Carnival Corporation & plc Q1 FY2026 earnings call

Greetings and welcome to the Carnival Corporation first quarter 2026 earnings conference call. Josh Weinstein, David Bernstein, and Mickey Arison joined. The company had an excellent start to the year with first quarter results ahead of guidance due to higher yields and better cost performance. Close-in demand was robust, guests spent more on board, pricing strengthened, and record first quarter revenues, net yields, operating income, EBITDA, and customer deposits were achieved. Bookings for current year sailings increased 10% year over year, cumulative future year bookings reached a first quarter record, and customer deposits reached a new first quarter record. They introduced Propel, targeting return on invested capital above 16%, earnings per share growth of more than 50% versus 2025, and distribution of more than 40% of cash from operations to shareholders by 2029. Drivers of Propel include yield expansion, discipline capacity growth and high returning capital allocation, further monetizing destination portfolio, and continued cost discipline.

Full-year guidance calls for earnings per share of $2.21. Includes first quarter operational improvement and additional improvement over remaining quarters, but offset by fuel price headwind. Guidance assumes fuel prices at certain levels. Yield growth assumes approximately 2.75%, cruise costs without fuel per ALBD expected to be up approximately 3.1%.

Q: Robin Farley of UBS asked about long-term targets and share repurchase.

A: Long-term targets are confident to deliver, minimal exposure to Middle East, generating more cash, and will give back cash via dividend and share repurchase.

Q: Steve Wozinski of CFO asked about booking environment and cancellation rates.

A: Cancellation trends not significant, onboard spends strong, bookings progressing with differences by region, and entered period with headroom.

Q: Matthew Boss of J.P. Morgan asked about bookings well into 2028 and ROIC drivers.

A: Bookings curve strong with teams pushing revenue, ROIC above 16% built on moderate yield and low cost growth with upside opportunity.

Q: Jian Xu of BNP Paribas asked about 2Q guidance and longer-term net yield drivers.

A: 2Q guidance based on differences in periods, broad-based improvements in commercial space driving net yield growth.

Q: Brant Montour of Barclays asked about AI integration and fleet capacity.

A: AI already impacting interaction, fleet age not a driver of revenue strategy with measured capacity growth.

Q: Trey Bowers of Wells Fargo asked about trends in non-European regions and fuel hedging.

A: Caribbean and Alaska strong, fuel hedging evaluated but focus on consumption.

Q: Ben Chaiken of Mizuho asked about free cash flow and stock buybacks.

A: Expect opportunistic buybacks, CapEx predictable, 40% of cash from operations returned to shareholders.

Q: Connor Cunningham of Melius Research asked about fuel recapture and demand destruction.

A: Fuel price somewhat irrelevant to day-to-day revenue management, focus on consumption.

Q: Chris Stalusopoulos of SIG asked about plan in elevated energy prices and AI impact.

A: Focus on lower consumption in short term, longer term change itineraries and have destination strategies, AI can be harnessed, brand mix relatively consistent by 2029