OTIS REPORTS FIRST QUARTER 2025 RESULTS

Rhea-AI Summary

Otis (NYSE: OTIS) reported Q1 2025 financial results with net sales of $3.3 billion, showing mixed performance across segments. Service segment demonstrated strength with 4% organic sales growth and 40 basis points operating profit margin expansion. The company's maintenance portfolio grew 4%, while modernization orders increased 12%.

Key financial metrics include:

• GAAP EPS decreased 29% to $0.61
• Adjusted EPS increased 5% to $0.92
• Service net sales up 1% to $2.2 billion
• New Equipment sales down 9% to $1.2 billion
• GAAP operating profit margin contracted 350 bps to 12.3%
• Adjusted operating profit margin expanded 40 bps to 16.7%

The company revised its 2025 outlook, projecting net sales of $14.6-14.8 billion (up 3-4%) and adjusted EPS of $4.00-4.10 (up 4-7%).

Positive

• Service segment organic sales grew 4% with 40 bps margin expansion
• Modernization orders increased 12% with backlog up 13%
• Maintenance portfolio units grew 4%
• Adjusted EPS increased 5% to $0.92
• Strong cash flow with adjusted free cash flow up to $186 million

Negative

• New Equipment sales declined 9% with >20% decline in China
• GAAP operating profit fell $133 million
• GAAP EPS decreased 29% to $0.61
• Total net sales decreased 3% to $3.3 billion
• GAAP operating profit margin contracted 350 bps to 12.3%

Insights

Financial Analyst

Otis shows resilient service growth offsetting equipment weakness, with adjusted metrics positive despite GAAP declines.

Otis delivered a bifurcated Q1 performance with strength in its high-margin Service business contrasting against weakness in New Equipment. The 4% organic Service sales growth coupled with 40 basis point margin expansion to 24.6% demonstrates the company's successful execution of its service-centric strategy. The maintenance portfolio growth of 4% and 12% increase in modernization orders establish strong recurring revenue foundations.

However, these positives were partially offset by a 9% decline in New Equipment sales, driven primarily by greater than 20% declines in China. This regional weakness creates a significant drag on overall performance, with company-wide net sales declining 3% to $3.3 billion.

The stark divergence between GAAP and adjusted metrics requires careful interpretation. While adjusted EPS increased 5% to $0.92 and adjusted operating profit margin expanded 40 basis points to 16.7%, GAAP metrics tell a different story with EPS dropping 29% to $0.61 and operating profit margin contracting 350 basis points to 12.3%. This gap stems from UpLift transformation costs and separation-related adjustments.

The company's $250 million in share repurchases and fifth consecutive annual dividend increase reflect confidence in free cash flow generation. Management's revised 2025 outlook projects 3-4% net sales growth and 4-7% adjusted EPS growth, maintaining a cautious view on New Equipment while banking on continued Service segment strength.

Otis delivers mid-single digit organic Service sales growth and strong Service operating profit margin expansion

• Service net sales up 1% with organic sales up 4%
• GAAP operating profit margin down 350 bps, adjusted operating profit margin up 40 bps
• GAAP EPS down 29% and adjusted EPS up 5%
• Maintenance portfolio units up 4%
• Modernization orders up 12%, backlog up 13%, up 14% at constant currency
• GAAP cash flow from operations of $190 million; adjusted free cash flow of $186 million
• Share repurchases of approximately $250 million

FARMINGTON, Conn., April 23, 2025 /PRNewswire/ -- Otis Worldwide Corporation (NYSE: OTIS) reported first quarter 2025 net sales of $3.3 billion with organic sales flat versus the prior year. GAAP earnings per share (EPS) decreased 29% to $0.61 and adjusted EPS increased 5% to $0.92.

