certain goods imported from China and other countries, which has resulted in retaliatory tariffs by China and other countries. Additional tariffs, export controls and sanctions laws imposed by the U.S. on a broader range of imports, or further retaliatory trade measures taken by China or other countries in response, could increase the cost of our products.
In response to the conflict between Russia and Ukraine, the U.S. and other countries imposed actions including sanctions, export and import controls, and trade restrictions with respect to Russian and Belarusian governments, government-related entities, and other entities and individuals. Further, the Russian government implemented retaliatory actions against the U.S. and other nation members of the North Atlantic Treaty Organization (NATO) as well as certain other nations. As a result of these governmental actions, in March 2022, we suspended substantially all of our sales, distribution, and service activities in Russia and Belarus (the Suspension), and in June 2022, we decided to wind down our existing businesses and operations in Russia (the Wind down). Given the uncertainty inherent in our remaining obligations related to our contracts with Russian counterparties, we do not believe it is possible to develop estimates of reasonably possible loss in excess of current accruals for these matters. Based on available information to date, the Company's estimate of potential future losses or other contingencies related to the Suspension and Wind down activities, including guarantee payments or any litigation costs or as otherwise related to our Wind down in Russia, could adversely affect the Company's consolidated results of operations in periods recognized but would not be material with respect to the Company's consolidated financial position. As the conflict continues to evolve, existing conditions may worsen, or other impacts, including escalation of the conflict in other regions of Europe, where there is a material portion of our business, increased tension between Russia and the U.S. and other NATO members and other countries, or other impacts that are unknown at this time, could lead to increased charges and could have a material adverse effect on our consolidated financial position. These impacts may result in increased costs or additional
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impacts on our operations and may adversely affect our ability to meet contractual and financial obligations, results of operations, and financial condition.
To the extent the current conflict between Russia and Ukraine escalates, it may also negatively impact other risks disclosed in our 2020 Annual Report on2021 Form 10-K underand Form 10-Q for the section titled Risk Factorsperiod ended March 31, 2022, and further impact our financial results. Such risks include, but are not limited to, adverse effects on macroeconomic conditions, including inflation and consumer spending; cybersecurity incidents and other disruptions to our information technology infrastructure or that of our customers and suppliers, including disruptions at our cloud computing, server, systems and other third party IT service providers; adverse changes in international trade policies and relations; our ability to implement and execute our business strategy, particularly in Eastern Europe and surrounding regions; disruptions in global supply chains; energy shortages; terrorist activities targeting U.S. government contractors and/or critical infrastructure; our exposure to foreign currency fluctuations; and constraints, volatility, or disruption in the capital markets.
Operating outside of the U.S. also exposes us to foreign exchange risk, which we monitor and seek to reduce through hedging activities. However, foreign exchange hedging activities bear a financial cost and may not always be available to us or be successful in eliminating such volatility. Finally, we generate significant amounts of cash outside of the U.S. that is no longerinvested with financial and non-financial counterparties. While we employ comprehensive controls regarding global cash management to guard against cash or investment loss and to ensure our ability to fund our operations and commitments, a risk as of June 30, 2021. See Note 15 Commitments and Contingencies of Notesmaterial disruption to the Consolidated Financial Statements for further discussion on Garrett.counterparties with whom we transact business could expose Honeywell to financial loss.
Operating outside the U.S. also exposes us to additional intellectual property risk. The laws and enforcement practices of certain jurisdictions in which we operate may not protect our intellectual property rights to the same extent as in the U.S. and may impose joint venture, technology transfer, local service or other foreign investment requirements, and restrictions that potentially compromise control over our technology and proprietary information. Failure of foreign jurisdictions to protect our intellectual property rights, an inability to effectively enforce such rights in foreign jurisdictions, or the imposition of foreign jurisdiction investment or sourcing restrictions or requirements could result in loss of valuable proprietary information and could impact our competitive position and financial results.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Honeywell purchased 4,610,344 shares of its common stock, par value $1 per share, in the quarter ended June 30, 2021. On February 12, 2021, the Board of Directors authorized the repurchase of up to a total of $10 billion of Honeywell common stock, which included approximately $2.8 billionamounts remaining under, and replaced, the previously approved share repurchase program, which was approved in April 2019, and authorized repurchases of up to $10 billion.program.
Repurchases may be made through a variety of methods, which could include open market purchases, accelerated share repurchase transactions, negotiated block transactions, 10b5-1 plans, other transactions that may be structured through investment banking institutions or privately negotiated, or a combination of the foregoing. Honeywell presently expects to repurchase outstanding shares from time to time (i) to offset the dilutive impact of employee stock-based compensation plans, including option exercises, restricted unit vesting and matching contributions under our savings plans, and (ii) to reduce share count via share repurchases as and when attractive opportunities arise. The amount and timing of future repurchases may vary depending on market conditions and the level of operating, financing and other investing activities.
