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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________________________ 
FORM 8-K
____________________________________ 

CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 25, 2023
____________________________________ 
logo_otis (2).jpg
OTIS WORLDWIDE CORPORATION
(Exact name of registrant as specified in its charter)
____________________________________ 
Delaware001-3922183-3789412
(State or other jurisdiction
of incorporation)		(Commission
File Number)		(I.R.S. Employer
Identification No.)
One Carrier Place
Farmington, Connecticut 06032
(Address of principal executive offices, including zip code)
Registrant’s telephone number, including area code
(860) 674-3000
N/A
(Former name or former address, if changed since last report)
____________________________________ 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company   ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.   ¨





Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock ($0.01 par value)OTISNew York Stock Exchange
0.000% Notes due 2023OTIS/23New York Stock Exchange
0.318% Notes due 2026OTIS/26New York Stock Exchange
0.934% Notes due 2031OTIS/31New York Stock Exchange
Section 2—Financial Information
Item 2.02. Results of Operations and Financial Condition.
On October 25, 2023, Otis Worldwide Corporation (“Otis”) issued a press release announcing its third quarter 2023 results.
The press release issued October 25, 2023 is furnished herewith as Exhibit No. 99 to this Report, and shall not be deemed filed for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section and shall not be deemed to be incorporated by reference into any filing by Otis under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Section 9—Financial Statements and Exhibits
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
Number
Exhibit Description
104Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document.




SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

OTIS WORLDWIDE CORPORATION
(Registrant)
Date: October 25, 2023By:
/s/ ANURAG MAHESHWARI
Anurag Maheshwari
Executive Vice President & Chief Financial Officer



Exhibit 99

OTIS REPORTS THIRD QUARTER 2023 RESULTS

Delivers organic sales and margin growth. Achieves high-teens adjusted EPS growth driven by continued Service momentum. Raises full year organic sales and adjusted EPS outlook

•3Q Net sales up 5.4% and organic sales up 5.2% driven by Service net sales up 10.1% with organic sales up 8.4%; Maintenance portfolio units increased 4.2%
•3Q GAAP EPS up 18.2% and adjusted EPS up 18.8% with Service GAAP operating profit margin expansion of 80 basis points and adjusted Service operating profit margin expansion of 90 basis points
•3Q New Equipment orders down 10%; backlog up 3%, up 2% at constant currency
•3Q Mod orders up 13%, backlog up 17%, up 15% at constant currency
•3Q GAAP cash flow from operations of $306 million; free cash flow of $272 million
•Updated full-year outlook1 with organic sales up ~5.5%, adjusted EPS of ~$3.52 and free cash flow of ~$1.5 billion.

FARMINGTON, Conn., October 25, 2023 – Otis Worldwide Corporation (NYSE:OTIS) reported third quarter 2023 net sales of $3.5 billion with 5.2% organic growth. GAAP diluted earnings per share (EPS) of $0.91 was up 18.2% versus the prior year and adjusted EPS increased 18.8% to $0.95.

"Otis delivered strong results in the third quarter, highlighted by organic sales growth in both segments, 60 basis points of adjusted operating profit margin expansion and high-teens adjusted EPS growth," said Judy Marks, Chair, CEO & President. “Emphasizing the consistent performance of our Service-driven business model, this quarter marks the eleventh consecutive quarter of Service organic sales growth, the fourth of maintenance portfolio growth above 4% and the fifth of modernization orders growth above 10%. We head into the last quarter of 2023 from a position of strength, as our strategy has been resilient through macro volatility, giving us the confidence to once again raise our EPS guidance. We continue to demonstrate our ability to execute, deliver value for our shareholders, customers, and colleagues and meet the needs of passengers around the world."



