Otis CEO on AI, Robotics, and Economic Vigor, Even as Stock Dips on Outlook

NEW YORK – In a market captivated by high-flying tech stocks, the insights of a 170-year-old elevator manufacturer might seem anachronistic. Yet, Otis Worldwide (OTIS), a bellwether for global construction and commercial real estate, offers a unique and grounded perspective on the very trends driving the modern economy—from the AI infrastructure boom to the future of robotics.

While the company's latest earnings report Wednesday sent its stock down, a conversation with CEO Judy Marks reveals a strategic vision focused on long-term technological and demographic tailwinds, suggesting the firm is building a foundation for growth far beyond the next fiscal quarter.

The Financial Picture: A Tale of Two Segments

Otis reported its fourth-quarter results, presenting a mixed but telling snapshot of its global operations. The numbers highlight a crucial dynamic: the steady, high-margin service business is currently propping up a softer market for new equipment.

• Headline Numbers: The company posted Q4 sales of $3.44 billion, a 3% increase year-over-year, with adjusted earnings per share rising 11% to $0.80, meeting analyst expectations.

• The Engine Room: Otis's Services segment, which handles the maintenance, repair, and modernization of existing elevators, was the clear standout. Sales in this division grew by a robust 8%, while its operating margins expanded impressively to 25.5% from 24.5% a year prior. This indicates strong recurring revenue and pricing power, as building owners continue to invest in the upkeep of their assets.

Despite the solid bottom-line performance, shares of Otis fell approximately 4% following the announcement. The market's caution appeared rooted in two key areas.

Why Wall Street Paused

The forward-looking guidance and weakness in the new equipment division tempered investor enthusiasm.

• New Equipment Headwinds: Sales and operating margins both declined in the New Equipment segment. This reflects ongoing challenges in key markets, particularly China's property sector, and a broader slowdown in global new construction projects.

• Tepid 2026 Outlook: The company's long-term guidance, projecting 2026 sales between $15 billion and $15.3 billion, was largely in line with the analyst consensus of $15.26 billion. However, its forecast for mid-to-high single-digit percentage EPS growth fell short of the more aggressive 9.6% average estimate, suggesting a more moderate growth trajectory than some investors had hoped for.

The View from the Top: A CEO's Macro Perspective

At the helm of Otis since its 2020 spin-off from the former United Technologies is Judy Marks. An industrial sector veteran who also serves on the board of construction and mining giant Caterpillar (CAT), Marks possesses a rare, dual vantage point on both vertical and horizontal construction, giving her a ground-level view of global economic activity.

In an interview, Marks detailed how Otis is navigating the current environment while positioning itself at the intersection of major secular trends.

On Robotics and the Future of Maintenance

Otis is actively moving from a reactive to a predictive maintenance model, with robotics and AI at the core of this transformation.

• Automated Inspections: Marks revealed that Otis is already testing a sophisticated, dog-like robot, reminiscent of those from Boston Dynamics, to perform unmanned elevator inspections. "It's working in an airport in China right now," she explained. "Overnight, it's inspecting all the doors and everything to make sure everything is in alignment. And if it's not working, the mechanic knows that's where I start tomorrow morning."

• The Smart Building Ecosystem: The vision extends beyond simple inspections. Marks emphasized the importance of interoperability, ensuring that all types of robots—from inspection drones to service droids in hospitals and hotels—can seamlessly interact with Otis elevators. "We're working already to make sure all robots can interface with all of our products and ride the elevators and call them without having to touch the buttons," she said. "That's why it's an exciting time." This positions Otis not just as a hardware provider, but as a key enabler of the automated buildings of the future.

The Hidden AI Boom Beneficiary

While not a direct technology player, Otis is a crucial downstream beneficiary of the artificial intelligence capital expenditure boom.

• The Data Center Connection: The exponential growth of AI requires a massive build-out of data centers. These are no longer simple warehouses but complex, multi-story industrial facilities that require heavy-duty, reliable elevators to move servers and other critical equipment.

• A New Growth Driver: This specialized construction creates a significant, high-value demand stream for Otis's New Equipment segment. While the broader construction market may be soft, the targeted boom in AI infrastructure provides a powerful, long-term tailwind.

Solving the Skilled Labor Puzzle

In an era where finding skilled technical talent is a major corporate challenge, Otis has developed a robust and successful pipeline for its highly specialized mechanic workforce.

• A Modern Apprenticeship: Marks detailed the company's partnership with the elevator union in the United States, which includes a four-year apprenticeship program. "We recruit as they're in their high schools," she noted. "They work for us during the day and get paid as a helper. They go to school at night, but they come out with a great career, no debt."

• Oversubscribed Demand: The program's success is a testament to its value proposition. "When these positions open in any city, they are oversubscribed for people who want to get a slot," Marks stated. This proactive approach to talent development insulates the company from the labor shortages plaguing other industries and ensures it has the skilled workforce needed to service its growing installed base.

The Bottom Line

For investors, Otis presents a compelling duality. The near-term stock performance reflects legitimate concerns about its New Equipment segment and a conservative long-term outlook. The health of the global construction cycle, especially in China, remains a significant variable.

However, looking beyond the immediate horizon, the strategic initiatives detailed by CEO Judy Marks paint a different picture. The company is embedding itself deeply into the growth narratives of automation, AI infrastructure, and the longevity economy. By innovating with robotics, capitalizing on the data center boom, and solving its own skilled labor challenges, Otis is laying the groundwork to ensure its elevators continue to lift not just people, but the very technologies shaping the 21st-century economy. The key challenge will be convincing the market that these future tailwinds can more than compensate for today's cyclical headwinds.