Otis Worldwide Corporation

Good morning and welcome to Otis's first quarter 2026 earnings conference call. This call is being carried live over the internet and recorded for replay. Presentation materials are available for download from Otis's website at www.otis.com. I'll now turn it over to Rob Cortero, Vice President of Investor Relations. Please go ahead.

Thank you, Krista. Welcome to Otis' first quarter 2026 earnings conference call. On the call with me today are Judy Marks, Chair, CEO, and President, and Christina Mendez, Executive Vice President and CFO. Please note, except where otherwise noted, the company will speak to results from continuing operations, excluding restructuring and significant non-recurring items. A reconciliation of these measures can be found in the appendix of the webcast. We also remind listeners that the presentation contains forward-looking statements, which are subject to risks and uncertainties. OTIS's SEC filings, including our Form 10-K and quarterly reports on Form 10-Q, provide details on important factors that could cause actual results to differ materially. Now, I'd like to turn it over to Judy.

Thank you, Rob. Good morning, afternoon, and evening, everyone. Thank you for joining us. We hope everyone listening is safe and well. Starting on slide three. Otis delivered a solid start to the year in orders and sales with continued demand momentum that provides visibility for future growth, especially in our service segment. Total organic sales increased 1% in the quarter, driven by organic service growth of 5%, with broad-based strength across all service lines of business. Maintenance and repair sales increased 4%, driven by an acceleration of organic repair sales, which increased approximately 10%. In modernization, we continue to see strong demand with orders up 11% in the quarter and the backlog up 30% at constant currency. This backlog provides improved visibility into the future and supports our view of modernization as a durable multi-year opportunity as the global install base continues to age. In new equipment, market conditions remain mixed, but we see encouraging signs of stabilization. Orders increased 1% at constant currency and 5% excluding China. Backlog increased 3% year-over-year at constant currency and was up 11% excluding China, giving us good momentum for the remainder of 2026 and beyond. While China continues to weigh on results, demand across the rest of the world remains positive, especially in the Americas, where orders grew more than 20% in the quarter for the seventh straight quarter of orders growth. Otis delivered another quarter of strong cash flow performance with adjusted free cash flow of approximately $272 million, up 46% versus the prior year. This reflects a ramp up in orders, improved working capital management, and continued focus on cash conversion. Yesterday, we announced a 5% increase to our quarterly dividend since SPIN, Our dividend has increased by approximately 120%, consistent with our disciplined approach to capital allocation and our commitment to returning cash to shareholders. During the quarter, we opportunistically completed approximately $400 million of share repurchases, reflecting our ongoing approach to capital deployment while maintaining flexibility to invest in the business and support long-term value creation. We recently announced a majority investment in WeMaintain, a digital and AI-enabled elevator service provider. We anticipate this transaction to contribute incremental growth as WeMaintain offers a compelling connected solution with a complement to Otis One for a multi-branded portfolio base. We're excited to welcome and support the WeMaintain team and integrated ecosystem and look forward to the long-term value creation opportunity. We're continuing to build our services capability to drive growth and margin. We will continue to invest in field and sales resources to support the service business. Lastly, we recently announced two new innovation offerings. The first is Otis Robust, a range of heavy-duty elevators designed for data centers and other mission-critical environments. I'll share more in a moment. Secondly, we also introduced Otis Viva Solutions, which supports safer and more accessible mobility for aging populations. Otis Viva Solutions focus on improving everyday usability and accessibility in elevators across both existing buildings via modernization and new installations. Turning to our orders performance on slide four. Combined new equipment and modernization orders increased 4% in the quarter, reflecting continued strength in the modernization business and new equipment orders returning to growth. The combined new equipment and modernization backlog increased 9% year over year, and our total backlog remains at historically high levels, approaching $20 billion, setting a solid foundation for future earnings visibility. New equipment orders increased 1% at constant currency in the quarter. We saw strong performance in North America, with orders up more than 20%, and low single-digit growth in EMEA, driven by the UK, Central Europe, and Western Europe. These gains were largely offset by a greater than 20% decline in Asia-Pacific due to a tough prior year comparison, as well as continued softness in China, where orders were down low teens. Modernization continued to perform well, with orders up 11% at constant currency, driven by North America and China, each up greater than 20%. This was partially offset by EMEA down high single digits and Asia Pacific down mid-teens, as both regions faced difficult comparisons for major projects in the prior year. Before moving to financial results, I'd like to mention several highlights from the first quarter. In France, Otis has been selected by Marseille Metropolitan Transport Authority to fully replace and maintain 51 escalators across 10 metro stations. The scope includes the installation of 35 escalators designed for standard heavy-duty metro use and 16 additional escalators engineered for the most demanding environments, featuring greater vertical rise and very high passenger volumes across one of France's busiest metro networks. In the Americas, Otis has been selected to supply 46 units to the Austin Convention Center redevelopment in Texas, including Skyrise and Gen 3 elevators, as well as public escalators. We view the expansion of the Austin Convention Center as part of a broader modernization opportunity across the U.S. Convention Center segment, where many facilities built 20 to 30 years ago are now being upgraded to meet today's capacity, accessibility, and performance requirements. In China, Otis will upgrade 46 elevators at the Runwen Community in Harbin City as part of a bond-funded residential renewal project, replacing all units with Gen 3 comfort elevators. This represents the first nationwide implementation of the Gen 3 comfort model since we launched it at the 8th China International Import Expo, aligning with the country's good housing standards. Built for residential modernization and elderly-friendly living, Gen 3 comfort elevators feature full-height mirrors to enhance spatial awareness, bright LED lighting to improve visibility and comfort, increased cab height for a more spacious and comfortable ride, and smart recognition cameras to detect and prevent safety hazards. The elevators are also equipped with a Regen energy regeneration system and Otis One IoT platform, delivering a safer, more comfortable, energy efficient, and connected travel experience for residents. And lastly, as I previously mentioned, we recently launched our OTIS robust range of elevators to serve data centers and other mission-critical environments, including hospitals and industrial buildings. OTIS robust is built for high-capacity, high-traffic applications that require durable, reliable around-the-clock operation, reflecting growing demand across infrastructure-driven markets. Engineered for heavy-duty performance, and accelerated project timelines, our robust solution demonstrates our commitment to product innovations that serve our customers' unique needs, including movement of high-value freight and passengers. Turning to our first quarter results on slide five, Otis delivered net sales of $3.6 billion with organic sales up 1%. Adjusted operating profit, excluding a $28 million foreign exchange tailwind, decreased by $38 million in the quarter. Adjusted operating profit margin declined 130 basis points to 15.4%. Adjusted EPS declined 3%, or 3 cents in the quarter, driven by operational performance, partially offset by favorable foreign exchange rates. With that, I'll turn it over to Christina to walk through our results in more detail.