Norwegian Cruise Line Holdings Ltd.

Second quarter 2026 results were ahead of expectations. Net yield was down 2.6% year over year, 100 basis points better than initial expectations. Adjusted net cruise cost ex fuel was $163, down 50 basis points. Adjusted EBITDA was $666 million, $34 million above guidance, and adjusted EPS was $0.48, $0.10 better than guidance. For full year 2026, management now expects net yield to decline approximately 5% and be at the low end of the prior range. Adjusted NCC ex fuel is now expected to be down approximately 25 basis points. Full-year adjusted EBITDA is expected to be approximately $2.5 billion and adjusted EPS approximately $1.50. For 3Q, net yield is expected to decline approximately 8.9% with load factor of 104%; for 4Q, net yield is expected to decline approximately 6.5% with load factor of 99%. Management said 2026 year-end net leverage is now expected to be above 6x.

John Chidsey framed the quarter as solid operationally but emphasized that the company is in the early stages of a turnaround. His message centered on changing how NCLH operates: strengthening leadership, improving marketing, rebuilding demand, and managing pricing more dynamically through baseloading. He was upbeat about the long-term cruise backdrop and repeatedly said the issues are fixable, but he also stressed that improvements will take time and that 2027 is likely transitional before 2028 normalizes.

Mark Kempa highlighted the beat versus guidance, pointing to better-than-expected yield, cost, EBITDA, and EPS. He said the company identified another $100 million of annualized savings and cash benefits in the quarter, largely tied to capital expenditures with the remainder mainly salary and benefit efficiencies, taking total savings over the past 3 years to more than $500 million. He also lowered 2026 NCC ex fuel growth to a 25 basis point decline, guided EBITDA to about $2.5 billion and EPS to about $1.50, and said year-end net leverage is expected to be above 6x, while noting that no significant debt maturities arrive until 2030 and that future newbuild and growth CapEx should decline by nearly $1 billion annually.

Analysts pressed on how much of the weak booked position and lower yields were macro-driven versus self-inflicted. Management said only a small part is macro, while the vast majority is due to execution and marketing issues, especially on Norwegian, and said the company is already seeing sequential improvement into 2027. Questions also focused on baseloading, consumer/travel-agent acceptance, Europe demand, and Great Stirrup Cay; management said baseloading is underway market by market, that the back half of 2027 should benefit first, and that the new island and waterpark should help generate awareness and demand, though it is too early to quantify the impact.