Carnival Corporation & plc

Q3 results: strong upside vs guidance (with operational drivers) - Management reported record revenues, yields, and net income in Q3 2026, with net income exceeding June guidance by ~$100m (~$0.08/share). - Outperformance split: - Yields: up ~2.5% YoY, and ~1.2 percentage points above June guidance, driven by close-in demand and robust onboard spending. - Cruise costs ex-fuel: up only ~1.8% YoY, ~100 bps better than June guidance (cost discipline; savings largely flow through to full year). - Fuel consumption: ~4% YoY reduction (on top of >5% last year), helping partially offset higher fuel prices. - Surprising/positive: the call emphasized how operational improvements were strong enough to offset fuel volatility.

Updated full-year 2026 guidance: EPS raised slightly, but fuel remains a key headwind - Company now expects >$150m net income improvement vs June guidance. - Still forecasting to overcome ~$150m impact from higher fuel prices via operational gains. - Guidance highlights: - Full-year yield growth: about ~2.3% (≈ +0.5pt vs June). - Q4 yield growth: ~1.7% YoY (≈ +0.75pt vs implied June). - Cruise costs ex-fuel (full year): ~+2.2% YoY, better than June (accounting/timing items discussed). - Fuel consumption expected better than planned; they cite ~26% reduction in fuel consumption per ALBD since 2019, reducing sensitivity. - Forecast: FY 2026 EPS ~ $2.24, up $0.02 vs prior guidance. - Negative point: despite improvements, they still expect fuel price headwind (~$0.11/share).

2027 outlook: “record” demand, but Q1 still impacted by spring booking disruption - Capacity growth: about +0.5% in 2027 vs 2026 (relatively flat supply). - Booking picture: “half booked” with occupancy and pricing at record levels. - Timing risk: Q1 2027 likely still reflects residual effects from spring disruption; however booking trends have improved over last 3 months. - Reassurance on revenue quality: company expects momentum in multi-year yield gains to continue through the year.