Key Figures
($ millions, except per share amounts)Quarter Ended September 30,Nine Months Ended September 30,
20232022Y/YY/Y (CFX)20232022Y/YY/Y (CFX)
Net sales$3,523$3,3445.4 %4.8 %$10,589$10,2463.3 %5.4 %
Adjusted net sales$3,523$3,3265.9 %5.3 %$10,589$10,1404.4 %6.4 %
Organic sales growth5.2 %6.1 %
GAAP
Operating profit$571$529$42$1,664$1,542$122
Operating profit margin16.2 %15.8 %40 bps15.7 %15.0 %70 bps
Net income$376$32416.0 %$1,083$95613.3 %
Earnings per share$0.91$0.7718.2 %$2.60$2.2515.6 %
Adjusted non-GAAP comparison
Operating profit$595$543$52$47 $1,703$1,621$82$114 
Operating profit margin16.9 %16.3 %60 bps16.1 %16.0 %10 bps
Net income$395$33816.9 %$1,113$1,0278.4 %
Earnings per share$0.95$0.8018.8 %$2.68$2.4210.7 %

Third quarter net sales of $3.5 billion increased 5.4% versus the prior year with a 5.2% increase in organic sales and a 0.6% benefit from foreign exchange.

Third quarter GAAP operating profit of $571 million increased $42 million and adjusted operating profit of $595 million increased $52 million driven by Service. GAAP operating profit margin expanded 40 basis points to 16.2% and adjusted operating profit margin expanded 60 basis points to 16.9%, driven by favorable Service performance and segment mix, partially offset by headwinds in corporate costs.

GAAP EPS of $0.91 increased 18.2% compared to prior year and adjusted EPS of $0.95 increased 18.8% as strong operational performance, effective tax rate improvement, and a lower share count contributed to 15 cents of adjusted EPS growth.




New Equipment
Quarter Ended September 30,Nine Months Ended September 30,
($ millions)20232022Y/YY/Y (CFX)20232022Y/YY/Y (CFX)
Net sales$1,435$1,447(0.8)%0.1 %$4,346$4,403(1.3)%1.7 %
Adjusted net sales$1,435$1,4330.1 %1.1 %$4,346$4,3170.7 %3.7 %
Organic sales1.0 %3.6 %
GAAP
Operating profit$94$100$(6)$277$292$(15)
Operating profit margin6.6 %6.9 %(30) bps6.4 %6.6 %(20) bps
Adjusted non-GAAP comparison
Operating profit$104$103$1$10$292$309$(17)$6
Operating profit margin7.2 %7.2 %0 bps6.7 %7.2 %(50) bps

In the third quarter, net sales of $1.4 billion decreased 0.8% with a 1.0% increase in organic sales that was partially offset by a 0.9% headwind from foreign exchange driven by strong organic sales growth in all regions outside of China.

GAAP operating profit decreased $6 million to $94 million and adjusted operating profit increased $10 million at constant currency. In the quarter, favorable price, improved productivity, and commodity tailwinds were partially offset by unfavorable regional and product mix and SG&A expense. GAAP operating profit margin contracted 30 basis points to 6.6% and adjusted operating profit margin was flat at 7.2%.

New Equipment orders were down 10% at constant currency with growth in EMEA and Asia Pacific more than offset by the Americas and China. New equipment backlog grew low-single digits in the quarter.

Service
Quarter Ended September 30,Nine Months Ended September 30,
($ millions)20232022Y/YY/Y (CFX)20232022Y/YY/Y (CFX)
Net sales$2,088$1,89710.1 %8.3 %$6,243$5,8436.8 %8.1 %
Adjusted net sales$2,088$1,89310.3 %8.5 %$6,243$5,8237.2 %8.4 %
Organic sales8.4 %8.0 %
GAAP
Operating profit$507$446$61$1,475$1,328$147
Operating profit margin24.3 %23.5 %80 bps23.6 %22.7 %90 bps
Adjusted non-GAAP comparison
Operating profit$518$452$66$53$1,496$1,360$136$145
Operating profit margin24.8 %23.9 %90 bps24.0 %23.4 %60 bps



In the third quarter, net sales of $2.1 billion increased 10.1% with a 8.4% increase in organic sales and a 1.8% benefit from foreign exchange. Organically maintenance and repair sales increased 8.6% and modernization sales increased 7.6%.

GAAP operating profit of $507 million increased $61 million and adjusted operating profit of $518 million increased $53 million at constant currency due to higher volume, favorable pricing and productivity, which were partially offset by annual wage inflation and higher material costs. GAAP operating profit margin expanded 80 basis points and adjusted operating profit margin expanded 90 basis points to 24.8%.

