Financial Data and Key Metrics Changes - In Q4 2025, net yields increased by 3.8%, while adjusted net cruise cost excluding fuel was $158, only increasing by 0.2%, leading to adjusted EBITDA of $564 million, which exceeded guidance [15][16] - For the full year 2025, net yields rose by 2.4%, adjusted EBITDA increased by 11% to $2.73 billion, and adjusted EPS rose by 19% to $2.11 [16][27] - The company expects adjusted EPS to be approximately $0.16 in Q1 2026, with a full-year expectation of a 13% increase to $2.38 [28] Business Line Data and Key Metrics Changes - The Norwegian brand launched a refreshed brand platform and opened bookings for Norwegian Aura, the largest of the Prima class ships, with first voyages in 2027 [17] - Oceania Cruises reported a record-breaking opening day for bookings of Oceania Sonata, surpassing previous launches by 45% [18] - Regent Seven Seas saw a 20% year-over-year increase in January bookings, indicating strong demand across its destination portfolio [18] Market Data and Key Metrics Changes - The Caribbean strategy is central to the company's growth, with a 40% capacity increase in Q1, although it faced execution challenges [20][21] - The company noted pressure in Alaska due to increased industry capacity, impacting yields [25][42] - The company is experiencing pricing headwinds in select markets, particularly in the Caribbean and Bahamas, affecting overall performance [25][26] Company Strategy and Development Direction - The new CEO emphasized the need for improved execution, financial discipline, and reducing leverage while focusing on sustainable value creation [9][14] - The company is undergoing a disciplined business review to align deployment, pricing, and marketing strategies to restore sustainable net yield growth [26][29] - Investments in technology and revenue management systems are prioritized to enhance operational efficiency and guest experience [10][66] Management's Comments on Operating Environment and Future Outlook - Management acknowledged execution missteps and emphasized the importance of cohesive planning and coordination across departments [38][40] - The CEO expressed confidence in the long-term potential of the Caribbean market despite short-term challenges [39][40] - The company is closely monitoring geopolitical events and their potential impact on bookings, particularly in Europe [34][75] Other Important Information - The company is approximately 51% hedged for fuel in 2026, which helps mitigate near-term volatility [34] - A new leadership team has been established, focusing on accountability and operational improvements [12][13] Q&A Session Summary Question: Addressing Caribbean deployments and capacity overhangs - The CEO acknowledged the need for better coordination in Caribbean deployments and expressed confidence in the long-term potential of the region [38][39] Question: Guidance on yield cost spread and market pressures - Management noted that execution missteps in the Caribbean and Europe are affecting performance, but they are working to correct these issues [41][42] Question: Impact of missteps on Europe and Caribbean strategies - Management confirmed that misalignment in deployment and commercial strategies has led to pressure in Europe and the Caribbean [46][48] Question: Culture of inefficiency and strategy changes - The CEO highlighted the need for a cohesive strategy and greater urgency in execution to address inefficiencies [50][51] Question: Review process and shareholder engagement - The CEO confirmed ongoing communication with shareholders, including Elliott, to gather insights on improving long-term shareholder value [58] Question: Consumer strength and competitive positioning - Management indicated that consumer demand remains strong, particularly in luxury brands, while acknowledging the need for improved execution in the mass brand [82]

Financial Data and Key Metrics Changes - In Q4 2025, net yields increased by 3.8%, while Adjusted Net Cruise Cost excluding fuel was $158, rising only 0.2% due to strong cost controls, leading to an Adjusted EBITDA of $564 million, which exceeded guidance [13][14] - For the full year 2025, net yields rose by 2.4% compared to the previous year, with Adjusted EBITDA increasing by 11% to $2.73 billion and Adjusted EPS rising by 19% to $2.11 [14][18] Business Line Data and Key Metrics Changes - The Norwegian brand launched a refreshed brand platform and opened bookings for Norwegian Aura, the largest of the Prima class ships, set to sail in 2027 [15][16] - Oceania Cruises reported a record-breaking opening day for bookings of Oceania Sonata, surpassing previous launches by 45%, while Regent Seven Seas saw a 20% year-over-year increase in January bookings [16] Market Data and Key Metrics Changes - The Caribbean strategy is central to the company's growth, with a 40% capacity increase in Q1, although the execution faced challenges due to misalignment in commercial strategies [18][19] - The company noted pressure in Alaska due to increased industry capacity, impacting yields [23] Company Strategy and Development Direction - The new CEO emphasized the need for improved execution, financial discipline, and reducing leverage, with a focus on aligning commercial strategies with deployment [6][12] - The company is undergoing a disciplined business review to ensure alignment across deployment, marketing, pricing, and revenue management [20][26] Management's Comments on Operating Environment and Future Outlook - Management acknowledged execution missteps that led to a decline in expected performance, particularly in the Caribbean and Europe, but expressed confidence in correcting these issues [19][23] - The company is focused on building a stronger foundation and restoring performance sustainably, with a commitment to improving guest experiences [28][29] Other Important Information - The company is closely monitoring geopolitical developments in the Middle East, with no current impacts on scheduled itineraries, and is approximately 51% hedged for fuel in 2026 [29] Q&A Session Summary Question: Addressing Caribbean deployments and capacity overhangs - The CEO acknowledged the need for better coordination in Caribbean deployments and expressed confidence in the long-term potential of the region despite recent missteps [33][34] Question: Guidance on yield cost spread and market conditions - Management noted that while there are pressures in the Caribbean and Alaska, they are working on correcting execution missteps to improve performance [36][37] Question: Impact of consumer behavior and competitive landscape - Management indicated that the consumer remains strong, particularly in luxury segments, but emphasized the need for improved execution in the mass brand [78] Question: Actions to support improvement in booking trends - The company is focused on balancing price and load factors while aligning commercial strategies to improve booking trends [58][59] Question: Cost growth outlook and investments needed - Management highlighted the need for investments in customer-facing technology and revenue management systems to drive future yields [61][62]