Carnival Corporation’s Earnings Call Highlights Robust Growth

Carnival Corporation ((CCL)) has held its Q1 earnings call. Read on for the main highlights of the call.

Carnival Corporation’s recent earnings call painted a picture of strong performance and optimism for the future. The company reported record-breaking revenue and yield metrics for the first quarter, alongside successful debt refinancing and robust consumer demand. Despite acknowledging some macroeconomic and geopolitical volatility, the overall outlook remains positive, with increased guidance for the full year and significant marketing and operational achievements.

Record-Breaking First Quarter Performance

Carnival Corporation achieved remarkable high watermarks for revenue, EBITDA, operating income, and customer deposits in the first quarter. The company’s net income exceeded guidance by over $170 million, with operating and EBITDA margins each improving by more than 400 basis points year-over-year.

Substantial Yield and Revenue Growth

The company reported a robust 7.3% yield increase, surpassing its yield guidance. For the full year, yield growth is now expected at 4.7%. EBITDA reached $1.2 billion, marking a nearly 40% increase year-over-year, showcasing Carnival’s strong financial performance.

Successful Refinancing Efforts

Carnival refinanced $5.5 billion of debt, resulting in $145 million in annualized interest expense savings. This strategic move contributed to lowering the full-year interest expense guidance by $100 million, strengthening the company’s financial position.

Strong Consumer Demand and Marketing Success

The company experienced historical high prices across all core programs for 2025 and record booking volumes for 2026. Marketing campaigns during wave season generated over 5 billion impressions, reflecting strong consumer interest and engagement.

Operational and Environmental Achievements

Carnival made progress in optimizing its portfolio, including the sale of Seaborn Sojourn. The company achieved a 19% reduction in carbon intensity compared to 2019, moving closer to its 2026 greenhouse gas target.

Macroeconomic and Geopolitical Volatility

While acknowledging heightened macroeconomic and geopolitical volatility, Carnival demonstrated resilience. No specific negative impact was reported, but the uncertain backdrop remains a consideration for the company.

Increased Dry Dock Costs

The company faced higher than expected dry dock costs due to unplanned dry docks, which affected cruise costs without fuel per ALBD. This was a notable challenge in the quarter.

Forward-Looking Guidance

Carnival Corporation raised its full-year yield guidance to 4.7% and increased its earnings guidance for the year by $185 million, projecting approximately $600 million in incremental earnings. The company is on track to reach its 2026 financial targets a year early, with a targeted ROIC of 12% and EBITDA per ALBD over 50% higher than two years ago. Additionally, Carnival is progressing towards its 2026 greenhouse gas target, with a 19% reduction in carbon intensity compared to 2019. Customer demand remains strong, with historical high prices for 2025 bookings and record booking volumes for 2026.

In summary, Carnival Corporation’s earnings call highlighted a very strong performance in the first quarter, with record-breaking financial metrics and a positive outlook for the future. The company is making significant strides in yield and revenue growth, successful refinancing, and environmental achievements, while navigating macroeconomic challenges with resilience. The forward-looking guidance suggests continued growth and success in the coming years.