OTIS REPORTS THIRD QUARTER 2026 RESULTS

Year-to-date share repurchases and dividends returned approximately $1.3 billion to shareholders.

Rhea-AI Summary

Otis Worldwide (OTIS) reported third-quarter 2026 net sales of $3.9 billion, with growth in both Service and New Equipment. Sales rose 6% year over year, including 6% organic growth, which excludes currency effects, acquisitions and certain other items. GAAP earnings per share rose 14% to $1.08; adjusted earnings per share were flat at $1.05.

Service sales increased 8%, while New Equipment sales rose 3%. Service operating margin reached 24.2%, up 100 basis points sequentially but down 130 basis points year over year. Adjusted operating profit fell $6 million to $626 million. Modernization orders rose 10% excluding currency effects. Operating cash flow declined to $337 million from $374 million. Otis maintained its full-year sales outlook of $15.1–$15.3 billion and adjusted earnings-per-share outlook of $4.01–$4.05, but revised expected adjusted free cash flow to approximately $1.5 billion from $1.50–$1.55 billion.

25 points · 0 major

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0 major · 22 points

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Positive

• Moderate pointThird-quarter net sales rose 6% to $3,914 million; organic sales also increased 6%.
• Moderate pointThird-quarter GAAP earnings per share increased 14% to $1.08 year over year.
• Moderate pointThird-quarter GAAP operating profit increased $34 million to $620 million year over year.
• Moderate pointThird-quarter GAAP net income increased 11% to $414 million year over year.
• Moderate pointModernization orders increased 10% at constant currency, excluding exchange-rate changes.
• Moderate pointModernization backlog increased 20% at both actual and constant currency.
• Moderate pointNine-month GAAP operating margin increased 80 basis points to 15.3% year over year.
• Moderate pointNine-month operating cash flow increased $238 million to $1,017 million year over year.
• Moderate pointNine-month free cash flow increased $229 million to $901 million year over year.
• Moderate pointYear-to-date share repurchases totaled approximately $800 million. 2.8% of market cap

15 minor points

• Minor pointService third-quarter sales increased 8% to $2,616 million, with organic growth of 7%.
• Minor pointService organic maintenance and repair sales increased 4% in the third quarter.
• Minor pointService organic modernization sales increased 20% in the third quarter.
• Minor pointService third-quarter operating profit increased $12 million to $633 million year over year.
• Minor pointNew Equipment third-quarter sales increased 3% to $1,298 million, with organic growth of 3%.
• Minor pointNew Equipment orders increased 1% at constant currency in the third quarter.
• Minor pointNew Equipment backlog increased 4% at both actual and constant currency.
• Minor pointNine-month net sales increased 7% to $11,339 million, with organic growth of 4%.
• Minor pointNine-month GAAP operating profit increased $190 million to $1,734 million year over year.
• Minor pointNine-month GAAP net income increased 17% to $1,182 million year over year.
• Minor pointNine-month GAAP earnings per share increased 20% to $3.07 year over year.
• Minor pointService nine-month sales increased 10% to $7,613 million, with organic growth of 7%.
• Minor pointService nine-month operating profit increased $52 million to $1,788 million year over year.
• Minor pointNew Equipment nine-month sales rose 1% to $3,726 million, despite a 1% organic decline.
• Minor pointNine-month adjusted free cash flow increased $68 million to $834 million year over year.

Negative

• Moderate pointThird-quarter adjusted operating profit declined $6 million to $626 million year over year.
• Moderate pointThird-quarter adjusted operating margin declined 110 basis points to 16.0% year over year.
• Moderate pointThird-quarter adjusted net income declined 2% to $402 million year over year.
• Moderate pointService margin fell 130 basis points year over year to 24.2%, despite improving 100 basis points sequentially.
• Moderate pointNew Equipment third-quarter operating profit declined $17 million to $42 million year over year.
• Moderate pointThird-quarter operating cash flow declined $37 million to $337 million year over year.
• Moderate pointThird-quarter free cash flow declined $39 million to $298 million year over year.
• Moderate pointNine-month adjusted earnings per share declined 2% to $2.96 year over year.
• Moderate point. Forward-looking: it has not happened yet and may not happen.Otis expects 2026 adjusted free cash flow of approximately $1.5 billion, versus $1.50–$1.55 billion previously.
• Moderate point. Forward-looking: it has not happened yet and may not happen.Otis expects 2026 adjusted operating profit of approximately $2.4 billion, down $30 million to flat at actual currency.
• Moderate point. Forward-looking: it has not happened yet and may not happen.Otis expects 2026 organic New Equipment sales down low single digits to flat.

11 minor points

• Minor pointThird-quarter GAAP operating margin declined 10 basis points to 15.8% year over year.
• Minor pointNew Equipment third-quarter operating margin declined 150 basis points to 3.2% year over year.
• Minor pointChina New Equipment sales declined greater than 20% in the third quarter.
• Minor pointChina New Equipment orders declined low teens at constant currency in the third quarter.
• Minor pointThird-quarter adjusted free cash flow declined $65 million to $272 million year over year.
• Minor pointNine-month adjusted operating profit declined $41 million to $1,763 million year over year.
• Minor pointNine-month adjusted operating margin declined 150 basis points to 15.5% year over year.
• Minor pointNine-month adjusted net income declined 5% to $1,138 million year over year.
• Minor pointService nine-month operating margin declined 150 basis points to 23.5% year over year.
• Minor pointNew Equipment nine-month operating profit declined $73 million to $120 million year over year.
• Minor pointNew Equipment nine-month operating margin declined 200 basis points to 3.2% year over year.

