The primary focus of Otis Worldwide Corporation (OTIS) has been seeking innovation opportunities and making strategic investments in them to foster its growth. Keeping up with this focal aspect, the Thailand subsidiary of Otis has recently disclosed its Gen3-connected elevator platform in Bangkok. Appealing Aspects of the Gen3 Elevator Built upon the breakthrough designs of the Gen2 family of elevators, this new addition houses the Otis ONE IoT digital platform, thus enabling it to proactively communicate b ...

I I F ■ F Matteo Colombo Investment thesis Otis Worldwide Corporation (NYSE:OTIS) is in the elevator and escalator business. It manufactures, installs and services lifts. The company's operations are organized into 2 segments: 1) new equipment and 2) service. OTIS was spun off from United Technologies in 2020 and is now a pure-play on elevators and escalators. For the deal, UTX shareholders received 0.5 shares of Otis for every UTX share owned. The New Equipment segment focuses on manufacturing + installing ...

Otis is the world's leading elevator and escalator manufacturing, installation and service company. We move 2.3 billion people a day and maintain approximately 2.3 million customer units worldwide, the industry's largest Service portfolio. Headquartered in Connecticut, USA, Otis is 71,000 people strong, including 42,000 field professionals, all committed to meeting the diverse needs of our customers and passengers in more than 200 countries and territories worldwide. To learn more, visit www.otis.com and fo ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ____________________________________ FORM 10-Q ____________________________________ ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-39221 ____________________________________ OTIS ...

2024 Q2/H1 Interim Results OTIS o 2004 H1 2024 segment net sales results New Equipment Service Otis YN Y/Y (7.2%) (8.4%) 5.874 OTIS @ 2004 of I W Outlook – 2H 2024 and beyond Industry & 2024 outlook Looking beyond 2024, during the Otis Investor Day held in February this year, Otis provided some guidance on their views of the market through 2028. Focusing first on the New Equipment section, they expect growth to be roughly flat through 2028, with unit growth around 0.8% annually. While Otis can see some upsi ...

However, quarterly net sales missed the consensus mark and declined on a year-over-year basis. Thanks to the continuous strength of its modernization strategy, the company witnessed order growth of more than 10% for eight consecutive quarters, leading to mid-teens backlog growth. Shares of this elevator and escalator manufacturing company lost 3.8% in the pre-market trading session on Jul 24. The company reported quarterly earnings of $1.06 per share, which surpassed the Zacks Consensus Estimate of $1.03 by ...

Financial Data and Key Metrics Changes - The company generated $353 million in free cash flow in Q2 2024, despite lower New Equipment orders, and expects to largely reverse the working capital build by year-end [11] - Adjusted EPS grew approximately 15% or $0.14 in the quarter, driven by strong operational performance and improvement in the tax rate [118] - Overall adjusted operating profit margin expanded by 110 basis points, with a focus on cost control and productivity improvements [10][110] Business Line Data and Key Metrics Changes - Service organic sales grew mid-single digits, with a 4.2% growth in the maintenance portfolio and a 17% increase in modernization backlog [7][26] - New Equipment orders were down 11% in Q2, with a mid-teens decline in the Americas and a double-digit decline in China, offset by high-single digit growth in EMEA and low to mid-single digit growth in Asia-Pacific [8][9] - Service operating profit increased to $538 million, marking a $51 million increase at constant currency, leading to margin expansion of 110 basis points [10] Market Data and Key Metrics Changes - The Americas and EMEA experienced low-single digit growth, while Asia-Pacific grew approximately 10%, driven by strong performances in Southeast Asia and India [9] - The New Equipment backlog at constant currency was down 3% year-over-year, with significant weakness in China impacting overall performance [116] - The company anticipates a decline in New Equipment sales in China of approximately 20% for the year, reflecting ongoing market challenges [31][140] Company Strategy and Development Direction - The company is focused on growing its Service segment, which is seen as the primary growth driver, while also ramping up modernization efforts [7][12] - A strategic imperative was added to enhance modernization efforts, aiming to improve MOD margins to at least double digits [41] - The company is committed to maintaining profitability in a competitive environment, particularly in China, by balancing price and volume [127][148] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to navigate macroeconomic challenges, particularly in China, while focusing on service growth and cost management [13][127] - The company expects to achieve approximately 10% EPS growth for the full year, aligning with medium-term guidance [13][141] - Management noted that while New Equipment markets remain under pressure, the service market continues to show strength, with expectations for mid-single digit growth in 2024 [121] Other Important Information - The company generated $300 million of working capital in the first half of the year, primarily due to the growth in the Service business [2][60] - The company has made significant progress in its Project Uplift initiative, anticipating run rate savings of $175 million by mid-2025 [122] - The company is actively pursuing modernization opportunities, particularly in infrastructure projects, which are expected to yield longer service commitments [53][136] Q&A Session Summary Question: What is the outlook for the New Equipment market in China? - Management indicated that the New Equipment market in China remains challenging, with expectations for a decline of 10% to 15% for the year [146] Question: How is the company managing pricing pressures in China? - The company is experiencing pricing challenges in China, with prices down approximately 10%, but is managing costs effectively in a deflationary environment [102][148] Question: What are the expectations for service growth in China? - Management expressed confidence in continued service growth in China, with a focus on improving conversion rates and capturing non-Otis units [103][127]

| --- | --- | --- | --- | --- | |-------|-------|--------------------|--------------------|-------| | | | | | | | | | Q2 July 24, 2024 | 2024 Earnings Call | | | | | | | | | | | | | | | --- | --- ...

The reported revenue represents a surprise of -3.50% over the Zacks Consensus Estimate of $3.73 billion. With the consensus EPS estimate being $1.03, the EPS surprise was +2.91%. As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately. View all Key Company Metrics for Otis Worldwide here>>> Otis Worldwide (OTIS) reported $3.6 billion in revenue for the quarter ended Jun ...

The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Ahead of this earnings release, the estimate revisions trend for Otis Worldwide: mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected ...