Carnival Cruise (CCL) - Q4 2025 Earnings Call
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Carnival Corporation & plc – Fiscal Q4 2025 Earnings Call
Date: December 19, 2025
Ticker: NYSE: CCL
Management Participants
Joshua Ian Weinstein – Chief Executive Officer & Director
David Bernstein – Chief Financial Officer & Chief Accounting Officer
Beth Roberts – Senior Vice President, Investor Relations
Micky Arison – Chair
Financial Performance (Required)
Carnival delivered record results in every quarter of 2025, with CEO Josh Weinstein stating: “We delivered historical fourth quarter highs for revenues, yields, operating income and EBITDA… and for the full year.”
Full-year net income exceeded $3 billion, up ~60% vs. 2024 and more than 30% above initial guidance, representing “an all-time high net income for our company.”
Q4 net income was $454 million, nearly 2.5x prior year, and exceeded September guidance by $154 million or $0.11 per share.
Full-year yields increased over 5.5% YoY, outperforming guidance by ~150 bps, driven by “higher ticket prices and an acceleration of strong onboard spending.”
EBITDA margins and operating margins expanded over 250 bps YoY, with EBITDA per ALBD reaching “an all-time high.”
ROIC exceeded 13%, which management highlighted as “the highest level this company has seen in 19 years.”
Guidance and Outlook (Required)
2026 net income guidance: >$3.45 billion, representing >12% growth YoY or +$0.23 per share.
2026 EBITDA expected to exceed $7.6 billion, up over $350 million YoY.
Yield guidance for 2026:
Reported: ~2.5% increase
Normalized: ~3%, adjusting for loyalty program accounting and deployment changes.
Weinstein emphasized that guidance already incorporates significant industry capacity growth:
“Our 2026 guidance fully incorporates the 14% increase in non-Carnival Corporation capacity growth in the Caribbean.”Booking strength:
~2/3 of 2026 capacity already booked
At historical high prices in both North America and Europe
Record booking volumes achieved for both 2026 and 2027 in the past three months.
Q1 2026 yields: ~1.6% reported, ~2.4% normalized, lapping a very strong prior-year comparison.
Management reiterated resilience despite macro concerns:
“The disconnect between consumer sentiment and actual booking behavior continues to reinforce what we’ve said for a long time.”
Capital Allocation & Balance Sheet (Required)
Carnival reached investment-grade leverage with net debt-to-EBITDA of 3.4x, ahead of schedule.
Since peak levels, the company has reduced total debt by over $10 billion.
Dividend reinstated at $0.15 per share quarterly, with management stating:
“Reinstating the dividend reflects both our confidence in the durability of our cash generation and the structural improvements we’ve made to our balance sheet.”Management targets net leverage below 3x, with CFO David Bernstein noting they expect to exit 2026 around ~2.8x.
Carnival called its remaining convertible debt, retiring 18 million shares.
Opportunistic share repurchases remain an option longer term.
Over $700 million of annual net interest expense improvement versus 2023 expected in 2026.
Cost Structure & Margins
2025 cruise costs ex-fuel per ALBD rose only 2.6%, beating guidance by over 100 bps.
2026 cruise costs ex-fuel per ALBD expected to rise ~3.25% reported, or ~2.5% normalized.
Key cost drivers for 2026:
~3.0% inflation and higher advertising
~0.6% higher dry dock expense (more OpEx vs CapEx)
~1.1% cost mitigation from efficiency initiatives and scale benefits
Regulatory costs (EU emissions allowances + Pillar 2 taxes) expected to cost ~$0.11 per share in 2026.
Fuel and FX expected to be a $0.20 per share tailwind in 2026.
Demand, Bookings & Pricing Trends
Onboard revenue per diem significantly outperformed prior-year levels in Q4.
Customer deposits up 7% YoY, reaching an all-time high at year-end.
Management emphasized pricing discipline:
“We are not mandating that our teams sail full to the last decimal point… we want people to maximize revenue.”No meaningful demand divergence across income tiers or brands:
“We’re not seeing any meaningful difference across the segments.”Weinstein highlighted value positioning:
“The price-to-experience ratio to land-based alternatives is still at a ridiculous value.”
Destination Strategy & Growth Investments
Celebration Key (Grand Bahama) surpassed 1 million guests, performing “pretty much as we had planned.”
Ticket premiums and onboard spend are tracking expectations.
Expansion at RelaxAway, Half Moon Cay coming later in 2026.
Future developments include Isla Tropicale (Roatán) and Ensenada, Mexico.
Management framed destinations as a long-term growth driver:
“We see much more pricing opportunity ahead as we transition our destination strategy from a utilitarian asset base to a marketable growth driver.”
AI, Marketing & Commercial Execution
AI increasingly used in marketing effectiveness, personalization, and efficiency gains.
Advertising spend running at ~3.5% of revenue, with increased reallocation toward digital and AI-driven tools.
Weinstein emphasized improved yield management and brand clarity as key drivers of same-ship yield growth.
Corporate Structure Simplification
Carnival plans to unify its dual-listed company (DLC) structure into a single NYSE-listed entity.
Carnival plc shareholders would receive 1-for-1 Carnival Corporation shares.
Expected benefits:
Lower administrative costs
Improved liquidity
Higher U.S. index inclusion
Shareholder votes expected in April 2026, with completion targeted for Q2 2026.
10 Notable Management Quotes
“We delivered over $3 billion to the bottom line, a 60% increase over 2024 and an all-time high net income.”
“ROIC in excess of 13%, the highest level this company has seen in 19 years.”
“Demand for our cruise lines is proving far more resilient than traditional macro indicators would suggest.”
“We are already about two-thirds booked at historical high prices.”
“We are formally resuming our dividend at an initial rate of $0.15 per quarter.”
“We are about a year ahead of schedule on our balance sheet recovery.”
“The price-to-experience ratio to land-based alternatives is still at a ridiculous value.”
“We are not immune to volatility, but having two-thirds of the business on the books underscores our resilience.”
“Celebration Key is a real differentiator for us.”
“We plan to deliver another double-digit earnings growth on top of the 60% increase we achieved in 2025.”
Q&A Summary
Q: Robin Farley (UBS) – Is close-in demand and onboard spend acceleration baked into 2026 guidance?
A: Management said guidance reflects their best current view but aims to continue momentum; upside remains possible.Q: Brandt Montour (Barclays) – Is Carnival trading volume for price in bookings?
A: No; revenue management remains focused on maximizing total revenue per voyage, not just occupancy.Q: Matthew Boss (JPMorgan) – What underpins same-ship yield growth into 2026?
A: Strong booking volumes, pricing discipline, portfolio diversification, and improved commercial execution.Q: Steve Wieczynski (Stifel) – Will Caribbean yields be positive in 2026?
A: Management expects Caribbean yields to support overall momentum despite capacity growth.Q: Lizzie Dove (Goldman Sachs) – What is driving same-ship yield growth with fewer new ships?
A: Better revenue management, clearer brand messaging, and improved onboard experience execution.Q: Conor Cunningham (Melius) – Why target sub-3x leverage?
A: Management believes ~2.75x supports a strong BBB profile while retaining flexibility.
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