News Explained

For the first nine months of 2026, Otis reports returning about $1.3 billion to shareholders—approximately $800 million through share repurchases and $500 million in dividends—so the reported capital return included both buybacks and direct cash distributions.

Key Figures

Net sales: $3.914 billion; up 6% year over year GAAP diluted EPS: $1.08; up 14% year over year Adjusted EPS: $1.05; flat year over year +5 more

Net sales

$3.914 billion; up 6% year over year

Third quarter 2026

GAAP diluted EPS

$1.08; up 14% year over year

Third quarter 2026

Adjusted EPS

$1.05; flat year over year

Third quarter 2026

Adjusted operating profit

$626 million; down $6 million year over year

Third quarter 2026

Service operating profit margin

24.2%; up 100 bps sequentially and down 130 bps year over year

Third quarter 2026

Adjusted free cash flow

$272 million; down $65 million year over year

Third quarter 2026

Full-year net sales outlook

$15.1–$15.3 billion

2026 outlook maintained

Full-year adjusted EPS outlook

$4.01–$4.05

2026 outlook maintained

Previous Earnings Reports

1 past event · Latest: Jul 22

Same Type 1 event

1. Jul 22

   Q2 earnings

   24h Move

   -2.1%

   Sales rose 7%, while adjusted operating profit fell $25 million and adjusted EPS declined 4%.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Key Terms

gaap, non-gaap, constant currency

3 terms

gaap financial

"Otis Worldwide Corporation ("Otis") reports its financial results in accordance with"

GAAP, or Generally Accepted Accounting Principles, are a set of standardized rules and guidelines that companies follow when preparing their financial statements. They ensure consistency, transparency, and comparability across different companies, making it easier for investors to understand and compare financial information accurately. This helps investors make informed decisions based on trustworthy and uniform financial reports.

View in glossary

non-gaap financial

"We supplement the reporting of our financial information determined under GAAP"

Non-GAAP refers to financial measures that companies use to show their earnings or performance without including certain expenses or income that are often added back to give a different picture. It matters because it can make a company's results look better or more favorable, but it may also hide important costs, so investors need to look at both GAAP (official rules) and non-GAAP numbers to get a full understanding.

View in glossary

constant currency financial

"We use the non-GAAP measure "at constant currency" or "CFX""

Constant currency is a way of measuring financial results that removes the effects of changes in currency exchange rates. It allows for a clearer comparison of a company's performance over time by showing what the numbers would look like if exchange rates had stayed the same. This helps investors understand whether growth comes from actual business improvements or just currency fluctuations.

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Otis delivers high single digit Service net sales growth and low single digit New Equipment net sales growth; Service operating profit margin improved sequentially; broadly maintaining full year outlook

Third quarter 2026

• Net sales up 6% and organic sales up 6%, driven by Service net sales up 8% with organic sales up 7%, and New Equipment net sales up 3% with organic sales up 3%
• GAAP operating profit up $34 million and adjusted operating profit down $6 million
• Service operating profit margin improved by 100 bps sequentially to 24.2%
• Modernization orders up 10% at constant currency, backlog up 20% at actual and constant currency
• Operating cash flow of $337 million; adjusted free cash flow of $272 million

Year-to-date 2026

• Net sales up 7% and organic sales up 4%, driven by Service net sales up 10% with organic sales up 7%
• GAAP operating profit up $190 million and adjusted operating profit down $41 million
• Operating cash flow of $1.0 billion; adjusted free cash flow of $834 million
• Share repurchases of approximately $800 million and dividends of approximately $500 million, returning approximately $1.3 billion to shareholders

FARMINGTON, Conn., Oct. 28, 2026 /PRNewswire/ -- Otis Worldwide Corporation (NYSE: OTIS) reported third quarter 2026 net sales of $3.9 billion with organic sales up 6% versus the prior year. GAAP earnings per share (EPS) increased 14% to $1.08 and adjusted EPS of $1.05 was flat compared to the prior year.

"Otis delivered another quarter of strong top-line growth, supported by sustained performance across all Service lines and growth in New Equipment. Our investments in field capability and AI-enabled pricing, combined with disciplined execution, continue to support double digit modernization growth and high single digit repair growth. Alongside our focus on service quality, reliability, uptime, and cost control, these actions drove the incremental increase in Service margin to above 24%," said Chair, CEO & President Judy Marks. "The third quarter Service revenue growth and sequential margin improvement continue to reinforce our Service flywheel strategy and give us confidence in the steps we are taking to build a stronger foundation for sustained growth."

Key Figures

		Quarter Ended September 30,								Nine Months Ended September 30,
(dollars in millions, except per share amounts)		2026		2025		Y/Y		Y/Y (CFX)		2026		2025		Y/Y		Y/Y (CFX)
Net sales		$  3,914		$  3,690		6 %		6 %		$ 11,339		$ 10,635		7 %		5 %
Organic sales growth								6 %								4 %
GAAP
Operating profit		$    620		$    586		$     34				$  1,734		$  1,544		$    190
Operating profit margin		15.8 %		15.9 %		(10) bps				15.3 %		14.5 %		80 bps
Net income		$    414		$    374		11 %				$  1,182		$  1,010		17 %
Earnings per share		$   1.08		$   0.95		14 %				$   3.07		$   2.55		20 %
Adjusted non-GAAP comparison
Operating profit		$    626		$    632		$     (6)		$    (3)		$  1,763		$  1,804		$   (41)		$  (73)
Operating profit margin		16.0 %		17.1 %		(110) bps				15.5 %		17.0 %		(150) bps
Net income		$    402		$    411		(2) %				$  1,138		$  1,195		(5) %
Earnings per share		$   1.05		$   1.05		— %				$   2.96		$   3.02		(2) %

Third quarter net sales of $3.9 billion, increased 6% versus the prior year, driven by Service net sales with growth in all lines of business, and New Equipment net sales with growth in the Americas, EMEA, and Asia Pacific partially offset by a decline in China.

