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Otis shares fall after Q2 earnings and a second guidance cut

Otis reported net sales of $3.86 billion, up 7% year over year, while adjusted operating profit declined and its full-year profit outlook moved to a $45 million decline at the midpoint.

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Otis Worldwide shares fell more than 2% after the company reported Q2 2026 results and trimmed its profit outlook for the second straight quarter, despite beating expectations for adjusted EPS.

Otis posted adjusted EPS of $1.01. Net sales rose 7% year over year to $3.86 billion, with organic sales up 6%, while modernization orders increased 24% and backlog climbed 26% on a constant-currency basis. Management also highlighted that service, which represents 94% of segment operating profit, grew organic sales 9%.

The profit story weakened alongside margins, with adjusted operating profit dropping to $587 million from $612 million and adjusted operating margin contracting 180 basis points to 15.2%. MarketBeat Ratings attributes the pressure largely to new-equipment performance, including China new-equipment sales falling in the “high teens,” along with productivity investments that weighed on margins.

For the full year, Otis kept its net sales guidance at $15.1 billion to $15.3 billion, but revised its constant-currency adjusted operating profit to a decline of $45 million to $15 million versus prior expectations for growth. Management also maintained 2026 adjusted EPS guidance at $4.01 to $4.05, essentially flat versus 2025, citing labor and material cost inflation outpacing near-term pricing gains, alongside spending to support micro-pricing and productivity initiatives. Otis raised its dividend by 5% and repurchased about $400 million in stock during the quarter.

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