Carnival Corporation Ltd. — Form 10-Q summary
Reporting period: Quarter and nine months ended August 31, 2026. Financial amounts are in U.S. dollars; unless otherwise noted, figures are in millions. The company completed its dual-listed-company unification and redomiciliation from Panama to Bermuda in May 2026, with no material change to its business or operations reported.
Financial performance
| Metric | Three months 2026 | Three months 2025 | Nine months 2026 | Nine months 2025 |
|---|---|---|---|---|
| Revenue | $8,435 | $8,153 | $21,263 | $20,292 |
| Operating income | $2,220 | $2,271 | $3,678 | $3,748 |
| Net income attributable to Carnival | $1,920 | $1,852 | $2,715 | $2,338 |
| Diluted EPS | $1.40 | $1.33 | $1.96 | $1.71 |
| Net cash from operating activities | Not provided | Not provided | $5,303 | $4,700 |
Quarterly revenue rose 3.5%; operating income declined about 2.2%. Operating margin was approximately 26.3%, versus 27.9% a year earlier. Nine-month revenue increased 4.8%, while operating income fell about 1.9%; operating margin was approximately 17.3%, versus 18.5%. Net income improved in both periods, helped by lower interest expense and substantially lower debt extinguishment costs compared with 2025.
- Revenue drivers: Third-quarter passenger-ticket revenue increased 1.8%, reflecting higher capacity and ticket prices; onboard and other revenue increased 6.7%, primarily on higher guest spending. For nine months, ticket revenue grew 3.4% and onboard and other revenue 7.4%, supported by capacity, pricing, guest spending and favorable currency translation.
- Cost pressures: Operating expenses increased 5.5% in the quarter and 6.3% year to date. Higher fuel prices, capacity, foreign exchange, emissions allowances and the absence of prior-year ship-sale gains contributed. Quarterly fuel cost per metric ton was $826 versus $607; lower fuel consumption per ALBD partly offset expense increases over nine months.
- Cash, liquidity and debt: Cash and cash equivalents were $1,220 at August 31, versus $1,928 at November 30, 2025. Reported liquidity was $5.7 billion, including $4.5 billion available under the revolving facility; an additional $10.7 billion of undrawn export credit facilities was available for ship deliveries. Total debt was $24.6 billion gross and $23.9 billion net of issuance costs and discounts, down from $27.4 billion gross at fiscal year-end. Long-term debt was $21.9 billion.
- Working capital: The company reported a $9.1 billion working capital deficit, compared with $8.9 billion at November 30, 2025. Management says this is largely structural, reflecting guest deposits collected before voyages; customer deposits totaled $7.6 billion.
- Cash uses: Nine-month capital expenditures were $2.1 billion. Financing cash outflows included $2.2 billion of debt repayments, $618 million of dividends and $929 million of share repurchases. Operating cash flow increased by $603 million year over year.
Changes, outlook and risks
- The May 2026 unification exchanged Carnival plc shares for Carnival Corporation Ltd. shares one-for-one; the company is now listed solely on the NYSE. The filing reports no material operational change.
- No quantified earnings or revenue guidance is provided in the supplied filing text. Management identifies seasonality: the third quarter is typically the strongest, and Alaska tour revenue is concentrated from May through September.
- The company expects the 2026 EU Emissions Trading System impact to be approximately $160 million as all in-scope emissions become subject to the system, compared with $91 million in 2025. Management also warns that fuel-price increases, geopolitical developments, currency movements and evolving emissions regulation could adversely affect profitability.
- Debt covenants include minimum interest coverage of 3.0 to 1.0 and minimum liquidity of $1.5 billion. The company reported compliance as of August 31, 2026. Scheduled principal payments include $2.5 billion in 2027, $4.0 billion in 2028 and $3.6 billion in 2029.
- Ship contractual capital commitments total $0.3 billion for the remainder of 2026 and substantial additional commitments thereafter, including $11.4 billion for 2031 and later. Execution and funding of the shipbuilding program remain important to monitor.
- Legal matters include the Havana Docks case remanded for further appellate proceedings, pending data-security class actions, and environmental inquiries. The company believes the ultimate outcomes disclosed will not materially affect its financial statements; litigation outcomes remain uncertain.
Important facts for investors to verify
- Whether fuel prices and emissions-compliance costs continue to pressure operating margins, and whether onboard spending and ticket pricing offset those costs.
- Cash generation, debt repayment and refinancing capacity relative to upcoming maturities, ship commitments and the working capital deficit.
- The pace and price of share repurchases under the remaining $1.562 billion authorization, alongside dividend payments and capital spending.
- Whether the expected $160 million 2026 ETS cost and other regulatory obligations develop as management anticipates.
- Developments in the Havana Docks appeal, data-security litigation and Clean Water Act matter; the filing does not provide clear quantified exposure for these contingencies.