"Otis delivered solid performance supported by the strength of our Service segment, which contributed mid-single digit organic sales growth and 40 basis points of operating profit margin expansion. We continued to execute our modernization strategy with orders up 12% leading to a mid-teens backlog growth that sets us up well for the rest of the year. We also grew our industry leading maintenance portfolio 4% again this quarter," said Chair, CEO & President Judy Marks. "With this strong performance, confidence in our strategy, and commitment to creating value for our shareholders, yesterday we announced a dividend increase for the fifth consecutive year."

Key Figures

($ millions, except per share amounts)	Quarter Ended March 31,
	2025		2024		Y/Y		Y/Y (CFX)
Net sales	$                 3,350		$                 3,437		(3) %		— %
Organic sales growth							— %
GAAP
Operating profit	$                    411		$                    544		$                (133)
Operating profit margin	12.3 %		15.8 %		(350) bps
Net income	$                    243		$                    353		(31) %
Earnings per share	$                   0.61		$                   0.86		(29) %
Adjusted non-GAAP comparison
Operating profit	$                    560		$                    561		$                     (1)		$                    15
Operating profit margin	16.7 %		16.3 %		40 bps
Net income	$                    368		$                    361		2 %
Earnings per share	$                   0.92		$                   0.88		5 %

First quarter net sales of $3.3 billion decreased 3% versus the prior year, driven primarily by New Equipment in China.

First quarter GAAP operating profit of $411 million decreased $133 million driven by UpLift transformation costs, separation-related adjustments, and other non-recurring items. Adjusted operating profit of $560 million decreased $1 million at actual currency and increased $15 million at constant currency, driven by Service. GAAP operating profit margin contracted 350 basis points to 12.3% and adjusted operating profit margin expanded 40 basis points to 16.7%, driven by favorable segment mix and favorable segment performance partially offset by headwinds in corporate costs.

GAAP EPS of $0.61 decreased 29% compared to the prior year driven by UpLift transformation costs, separation-related adjustments, and other non-recurring items. Adjusted EPS of $0.92 increased 5% due to solid operational performance and a lower share count, partially offset by FX headwind.

Service

		Quarter Ended March 31,
($ millions)		2025		2024		Y/Y		Y/Y (CFX)
Net sales		$                 2,187		$                 2,157		1 %		4 %
Organic sales								4 %
Segment operating profit		$                    537		$                    523		$                      14		$                      29
Segment operating profit margin		24.6 %		24.2 %		40 bps

In the first quarter, net sales of $2.2 billion increased 1%, with a 4% increase in organic sales. Organic maintenance and repair sales increased 3% and organic modernization sales increased 10%.

Segment operating profit of $537 million increased $14 million at actual currency and $29 million at constant currency due to higher volume, favorable pricing and productivity, partially offset by inflationary pressures including higher labor and higher material costs, and mix. Segment operating profit margin expanded 40 basis points to 24.6%.

New Equipment

		Quarter Ended March 31,
($ millions)		2025		2024		Y/Y		Y/Y (CFX)
Net sales		$                 1,163		$                 1,280		(9) %		(6) %
Organic sales								(7) %
Segment operating profit		$                      66		$                      71		$                     (5)		$                     (4)
Segment operating profit margin		5.7 %		5.5 %		20 bps

In the first quarter, net sales of $1.2 billion decreased 9% versus the prior year, with approximately 10% organic growth in Asia Pacific and mid-single digit organic sales growth in EMEA more than offset by a greater than 20% decline in China and a high-single digit decline in the Americas.

Segment operating profit of $66 million decreased $5 million at actual currency and $4 million at constant currency from the impacts of lower volume and unfavorable mix, partially offset by productivity and commodity tailwinds. Pricing was relatively flat. Segment operating profit margin expanded 20 basis points to 5.7%.

New Equipment orders were down 1% at constant currency with greater than 20% growth in Asia Pacific and mid-teens growth in the Americas offset by a greater than 20% decline in China and a mid-single digit decline in EMEA. New Equipment backlog decreased 4% at actual currency and decreased 3% at constant currency.

