OTIS REPORTS THIRD QUARTER 2026 RESULTS
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
• 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
• Modernization orders up 10% at constant currency, backlog up 20% at actual and constant currency
• 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
• Share repurchases of approximately $800 million and dividends of approximately $500 million, returning approximately $1.3 billion to shareholders
FARMINGTON, Conn., October 28, 2026 – 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." 1 Key Figures
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. 2 Service
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.
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. 3
Third quarter cash flow changes were driven by an increase in net income offset by changes in working capital.
• 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 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.
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. 4 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 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 Organic sales 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 Represents SG&A expense (a GAAP administrative ("SG&A") expense measure), excluding restructuring costs and other significant items. Represents income from continuing Adjusted operating profit operations (a GAAP measure), excluding restructuring costs and other significant items. Represents net interest expense (a GAAP measure), adjusted for the impacts of non-recurring acquisition Adjusted net interest expense related financing costs and related net interest expense pending the completion of a transaction and other significant items. Represents noncontrolling interest in Adjusted noncontrolling interest in earnings (a GAAP measure), excluding earnings restructuring costs and other significant items, including related tax effects. Represents net income attributable to Otis Worldwide Corporation (a GAAP Adjusted net income measure), excluding restructuring costs and other significant items, including related tax effects. Represents diluted earnings per share attributable to common shareholders Adjusted earnings per share ("EPS") (a GAAP measure), adjusted for the per share impact of restructuring and other significant items, including related tax effects. Represents the effective tax rate (a GAAP measure) adjusted for other Adjusted effective tax rate significant items and the tax impact of restructuring costs and other significant items.
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 Constant currency 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. 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 Free cash flow 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. 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 Adjusted free cash flow 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. 6
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 7 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. 8
Reconciliation of Reported (GAAP) to Adjusted Operating Profit & Operating Profit Margin
Reconciliation of Reported (GAAP) to Adjusted (Non-GAAP) Net Income, Earnings Per Share, and Effective Tax Rate
Factors Contributing to Total % Change in Net Sales FX Acquisitions / Organic Translation Divestitures, Total net and Other New Equipment 3% —% —% 3% Service 7% (1)% 2% 8% Maintenance 4% (1)% 1% 4% and Repair Modernization 20% —% —% 20% Total Net 6% —% —% 6% Sales Nine Months Ended September 30, 2026 Compared with Nine Months Ended September 30, 2025 Factors Contributing to Total % Change in Net Sales FX Acquisitions / Organic Translation Divestitures, Total net and Other New Equipment (1)% 2% —% 1% Service 7% 2% 1% 10% Maintenance 5% 2% 1% 8% and Repair Modernization 17% 1% 1% 19% Total Net 4% 2% 1% 7% Sales
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 4% currency
September 30, 2026 ───────────────────────────────────────────────────────────────────────── Y/Y Growth % Modernization Backlog increase at actual currency 20% Foreign exchange impact to Modernization Backlog —% Modernization Backlog increase at constant 20% currency
Reconciliation of Segment and Total Adjusted Operating Profit at Constant Currency