Third quarter GAAP operating profit of $620 million increased $34 million driven primarily by the absence of UpLift transformation costs, separation-related adjustments, and other non-recurring items in the prior year. Adjusted operating profit of $626 million decreased $6 million at actual currency and $3 million at constant currency, with the benefits from growth in Service more than offset by a decline in New Equipment. GAAP operating profit margin contracted 10 basis points to 15.8% and adjusted operating profit margin of 16.0% declined 110 basis points versus the prior year driven by unfavorable segment performance, partially offset by segment mix. While the performance was impacted by ongoing investment in key Service growth initiatives, Service operating profit margin improved sequentially by 100 bps.

GAAP EPS of $1.08 increased 14% compared to the prior year primarily driven by the absence of UpLift transformation costs, separation-related adjustments, and other non-recurring items in the prior year. Adjusted EPS of $1.05 was flat versus the prior year with the benefits from lower share count and minority interest offset by a higher tax rate, higher interest, and unfavorable FX rates.

Service

		Quarter Ended September 30,								Nine Months Ended September 30,
(dollars in millions)		2026		2025		Y/Y		Y/Y (CFX)		2026		2025		Y/Y		Y/Y (CFX)
Net sales		$ 2,616		$ 2,433		8 %		9 %		$ 7,613		$ 6,939		10 %		8 %
Organic sales								7 %								7 %
Segment operating profit		$   633		$   621		$     12		$     20		$ 1,788		$ 1,736		$     52		$     26
Segment operating profit margin		24.2 %		25.5 %		(130) bps				23.5 %		25.0 %		(150) bps

In the third quarter, net sales of $2.6 billion increased 8%, with a 7% increase in organic sales. Organic maintenance and repair sales increased 4% and organic modernization sales increased 20%.

Segment operating profit of $633 million increased $12 million at actual currency and increased $20 million at constant currency as higher volume, favorable pricing and other employment related cost reductions were partially offset by higher labor cost including the impact of ongoing strategic initiatives and productivity, and unfavorable mix. Segment operating profit margin contracted 130 basis points to 24.2%, but improved 100 bps sequentially.

New Equipment

		Quarter Ended September 30,								Nine Months Ended September 30,
(dollars in millions)		2026		2025		Y/Y		Y/Y (CFX)		2026		2025		Y/Y		Y/Y (CFX)
Net sales		$ 1,298		$ 1,257		3 %		3 %		$ 3,726		$ 3,696		1 %		(1) %
Organic sales								3 %								(1) %
Segment operating profit		$     42		$     59		$   (17)		$  (22)		$   120		$   193		$   (73)		$  (79)
Segment operating profit margin		3.2 %		4.7 %		(150) bps				3.2 %		5.2 %		(200) bps

In the third quarter, net sales of $1.3 billion increased 3%, with a 3% increase in organic sales, driven by low teens growth in the Americas, mid-single digit growth in EMEA, and high single digit growth in Asia Pacific, partially offset by a greater than 20% decline in China.

Segment operating profit of $42 million decreased $17 million at actual currency and $22 million at constant currency primarily from unfavorable price and mix, partially offset by productivity and higher volume. Segment operating profit margin contracted 150 basis points to 3.2%.

New Equipment orders were up 1% at constant currency with low teens growth in the Americas, and low single digit growth in both EMEA and Asia Pacific, partially offset by low teens decline in China. New Equipment backlog increased 4% at actual currency and constant currency.

Cash flow

		Quarter Ended September 30,						Nine Months Ended September 30,
(dollars in millions)		2026		2025		Y/Y		2026		2025		Y/Y
Cash flow from operations		$        337		$        374		$      (37)		$     1,017		$        779		$       238
Free cash flow		$        298		$        337		$      (39)		$        901		$        672		$       229
Adjusted free cash flow		$        272		$        337		$      (65)		$        834		$        766		$        68

Third quarter cash flow changes were driven by an increase in net income offset by changes in working capital.

2026 Outlook¹

Otis is maintaining its full year outlook for the following:

• Net sales of $15.1 to $15.3 billion
• Organic sales up low to mid-single digits
  • Organic New Equipment sales down low single digits to flat
  • Organic Service sales up mid to high single digits
• Adjusted operating profit of approximately $2.4 billion, down $45 to $15 million at constant currency; down $30 million to flat at actual currency
• Adjusted EPS of $4.01 to $4.05
• Adjusted free cash flow of ~$1.5 billion (vs. prior range of $1.50 to $1.55 billion)

¹ Note: When we provide outlook for organic sales, adjusted operating profit, adjusted EPS, adjusted effective tax rate and adjusted free cash flow on a forward-looking basis, a reconciliation of the differences between the non-GAAP expectations and the corresponding GAAP measures generally is not available without unreasonable effort. See "Use and Definitions of Non-GAAP Financial Measures" below for additional information.

