OneSpaWorld Holdings Ltd. (OSW) Declined Despite Beating Expectations and Improved Guidance

Core Insights - Ariel Investments reported a strong performance for its Small Cap Concentrated Value Strategy in Q3 2025, with a gross return of +15.08% and a net return of +14.93%, outperforming the Russell 2000 Value Index and the Russell 2000 Index [1] Company Performance - OneSpaWorld Holdings Limited (NASDAQ:OSW) operates health and wellness centers on cruise ships and at destination resorts, with a market capitalization of $2.094 billion as of November 27, 2025 [2] - In Q3 2025, OneSpaWorld's revenue increased by 7% to $258.5 million, despite a one-month return of -12.56% and a 52-week gain of 7.32% [4] Investment Analysis - OneSpaWorld's stock performance detracted from the overall strategy's performance, even though the company beat earnings estimates and raised full-year guidance [3] - The company is focusing on AI-driven initiatives to improve yields and expand margins, while also managing debt and returning capital to shareholders through buybacks and dividends [3] - Despite acknowledging OneSpaWorld's potential, the analysis suggests that certain AI stocks may offer greater upside potential with less downside risk [4]