Quarter Ended September 30, 2026 Compared with Quarter Ended September (dollars in 30, 2025 millions) 2026 2025 Y/Y ────────────────────────────────────────────────────────────────────────────── New Equipment Segment $ 42 $ 59 $ -17 Operating Profit Impact of -5 — -5 foreign exchange Segment Operating Profit $ 37 $ 59 $ -22 at constant currency Service Segment $ 633 $ 621 $ 12 Operating Profit Impact of 8 — 8 foreign exchange Segment Operating Profit $ 641 $ 621 $ 20 at constant currency Otis Consolidated Adjusted $ 626 $ 632 $ -6 Operating Profit Impact of 3 — 3 foreign exchange Adjusted Operating Profit $ 629 $ 632 $ -3 at constant currency Nine Months Ended September 30, 2026 Compared with Nine Months Ended September 30, 2025 (dollars in 2026 2025 Y/Y millions) New Equipment Segment $ 120 $ 193 $ -73 Operating Profit Impact of -6 — -6 foreign exchange Segment Operating Profit $ 114 $ 193 $ -79 at constant currency Service Segment $ 1,788 $ 1,736 $ 52 Operating Profit Impact of -26 — -26 foreign exchange Segment Operating Profit $ 1,762 $ 1,736 $ 26 at constant currency Otis Consolidated Adjusted $ 1,763 $ 1,804 $ -41 Operating Profit Impact of -32 — -32 foreign exchange Adjusted Operating Profit $ 1,731 $ 1,804 $ -73 at constant currency
September 30, 2026 December 31, 2025 ────────────────────────────────────────────────────────────────────────────── (dollars in -Unaudited millions) Assets Cash and cash $ 866 $ 1,096 equivalents Accounts 4,058 3,688 receivable, net Contract assets 908 699 Inventories 689 613 Other current 397 405 assets Total Current 6,918 6,501 Assets Future income tax 423 407 benefits Fixed assets, net 771 743 Operating lease right-of-use 596 554 assets Intangible assets, 379 343 net Goodwill 1,846 1,695 Other assets 377 410 Total Assets $ 11,310 $ 10,653 Liabilities and Equity (Deficit) Short-term borrowings and current $ 1,224 $ 1,056 portion of long-term debt Accounts payable 2,145 2,142 Accrued 1,704 1,847 liabilities Contract 2,979 2,611 liabilities Total Current 8,052 7,656 Liabilities Long-term debt 7,051 6,900 Future pension and postretirement 421 419 benefit obligations Operating lease 419 397 liabilities Future income tax 198 223 obligations Other long-term 327 329 liabilities Total Liabilities 16,468 15,924 Redeemable noncontrolling 106 75 interest Shareholders' Equity (Deficit): Common Stock and additional paid-in 371 333 capital Treasury Stock -5,005 -4,198 Retained earnings (accumulated 125 -440 deficit) Accumulated other comprehensive -921 -1,087 income (loss) Total Shareholders' -5,430 -5,392 Equity (Deficit) Noncontrolling 166 46 interest Total Equity -5,264 -5,346 (Deficit) Total Liabilities and Equity $ 11,310 $ 10,653 (Deficit)
Nine Quarter Months Ended Ended September Septemb… 30, 30, ────────────────────────────────────────────────────────────────────────────── -Unaudit… -Unaudi… (dollars in 2026 2025 2026 2025 million… Operati… Activit… Net income $ 426 $ 392 $ 1,228 $ 1,071 from operati… Adjustm… to reconci… net income to net cash flows provided by operati… activit… Depreci… and 41 44 124 130 amortiz… Deferred income tax — -28 -38 -102 expense (benefi… Stock compens… 18 19 57 63 cost Change in operati… assets and liabili… net of acquisi…
Accounts receiva… -47 -45 -347 -191 net Contract assets and -130 -54 154 16 liabili… current Invento… 1 -37 -78 -52 Other current 13 66 80 76 assets Accounts 29 19 -19 -193 payable Accrued -17 -2 -85 21 liabili… Pension -10 -9 -31 -36 contrib… Other operati… 13 9 -28 -24 activit… net Net cash flows provided by (used 337 374 1,017 779 in) operati… activit… Investi… Activit… Capital -39 -37 -116 -107 expendi… Acquisi… of busines… and -2 -10 -195 -92 intangi… assets, net of cash Other investi… 102 -9 56 -177 activit… net Net cash flows provided by (used 61 -56 -255 -376 in) investi… activit… Financi… Activit… Increase (decrea… in -152 -193 -185 280 short-t… borrowi… net Issuance of long-te… — 500 700 500 debt, net Payment of debt — -5 -5 -5 issuance costs Repayme… of — — -135 -1,300 long-te… debt Dividen… paid on -168 -164 -498 -483 Common Stock Repurch… of — -248 -807 -809 Common Stock Acquisi… of noncont… -1 — -11 — interest shares Dividen… paid to -37 -57 -44 -62 noncont… interest Other financi… -18 -1 -12 -11 activit… net Net cash flows provided by (used -376 -168 -997 -1,890 in) financi… activit… Summary of Activit… Net cash provided by (used 337 374 1,017 779 in) operati… activit… Net cash provided by (used 61 -56 -255 -376 in) investi… activit… Net cash provided by (used -376 -168 -997 -1,890 in) financi… activit… Effect of exchange rate 7 — 8 19 changes on cash and cash equival… Net increase (decrea… in cash, cash 29 150 -227 -1,468 equival… and restric… cash Cash, cash equival… and restric… 849 703 1,105 2,321 cash, beginni… of period Cash, cash equival… and 878 853 878 853 restric… cash, end of period Less: Restric… 12 13 12 13 cash Cash and cash equival… $ 866 $ 840 $ 866 $ 840 end of period
Full text with the tables
Exhibit 99
OTIS REPORTS THIRD QUARTER 2026 RESULTS
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., October 28, 2026 – 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."