About Otis

Otis is the world's leading elevator and escalator manufacturing, installation, service and modernization company. We move 2.5 billion people a day and maintain approximately 2.5 million customer units worldwide, the industry's largest Service portfolio. Headquartered in Connecticut, USA, Otis is 72,000 people strong, including 45,000 field professionals, all committed to manufacturing, installing and maintaining products to meet the diverse needs of our customers and passengers in more than 200 countries and territories worldwide. For more information, visit www.otis.com and follow us on LinkedIn, YouTube, Instagram and Facebook @OtisElevatorCo.

Use and Definitions of Non-GAAP Financial Measures

Otis Worldwide Corporation ("Otis") reports its financial results in accordance with accounting principles generally accepted in the United States ("GAAP"). We supplement the reporting of our financial information determined under GAAP with certain non-GAAP financial information. The non-GAAP information presented provides investors with additional useful information, but should not be considered in isolation or as substitutes for the related GAAP measures. Moreover, other companies may define non-GAAP measures differently, which limits the usefulness of these measures for comparisons with such other companies. We encourage investors to review our financial statements and publicly filed reports in their entirety and not to rely on any single financial measure. A reconciliation of the non-GAAP measures (referenced in this press release) to the corresponding amounts prepared in accordance with GAAP appears in the attached tables. These tables provide additional information as to the items and amounts that have been excluded from the adjusted measures. Below are our non-GAAP financial measures:

Non-GAAP measure	Definition
Organic sales	Represents consolidated net sales (a GAAP measure), excluding the impact of foreign currency translation, acquisitions and divestitures completed in the preceding twelve months and other significant items of a non-recurring and/or nonoperational nature ("other significant items"). Management believes organic sales is a useful measure in providing period-to-period comparisons of the results of the Company's ongoing operational performance.
Adjusted selling, general and administrative ("SG&A") expense	Represents SG&A expense (a GAAP measure), excluding restructuring costs and other significant items.
Adjusted operating profit	Represents income from continuing operations (a GAAP measure), excluding restructuring costs and other significant items.
Adjusted net interest expense	Represents net interest expense (a GAAP measure), adjusted for the impacts of non-recurring acquisition related financing costs and related net interest expense pending the completion of a transaction and other significant items.
Adjusted noncontrolling interest in earnings	Represents noncontrolling interest in earnings (a GAAP measure), excluding restructuring costs and other significant items, including related tax effects.
Adjusted net income	Represents net income attributable to Otis Worldwide Corporation (a GAAP measure), excluding restructuring costs and other significant items, including related tax effects.
Adjusted earnings per share ("EPS")	Represents diluted earnings per share attributable to common shareholders (a GAAP measure), adjusted for the per share impact of restructuring and other significant items, including related tax effects.
Adjusted effective tax rate	Represents the effective tax rate (a GAAP measure) adjusted for other significant items and the tax impact of restructuring costs and other significant items.
Constant currency	GAAP financial results include the impact of changes in foreign currency exchange rates ("AFX"). We use the non-GAAP measure "at constant currency" or "CFX" to show changes in our financial results without giving effect to period-to-period currency fluctuations. Under U.S. GAAP, income statement results are translated in U.S. dollars at the average exchange rate for the period presented. Management believes that this non-GAAP measure is useful in providing period-to-period comparisons of the results of the Company's ongoing operational performance.
Free cash flow	Represents cash flow from operations (a GAAP measure) less capital expenditures. Management believes free cash flow is a useful measure of liquidity and an additional basis for assessing Otis' ability to fund its activities, including the financing of acquisitions, debt service, repurchases of common stock and distribution of earnings to shareholders. Free cash flow should not be considered an alternative to, or more meaningful than, net cash flows provided by operating activities, or any other measure of liquidity presented in accordance with GAAP.
Adjusted free cash flow	Represents cash flow from operations (a GAAP measure) less capital expenditures, adjusted to exclude certain items management believes affect the comparability of operating results. Management believes adjusted free cash flow is a useful measure of liquidity that provides investors additional information regarding the Company's ability to fund its activities, including the financing of acquisitions, debt service, repurchases of common stock and distribution of earnings to shareholders. Adjusted free cash flow should not be considered an alternative to, or more meaningful than, net cash flows provided by operating activities, or any other measure of liquidity presented in accordance with GAAP.

Management believes that organic sales, adjusted SG&A expense, adjusted operating profit, adjusted net interest expense, adjusted noncontrolling interest in earnings, adjusted net income, adjusted EPS and the adjusted effective tax rate are useful measures in providing period-to-period comparisons of the results of the Company's ongoing operational performance.

When we provide our expectations for adjusted net sales, organic sales, adjusted operating profit, adjusted net interest expense, adjusted noncontrolling interest in earnings, adjusted net income, adjusted effective tax rate, adjusted EPS, free cash flow and adjusted free cash flow on a forward-looking basis, a reconciliation of the differences between the non-GAAP expectations and the corresponding GAAP measures (expected diluted EPS from continuing operations, operating profit, the effective tax rate, net sales and expected cash flow from operations) generally is not available without unreasonable effort due to potentially high variability, complexity and low visibility as to the items that would be excluded from the GAAP measure in the relevant future period, such as unusual gains and losses, the ultimate outcome of pending litigation, fluctuations in foreign currency exchange rates, the impact and timing of potential acquisitions and divestitures, and other structural changes or their probable significance. The variability of the excluded items may have a significant, and potentially unpredictable, impact on our future GAAP results.