Cash flow

		Quarter Ended March 31,
($ millions)		2025		2024		Y/Y
Cash flow from operations		$            190		$            171		$             19
Free cash flow		$            156		$            140		$             16
Adjusted free cash flow		$            186		$            155		$             31

First quarter cash flow changes were driven by a benefit from changes in working capital offset by a decrease in net income.

2025 Outlook¹

Otis is revising its full year outlook:

• Net sales of $14.6 to $14.8 billion, up 3 to 4%
• Organic sales up 2 to 4%
  • Organic New Equipment sales down 1 to 4%
  • Organic Service sales up 5 to 7%
• Adjusted operating profit of $2.4 to $2.5 billion, up $105 to $135 million at constant currency excluding ($75) to ($45) million of tariff impact, up $55 to $105 million at actual currency including the tariff impact
• Adjusted EPS of $4.00 to $4.10, up 4 to 7%; adjusted effective tax rate of approximately 24.8%
• Adjusted free cash flow of approximately $1.6 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 and service company. We move 2.4 billion people a day and maintain approximately 2.4 million customer units worldwide, the industry's largest Service portfolio. Headquartered in Connecticut, USA, Otis is 72,000 people strong, including 44,000 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, Instagram, and Facebook @OtisElevatorCo.

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
Organic sales	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 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 administrative ("SG&A") expense	Represents SG&A expense (a GAAP measure), excluding restructuring costs and other significant items.
Adjusted operating profit	Represents income from continuing operations (a GAAP measure), excluding restructuring costs and other significant items.
Adjusted net interest expense	Represents net interest expense (a GAAP measure), adjusted for the impacts of non-recurring acquisition related financing costs and related net interest expense pending the completion of a transaction and other significant items.
Adjusted noncontrolling interest in earnings	Represents noncontrolling interest in earnings (a GAAP measure), excluding restructuring costs and other significant items, including related tax effects.
Adjusted net income	Represents net income attributable to Otis Worldwide Corporation (a GAAP measure), excluding restructuring costs and other significant items, including related tax effects.
Adjusted earnings per share ("EPS")	Represents diluted earnings per share attributable to common shareholders (a GAAP measure), adjusted for the per share impact of restructuring and other significant items, including related tax effects.
Adjusted effective tax rate	Represents the effective tax rate (a GAAP measure) adjusted for other significant items and the tax impact of restructuring costs and other significant items.
Constant currency	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 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.
Free cash flow	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 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.
Adjusted free cash flow	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 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.

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 and China), 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 environmental, social and governance targets or goals, 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 increasing tensions between the U.S. and China, 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) the effect of geopolitical conflicts, including the effect of the on-going conflict between Russia and Ukraine and conflicts in the Middle East; (4) challenges in the development, production, delivery, support, performance and realization of the anticipated benefits of advanced technologies and new products and services; (5) future levels of indebtedness, capital spending and research and development spending; (6) future availability of credit and factors that may affect such availability or costs thereof, including credit market conditions and Otis' capital structure; (7) 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; (8) fluctuations in prices and delays and disruption in delivery of materials and services from suppliers, whether as a result of changes in general economic conditions, geopolitical conflicts or otherwise; (9) cost reduction or containment actions, restructuring or transformation costs and related savings and other consequences thereof, including with respect to UpLift and China and related impacts of reorganization and outsourcing activities and change management, as applicable; (10) new business and investment opportunities; (11) the outcome of legal proceedings, investigations and other contingencies; (12) pension plan assumptions and future contributions; (13) the impact of the negotiation of collective bargaining agreements and labor disputes, labor actions, including strikes or work stoppages, and labor inflation in the markets in which Otis and its businesses operate globally; (14) the effect of changes in tax, environmental, regulatory (including among other things import/export, tariffs, climate change or other ESG-related legal and regulatory changes) and other laws and regulations in the U.S., including in connection with the new administration's policies and priorities, and other countries in which Otis and its businesses operate; (15) the ability of Otis to retain and hire key personnel; (16) 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; (17) 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 (18) 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.