1
Key Figures
…
… …
… …
… …
… …
… … … …
──────────────────────────────────────────────────────────────────────────────
$ … % 6 $ … % 5
6 4
$ … $ … $ … $ …
% … … % … …
… …
$ … % $ … %
$ … % $ … %
$ … $ … … $ … $ … …
% … … % … …
… …
$ … % $ … %
$ … % $ … %
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.
2
Service
…
… …
… …
… …
… …
… … … …
──────────────────────────────────────────────────────────────────────────────
$ … % 9 $ … % 8
7 7
$ … $ … $ … $ …
% … … % … …
… …
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
…
… …
… …
… …
… …
… … … …
──────────────────────────────────────────────────────────────────────────────
$ … % 3 $ … % …
3 …
$ … $ … $ … $ …
% … … % … …
… …
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.
3
Cash flow
Ni…
Qu… Mo…
(… En… En…
in Se… Se…
m… 20… 30, 20… Y/Y 20… 30, 20… Y/Y
──────────────────────────────────────────────────────────────────────────────
C…
f… $ 337 $ 374 $ -37 $ 1,… $ 7… $ 2…
f…
o…
F…
c… $ 298 $ 337 $ -39 $ 901 $ 6… $ 2…
f…
A…
f… $ 272 $ 337 $ -65 $ 834 $ 7… $ 68
c…
f…
Third quarter cash flow changes were driven by an increase in net income offset
by changes in working capital.
2026 Outlook
1
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.
4
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
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
Organic sales 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 Represents SG&A expense (a GAAP
administrative ("SG&A") expense measure), excluding restructuring
costs and other significant items.
Represents income from continuing
Adjusted operating profit operations (a GAAP measure),
excluding restructuring costs and
other significant items.
Represents net interest expense (a
GAAP measure), adjusted for the
impacts of non-recurring acquisition
Adjusted net interest expense related financing costs and related
net interest expense pending the
completion of a transaction and other
significant items.
Represents noncontrolling interest in
Adjusted noncontrolling interest in earnings (a GAAP measure), excluding
earnings restructuring costs and other
significant items, including related
tax effects.
Represents net income attributable to
Otis Worldwide Corporation (a GAAP
Adjusted net income measure), excluding restructuring
costs and other significant items,
including related tax effects.
Represents diluted earnings per share
attributable to common shareholders
Adjusted earnings per share ("EPS") (a GAAP measure), adjusted for the
per share impact of restructuring and
other significant items, including
related tax effects.
Represents the effective tax rate (a
GAAP measure) adjusted for other
Adjusted effective tax rate significant items and the tax impact
of restructuring costs and other
significant items.
5
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
Constant currency 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.
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
Free cash flow 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.
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
Adjusted free cash flow 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.
6
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
7
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.
