Norwegian Cruise Line Holdings Ltd. Q1 FY2026 earnings call

John Chidsey discussed his first few months in the CEO role, focusing on driving sustainable improvement, strengthening internal culture, optimizing SG&A structure, streamlining the organization, exploring offshoring initiatives, and evaluating the bundled air program. He also mentioned implementing phase one of a new revenue management system, refining revenue management, and bringing in new marketing leadership. Mark Kempe provided details on first quarter results, guidance for the year, cost management actions, gross new build and growth capex, and debt maturity profile.

2026 outlook is below expectations. Net yield expected to decline 3% to 5%. Adjusted EBITDA guidance reduced to between 2.48 and 2.64 billion, adjusted EPS guidance to between $1.45 and $1.79. Adjusted net cruise cost ex-fuel expected to be approximately flat for the year. Gross new build and growth capex expected to decline by nearly $1 billion per year.

External operating environment turned more challenging, including geopolitical developments adding pressure, especially in European market and close-in bookings. Internal issues like execution, alignment, and discipline need to be addressed. Marketing function not operating effectively, revenue management system calibration and team building needed.

Q: Matthew Boss asked about the 400 basis point revision to full year net yield outlook, breakdown of macro vs company-specific and region impact.

A: John Chidsey said most of the reduction is due to revenue management and marketing issues.

Q: Matthew Boss asked about EBITDA margin forecast, flow through of cost savings vs transitory costs.

A: Mark Kempe said no structural change to 39% margin target, EBITDA reduction from revised revenue guidance, cost savings and transitory costs.

Q: Steve Wyszynski asked about revised yield guidance, delta between 3% and 5% decline.

A: Mark Kempe said it's due to marketing and demand issues, teams building.

Q: Steve Wyszynski asked about Norwegian brand being lost with agents and consumers.

A: John Chidsey said it's a turnaround, not completely lost but not firing on all cylinders.

Q: Ben Chaykin asked about 2027 Europe booking, ensuring disruptions don't stick.

A: John Chidsey said luxury brands have some green shoots, Norwegian brand teams are being built.

Q: Connor Cunningham asked about 3Q net yield, granularity.

A: John Chidsey said wider range due to teams gelling.

Q: Brant Montour asked about stabilization in 3Q, non-commissionable fares effect.

A: John Chidsey said Europe had elevated cancellations, non-commissionable fares early stage.

Q: James Hardiman asked about 2027 booking curve, yield growth.

A: John Chidsey said meaningful improvements in cost, revenue takes time.

Q: Lizzie Dove asked about Caribbean situation, long-term Europe deployment.

A: John Chidsey said Caribbean marketing improving, Europe mix is okay.

Q: Vince Chappell asked about Grace Stirrup Cay review scores, yield benefit.

A: Mark Kempe said guest satisfaction improved, late summer opening monetization.

Q: Robin Farley asked about Middle East impact on bookings, leverage levels.

A: John Chidsey said Middle East has impact, leverage in high fives.

Q: Trey Bowers asked about luxury brands vs Norwegian, SG&A savings.

A: John Chidsey said luxury brands resilient, marketing spend inefficiency in past