In line / mixed
Organic growth accelerated to 6%, led by 9% Service and 24% modernization, while Service margin remained near 23.2%.
OTISIndustrialsIndustrial Machinery & Supplies & Components
Otis Worldwide
The deepest guidance cut of the cycle drove an initial drop, but low expectations and stronger organic growth limited the damage.
ResultIn line / mixedGuidanceLoweredEnvironmentmixed
Latest eventQ2 202622 Jul 2026Open full analysis
Latest quarter
The investment read-through
Lowered
Otis reduced 2026 EPS to $4.01–$4.05 and again relied on a roughly 150-basis-point half-on-half Service-margin improvement.
Acceleration
Otis reduced 2026 EPS to $4.01–$4.05 and again relied on a roughly 150-basis-point half-on-half Service-margin improvement.
Qualitative
The stock initially fell on the larger-than-expected cut, then recovered as trough valuation and stronger revenue reduced incremental downside.
Latest narrative
What the market is now debating
The debate is now binary: delayed margin recovery versus a structurally broken Service model.
Market environment deltaEnvironmentmixed
The deepest guidance cut of the cycle drove an initial drop, but low expectations and stronger organic growth limited the damage.
- Demand
- Service and modernization demand were healthy, but the earnings benefit remained weak.
- Supply
- Backlog and installed-base activity supported growth; cost and mix prevented normal margin conversion.
- Competition
- Ex-China retention and Service pricing became the competitive proof points for the 2027 algorithm.
Industry-specific KPIs
What this company should be judged on
Service organic growthMaintenance portfolioModernization ordersNew equipment ordersAdjusted margin
Latest KPI read-through
Otis reduced 2026 EPS to $4.01–$4.05 and again relied on a roughly 150-basis-point half-on-half Service-margin improvement.
[AS-ME-072]Eight-event history
Guidance and narrative timeline
8
22 Jul 2026
Q2 2026
GuidanceLoweredEnvironmentmixed
The deepest guidance cut of the cycle drove an initial drop, but low expectations and stronger organic growth limited the damage.
GuidanceOtis reduced 2026 EPS to $4.01–$4.05 and again relied on a roughly 150-basis-point half-on-half Service-margin improvement.NarrativeThe debate is now binary: delayed margin recovery versus a structurally broken Service model.
Q2 2026Full analysis→
7
22 Apr 2026
Q1 2026
GuidanceMixed / newly framedEnvironmentworsening
Revenue growth did not protect the stock when Service margin missed the level needed for the second-half plan.
GuidanceThe full-year framework remained dependent on a large second-half Service-margin recovery, with little evidence in the first quarter.NarrativeThe market stopped rewarding revenue growth unless it translated into Service margin.
Q1 2026Full analysis→
6
28 Jan 2026
Q4 / FY2025
GuidanceMixed / newly framedEnvironmentworsening
A below-consensus 2026 earnings framework confirmed that the recovery would be back-end loaded and margin constrained.
GuidanceInitial 2026 EPS, operating profit and cadence landed below the market's working assumptions, with meaningful improvement deferred to the second half.NarrativeThe narrative changed from temporary Service timing to a potentially lower margin plateau.
Q4 / FY2025Full analysis→
5
29 Oct 2025
Q3 2025
GuidanceRaisedEnvironmentimproving
Service and modernization reaccelerated, repairing part of the prior-quarter credibility gap.
GuidanceOtis raised EPS and improved the operating outlook, though investors still questioned the fourth-quarter bridge and Service-margin ceiling.NarrativeThe quarter restored growth credibility without fully restoring the margin algorithm.
Q3 2025Full analysis→
4
23 Jul 2025
Q2 2025
GuidanceSelective cutEnvironmentworsening
A broad organic-sales downgrade and further Service slippage converted a defensive compounder into a show-me story.
GuidanceOtis cut the organic sales outlook across several regions and reduced Service expectations again, while leaving $4.00–$4.10 EPS unchanged.NarrativeThe market began to treat the Service algorithm itself as the principal risk.
Q2 2025Full analysis→
3
23 Apr 2025
Q1 2025
GuidanceSelective cutEnvironmentworsening
The first crack in the Service flywheel mattered more than a headline earnings beat.
GuidanceThe annual EPS range stayed unchanged, but favorable currency concealed an underlying profit trim and the low end of Service growth was reduced.NarrativeThe debate shifted decisively from China equipment exposure to the durability of Service growth and margins.
Q1 2025Full analysis→
2
29 Jan 2025
Q4 / FY2024
GuidanceMixed / newly framedEnvironmentmixed
The first 2025 earnings guide screened below consensus, but investors treated most of the gap as foreign exchange.
GuidanceInitial 2025 EPS was roughly 2% below consensus, mainly because of currency; Service was expected to grow 6–7%.NarrativeThe premium thesis remained intact but became more dependent on Service delivering its guided spread over the portfolio.
Q4 / FY2024Full analysis→
1
30 Oct 2024
Q3 2024
GuidanceLoweredEnvironmentworsening
A modest earnings miss became more important when China forced cuts to sales, cash flow and the forward margin base.
GuidanceOtis lowered 2024 sales, earnings and free-cash-flow expectations, leaving a weaker starting point for 2025 New Equipment margins.NarrativeThe equity story became a Service-defense thesis against a shrinking China equipment pool.
Q3 2024Full analysis→