Cash flow
Quarter Ended September 30,Nine Months Ended September 30,
($ millions)20232022Y/Y20232022Y/Y
Cash flow from operations$306 $239 $67$1,030 $1,096 $(66)
Free cash flow$272 $215 $57$934 $1,015 $(81)
Free cash flow conversion72 %66 %86 %106 %

Third quarter cash from operations of $306 million increased $67 million and free cash flow of $272 million increased $57 million versus prior year driven by net income, partially offset by higher capital expenditures.


2023 Outlook1
Otis is revising its full year outlook:
•Adjusted net sales of ~$14.1 billion, up ~4%
•Organic sales up ~5.5%
◦Organic New Equipment sales up ~3%
◦Organic Service sales up ~7.5%
•Adjusted operating profit of ~$2.265 billion, up ~$170 million at constant currency; up ~$140 million at actual currency
•Adjusted EPS of ~$3.52, up ~11%; adjusted effective tax rate of ~26.0%
•Free cash flow of ~$1.5 billion with conversion of ~105% of GAAP net income
•Share repurchases of $800 million

1Note: When we provide outlook for organic sales, adjusted operating profit, adjusted effective tax rate and 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 billion people a day and maintain approximately 2.2 million customer units worldwide, the industry's largest maintenance portfolio. Headquartered in Connecticut, USA, Otis is 69,000 people strong, including 41,000 field professionals, all committed to meeting 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, Facebook and Twitter @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.

Adjusted net sales, organic sales, adjusted selling, general and administrative (“SG&A”) expense, adjusted operating profit, adjusted net interest expense, adjusted net income, adjusted diluted earnings per share (“EPS”), adjusted effective tax rate, constant currency and free cash flow are non-GAAP financial measures.

Adjusted net sales represents net sales (a GAAP measure), excluding significant items of a non-recurring and/or nonoperational nature (“other significant items”).

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. 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 SG&A expense represents SG&A expense (a GAAP measure), excluding restructuring costs and other significant items.

Adjusted general corporate expenses and other represents general corporate expenses and other (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.

The 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.

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 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.



Management believes that adjusted net sales, organic sales, adjusted SG&A, adjusted general corporate expenses and other, adjusted operating profit, adjusted net interest expense, 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.

Additionally, 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 is a non-GAAP financial measure that 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.

When we provide our expectations for adjusted net sales, organic sales, adjusted operating profit, adjusted net interest expense, adjusted net income, adjusted effective tax rate, adjusted EPS and 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 actions, including UpLift, 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 (including COVID-19 and variants thereof), 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 other countries in which Otis and its businesses operate, including the effects of the ongoing conflict between Russia and Ukraine, the recent war in Israel and Gaza, and increased tensions between the U.S. and China, on general market conditions, commodity costs, global trade policies and related sanctions and export controls, and currency exchange rates in the near term and beyond; (3) challenges in the development, production, delivery, support, performance and realization of the anticipated benefits of advanced technologies and new products and services; (4) future levels of indebtedness, capital spending and research and development spending; (5) future availability of credit and factors that may affect such availability or costs, including credit market conditions and Otis’ capital structure; (6) the timing and scope of future repurchases of Otis’ common stock ("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; (7) fluctuations in prices and delays and disruption in delivery of materials and services from suppliers, whether as a result of COVID-19, the ongoing conflict between Russia and Ukraine or otherwise; (8) cost reduction or containment actions, restructuring costs and related savings and other consequences thereof, including with respect to UpLift; (9) new business and investment opportunities; (10) the outcome of legal proceedings, investigations and other contingencies; (11) pension plan assumptions and future contributions; (12) the impact of the negotiation of collective bargaining agreements and labor disputes and labor inflation in the markets in which Otis and its businesses operate globally; (13) the effect of changes in tax, environmental, regulatory (including among other things import/export) and other laws and regulations in the U.S. and other countries in which Otis and its businesses operate; (14) the ability of Otis to retain and hire key personnel; (15) 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; (16) the determination by the Internal Revenue Service 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 Raytheon Technologies Corporation (“RTX”); and (17) 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
September 30,
Nine Months Ended
September 30,
(Unaudited)(Unaudited)
(amounts in millions, except per share amounts)2023202220232022
Net Sales$3,523 $3,344 $10,589 $10,246 
Costs and Expenses:
Cost of products and services sold2,477 2,373 7,464 7,286 
Research and development36 37 107 112 
Selling, general and administrative452 417 1,386 1,315 
Total Costs and Expenses2,965 2,827 8,957 8,713 
Other income (expense), net13 12 32 9 
Operating profit571 529 1,664 1,542 
Non-service pension cost (benefit)— 1 1 2 
Interest expense (income), net39 35 109 107 
Net income before income taxes532 493 1,554 1,433 
Income tax expense137 143 400 382 
Net income395 350 1,154 1,051 
Less: Noncontrolling interest in subsidiaries' earnings19 26 71 95 
Net income attributable to Otis Worldwide Corporation$376 $324 $1,083 $956 
Earnings Per Share of Common Stock:
Basic$0.92 $0.77 $2.62 $2.27 
Diluted$0.91 $0.77 $2.60 $2.25 
Weighted Average Number of Shares Outstanding:
Basic shares410.8 418.5 412.6 421.3 
Diluted Shares413.7 421.2 415.8 424.3 