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purchased 7,510,486 shares of its common stock, par value $1 per share. As of June 30, 2021, $8.62022, $4.7 billion remained available for additional share repurchases. The following table summarizes Honeywell’s purchase of its common stock for the quarter ended June 30, 2021:2022:
Issuer Purchases of Equity Securities
PeriodTotal Number of Shares PurchasedAverage Price Paid per ShareTotal Number of Shares Purchased as Part of Publicly Announced Plans or ProgramsApproximate Dollar Value of Shares that May Yet be Purchased Under Plans or Programs (Dollars in millions)
April 1-30, 2021103,225 $223.41 103,225 $9,641 
May 1-31, 20212,361,275 $224.48 2,361,275 $9,111 
June 1-30, 20212,145,844 $220.98 2,145,844 $8,637 
Issuer Purchases of Equity Securities
PeriodTotal
Number of
Shares
Purchased		Average
Price Paid
per Share		Total Number
of Shares
Purchased as
Part of Publicly
Announced
Plans
or Programs		Approximate Dollar
Value of Shares that
May Yet be
Purchased Under Plans or
Programs
(Dollars in millions)
April 1-30, 2022335,486 $189.09 335,486 $6,024 
May 1-31, 20222,900,000 $194.21 2,900,000 $5,461 
June 1-30, 20224,275,000 $185.31 4,275,000 $4,668 
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ITEM 4. MINE SAFETY DISCLOSURES
One of our wholly-owned subsidiaries has a placer claim for and operates a chabazite ore surface mine in Arizona. Information concerning mine safety and other regulatory matters associated with this mine is required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K and is included in Exhibit 95 to this quarterly report.
ITEM 5. OTHER INFORMATION
On May 10, 2021, Honeywell voluntarily withdrew the listing of its common stock, par value $1.00 per share (the Common Stock), and the listings of its 1.300% Senior Notes due 2023, 0.000% Senior Notes due 2024, 2.250% Senior Notes due 2028, and 0.750% Senior Notes due 2032 (collectively, the Notes), from the New York Stock Exchange (NYSE) and transferred the listings to The Nasdaq Stock Market LLC (Nasdaq). Exhibits 10.1 through 10.7 were all impacted by the transfer of our Common Stock and Notes to the Nasdaq.
As previously disclosed, Mr. Rajeev Gautam, President and Chief Executive Officer of Performance Materials and Technologies will retire from the Company on August 13, 2021 (the Retirement Date). Following the Retirement Date and through January 31, 2022 (the Consulting Period), Mr. Gautam will serve as President Emeritus, Honeywell Performance Materials and Technologies, with responsibility for ensuring smooth customer transitions across Performance Materials and Technologies and helping enable growth within the Honeywell UOP business unit.
On July 20, 2021, in consideration for Mr. Gautam’s agreement to serve in this capacity during the Consulting Period and extend the time period of his existing non-solicitation and non-compete covenants from two years to three years, the Company and Mr. Gautam entered into a Retirement Agreement and a Consulting Agreement that together provide Mr. Gautam with the following benefits: (i) Mr. Gautam will receive a service fee of $15,000 per month throughout the Consulting Period, (ii) the outstanding restricted stock units previously awarded to Mr. Gautam that are unvested at the time of his retirement shall remain outstanding and continue to vest as scheduled pursuant to their existing terms and conditions, including the satisfaction of any applicable Company performance requirements, (iii) all outstanding stock options that are unvested at the time of his retirement shall remain outstanding and continue to vest as scheduled and shall remain exercisable for the full term of the option, (iv) the outstanding performance stock units previously awarded to Mr. Gautam that are unvested at the time of his retirement shall remain outstanding and continue to vest as scheduled pursuant to their existing terms and conditions, including the satisfaction of any applicable Company performance requirements, and (v) Mr. Gautam shall be eligible to receive a short-term incentive award for the 2021 performance year at the funding levels to be authorized by the Company’s Board of Directors, pro-rated to the Retirement Date, based upon Mr. Gautam’s individual performance, Performance Materials and Technologies performance, and overall Company performance. The foregoing description of Mr. Gautam’s Retirement Agreement and Consulting Agreement is not intended to be complete and is qualified in its entirety by reference to the agreements, copies of which are filed herewith.

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ITEM 6. EXHIBITS
Exhibit
No.		 Description
10.1*
10.2*
10.3*
10.4*
10.5*
10.6*
10.7*
10.8*
31.1 
Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (furnished(filed herewith)
31.2 
Certification of Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (furnished(filed herewith)
32.1 
Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
32.2 
Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
95
Mine Safety Disclosures (filed herewith)
101.INSInline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)
101.SCHInline XBRL Taxonomy Extension Schema (filed herewith)
101.CALInline XBRL Taxonomy Extension Calculation Linkbase (filed herewith)
101.DEFInline XBRL Taxonomy Extension Definition Linkbase (filed herewith)
101.LABInline XBRL Taxonomy Extension Label Linkbase (filed herewith)
101.PREInline XBRL Taxonomy Extension Presentation Linkbase (filed herewith)
104Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

The Exhibits identified with an asterisk (*) are management contracts or compensatory plans or arrangements.

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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 
 Honeywell International Inc.HONEYWELL INTERNATIONAL INC.
   
Date: July 23, 202128, 2022By:/s/ Robert D. Mailloux
  Robert D. Mailloux
Vice President and Controller
(on behalf of the Registrant
and as the Registrant’s
Principal Accounting Officer)
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