8
Otis Worldwide Corporation
Condensed Consolidated Statements of Operations
Nine
Quar… Months
Ended Ended
Sept… Septe…
30, 30,
──────────────────────────────────────────────────────────────────────────────
-Una… -Una…
(do…
in
mil…
exc…
per 2026 2025 2026 2025
sha…
amo…
sha…
in
mil…
Net $ 3,914 $ 3,690 $ 11,339 $ 10,6…
Sal…
Cos…
and
Exp…
Cost
of
prod… 2,759 2,557 7,966 7,412
and
serv…
sold
Rese…
and 40 36 117 111
deve…
Sell…
gene… 489 504 1,519 1,467
and
admi…
Total
Costs 3,288 3,097 9,602 8,990
and
Expe…
Oth…
inc… -6 -7 -3 -101
(ex…
net
Ope… 620 586 1,734 1,544
pro…
Non-…
pens… — 4 2 4
cost
(ben…
Inte…
expe… 68 61 153 132
(inc…
net
Net
inc…
bef… 552 521 1,579 1,408
inc…
tax…
Inco…
tax 126 129 351 337
expe…
(ben…
Net 426 392 1,228 1,071
inc…
Less:
Nonc…
inte… 12 18 46 61
in
subs…
earn…
Net
inc…
att…
to $ 414 $ 374 $ 1,182 $ 1,010
Otis
Wor…
Cor…
Ear…
Per
Sha…
of
Com…
Sto…
Basic $ 1.09 $ 0.96 $ 3.08 $ 2.57
Dilu… $ 1.08 $ 0.95 $ 3.07 $ 2.55
Wei…
Ave…
Num…
of
Sha…
Out…
Basic 381.0 391.0 384.0 393.7
shar…
Dilu… 381.9 392.8 385.1 395.8
Shar…
9
Otis Worldwide Corporation
Reconciliation of Reported (GAAP) to Adjusted Operating Profit & Operating
Profit Margin
Nine
Quar… Mon…
Ended End…
Sept… Sep…
30, 30,
──────────────────────────────────────────────────────────────────────────────
-Una… -Un…
(do…
in 2026 2025 2026 2025
mil…
Net
Sal…
New $ 1,298 $ 1,257 $ 3,726 $ 3,6…
Equ…
Ser… 2,616 2,433 7,613 6,9…
Tot…
Net $ 3,914 $ 3,690 $ 11,3… $ 10,…
Sal…
Ope…
Pro…
New $ 42 $ 59 $ 120 $ 193
Equ…
Ser… 633 621 1,788 1,7…
Tot…
seg… 675 680 1,908 1,9…
ope…
pro…
Cor…
and -55 -94 -174 -385
Una…
Tot…
Otis
GAAP 620 586 1,734 1,5…
Ope…
Pro…
UpL… — 27 — 72
res…
Oth… 5 6 23 41
res…
UpL…
tra… — 10 — 51
cos…
Sep… — 4 5 65
adj…
Lit…
set… — — — 21
cos…
Held
for — — — 10
sale
imp…
Oth… 1 -1 1 —
net
Tot…
Otis
Adj… $ 626 $ 632 $ 1,763 $ 1,8…
Ope…
Pro…
Rep…
Tot…
Ope… 15.8 % 15.9 % 15.3 % 14.5 %
Pro…
Mar…
Adj…
Tot…
Ope… 16.0 % 17.1 % 15.5 % 17.0 %
Pro…
Mar…
1Se…
adj…
in
the
qua…
and
nine
mon…
end…
Sep…
30,
2026
and
2025
rep…
est…
amo…
due
to
RTX
Cor…
(our
for…
par…
in
acc…
with
the
Tax
Mat…
Agr…
inc…
tho…
amo…
rel…
to a
fav…
rul…
rec…
in
Aug…
2024
reg…
a
tax
lit…
in
Ger…
2Li…
set…
cos…
in
the
nine
mon…
end…
Sep…
30,
2025
rep…
the
agg…
amo…
of
set…
cos…
and
inc…
in
loss
con…
acc…
exc…
leg…
cos…
for
cer…
leg…
mat…
that
are
out…
of
the
ord…
cou…
of
bus…
due
to
the
siz…
com…
and…
uni…
fac…
of
the…
mat…
10
Otis Worldwide Corporation
Reconciliation of Reported (GAAP) to Adjusted (Non-GAAP) Net Income, Earnings
Per Share, and Effective Tax Rate
Nine
Qua… Mon…
End… End…
Sep… Sep…
30, 30,
──────────────────────────────────────────────────────────────────────────────
-Un… -Un…
(d…
in
mi…
ex… 2026 2025 2026 20…
per
sh…
am…
Ad…
Op… $ 626 $ 632 $ 1,7… $ 1,…
Pr…
No…
pe… — 4 2 4
co…
(b…
Ad…
net
in… 69 61 196 164
ex…