Otis Worldwide Corporation
Segment Net Sales and Operating Profit

Quarter Ended
September 30,
Quarter Ended
September 30,
(Unaudited)(Unaudited)
(dollars in millions)20232022
Reported AdjustedReportedAdjusted *
Net Sales
New Equipment$1,435 $1,435 $1,447 $1,433 
Service2,088 2,088 1,897 1,893 
Consolidated Net Sales$3,523 $3,523 $3,344 $3,326 
Operating Profit
New Equipment$94 $104 $100 $103 
Service507 518 446 452 
Segment Operating Profit601 622 546 555 
General corporate expenses and other(30)(27)(17)(12)
Consolidated Operating Profit$571 $595 $529 $543 
Segment Operating Profit Margin
New Equipment6.6 %7.2 %6.9 %7.2 %
Service24.3 %24.8 %23.5 %23.9 %
Total Operating Profit Margin16.2 %16.9 %15.8 %16.3 %

Nine Months Ended
September 30,
Nine Months Ended
September 30,
(Unaudited)(Unaudited)
(dollars in millions)20232022
ReportedAdjustedReportedAdjusted
Net Sales
New Equipment$4,346 $4,346 $4,403 $4,317 
Service6,243 6,243 5,843 5,823 
Consolidated Net Sales$10,589 $10,589 $10,246 $10,140 
Operating Profit
New Equipment$277 $292 $292 $309 
Service1,475 1,496 1,328 1,360 
Segment Operating Profit1,752 1,788 1,620 1,669 
General corporate expenses and other(88)(85)(78)(48)
Consolidated Operating Profit$1,664 $1,703 $1,542 $1,621 
Segment Operating Profit Margin
New Equipment6.4 %6.7 %6.6 %7.2 %
Service23.6 %24.0 %22.7 %23.4 %
Total Operating Profit Margin15.7 %16.1 %15.0 %16.0 %





Otis Worldwide Corporation
Reconciliation of Reported (GAAP) to Adjusted Operating Profit & Operating Profit Margin
Quarter Ended
September 30,
Nine Months Ended
September 30,
(Unaudited)(Unaudited)
(dollars in millions)2023
2022
2023
2022
New Equipment
GAAP Net sales$1,435 $1,447 $4,346 $4,403 
Russia sales— (14)— (86)
Adjusted New Equipment Sales$1,435 $1,433 $4,346 $4,317 
GAAP Operating profit$94 $100 277 292 
Restructuring10 2 15 18 
Russia operations— (1)— (3)
Russia conflict-related charges— 2 — 2 
Adjusted New Equipment Operating Profit$104 $103 $292 $309 
Reported New Equipment Operating Profit Margin6.6 %6.9 %6.4 %6.6 %
Adjusted New Equipment Operating Profit Margin7.2 %7.2 %6.7 %7.2 %
Service
GAAP Net sales$2,088 $1,897 $6,243 $5,843 
Russia sales— (4)— (20)
Adjusted Service Sales$2,088 $1,893 $6,243 $5,823 
GAAP Operating profit$507 $446 $1,475 $1,328 
Restructuring11 4 21 27 
Russia operations— 1 — 4 
Russia conflict-related charges— 1 — 1 
Adjusted Service Operating Profit$518 $452 $1,496 $1,360 
Reported Service Operating Profit Margin24.3 %23.5 %23.6 %22.7 %
Adjusted Service Operating Profit Margin24.8 %23.9 %24.0 %23.4 %
General Corporate Expenses and Other
GAAP General corporate expenses and other$(30)$(17)$(88)$(78)
Transformation costs4 — 4 — 
Russia other expense (income)— (2)— 4 
Russia sale and conflict-related charges— 7 — 25 
Other, net(1)— (1)1 
Adjusted General corporate expenses and other$(27)$(12)$(85)$(48)
Total Otis
GAAP Operating profit$571 $529 $1,664 $1,542 
Restructuring21 6 36 45 
Transformation costs4 — 4 — 
Russia operations— (2)— 5 
Russia sale and conflict-related charges— 10 — 28 
Other, net(1)— (1)1 
Adjusted Total Operating Profit$595 $543 $1,703 $1,621 
Reported Total Operating Profit Margin16.2 %15.8 %15.7 %15.0 %
Adjusted Total Operating Profit Margin16.9 %16.3 %16.1 %16.0 %



