It has been about a month since the last earnings report for Otis Worldwide (OTIS Quick QuoteOTIS - Free Report) . Shares have lost about 9.9% in that time frame, underperforming the S&P 500.

But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Otis Worldwide due for a breakout? Well, first let's take a quick look at the latest earnings report in order to get a better handle on the recent drivers for Otis Worldwide Corporation before we dive into how investors and analysts have reacted as of late.

Otis Worldwide Q1 Earnings Fall Short of Estimates, Sales Beat

Otis Worldwide reported mixed first-quarter 2026 results, wherein earnings missed the Zacks Consensus Estimate and declined year over year. Meanwhile, net sales surpassed the same and increased from the prior year's reported figure.

Otis Worldwide’s first-quarter results reflected broad-based momentum in Service, led by repair activity, alongside solid order and backlog improvement in the modernization business. The company has emphasized actions around operational execution, pricing and cost efficiency as it works to monetize investments and improve margin performance in the coming quarters.

However, management attributed the margin pressure to tariff impacts relative to the prior year, continued Service investments that began in the second quarter of last year and accelerated this year, and shipment delays tied to geopolitical disruption in the Middle East.

Inside OTIS’ Q1 Headlines

OTIS reported earnings per share (EPS) of 89 cents, missing the Zacks Consensus Estimate of 91 cents by 2.2%. In the year-ago quarter, it reported an adjusted EPS of 92 cents.

Net sales of $3.57 billion surpassed the consensus mark of $3.5 billion by 2% and increased 6.4% on a year-over-year basis. Organically, net sales were up 1% year over year. Favorable foreign exchange movement supported sales growth by 5%. A standout in the quarter was repair, with net sales up 16% at actual currency and organic repair sales up about 10%.

Adjusted operating margin contracted 130 basis points year over year to 15.4%, reflecting weaker segment performance, partially offset by a favorable segment mix.

Segment Details of OTIS

Service: The net sales of this segment increased 11% year over year to $2.42 billion. A 5% rise in organic sales was accompanied by a 5% favorable foreign exchange movement. Organic maintenance and repair sales increased 4% and organic modernization sales rose 6% from the year-ago quarter. The Modernization backlog at constant currency increased 30% year over year.

Segment operating margin contracted 160 bps year over year to 23% due to higher volume and favorable pricing, which were more than offset by higher labor and material costs, investments and mix effects.

New Equipment: This segment’s net sales of $1.15 billion fell 1% from the prior-year period. Organic sales declined 5%. 

New Equipment orders rose 1% at constant currency, with more than 20% strength in the Americas and low single-digit growth in EMEA, partially offset by more than 20% decline in the Asia Pacific and a low teens decline in China. The segment’s backlog increased 6% at actual currency and 3% at constant currency, providing some support for future revenue conversion despite near-term delivery challenges.

Segment operating margin contracted 240 bps year over year to 3.3%. The downtrend was due to the impacts of lower volume, unfavorable price and mix, which was partially offset by productivity tailwinds.

Financial Position of OTIS

Otis Worldwide had cash and cash equivalents of $834 million as of March 31, 2026, down from $1.1 billion reported at 2025-end. Long-term debt decreased to $6.88 billion as of March 31, 2026, from $6.9 billion at the end of 2025.

Net cash flows provided by operating activities were $413 million as of March 31, 2026, up from $190 million a year ago.

Adjusted free cash flow totaled $272 million as of March 31, 2026, up from $186 million a year ago.

OTIS Revises 2026 Guidance

The company expects net sales in the range of $15.1-$15.3 billion (up from the prior outlook of $15-$15.3 billion), implying approximately 4.6-6% year-over-year growth. Organic sales growth is still projected in the low to mid-single-digit range.

Organic New Equipment sales are now expected to range from low single digits to flat (previously projected as flat to low single digits), while Organic Service sales are still anticipated to grow in the mid to high-single-digit range.

Adjusted operating profit is projected at $2.5 billion (down from the prior range of $2.5-$2.6 billion), now reflecting an increase of $20-$60 million at constant currency and $60-$100 million at actual currency.

Adjusted earnings are forecasted at $4.20-$4.24 per share, while adjusted free cash flow is expected to be between $1.6 billion and $1.65 billion (compared with the earlier outlook of $1.6-$1.7 billion).

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a upward trend in estimates review.

VGM Scores

At this time, Otis Worldwide has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Charting a somewhat similar path, the stock has a score of C on the value side, putting it in the middle 20% for value investors.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending upward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, Otis Worldwide has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.