2
Ad…
in…
fr…
op… 557 567 1,5… 1,…
be…
in…
ta…
In…
tax 126 129 351 337
ex…
(b…
Tax
im…
on
re… 2 10 6 42
and
no…
it…
No…
tax 15 — 35 12
it…
Ad…
net
in… 414 428 1,1… 1,…
fr…
op…
Ad…
no… 12 17 35 50
in…
3
Ad…
net
in…
at… $ 402 $ 411 $ 1,1… $ 1,…
to
co…
sh…
GA…
net
in…
at… $ 414 $ 374 $ 1,… $ 1,0…
to
co…
sh…
Up… — 27 — 72
re…
Ot… 5 6 23 41
re…
Up…
tr… — 10 — 51
co…
Se… — 4 5 65
ad…
Li…
se… — — — 21
co…
He…
for — — — 10
sa…
im…
In…
in…
re…
to -1 — -32 -16
no…
tax
it…
2
Tax
ef…
of
re…
no… -2 -10 -6 -42
it…
and
ot…
ad…
No…
tax -15 — -35 -12
it…
2
Ot… 1 — 1 -5
ne…
Ad…
net
in…
at… $ 402 $ 411 $ 1,1… $ 1,…
to
co…
sh…
Di…
Ea… $ 1.… $ 0.… $ 3.… $ 2.55
Per
Sh…
Im…
to
di… -0… 0.… -0… 0.47
ea…
per
sh…
Ad…
Di…
Ea… $ 1.… $ 1.… $ 2.… $ 3.02
Per
Sh…
Ef…
Tax 22… % 24… % 22… % 23.9 %
Ra…
Im…
of
ad…
on 2.9 % -0… % 2.8 % — %
ef…
tax
ra…
Ad…
Ef… 25… % 24… % 25… % 23.9 %
Tax
Ra…
1In
Au…
20…
we
re…
a
fa…
ru…
re…
a
tax
li…
in
Ge…
As
a
re…
in…
tax
be…
and
re…
in…
in…
we…
re…
in
20…
In…
tax
ex…
is
re…
as
ad…
wi…
$15
mi…
of
in…
tax
be…
for
the
qu…
and
ni…
mo…
en…
Se…
30,
20…
No
re…
in…
tax
be…
was
re…
in
20…
Net
in…
ex…
is
re…
as
ad…
wi…
$1
mi…
and
$8
mi…
of
in…
in…
for
the
qu…
and
ni…
mo…
en…
Se…
30,
20…
re…
co…
to
$2
mi…
for
the
ni…
mo…
en…
Se…
30,
20…
2C…
tax
re…
we…
ad…
in
the
se…
qu…
of
20…
and
20…
As
a
re…
Net
in…
ex…
and
No…
in…
are
re…
as
ad…
wi…
$35
mi…
of
in…
in…
and
$11
mi…
of
the
no…
in…
sh…
of
the
re…
ad…
re…
for
the
ni…
mo…
en…
Se…
30,
20…
co…
to
$30
mi…
and
$16
mi…
re…
for
the
sa…
pe…
in
20…
3N…
in…
is
re…
as
ad…
wi…
$1
mi…
and
$5
mi…
for
the
qu…
and
ni…
mo…
en…
Se…
30,
20…
re…
11
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
FX Acquisitions /
Organic Translation Divestitures, Total
net and Other
New Equipment 3% —% —% 3%
Service 7% (1)% 2% 8%
Maintenance 4% (1)% 1% 4%
and Repair
Modernization 20% —% —% 20%
Total Net 6% —% —% 6%
Sales
Nine Months
Ended
September 30,
2026
Compared with
Nine Months
Ended
September 30,
2025
Factors
Contributing to
Total % Change
in Net Sales
FX Acquisitions /
Organic Translation Divestitures, Total
net and Other
New Equipment (1)% 2% —% 1%
Service 7% 2% 1% 10%
Maintenance 5% 2% 1% 8%
and Repair
Modernization 17% 1% 1% 19%
Total Net 4% 2% 1% 7%
Sales
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 4%
currency
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 20%
currency
12
Otis Worldwide Corporation
Reconciliation of Segment and Total Adjusted Operating Profit at Constant
Currency
Quarter Ended
September 30,
2026
Compared with
Quarter Ended
September (dollars in
30, 2025 millions) 2026 2025 Y/Y
──────────────────────────────────────────────────────────────────────────────
New Equipment
Segment $ 42 $ 59 $ -17
Operating Profit
Impact of -5 — -5
foreign exchange
Segment
Operating Profit $ 37 $ 59 $ -22
at constant
currency
Service
