HELSINKI, April 29 (Xinhua) -- Finnish elevator and escalator manufacturer KONE Corporation reported higher sales and improved profitability in the first quarter of 2026, driven by growth in its service and modernization businesses, the company said on Wednesday.

KONE's sales rose 1.3 percent year-on-year to 2.71 billion euros (3.17 billion U.S. dollars) in the January-March period. At comparable exchange rates, sales increased by 6.7 percent.

KONE President and CEO Philippe Delorme described the start of the year as "solid," despite geopolitical tensions linked to the conflict in the Middle East. He noted that business disruptions have so far been limited but warned that the impact could become more pronounced in the coming quarters if the conflict persists.

According to the company, the global market for new building solutions declined slightly in the first quarter, while service and modernization markets expanded across all regions.

Local media reports indicate that China accounts for about 20 percent of KONE's global revenue and remains its largest single market.

Also on Wednesday, KONE announced an agreement to combine with German elevator and escalator manufacturer TK Elevator (TKE) in a cash-and-share transaction. The deal aims to create a major global player in the industry and is subject to regulatory and shareholder approvals. It is expected to close no earlier than the second quarter of 2027. ■