Carnival reports “phenomenal” $1.9BN third quarter

Carnival Corporation CEO Josh Weinstein.[Photo: Carnival Corporation]

More upbeat news from the cruise sector: Industry giant Carnival Corporation today reported financial results for the third quarter 2025 and provided an updated outlook for the full year and an outlook for the fourth quarter 2025.

HIGHLIGHTS

• Achieved all-time high net income of $1.9 billion and adjusted net income of $2.0 billion.
• Raised full year 2025 adjusted net income guidance for the third quarter in a row
• Delivered record revenues of $8.2 billion, a record for the tenth consecutive quarter
• Cumulative advanced booked position for 2026 remains strong, in line with 2025 record levels and at historical high prices
• Refinanced $4.5 billion of debt during the quarter, simplifying its capital structure and prepaid an additional $0.7 billion of debt.

2025 OUTLOOK

For the full year 2025, the company expects:

• Net yields (in constant currency) up approximately 5.3 percent compared to 2024, 0.3 percentage points better than June guidance.
• Adjusted cruise costs excluding fuel per ALBD (in constant currency) up approximately 3.3 percent compared to 2024, better than June guidance.
• Adjusted net income up nearly 55 percent compared to 2024 and better than June guidance by $235 million.
• Adjusted EBITDA of approximately $7.05 billion, up 15 percent compared to 2024 and better than June guidance.

“This was a phenomenal quarter delivering all-time high net income and our tenth consecutive quarter of record revenues,” said CEO Josh Weinstein. “Strong demand and onboard spending drove a 4.6% improvement in net yields (in constant currency), all of which was achieved on a same ship basis.”

“Adjusted return on invested capital reached 13% for the first time in nearly 20 years, a clear testament to the continued improvement in our operational execution—driven not only by consistently strong performance from Carnival Cruise Line and AIDA, but also great advancement across the rest of our portfolio of world class brands,” Weinstein added.

“Even with our rapid progress, we believe we have ample opportunity to increase same ship net yields and further close the unbelievable price-to-value gap versus land based vacation alternatives, pushing margins and returns even higher over time,” he said.

FINANCING

“With our current refinancing strategy nearly complete, we’ve continued taking decisive actions to strengthen our balance sheet by simplifying our capital structure, reducing interest expense and managing our future debt maturities,” commented CFO David Bernstein. “This year alone, we’ve opportunistically refinanced over $11 billion of debt and prepaid another $1 billion. With that and today’s redemption notice for all our outstanding convertible notes—which if converted will be settled with a mix of cash and equity—we’re closing in on our near-term target of reaching investment grade leverage metrics. Our focus is now on driving our net debt to adjusted EBITDA ratio to under 3x as we continue boosting our financial strength.”

During the quarter, the company continued its refinancing strategy to reduce interest expense and manage its maturity towers, while reducing secured debt by nearly $2.5 billion. The company successfully issued two senior unsecured notes: $1.2 billion at 4.125 percent due in 2031 and $3.0 billion at 5.75 percent due in 2032. In addition, the company entered into a $400 million loan. The combined proceeds from these financings, together with cash on hand, were used to repay over $5 billion of debt. These transactions reflect the company’s continued focus on strengthening its capital structure and enhancing its financial flexibility.

During the quarter, Moody’s upgraded the company’s credit rating and maintained a positive outlook. The company believes this is a reflection of its improved leverage metrics and its strong momentum.

The company ended the quarter with $26.5 billion of total debt. As of August 31, 2025, the company’s debt maturities for the fourth quarter of 2025 and full year 2026 are $0.3 billion and $1.4 billion. The company achieved a 3.6x net debt to adjusted EBITDA ratio as of August 31, 2025, an improvement from 4.7x as of August 31, 2021.

EARNINGS CALL

To take a deeper dive into what’s behind the numbers, you can access a transcript of today’s earnings call with analysts HERE