Segment $ 633 $ 621 $ 12
Operating Profit
Impact of 8 — 8
foreign exchange
Segment
Operating Profit $ 641 $ 621 $ 20
at constant
currency
Otis
Consolidated
Adjusted $ 626 $ 632 $ -6
Operating Profit
Impact of 3 — 3
foreign exchange
Adjusted
Operating Profit $ 629 $ 632 $ -3
at constant
currency
Nine Months
Ended September
30, 2026
Compared with
Nine Months
Ended
September 30,
2025
(dollars in 2026 2025 Y/Y
millions)
New Equipment
Segment $ 120 $ 193 $ -73
Operating Profit
Impact of -6 — -6
foreign exchange
Segment
Operating Profit $ 114 $ 193 $ -79
at constant
currency
Service
Segment $ 1,788 $ 1,736 $ 52
Operating Profit
Impact of -26 — -26
foreign exchange
Segment
Operating Profit $ 1,762 $ 1,736 $ 26
at constant
currency
Otis
Consolidated
Adjusted $ 1,763 $ 1,804 $ -41
Operating Profit
Impact of -32 — -32
foreign exchange
Adjusted
Operating Profit $ 1,731 $ 1,804 $ -73
at constant
currency
13
Otis Worldwide Corporation
Condensed Consolidated Balance Sheet
September 30, 2026 December 31, 2025
──────────────────────────────────────────────────────────────────────────────
(dollars in -Unaudited
millions)
Assets
Cash and cash $ 866 $ 1,096
equivalents
Accounts 4,058 3,688
receivable, net
Contract assets 908 699
Inventories 689 613
Other current 397 405
assets
Total Current 6,918 6,501
Assets
Future income tax 423 407
benefits
Fixed assets, net 771 743
Operating lease
right-of-use 596 554
assets
Intangible assets, 379 343
net
Goodwill 1,846 1,695
Other assets 377 410
Total Assets $ 11,310 $ 10,653
Liabilities and
Equity (Deficit)
Short-term
borrowings and
current $ 1,224 $ 1,056
portion of
long-term debt
Accounts payable 2,145 2,142
Accrued 1,704 1,847
liabilities
Contract 2,979 2,611
liabilities
Total Current 8,052 7,656
Liabilities
Long-term debt 7,051 6,900
Future pension and
postretirement 421 419
benefit
obligations
Operating lease 419 397
liabilities
Future income tax 198 223
obligations
Other long-term 327 329
liabilities
Total Liabilities 16,468 15,924
Redeemable
noncontrolling 106 75
interest
Shareholders'
Equity (Deficit):
Common Stock and
additional paid-in 371 333
capital
Treasury Stock -5,005 -4,198
Retained earnings
(accumulated 125 -440
deficit)
Accumulated other
comprehensive -921 -1,087
income
(loss)
Total
Shareholders' -5,430 -5,392
Equity (Deficit)
Noncontrolling 166 46
interest
Total Equity -5,264 -5,346
(Deficit)
Total Liabilities
and Equity $ 11,310 $ 10,653
(Deficit)
14
Otis Worldwide Corporation
Condensed Consolidated Statement of Cash Flows
Nine
Quarter Months
Ended Ended
September Septemb…
30, 30,
──────────────────────────────────────────────────────────────────────────────
-Unaudit… -Unaudi…
(dollars
in 2026 2025 2026 2025
million…
Operati…
Activit…
Net
income $ 426 $ 392 $ 1,228 $ 1,071
from
operati…
Adjustm…
to
reconci…
net
income