Otis Worldwide Corporation
Reconciliation of Reported (GAAP) to Adjusted (Non-GAAP) Net Income, Earnings Per Share, and Effective Tax Rate

Quarter Ended
September 30,
Nine Months Ended
September 30,
(Unaudited)(Unaudited)
(dollars in millions, except per share amounts)2023
2022
2023
2022
Adjusted Operating Profit$595 $543 $1,703 $1,621 
Non-service pension cost (benefit)— 1 1 2 
Net interest expense 1
39 35 109 103 
Adjusted income from operations before income taxes556 507 1,593 1,516 
Income tax expense137 143 400 382 
Tax impact on restructuring and non-recurring items5 (1)9 10 
Non-recurring tax items— 1 — 2 
Adjusted net income from operations 414 364 1,184 1,122 
Noncontrolling interest19 26 71 95 
Adjusted net income attributable to Otis Worldwide Corporation$395 $338 $1,113 $1,027 
GAAP net income attributable to common shareholders$376 $324 $1,083 $956 
Restructuring21 6 36 45 
Transformation costs4 — 4 — 
Zardoya Otis Tender Offer finance costs 1
— — — 5 
Russia operations— (2)— 4 
Russia sale and conflict-related charges— 10 — 28 
Other, net(1)— (1)1 
Tax effects of restructuring, non-recurring items and other adjustments(5)1 (9)(10)
Non-recurring tax items— (1)— (2)
Adjusted net income attributable to common shareholders$395 $338 $1,113 $1,027 
Diluted Earnings Per Share$0.91 $0.77 $2.60 $2.25 
  Impact to diluted earnings per share0.04 0.03 0.08 0.17 
Adjusted Diluted Earnings Per Share$0.95 $0.80 $2.68 $2.42 
Effective Tax Rate25.8 %29.0 %25.7 %26.7 %
  Impact of adjustments on effective tax rate(0.3)%(0.8)%— %(0.7)%
Adjusted Effective Tax Rate25.5 %28.2 %25.7 %26.0 %

1 Otis incurred interest costs associated with financing the Zardoya Otis Tender Offer. Net interest expense for the nine months ended September 30, 2022 is reflected as adjusted without those costs.



Otis Worldwide Corporation
Components of Changes in Net Sales

Quarter Ended September 30, 2023 Compared with Quarter Ended September 30, 2022
Factors Contributing to Total % Change in Net Sales
OrganicFX
Translation		Acquisitions /
Divestitures, net and Other		Total
New Equipment1.0%(0.9)%(0.9)%(0.8)%
Service8.4%1.8%(0.1)%10.1%
Maintenance and Repair8.6%2.0%(0.2)%10.4%
Modernization7.6%0.9%0.3%8.8%
Total Net Sales5.2%0.6%(0.4)%5.4%
Nine Months Ended September 30, 2023 Compared with Nine Months Ended September 30, 2022
Factors Contributing to Total % Change in Net Sales
OrganicFX
Translation		Acquisitions /
Divestitures, net and Other		Total
New Equipment3.6%(3.0)%(1.9)%(1.3)%
Service8.0%(1.3)%0.1%6.8%
Maintenance and Repair8.2%(1.2)%—%7.0%
Modernization7.3%(1.7)%0.7%6.3%
Total Net Sales6.1%(2.1)%(0.7)%3.3%


