v3.25.2
Segment Financial Data
 6 Months Ended
Jun. 30, 2025
Segment Reporting [Abstract]  
Segment Financial Data Segment Financial Data
Our operations are classified into two operating segments: New Equipment and Service. Through the New Equipment segment, we design, manufacture, sell and install a wide range of passenger and freight elevators as well as escalators and moving walkways to customers in the residential, commercial and infrastructure projects. The Service segment provides maintenance and repair services for both our products and those of other manufacturers, and provides modernization services to upgrade elevators and escalators. The operating segments are generally based on the management structure of the Company, as well as how management allocates resources, assesses performance and makes strategic and operational decisions.

Segment Information. Otis discloses segment operating profit as its measure of segment performance, reconciled to Net income before income taxes. Segment operating profit excludes certain expenses and income that are not allocated to segments (as described below in "Corporate and Unallocated").

Otis' Chief Operating Decision Maker ("CODM"), is the Company's Chief Executive Officer. The CODM assesses the performance of each operating segment and allocates resources to those segments based on net sales and segment operating profit. The CODM compares segment operating profit results to prior periods and forecasted amounts to assess performance and to make decisions regarding the allocation of capital and other investments. The discrete asset information for each segment is not presented to, or reviewed by, the CODM.
Segment information for the quarters ended June 30, 2025 and 2024 is as follows:

Quarter Ended June 30, 2025Quarter Ended June 30, 2024
(dollars in millions)New EquipmentServiceTotalNew EquipmentServiceTotal
Net sales$1,276 $2,319 $3,595 $1,421 $2,180 $3,601 
Costs and expenses:
Cost of sales1,061 1,440 2,501 1,164 1,352 2,516 
Selling, general and administrative119 292 411 122 283 405 
Other including research and development28 9 37 25 7 32 
Total segment operating profit$68 $578 646 $110 $538 648 
Corporate and Unallocated
General corporate expenses and other34 35 
UpLift restructuring25 6 
Other restructuring12 5 
UpLift transformation costs18 15 
Separation-related adjustments9 (1)
Litigation-related settlement costs— 18 
Other, net1 — 
Total company operating profit547 570 
Non-service pension cost (benefit)— (1)
Interest expense (income), net26 27 
Net income before income taxes$521 $544 
Segment information for the six months ended June 30, 2025 and 2024 is as follows:

Six Months Ended June 30, 2025Six Months Ended June 30, 2024
(dollars in millions)New EquipmentServiceTotalNew EquipmentServiceTotal
Net sales$2,439 $4,506 $6,945 $2,701 $4,337 $7,038 
Costs and expenses:
Cost of sales2,023 2,803 4,826 2,229 2,691 4,920 
Selling, general and administrative229 574 803 243 574 817 
Other including research and development53 14 67 48 11 59 
Total segment operating profit$134 $1,115 1,249 $181 $1,061 1,242 
Corporate and Unallocated
General corporate expenses and other77 68 
UpLift restructuring45 7 
Other restructuring35 24 
UpLift transformation costs41 27 
Separation-related adjustments61 (16)
Litigation-related settlement costs21 18 
Held for sale impairment10 — 
Other, net1 — 
Total company operating profit958 1,114 
Non-service pension cost (benefit)— (1)
Interest expense (income), net71 71 
Net income before income taxes$887 $1,044 

Corporate and Unallocated includes adjustments related to the Separation, litigation-related settlement costs, impairment loss related to net assets held for sale, restructuring costs and UpLift transformation costs.

Separation-related adjustments, represent net adjustments of amounts due to and from RTX in accordance with the TMA. Separation-related adjustments in 2025 includes amounts due to RTX related to a favorable ruling received in August 2024 regarding the German tax litigation. Separation-related adjustments in 2024 include a reduction of our contractual indemnity obligation payable to RTX that resulted from the TMA and receipts from RTX in accordance with the TMA. These adjustments are recorded in Other income (expense), net in our Condensed Consolidated Statements of Operations during the quarters and six months ended June 30, 2025 and 2024, respectively. See Note 11, "Income Taxes" and Note 16, "Contingent Liabilities" for additional information about the German tax litigation.

Litigation-related settlement costs in the six months ended June 30, 2025 and 2024 represent the aggregate amount of settlement costs and increase in loss contingency accruals, excluding legal costs, for certain legal matters that are outside of the ordinary course of business due to the size, complexity and/or unique facts of these matters.

Impairment loss related to net assets held for sale is recorded in Other income (expense), net in the Condensed Consolidated Statements of Operations in the six months ended June 30, 2025. See Note 6, "Business Acquisitions, Dispositions, Goodwill and Intangible Assets" for additional information about the held for sale assets and liabilities.

Refer to Note 12, "Restructuring and Transformation Costs" for more information about restructuring and UpLift transformation costs.