Cautionary Statement
This communication contains statements which, to the extent they are not statements of historical or present fact, constitute "forward-looking statements" under the securities laws. From time to time, oral or written forward-looking statements may also be included in other information released to the public. These forward-looking statements are intended to provide management's current expectations or plans for Otis' future operating and financial performance, based on assumptions currently believed to be valid. Forward-looking statements can be identified by the use of words such as "believe," "expect," "expectations," "plans," "strategy," "prospects," "estimate," "project," "target," "anticipate," "will," "should," "see," "guidance," "outlook," "medium-term," "near-term," "confident," "goals" and other words of similar meaning in connection with a discussion of future operating or financial performance. Forward-looking statements may include, among other things, statements relating to future sales, earnings, cash flow, results of operations, uses of cash, dividends, share repurchases, tax rates, research & development spend, restructuring or transformation actions (including UpLift and related reorganization and outsourcing activities), credit ratings, net indebtedness and other measures of financial performance or potential future plans, strategies or transactions, or statements that relate to climate change and our intent to achieve certain sustainability targets or other corporate responsibility initiatives, including operational impacts and costs associated therewith, and other statements that are not historical facts. All forward-looking statements involve risks, uncertainties and other factors that may cause actual results to differ materially from those expressed or implied in the forward-looking statements. For those statements, Otis claims the protection of the safe harbor for forward-looking statements contained in the U.S. Private Securities Litigation Reform Act of 1995. Such risks, uncertainties and other factors include, without limitation: (1) the effect of economic conditions in the industries and markets in which Otis and its businesses operate and any changes therein, including financial market conditions, fluctuations in commodity prices and other inflationary pressures, interest rates and foreign currency exchange rates, levels of end market demand in construction, pandemic health issues, natural disasters, whether as a result of climate change or otherwise, and the financial condition of Otis' customers and suppliers; (2) the effect of changes in political conditions in the U.S. and in other countries in which Otis and its businesses operate, including as a result of the U.S. midterm elections, tensions between the U.S. and China and geopolitical conflicts, including the ongoing conflicts and instability in the Middle East and the conflict between Russia and Ukraine on general market conditions, commodity costs, global trade policies and related sanctions, export controls and tariffs, and currency exchange rates in the near term and beyond; (3) challenges in the development, production, delivery, support, employee adoption, performance and realization of the anticipated benefits of advanced technologies and new products and services; (4) future levels of indebtedness, capital spending and research and development spending; (5) future availability of credit and factors that may affect such availability or costs thereof, including credit market conditions and Otis' capital structure; (6) the timing and scope of future repurchases of Otis' common stock, which may be suspended at any time due to various factors, including market conditions and the level of other investing activities and uses of cash; (7) fluctuations in prices and delays and disruptions in delivery of materials and services from suppliers, whether as a result of changes in general economic conditions, geopolitical conflicts or otherwise; (8) cost reduction or containment actions, restructuring or transformation costs and related savings and other consequences thereof, including with respect to UpLift and related impacts of reorganization, change management and outsourcing activities, as applicable; (9) new business and investment opportunities and the realization of anticipated benefits, including meeting customer expectations and maintaining our competitiveness; (10) the outcome of legal proceedings, investigations and other contingencies; (11) pension plan assumptions and future contributions; (12) the impact of the negotiation of collective bargaining agreements and labor disputes, labor actions, including strikes or work stoppages, and labor inflation in the markets in which Otis and its businesses operate globally; (13) the effect of changes in laws, regulations and enforcement priorities in the U.S., including as a result of the midterm elections, and other countries in which Otis and its businesses operate; (14) the ability of Otis to retain and hire key personnel; (15) the scope, nature, impact or timing of acquisition and divestiture activity, the integration of acquired businesses into existing businesses and realization of synergies and opportunities for growth and innovation and incurrence of related costs; (16) the determination by the Internal Revenue Service (the "IRS") and other tax authorities that the distribution or certain related transactions should be treated as taxable transactions in connection with the separation (the "Separation") of Otis and Carrier Global Corporation ("Carrier") from United Technologies Corporation (now known as RTX Corporation ("RTX"); and (17) our obligations and disputes that have or may hereafter arise under the agreements we entered into with RTX and Carrier in connection with the Separation. The above list of factors is not exhaustive or necessarily in order of importance. For additional information on identifying factors that may cause actual results to vary from those stated in forward-looking statements, see Otis' registration statement on Form 10 and the reports of Otis on Forms 10-K, 10-Q and 8-K filed with or furnished to the SEC from time to time. Any forward-looking statement speaks only as of the date on which it is made, and Otis assumes no obligation to update or revise such statement, whether as a result of new information, future events or otherwise, except as required by applicable law.