Components of Changes in New Equipment Backlog
September 30, 2023
Y/Y Growth %
New Equipment Backlog increase at actual currency3%
Foreign exchange impact to New Equipment Backlog(1)%
New Equipment Backlog increase at constant currency2%


Components of Changes in Modernization Backlog
September 30, 2023
Y/Y Growth %
Modernization Backlog increase at actual currency17%
Foreign exchange impact to Modernization Backlog(2)%
Modernization Backlog increase at constant currency15%



Otis Worldwide Corporation
Reconciliation of Adjusted Operating Profit at Constant Currency

Quarter Ended September 30, 2023 Compared with Quarter Ended September 30, 2022
(dollars in millions)2023
2022
Y/Y
New Equipment
Adjusted Operating Profit$104 $103 $1 
Impact of foreign exchange9 9 
Adjusted Operating Profit at constant currency$113 $103 $10 
Service
Adjusted Operating Profit$518 $452 $66 
Impact of foreign exchange(13)(13)
Adjusted Operating Profit at constant currency$505 $452 $53 
Otis Consolidated
Adjusted Operating Profit$595 $543 $52 
Impact of foreign exchange(5)(5)
Adjusted Operating Profit at constant currency$590 $543 $47 
Nine Months Ended September 30, 2023 Compared with Nine Months Ended September 30, 2022
(dollars in millions)20232022Y/Y
New Equipment
Adjusted Operating Profit$292 $309 $(17)
Impact of foreign exchange23 23 
Adjusted Operating Profit at constant currency$315 $309 $6 
Service
Adjusted Operating Profit$1,496 $1,360 $136 
Impact of foreign exchange9 9 
Adjusted Operating Profit at constant currency$1,505 $1,360 $145 
Otis Consolidated
Adjusted Operating Profit$1,703 $1,621 $82 
Impact of foreign exchange32 32 
Adjusted Operating Profit at constant currency$1,735 $1,621 $114 



Otis Worldwide Corporation
Condensed Consolidated Balance Sheet

September 30, 2023December 31, 2022
(amounts in millions)(Unaudited)
Assets
Cash and cash equivalents$1,636 $1,189 
Accounts receivable, net 3,455 3,357 
Contract assets733 664 
Inventories624 617 
Other current assets301 316 
Total Current Assets6,749 6,143 
Future income tax benefits290 285 
Fixed assets, net708 719 
Operating lease right-of-use assets417 449 
Intangible assets, net336 369 
Goodwill1,547 1,567 
Other assets343 287 
Total Assets$10,390 $9,819 
Liabilities and Equity (Deficit)
Short-term borrowings and current portion of long-term debt$585 $670 
Accounts payable1,655 1,717 
Accrued liabilities1,725 1,794 
Contract liabilities2,784 2,662 
Total Current Liabilities6,749 6,843 
Long-term debt6,822 6,098 
Future pension and postretirement benefit obligations390 392 
Operating lease liabilities293 315 
Future income tax obligations 258 279 
Other long-term liabilities488 556 
Total Liabilities15,000 14,483 
Redeemable noncontrolling interest123 135 
Shareholders' Equity (Deficit):
Common Stock and additional paid-in capital198 162 
Treasury Stock(2,155)(1,575)
Accumulated deficit(2,183)(2,865)
Accumulated other comprehensive income (loss)(648)(592)
Total Shareholders' Equity (Deficit)(4,788)(4,870)
Noncontrolling interest55 71 
Total Equity (Deficit)(4,733)(4,799)
Total Liabilities and Equity (Deficit)$10,390 $9,819 




