Otis reported first quarter net sales of $3.6 billion, a 6% increase year-over-year, driven by strong performance in its Service segment. Adjusted EPS came in at $0.89, a 3% decrease from the prior year, missing analyst expectations due to margin contraction from cost headwinds and investments.
Key Highlights
- Service segment net sales grew 11% to $2.4 billion, with organic growth of 5%, led by a 16% increase in Repair sales.
- Modernization orders continued to show strength, rising 11% at constant currency, which expanded the modernization backlog by 30% at constant currency.
- The New Equipment segment remains challenged, with organic sales declining 5% and orders in China falling by low teens, though the overall New Equipment backlog grew 3% at constant currency.
- Adjusted operating margin contracted 130 basis points to 15.4%, with the Service segment margin specifically declining 160 basis points to 23.0%.