Otis Worldwide Corporation Condensed Consolidated Statements of Operations
			Quarter Ended September 30,				Nine Months Ended September 30,
			(Unaudited)				(Unaudited)
(dollars in millions, except per share amounts; shares in millions)			2026		2025		2026		2025
Net Sales			$        3,914		$        3,690		$      11,339		$      10,635
Costs and Expenses:
	Cost of products and services sold		2,759		2,557		7,966		7,412
	Research and development		40		36		117		111
	Selling, general and administrative		489		504		1,519		1,467
	Total Costs and Expenses		3,288		3,097		9,602		8,990
Other income (expense), net			(6)		(7)		(3)		(101)
Operating profit			620		586		1,734		1,544
	Non-service pension cost (benefit)		—		4		2		4
	Interest expense (income), net		68		61		153		132
Net income before income taxes			552		521		1,579		1,408
	Income tax expense (benefit)		126		129		351		337
Net income			426		392		1,228		1,071
	Less: Noncontrolling interest in subsidiaries' earnings		12		18		46		61
Net income attributable to Otis Worldwide Corporation			$          414		$          374		$       1,182		$       1,010
Earnings Per Share of Common Stock:
	Basic		$         1.09		$         0.96		$        3.08		$        2.57
	Diluted		$         1.08		$         0.95		$        3.07		$        2.55
Weighted Average Number of Shares Outstanding:
	Basic shares		381.0		391.0		384.0		393.7
	Diluted Shares		381.9		392.8		385.1		395.8

 

Otis Worldwide Corporation Reconciliation of Reported (GAAP) to Adjusted Operating Profit & Operating Profit Margin
		Quarter Ended September 30,				Nine Months Ended September 30,
		(Unaudited)				(Unaudited)
(dollars in millions)		2026		2025		2026		2025
Net Sales
New Equipment		$     1,298		$     1,257		$      3,726		$      3,696
Service		2,616		2,433		7,613		6,939
Total Net Sales		$     3,914		$     3,690		$    11,339		$    10,635
Operating Profit
New Equipment		$          42		$          59		$         120		$         193
Service		633		621		1,788		1,736
Total segment operating profit		675		680		1,908		1,929
Corporate and Unallocated		(55)		(94)		(174)		(385)
Total Otis GAAP Operating Profit		620		586		1,734		1,544
UpLift restructuring		—		27		—		72
Other restructuring		5		6		23		41
UpLift transformation costs		—		10		—		51
Separation-related adjustments 1		—		4		5		65
Litigation-related settlement costs 2		—		—		—		21
Held for sale impairment		—		—		—		10
Other, net		1		(1)		1		—
Total Otis Adjusted Operating Profit		$        626		$        632		$      1,763		$      1,804
Reported Total Operating Profit Margin		15.8 %		15.9 %		15.3 %		14.5 %
Adjusted Total Operating Profit Margin		16.0 %		17.1 %		15.5 %		17.0 %
1 Separation-related adjustments in the quarters and nine months ended September 30, 2026 and 2025 represent estimated amounts due to RTX Corporation (our former parent) in accordance with the Tax Matters Agreement, including those amounts related to a favorable ruling received in August 2024 regarding a tax litigation in Germany.
2 Litigation-related settlement costs in the nine months ended September 30, 2025 represent the aggregate amount of settlement costs and increase in loss contingency accruals, excluding legal costs, for certain legal matters that are outside of the ordinary course of business due to the size, complexity and/or unique facts of these matters.

 

Otis Worldwide Corporation Reconciliation of Reported (GAAP) to Adjusted (Non-GAAP) Net Income, Earnings Per Share, and Effective Tax Rate
		Quarter Ended September 30,				Nine Months Ended September 30,
		(Unaudited)				(Unaudited)
(dollars in millions, except per share amounts)		2026		2025		2026		2025
Adjusted Operating Profit		$       626		$       632		$     1,763		$     1,804
Non-service pension cost (benefit)		—		4		2		4
Adjusted net interest expense 1, 2		69		61		196		164
Adjusted income from operations before income taxes		557		567		1,565		1,636
Income tax expense (benefit)		126		129		351		337
Tax impact on restructuring and non-recurring items		2		10		6		42
Non-recurring tax items 1		15		—		35		12
Adjusted net income from operations		414		428		1,173		1,245
Adjusted noncontrolling interest 2, 3		12		17		35		50
Adjusted net income attributable to common shareholders		$       402		$       411		$     1,138		$     1,195
GAAP net income attributable to common shareholders		$       414		$       374		$     1,182		$     1,010
UpLift restructuring		—		27		—		72
Other restructuring		5		6		23		41
UpLift transformation costs		—		10		—		51
Separation-related adjustments		—		4		5		65
Litigation-related settlement costs		—		—		—		21
Held for sale impairment		—		—		—		10
Interest income related to non-recurring tax items 1, 2		(1)		—		(32)		(16)
Tax effects of restructuring, non-recurring items and other adjustments		(2)		(10)		(6)		(42)
Non-recurring tax items 1, 2		(15)		—		(35)		(12)
Other, net 3		1		—		1		(5)
Adjusted net income attributable to common shareholders		$       402		$       411		$     1,138		$     1,195
Diluted Earnings Per Share		$      1.08		$      0.95		$       3.07		$       2.55
Impact to diluted earnings per share		(0.03)		0.10		(0.11)		0.47
Adjusted Diluted Earnings Per Share		$      1.05		$      1.05		$       2.96		$       3.02
Effective Tax Rate		22.8 %		24.8 %		22.2 %		23.9 %
Impact of adjustments on effective tax rate		2.9 %		(0.3) %		2.8 %		— %
Adjusted Effective Tax Rate		25.7 %		24.5 %		25.0 %		23.9 %
1 In August 2024, we received a favorable ruling regarding a tax litigation in Germany. As a result, income tax benefits and related interest income were recorded in 2024. Income tax expense is reflected as adjusted without $15 million of income tax benefit for the quarter and nine months ended September 30, 2026. No related income tax benefit was recorded in 2025. Net interest expense is reflected as adjusted without $1 million and $8 million of interest income for the quarter and nine months ended September 30, 2026, respectively, compared to $2 million for the nine months ended September 30, 2025.
2 Certain tax reserves were adjusted in the second quarter of 2026 and 2025. As a result, Net interest expense and Noncontrolling interest are reflected as adjusted without $35 million of interest income and $11 million of the noncontrolling interest share of the reserve adjustments, respectively, for the nine months ended September 30, 2026, compared to $30 million and $16 million, respectively, for the same period in 2025.
3 Noncontrolling interest is reflected as adjusted without $1 million and $5 million for the quarter and nine months ended September 30, 2025, respectively.