Otis Worldwide Corporation
Condensed Consolidated Statement of Cash Flows
Quarter Ended
September 30,
Nine Months Ended
September 30,
(Unaudited)(Unaudited)
(dollars in millions)2023202220232022
Operating Activities:
Net income from operations$395 $350 $1,154 $1,051 
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortization46 48 145 145 
Deferred income tax expense (benefit)(18)— (34)6 
Stock compensation cost15 13 49 41 
Change in:
Accounts receivable, net(10)(67)(214)(171)
Contract assets and liabilities, current(86)9 68 143 
Inventories13 (41)(8)(80)
Other current assets34 (14)(4)(14)
Accounts payable(78)2 (35)137 
Accrued liabilities19 (26)(66)(166)
Pension contributions (8)(7)(32)(28)
Other operating activities, net(16)(28)7 32 
Net cash flows provided by (used in) operating activities306 239 1,030 1,096 
Investing Activities:
Capital expenditures(34)(24)(96)(81)
Acquisitions of businesses and intangible assets, net of cash(7)(10)(27)(38)
Dispositions of businesses, net of cash— 61 — 61 
Proceeds from sale of (investments in) marketable securities, net(2)— (2)(7)
Other investing activities, net2 45 (7)127 
Net cash flows provided by (used in) investing activities(41)72 (132)62 
Financing Activities:
Increase (decrease) in short-term borrowings, net(147)23 (90)80 
Issuance of long-term debt, net747 — 747 — 
Payment of debt issuance costs(6)— (6)— 
Repayment of long-term debt— — — (500)
Dividends paid on Common Stock(139)(121)(400)(345)
Repurchases of Common Stock(225)(300)(575)(700)
Dividends paid to noncontrolling interest(61)(66)(76)(107)
Acquisition of Zardoya Otis shares— — — (1,802)
Other financing activities, net(2)(1)(18)(28)
Net cash flows provided by (used in) financing activities167 (465)(418)(3,402)
Summary of Activity:
Net cash provided by operating activities306 239 1,030 1,096 
Net cash provided by (used in) investing activities(41)72 (132)62 
Net cash provided by (used in) financing activities167 (465)(418)(3,402)
Effect of exchange rate changes on cash and cash equivalents(18)(69)(34)(191)
Net increase (decrease) in cash, cash equivalents and restricted cash414 (223)446 (2,435)
Cash, cash equivalents and restricted cash, beginning of period1,227 1,265 1,195 3,477 
Cash, cash equivalents and restricted cash, end of period1,641 1,042 1,641 1,042 
Less: Restricted cash5 8 5 8 
Cash and cash equivalents, end of period$1,636 $1,034 $1,636 $1,034 



Otis Worldwide Corporation
Free Cash Flow Reconciliation

Quarter Ended September 30,
(Unaudited)
(dollars in millions)
20232022
Net income attributable to common shareholders$376 $324 
Net cash flows provided by operating activities$306 $239 
Net cash flows provided by operating activities as a percentage of net income attributable to common shareholders81 %74 %
Capital expenditures(34)(24)
Capital expenditures as a percentage of net income attributable to common shareholders(9)%(7)%
Free cash flow $272 $215 
Free cash flow as a percentage of net income attributable
to common shareholders		72 %66 %
Nine Months Ended September 30,
(Unaudited)
(dollars in millions)20232022
Net income attributable to common shareholders$1,083 $956 
Net cash flows provided by operating activities$1,030 $1,096 
Net cash flows provided by operating activities as a percentage of net income attributable to common shareholders95 %115 %
Capital expenditures(96)(81)
Capital expenditures as a percentage of net income attributable to common shareholders(9)%(8)%
Free cash flow $934 $1,015 
Free cash flow as a percentage of net income attributable to common shareholders86 %106 %




v3.23.3
Cover
Oct. 25, 2023
Document Information [Line Items]  
Document Type 8-K
Document Period End Date Oct. 25, 2023
Entity Registrant Name OTIS WORLDWIDE CORPORATION
Entity Central Index Key 0001781335
Amendment Flag false
Entity Incorporation, State or Country Code DE
Entity File Number 001-39221
Entity Tax Identification Number 83-3789412
Entity Address, Address Line One One Carrier Place
Entity Address, City or Town Farmington
Entity Address, State or Province CT
Entity Address, Postal Zip Code 06032
City Area Code 860
Local Phone Number 674-3000
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company false
Common Stock  
Document Information [Line Items]  
Title of 12(b) Security Common Stock ($0.01 par value)
Trading Symbol OTIS
Security Exchange Name NYSE
0.000% Notes Due 2023  
Document Information [Line Items]  
Title of 12(b) Security 0.000% Notes due 2023
Trading Symbol OTIS/23
Security Exchange Name NYSE
.0318% Notes Due 2026  
Document Information [Line Items]  
Title of 12(b) Security 0.318% Notes due 2026
Trading Symbol OTIS/26
Security Exchange Name NYSE
0.934% Notes Due 2031  
Document Information [Line Items]  
Title of 12(b) Security 0.934% Notes due 2031
Trading Symbol OTIS/31
Security Exchange Name NYSE
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