Otis Worldwide Corporation
Condensed Consolidated Statements of Operations
			Quarter Ended March 31,
			(Unaudited)
(dollars in millions, except per share amounts; shares in millions)			2025		2024
Net Sales			$            3,350		$            3,437
Costs and Expenses:
	Cost of products and services sold		2,349		2,409
	Research and development		37		36
	Selling, general and administrative		464		462
	Total Costs and Expenses		2,850		2,907
Other income (expense), net			(89)		14
Operating profit			411		544
	Non-service pension cost (benefit)		—		—
	Interest expense (income), net		45		44
Net income before income taxes			366		500
	Income tax expense (benefit)		110		126
Net income			256		374
	Less: Noncontrolling interest in subsidiaries' earnings		13		21
Net income attributable to Otis Worldwide Corporation			$                243		$                353
Earnings Per Share of Common Stock:
	Basic		$               0.61		$               0.87
	Diluted		$               0.61		$               0.86
Weighted Average Number of Shares Outstanding:
	Basic shares		396.6		405.2
	Diluted Shares		399.1		408.1

 

Otis Worldwide Corporation
Reconciliation of Reported (GAAP) to Adjusted Operating Profit & Operating Profit Margin
		Quarter Ended March 31,
		(Unaudited)
(dollars in millions)		2025		2024
Net Sales
New Equipment		$         1,163		$         1,280
Service		2,187		2,157
Total Net Sales		$         3,350		$         3,437
Operating Profit
New Equipment		$              66		$              71
Service		537		523
Total segment operating profit		603		594
Corporate and Unallocated		(192)		(50)
Total Otis GAAP Operating Profit		411		544
UpLift restructuring		20		1
Other restructuring		23		19
UpLift transformation costs		23		12
Separation-related adjustments 1		52		(15)
Litigation-related settlement costs 2		21		—
Held for sale impairment		10		—
Total Otis Adjusted Operating Profit		$            560		$            561
Reported Total Operating Profit Margin		12.3 %		15.8 %
Adjusted Total Operating Profit Margin		16.7 %		16.3 %

1 Separation-related adjustments in the quarter ended March 31, 2025 represent estimated amounts due to RTX Corporation (our former parent) in accordance with the Tax Matters Agreement, including those amounts related to a favorable ruling received in August 2024 regarding a tax litigation in Germany.
2 Litigation-related settlement costs in the quarter ended March 31, 2025 represent the aggregate amount of settlement costs and increase in loss contingency accruals, excluding legal costs, for certain legal matters that are outside of the ordinary course of business due to the size, complexity and/or unique facts of these matters.

 

Otis Worldwide Corporation
Reconciliation of Reported (GAAP) to Adjusted (Non-GAAP) Net Income, Earnings Per Share, and Effective Tax Rate
		Quarter Ended March 31,
		(Unaudited)
(dollars in millions, except per share amounts)		2025		2024
Adjusted Operating Profit		$            560		$            561
Adjusted net interest expense 1		46		44
Adjusted income from operations before income taxes		514		517
Income tax expense (benefit)		110		126
Tax impact on restructuring and non-recurring items		21		9
Adjusted net income from operations		383		382
Adjusted noncontrolling interest 2		15		21
Adjusted net income attributable to common shareholders		$            368		$            361
GAAP net income attributable to common shareholders		$           243		$           353
UpLift restructuring		20		1
Other restructuring		23		19
UpLift transformation costs		23		12
Separation-related adjustments		52		(15)
Litigation-related settlement costs		21		—
Held for sale impairment		10		—
Interest income related to non-recurring tax items 1		(1)		—
Tax effects of restructuring, non-recurring items and other adjustments		(21)		(9)
Other, net 2		(2)		—
Adjusted net income attributable to common shareholders		$            368		$            361
Diluted Earnings Per Share		$          0.61		$          0.86
Impact to diluted earnings per share		0.31		0.02
Adjusted Earnings Per Share		$          0.92		$          0.88
Effective Tax Rate		30.1 %		25.2 %
Impact of adjustments on effective tax rate		(4.5) %		0.8 %
Adjusted Effective Tax Rate		25.6 %		26.0 %

1 In August 2024, we received a favorable ruling regarding a tax litigation in Germany. As a result, income tax benefits and related interest income were recorded in 2024. Net interest expense is reflected as adjusted without $1 million of interest income for the quarter ended March 31, 2025.
2 Noncontrolling interest is reflected as adjusted without $2 million of the noncontrolling interest share of Other restructuring for the quarter ended March 31, 2025.