 

Otis Worldwide Corporation Components of Changes in Net Sales
Quarter Ended September 30, 2026 Compared with Quarter Ended September 30, 2025
		Factors Contributing to Total % Change in Net Sales
		Organic		FX Translation		Acquisitions / Divestitures, net and Other		Total
New Equipment		3 %		— %		— %		3 %
Service		7 %		(1) %		2 %		8 %
Maintenance and Repair		4 %		(1) %		1 %		4 %
Modernization		20 %		— %		— %		20 %
Total Net Sales		6 %		— %		— %		6 %
Nine Months Ended September 30, 2026 Compared with Nine Months Ended September 30, 2025
		Factors Contributing to Total % Change in Net Sales
		Organic		FX Translation		Acquisitions / Divestitures, net and Other		Total
New Equipment		(1) %		2 %		— %		1 %
Service		7 %		2 %		1 %		10 %
Maintenance and Repair		5 %		2 %		1 %		8 %
Modernization		17 %		1 %		1 %		19 %
Total Net Sales		4 %		2 %		1 %		7 %

 

Components of Changes in New Equipment Backlog
		September 30, 2026
		Y/Y Growth %
New Equipment Backlog increase at actual currency		4 %
Foreign exchange impact to New Equipment Backlog		— %
New Equipment Backlog increase at constant currency		4 %
Components of Changes in Modernization Backlog
		September 30, 2026
		Y/Y Growth %
Modernization Backlog increase at actual currency		20 %
Foreign exchange impact to Modernization Backlog		— %
Modernization Backlog increase at constant currency		20 %

 

Otis Worldwide Corporation  Reconciliation of Segment and Total Adjusted Operating Profit at Constant Currency
Quarter Ended September 30, 2026 Compared with Quarter Ended September 30, 2025
(dollars in millions)		2026		2025		Y/Y
New Equipment
Segment Operating Profit		$               42		$               59		$             (17)
Impact of foreign exchange		(5)		—		(5)
Segment Operating Profit at constant currency		$               37		$               59		$             (22)
Service
Segment Operating Profit		$             633		$             621		$               12
Impact of foreign exchange		8		—		8
Segment Operating Profit at constant currency		$             641		$             621		$               20
Otis Consolidated
Adjusted Operating Profit		$             626		$             632		$               (6)
Impact of foreign exchange		3		—		3
Adjusted Operating Profit at constant currency		$             629		$             632		$               (3)
Nine Months Ended September 30, 2026 Compared with Nine Months Ended September 30, 2025
(dollars in millions)		2026		2025		Y/Y
New Equipment
Segment Operating Profit		$             120		$             193		$             (73)
Impact of foreign exchange		(6)		—		(6)
Segment Operating Profit at constant currency		$             114		$             193		$             (79)
Service
Segment Operating Profit		$           1,788		$           1,736		$               52
Impact of foreign exchange		(26)		—		(26)
Segment Operating Profit at constant currency		$           1,762		$           1,736		$               26
Otis Consolidated
Adjusted Operating Profit		$           1,763		$           1,804		$             (41)
Impact of foreign exchange		(32)		—		(32)
Adjusted Operating Profit at constant currency		$           1,731		$           1,804		$             (73)

 

Otis Worldwide Corporation Condensed Consolidated Balance Sheet
		September 30, 2026		December 31, 2025
(dollars in millions)		(Unaudited)
Assets
Cash and cash equivalents		$                  866		$                1,096
Accounts receivable, net		4,058		3,688
Contract assets		908		699
Inventories		689		613
Other current assets		397		405
Total Current Assets		6,918		6,501
Future income tax benefits		423		407
Fixed assets, net		771		743
Operating lease right-of-use assets		596		554
Intangible assets, net		379		343
Goodwill		1,846		1,695
Other assets		377		410
Total Assets		$              11,310		$              10,653
Liabilities and Equity (Deficit)
Short-term borrowings and current portion of long-term debt		$                1,224		$                1,056
Accounts payable		2,145		2,142
Accrued liabilities		1,704		1,847
Contract liabilities		2,979		2,611
Total Current Liabilities		8,052		7,656
Long-term debt		7,051		6,900
Future pension and postretirement benefit obligations		421		419
Operating lease liabilities		419		397
Future income tax obligations		198		223
Other long-term liabilities		327		329
Total Liabilities		16,468		15,924
Redeemable noncontrolling interest		106		75
Shareholders' Equity (Deficit):
Common Stock and additional paid-in capital		371		333
Treasury Stock		(5,005)		(4,198)
Retained earnings (accumulated deficit)		125		(440)
Accumulated other comprehensive income (loss)		(921)		(1,087)
Total Shareholders' Equity (Deficit)		(5,430)		(5,392)
Noncontrolling interest		166		46
Total Equity (Deficit)		(5,264)		(5,346)
Total Liabilities and Equity (Deficit)		$              11,310		$              10,653

 

