Otis Worldwide (OTIS) Q2 2026 earnings summary

Executive summary

• Net sales rose 7% year-over-year to $3.9 billion in Q2 2026, with organic sales up 6% and strong Service segment growth offsetting New Equipment declines, especially in China and EMEA.

• Service organic sales grew 9% (maintenance and repair up 6%, modernization up 24%), while New Equipment organic sales declined 1%.

• Adjusted free cash flow reached $290 million in Q2, up from $243 million in Q2 2025, supporting continued investment and shareholder returns.

• Adjusted operating profit margin contracted 180 basis points to 15.2%, with adjusted EPS down 4% to $1.01, while GAAP EPS increased 13% to $1.12.

• Strategic investments in service quality and operational initiatives are impacting margins short-term but expected to drive long-term growth.

Financial highlights

• Q2 2026 net sales: $3.86–$3.9 billion (up 7% year-over-year); organic sales up 6%.

• Adjusted operating profit: $587 million (down $25–$32 million year-over-year); margin 15.2% (down 180 bps).

• Adjusted EPS: $1.01 (down 4% year-over-year); GAAP EPS: $1.12 (up 13%).

• Adjusted free cash flow: $290 million in Q2; $1.5–$1.65 billion full-year outlook.

• Share repurchases: $400 million in Q2, $800 million in H1 2026; dividends increased by 5%.

Outlook and guidance

• Full-year 2026 net sales expected at $15.1–$15.3 billion, with low to mid-single-digit organic growth.

• Adjusted operating profit outlook: $1.5–$1.55 billion at constant currency; adjusted EPS: $4.01–$4.05.

• Adjusted free cash flow guidance: $1.5–$1.65 billion.

• Service organic sales expected to remain strong at mid to high single-digit growth; profit growth expected in Q4.

• Service margins expected to expand to around 25% by Q4, with full-year service margin just below 24%.