to
net cash
flows
provided
by
operati…
activit…
Depreci…
and 41 44 124 130
amortiz…
Deferred
income
tax — -28 -38 -102
expense
(benefi…
Stock
compens… 18 19 57 63
cost
Change
in
operati…
assets
and
liabili…
net of
acquisi…
Accounts
receiva… -47 -45 -347 -191
net
Contract
assets
and -130 -54 154 16
liabili…
current
Invento… 1 -37 -78 -52
Other
current 13 66 80 76
assets
Accounts 29 19 -19 -193
payable
Accrued -17 -2 -85 21
liabili…
Pension -10 -9 -31 -36
contrib…
Other
operati… 13 9 -28 -24
activit…
net
Net cash
flows
provided
by (used 337 374 1,017 779
in)
operati…
activit…
Investi…
Activit…
Capital -39 -37 -116 -107
expendi…
Acquisi…
of
busines…
and -2 -10 -195 -92
intangi…
assets,
net of
cash
Other
investi… 102 -9 56 -177
activit…
net
Net cash
flows
provided
by (used 61 -56 -255 -376
in)
investi…
activit…
Financi…
Activit…
Increase
(decrea…
in -152 -193 -185 280
short-t…
borrowi…
net
Issuance
of
long-te… — 500 700 500
debt,
net
Payment
of debt — -5 -5 -5
issuance
costs
Repayme…
of — — -135 -1,300
long-te…
debt
Dividen…
paid on -168 -164 -498 -483
Common
Stock
Repurch…
of — -248 -807 -809
Common
Stock
Acquisi…
of
noncont… -1 — -11 —
interest
shares
Dividen…
paid to -37 -57 -44 -62
noncont…
interest
Other
financi… -18 -1 -12 -11
activit…
net
Net cash
flows
provided
by (used -376 -168 -997 -1,890
in)
financi…
activit…
Summary
of
Activit…
Net cash
provided
by (used 337 374 1,017 779
in)
operati…
activit…
Net cash
provided
by (used 61 -56 -255 -376
in)
investi…
activit…
Net cash
provided
by (used -376 -168 -997 -1,890
in)
financi…
activit…
Effect
of
exchange
rate 7 — 8 19
changes
on cash
and cash
equival…
Net
increase
(decrea…
in cash,
cash 29 150 -227 -1,468
equival…
and
restric…
cash
Cash,
cash
equival…
and
restric… 849 703 1,105 2,321
cash,
beginni…
of
period
Cash,
cash
equival…
and 878 853 878 853
restric…
cash,
end of
period
Less:
Restric… 12 13 12 13
cash
Cash and
cash
equival… $ 866 $ 840 $ 866 $ 840
end of
period
15
Otis Worldwide Corporation
Adjusted Free Cash Flow Reconciliation
Nine
Quarter Months
Ended Ended
Septem… Septemb…
30, 30,
──────────────────────────────────────────────────────────────────────────────
-Unaud… -Unaudi…
(doll…
in 2026 2025 2026 2025
milli…
Net
cash
flows
provi… $ 337 $ 374 $ 1,017 $ 779
by
opera…
activ…
(GAAP)
Capit… -39 -37 -116 -107
expen…
Free
cash 298 337 901 672
flow
(Non-…
Adjus…
for:
UpLift
restr… 3 9 17 28
payme…
UpLift
trans… 3 16 14 49
payme…
Separ… — 20 63 92
payme…
German
Tax
Litig… -32 -45 -161 -75
refun…
net2
Adjus…
free
cash $ 272 $ 337 $ 834 $ 766
flow
(Non-…
1These
repre…
payme…
to RTX
Corpo…
(our
former
paren…
in
accor…
with
the
Tax
Matte…
Agree…
2In
August
2024,
we
recei…
a
favor…
ruling
regar…
a tax
litig…
in
Germa…
The
Compa…
began
recei…
refun…
during
2025
and
antic…
the
refund
proce…
to
conti…
throu…
2026.
16