 

Otis Worldwide Corporation
Components of Changes in Net Sales
Quarter Ended March 31, 2025 Compared with Quarter Ended March 31, 2024
		Factors Contributing to Total % Change in Net Sales
		Organic		FX Translation		Acquisitions / Divestitures, net and Other		Total
New Equipment		(7) %		(3) %		1 %		(9) %
Service		4 %		(3) %		— %		1 %
Maintenance and Repair		3 %		(3) %		— %		— %
Modernization		10 %		(3) %		— %		7 %
Total Net Sales		— %		(3) %		— %		(3) %

 

Components of Changes in New Equipment Backlog
		March 31, 2025
		Y/Y Growth %
New Equipment Backlog increase at actual currency		(4) %
Foreign exchange impact to New Equipment Backlog		1 %
New Equipment Backlog increase at constant currency		(3) %

 

Components of Changes in Modernization Backlog
		March 31, 2025
		Y/Y Growth %
Modernization Backlog increase at actual currency		13 %
Foreign exchange impact to Modernization Backlog		1 %
Modernization Backlog increase at constant currency		14 %

 

Otis Worldwide Corporation
Reconciliation of Segment and Total Adjusted Operating Profit at Constant Currency
Quarter Ended March 31, 2025 Compared with Quarter Ended March 31, 2024
(dollars in millions)		2025		2024		Y/Y
New Equipment
Segment Operating Profit		$                       66		$                       71		$                        (5)
Impact of foreign exchange		1		—		1
Segment Operating Profit at constant currency		$                       67		$                       71		$                        (4)
Service
Segment Operating Profit		$                     537		$                     523		$                       14
Impact of foreign exchange		15		—		15
Segment Operating Profit at constant currency		$                     552		$                     523		$                       29
Otis Consolidated
Adjusted Operating Profit		$                     560		$                     561		$                        (1)
Impact of foreign exchange		16		—		16
Adjusted Operating Profit at constant currency		$                     576		$                     561		$                       15

 

Otis Worldwide Corporation
Condensed Consolidated Balance Sheet
		March 31, 2025		December 31, 2024
(dollars in millions)		(Unaudited)
Assets
Cash and cash equivalents		$                         1,918		$                         2,300
Accounts receivable, net		3,570		3,428
Contract assets		690		706
Inventories		586		557
Other current assets		671		679
Total Current Assets		7,435		7,670
Future income tax benefits		305		302
Fixed assets, net		708		701
Operating lease right-of-use assets		456		422
Intangible assets, net		326		311
Goodwill		1,588		1,548
Other assets		360		362
Total Assets		$                      11,178		$                      11,316
Liabilities and Equity (Deficit)
Short-term borrowings and current portion of long-term debt		$                        1,483		$                        1,351
Accounts payable		1,618		1,879
Accrued liabilities		1,921		1,921
Contract liabilities		2,870		2,598
Total Current Liabilities		7,892		7,749
Long-term debt		6,923		6,973
Future pension and postretirement benefit obligations		432		434
Operating lease liabilities		319		298
Future income tax obligations		217		207
Other long-term liabilities		386		383
Total Liabilities		16,169		16,044
Redeemable noncontrolling interest		62		57
Shareholders' Equity (Deficit):
Common Stock and additional paid-in capital		278		265
Treasury Stock		(3,646)		(3,390)
Accumulated deficit		(889)		(978)
Accumulated other comprehensive income (loss)		(871)		(745)
Total Shareholders' Equity (Deficit)		(5,128)		(4,848)
Noncontrolling interest		75		63
Total Equity (Deficit)		(5,053)		(4,785)
Total Liabilities and Equity (Deficit)		$                      11,178		$                      11,316

