10-QPeriod: Q1 FY2025

CARNIVAL CORP Quarterly Report for Q1 Ended Feb 28, 2025

Filed March 25, 2025For Securities:CCL

Summary

Carnival Corporation & plc reported a net loss of $78 million ($0.06 per diluted share) for the three months ended February 28, 2025, an improvement from a net loss of $214 million ($0.17 per diluted share) in the prior year period. This narrowing of losses was driven by a significant increase in revenue, up 7.6% to $5.8 billion, fueled by higher passenger ticket prices and increased onboard spending. Despite the revenue growth, the company faced substantial debt extinguishment and modification costs amounting to $252 million, which weighed on profitability. Operationally, the company saw a capacity increase of 2.5%, primarily in its North America segment, contributing to higher occupancy and passenger volumes. While fuel costs saw a slight decrease, overall operating expenses rose modestly due to increased capacity and related costs. Carnival also proactively managed its debt, issuing new notes and redeeming older, higher-interest debt, which, while incurring significant extinguishment costs in the short term, aims to improve long-term financial flexibility and reduce interest expense. The company ended the quarter with substantial liquidity, including cash and available credit facilities.

Financial Highlights

49 data points
Beta

Revenue

$5.81B

35.2% Gross Margin

Net Income

-$78.00M

-1.3% Net Margin

EPS (Diluted)

$-0.06

Total Assets

$48.53B

Cash & Equivalents

$833.00M

Free Cash Flow

$318.00M

Financial Statements
Beta
Revenue$5.81B
Cost of Revenue$3.77B
Gross Profit$2.04B
SG&A Expenses$848.00M
Operating Expenses$5.27B
Operating Income$543.00M
Net Income-$78.00M
EPS (Basic)$-0.06
EPS (Diluted)$-0.06
Shares Outstanding (Basic)1.31B
Shares Outstanding (Diluted)1.31B

Key Highlights

  • 1Revenue increased by 7.6% to $5.8 billion, driven by higher passenger ticket prices and increased onboard spending.
  • 2Net loss narrowed to $78 million from $214 million in the prior year quarter.
  • 3Operating income significantly improved to $543 million from $276 million, primarily due to revenue growth and lower interest expenses.
  • 4Total debt was reduced, with a focus on refinancing higher-interest debt.
  • 5The company experienced a 2.5% increase in capacity (Available Lower Berth Days), led by the North America segment.
  • 6Significant debt extinguishment and modification costs of $252 million were incurred due to debt refinancing activities.
  • 7Liquidity remains strong, with $833 million in cash and cash equivalents and substantial availability under revolving credit facilities.

Frequently Asked Questions

Carnival Corporation & plc reported a net loss of $78 million for the quarter ended February 28, 2025, compared to a net loss of $214 million in the same period last year. While still reporting a loss, this represents a significant improvement, driven by a 7.6% increase in total revenues to $5.8 billion, primarily due to higher ticket prices and increased guest spending onboard.

Carnival actively managed its debt by issuing $1.0 billion in 5.8% senior unsecured notes due 2030 and $2.0 billion in 6.1% senior unsecured notes due 2033, using the proceeds to redeem older, higher-interest debt. This strategy led to significant debt extinguishment and modification costs of $252 million for the quarter but is intended to reduce future interest expenses and improve financial flexibility.

The company reported a 2.5% increase in capacity (Available Lower Berth Days) year-over-year, driven by new ship introductions in the North America segment. Occupancy remained strong at 103%. Management noted continued strength in demand, contributing to higher ticket prices and onboard spending.

While revenues grew, operating expenses also increased by 1.7% to $3.8 billion, largely due to the increased capacity and related costs. A significant factor impacting the net loss was the $252 million in debt extinguishment and modification costs. Interest expense, net of capitalized interest, decreased by 20% to $377 million, benefiting from lower total debt and average interest rates.