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-driven growth; new equipment sales were flat and organic sales declined 1%.

• Service organic sales grew 9%, led by 24% modernization growth and double-digit repair growth; modernization orders up 9%, backlog up 26% at constant currency.

• 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 due to operational performance.

• 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 were $3.9 billion, up 7% year-over-year; organic sales up 6%.

• Adjusted operating profit was $587 million, down $25–$32 million year-over-year; margin down 180 bps to 15.2%.

• Adjusted EPS was $1.01, down 4% year-over-year.

• Adjusted free cash flow was $290 million in Q2 and $562 million for H1; full-year outlook $1.5–$1.65 billion.

• $800 million in share buybacks and a 5% dividend increase in H1 2026, returning over $1.1 billion to shareholders.

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 revised to $1.5–$1.55 billion at constant currency, reflecting retention and productivity headwinds.

• Adjusted EPS guidance for 2026 is $4.01–$4.05.

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

• Service organic sales to remain strong at mid-single-digit growth in Q3, with profit growth expected in Q4; service margins expected to expand to around 25% by Q4.