 

Otis Worldwide Corporation
Condensed Consolidated Statement of Cash Flows
		Quarter Ended March 31,
		(Unaudited)
(dollars in millions)		2025		2024
Operating Activities:
Net income from operations		$        256		$        374
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortization		42		44
Deferred income tax expense (benefit)		—		16
Stock compensation cost		21		16
Change in:
Accounts receivable, net		(104)		(162)
Contract assets and liabilities, current		260		275
Inventories		(18)		9
Other current assets		(2)		(24)
Accounts payable		(281)		(217)
Accrued liabilities		12		(142)
Pension contributions		(18)		(12)
Other operating activities, net		22		(6)
Net cash flows provided by (used in) operating activities		190		171
Investing Activities:
Capital expenditures		(34)		(31)
Acquisitions of businesses and intangible assets, net of cash		(36)		(30)
Other investing activities, net		(91)		(18)
Net cash flows provided by (used in) investing activities		(161)		(79)
Financing Activities:
Increase (decrease) in short-term borrowings, net		(11)		3
Dividends paid on Common Stock		(155)		(138)
Repurchases of Common Stock		(253)		(300)
Dividends paid to noncontrolling interest		(2)		(9)
Acquisition of noncontrolling interest shares		—		(4)
Other financing activities, net		(7)		(19)
Net cash flows provided by (used in) financing activities		(428)		(467)
Summary of Activity:
Net cash provided by (used in) operating activities		190		171
Net cash provided by (used in) investing activities		(161)		(79)
Net cash provided by (used in) financing activities		(428)		(467)
Effect of exchange rate changes on cash and cash equivalents		7		(18)
Net increase (decrease) in cash, cash equivalents and restricted cash		(392)		(393)
Cash, cash equivalents and restricted cash, beginning of period		2,321		1,280
Cash, cash equivalents and restricted cash, end of period		1,929		887
Less: Restricted cash		11		3
Cash and cash equivalents, end of period		$     1,918		$        884

 

Otis Worldwide Corporation
Adjusted Free Cash Flow Reconciliation
		Quarter Ended March 31,
		(Unaudited)
(dollars in millions)		2025		2024
Net cash flows provided by operating activities (GAAP)		$           190		$           171
Capital expenditures		(34)		(31)
Free cash flow (Non-GAAP)		156		140
Adjustments for:
UpLift restructuring payments		11		7
UpLift transformation payments		19		8
Adjusted free cash flow (Non-GAAP)		$           186		$           155

 

Investor Relations Contact:		Media Contact:
Rob Quartaro		Katy Padgett
+1-860-676-6011		+1-860-674-3047
investorrelations@otis.com		kathleen.padgett@otis.com

 

View original content:https://www.prnewswire.com/news-releases/otis-reports-first-quarter-2025-results-302435758.html

SOURCE Otis Worldwide Corporation

FAQ

What caused OTIS stock's Q1 2025 earnings decline?

OTIS reported a 29% decline in GAAP EPS to $0.61 due to UpLift transformation costs, separation-related adjustments, and other non-recurring items.

How did OTIS Service segment perform in Q1 2025?

OTIS Service segment showed strong performance with 4% organic sales growth, revenue of $2.2 billion, and operating profit margin expansion of 40 bps to 24.6%.

What is OTIS's modernization orders growth in Q1 2025?

OTIS reported 12% growth in modernization orders, with backlog up 13% (14% at constant currency).

What is OTIS's revenue guidance for 2025?

OTIS expects net sales of $14.6-14.8 billion, representing 3-4% growth, with organic sales growth of 2-4%.

How much did OTIS spend on share repurchases in Q1 2025?

OTIS conducted share repurchases of approximately $250 million during Q1 2025.