Otis Worldwide Corporation Condensed Consolidated Statement of Cash Flows
		Quarter Ended September 30,				Nine Months Ended September 30,
		(Unaudited)				(Unaudited)
(dollars in millions)		2026		2025		2026		2025
Operating Activities:
Net income from operations		$     426		$     392		$   1,228		$   1,071
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortization		41		44		124		130
Deferred income tax expense (benefit)		—		(28)		(38)		(102)
Stock compensation cost		18		19		57		63
Change in operating assets and liabilities, net of acquisitions:
Accounts receivable, net		(47)		(45)		(347)		(191)
Contract assets and liabilities, current		(130)		(54)		154		16
Inventories		1		(37)		(78)		(52)
Other current assets		13		66		80		76
Accounts payable		29		19		(19)		(193)
Accrued liabilities		(17)		(2)		(85)		21
Pension contributions		(10)		(9)		(31)		(36)
Other operating activities, net		13		9		(28)		(24)
Net cash flows provided by (used in) operating activities		337		374		1,017		779
Investing Activities:
Capital expenditures		(39)		(37)		(116)		(107)
Acquisitions of businesses and intangible assets, net of cash		(2)		(10)		(195)		(92)
Other investing activities, net		102		(9)		56		(177)
Net cash flows provided by (used in) investing activities		61		(56)		(255)		(376)
Financing Activities:
Increase (decrease) in short-term borrowings, net		(152)		(193)		(185)		280
Issuance of long-term debt, net		—		500		700		500
Payment of debt issuance costs		—		(5)		(5)		(5)
Repayment of long-term debt		—		—		(135)		(1,300)
Dividends paid on Common Stock		(168)		(164)		(498)		(483)
Repurchases of Common Stock		—		(248)		(807)		(809)
Acquisition of noncontrolling interest shares		(1)		—		(11)		—
Dividends paid to noncontrolling interest		(37)		(57)		(44)		(62)
Other financing activities, net		(18)		(1)		(12)		(11)
Net cash flows provided by (used in) financing activities		(376)		(168)		(997)		(1,890)
Summary of Activity:
Net cash provided by (used in) operating activities		337		374		1,017		779
Net cash provided by (used in) investing activities		61		(56)		(255)		(376)
Net cash provided by (used in) financing activities		(376)		(168)		(997)		(1,890)
Effect of exchange rate changes on cash and cash equivalents		7		—		8		19
Net increase (decrease) in cash, cash equivalents and restricted cash		29		150		(227)		(1,468)
Cash, cash equivalents and restricted cash, beginning of period		849		703		1,105		2,321
Cash, cash equivalents and restricted cash, end of period		878		853		878		853
Less: Restricted cash		12		13		12		13
Cash and cash equivalents, end of period		$     866		$     840		$     866		$     840

 

Otis Worldwide Corporation Adjusted Free Cash Flow Reconciliation
		Quarter Ended September 30,				Nine Months Ended September 30,
		(Unaudited)				(Unaudited)
(dollars in millions)		2026		2025		2026		2025
Net cash flows provided by operating activities (GAAP)		$       337		$       374		$     1,017		$       779
Capital expenditures		(39)		(37)		(116)		(107)
Free cash flow (Non-GAAP)		298		337		901		672
Adjustments for:
UpLift restructuring payments		3		9		17		28
UpLift transformation payments		3		16		14		49
Separation-related payments 1		—		20		63		92
German Tax Litigation refunds, net 2		(32)		(45)		(161)		(75)
Adjusted free cash flow (Non-GAAP)		$       272		$       337		$       834		$       766
1 These represent payments to RTX Corporation (our former parent) in accordance with the Tax Matters Agreement.
2 In August 2024, we received a favorable ruling regarding a tax litigation in Germany. The Company began receiving refunds during 2025 and anticipates the refund process to continue through 2026.

Media contact:

Katy Padgett 
+1-860-674-3047
kathleen.padgett@otis.com

Investor contact:

Sofya Tsinis
+1-860-676-6011
investorrelations@otis.com

View original content:https://www.prnewswire.com/news-releases/otis-reports-third-quarter-2026-results-302921987.html

SOURCE Otis Worldwide Corporation

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What were Otis's third-quarter 2026 sales and earnings per share?

Otis reported net sales of $3,914 million and GAAP earnings per share of $1.08 for the quarter ended September 30, 2026. Sales increased 6% and GAAP earnings per share increased 14% year over year. Adjusted earnings per share were unchanged at $1.05.

What is Otis's full-year 2026 outlook?

Otis expects sales of $15.1 to $15.3 billion, adjusted earnings per share of $4.01 to $4.05 and adjusted free cash flow of approximately $1.5 billion. Its organic sales outlook is up low to mid-single digits, including Service growth of mid to high single digits and New Equipment sales down low single digits to flat.

How did Otis New Equipment perform by region in the third quarter of 2026?

Otis New Equipment organic sales grew in the Americas, EMEA and Asia Pacific, while declining in China. Growth was low teens in the Americas, mid-single digits in EMEA and high single digits in Asia Pacific; China declined greater than 20%. Orders at constant currency grew low teens in the Americas and low single digits in both EMEA and Asia Pacific, while declining low teens in China.

Why did Otis GAAP earnings rise while adjusted earnings per share stayed flat in the third quarter of 2026?

GAAP earnings per share increased primarily because prior-year UpLift transformation costs, separation-related adjustments and other non-recurring items were absent. For adjusted earnings per share, benefits from a lower share count and minority interest were offset by a higher tax rate, higher interest and unfavorable exchange rates.