Norwegian Cruise Line Holdings Ltd. Q4 FY2025 earnings call

• John emphasized the need to create a sense of urgency, improve execution and accountability, optimize organization and eliminate bureaucracy. He mentioned the company has an all-new leadership team in critical functions. - Mark walked through fourth quarter and full year 2025 results, highlighted operational highlights like Norwegian's brand launch, Oceana's adults-only policy success, new ship orders, and Great Stirrup Cay's early positive feedback. Also discussed the Caribbean deployment challenges with misalignment of commercial strategy and deployment.

Fourth quarter net yields grew 3.8%, with adjusted net cruise cost ex-fuel of $158 below guidance, increasing only 0.2%, driving adjusted EBITDA of $564 million. Full year 2025 net yields rose 2.4% compared to prior year, adjusted net cruise costs ex-fuel per capacity day rose only 0.7%, adjusted EBITDA increased 11% to $2.73 billion, adjusted operational EBITDA margin improved 160 basis points to 37.1%, and adjusted EPS increased 19% to $2.11. Norwegian brand launched refreshed brand platform, opened bookings for Norwegian Aura. Oceana announced adults-only policy fleet-wide with strong sales. Regent saw January bookings up 20% year over year. New ship orders across all three brands, with 17 ships on order through 2037. Great Stirrup Cay had positive initial guest feedback.

• Net yields: First quarter expected to decline ~1.6% due to pricing pressure, balance of year expected to stabilize and modestly improve to flat full year. - Costs: First quarter adjusted net cruise costs ex-fuel expected to decrease ~0.8%, remaining nine months expected to grow ~1.4%, full year unit cost growth ~0.9%. - Adjusted operational EBITDA margin: First quarter expected to improve to ~29.1%, full year expected to remain essentially flat at ~37%. - Adjusted EBITDA: Full year expected to increase ~8% to $2.95 billion. - Adjusted EPS: First quarter expected to be ~$0.16, full year expected to increase ~13% to $2.38. - Net leverage: Full year 2026 expected to remain approximately flat at 5.2 times.

• Execution and coordination failures in developing coordinated plans and operating cadence. - Siloed culture lacking a one team mentality. - Caribbean deployment had timing issues with insufficient alignment of revenue management, sales, marketing, itinerary planning, and on-island monetization strategies. - Competitive activity in Alaska pressured yields due to elevated industry capacity levels.

Q: Steve Wisinski asked about Caribbean deployments and guidance implications.

A: John said Caribbean strategy is sound but timing was off with siloed efforts, Mark added about commercial missteps in Caribbean, Bahamas, Europe, and Alaska affecting guidance.

Q: Ben Chaykin followed up on Europe missteps and Caribbean impact.

A: John and Mark discussed Europe deployment reduction, open jaw itinerary pressure, and need for commercial alignment.

Q: Connor Cunningham asked about review process and Elliott contact.

A: John said review process ongoing, been in touch with Elliott and on roadshow.

Q: Matthew Boss asked about actions to support booking trends and cost growth outlook.

A: Mark discussed balance between price and load factor, and need to invest in customer-facing systems and SG&A optimization.

Q: Brant Montour asked about scale disadvantage and Middle East impact.

A: John said not at disadvantage, Mark said no noticeable booking pressure from Middle East yet.

Q: James Hardiman asked about consumer cyclicality and competitive piece.

A: John and Mark discussed new team and consumer strength despite missteps.

Q: Vince Cipo asked about yield growth shape and bookings.

A: John and Mark talked about booking momentum, organizational changes, and focus on Norwegian brand.

Q: Lizzie Duff asked about brand portfolio core and margins.

A: John said all brands are core and he hasn't dug into margins in detail.

Q: Trey Bowers asked about Elliott and brand sale interest.

A: John said open to board renewal and believes in current brands.