Otis Delivers 6% Q1 Sales Growth, $413M Cash Flow and $400M Buybacks
Otis reported first quarter net sales of $3.6 billion, up 6% and 1% organically, driven by 11% Service net sales growth and an 11% rise in modernization orders, with backlog up 32%. The company generated $413 million in operating cash flow and repurchased $400 million of shares.
1. First Quarter Financial Results
Otis reported net sales of $3.6 billion in Q1 2026, up 6% year-over-year and 1% organically. GAAP EPS rose 43% to $0.87 while adjusted EPS slipped 3% to $0.89, reflecting cost headwinds and investments. Operating cash flow reached $413 million, and the company repurchased $400 million of shares.
2. Service and Modernization Momentum
Service net sales climbed 11% (5% organic), with repair sales up 16% at actual currency and 10% organically, and modernization organic sales rising 6%. Modernization orders increased 11%, driving backlog growth of 32%, supported by pricing actions and disciplined execution.
3. New Equipment and Segment Pressures
New Equipment net sales fell 1% (5% organic decline), notably in China and Asia Pacific, resulting in a 240-basis-point margin contraction to 3.3%. The segment faced shipment delays and tariff impacts, prompting operational execution and cost efficiency measures.
4. Capital Allocation and Outlook
Strong cash generation enabled $400 million in share repurchases and a majority investment in AI-enabled elevator service provider WeMaintain. Management expects backlog growth, pricing actions, and disciplined execution to sustain momentum into the second quarter and beyond.