Steve Wieczynski

Steve Wieczynski inquired about potential upside to charting-the-course EPS targets for next year, considering the low to mid-single-digit yield growth, sub-inflationary cost growth, and recent capital market transactions. He also asked if the Q4 yield guidance embedded any impacts from weather or the government shutdown, beyond the load factor lift.

Answer

Mark Kempa (EVP and CFO) reiterated the commitment to sub-inflationary unit cost growth for 2026. Harry Sommer (President and CEO) confirmed confidence in hitting charting-the-course targets, citing strong execution and early positive indicators. Harry Sommer also stated that while a 3.5-4% yield growth for Q4 was strong, a modest headwind from the government shutdown was possible, but weather impacts were minimal.

Steve Wieczynski from Stifel sought clarification on Carnival's sentiment regarding 2026 compared to three months prior, given accelerated booking trends, and asked for the meaning of "unprecedented start" for 2027 bookings. He also inquired about specific initiatives or "behind-the-scenes" efforts to mitigate the projected 200 basis point headwind for 2026 from Carnival Rewards, dry docks, and island development.

Answer

CEO Josh Weinstein confirmed that "unprecedented start" for 2027 bookings refers to a record number of bookings in the Q3 2025 13-week window. He expressed confidence in 2026, citing the longest booking curve on record (50% booked), strong Q3 booking period, full-year benefit of Celebration Key, half-year benefit of Relax Away Half Moon Cay, continued onboard revenue strength, and minimal capacity growth. He mentioned ongoing efforts to improve efficiency and mitigate cost headwinds, with brand-specific operating plan meetings scheduled.

Steve Wieczynski asked for an update on the 2026 outlook compared to three months prior, noting that booking trends appear to have accelerated against market fears of deceleration. He also sought clarification on the term 'unprecedented start' used for 2027 bookings. For a follow-up, he asked about any unmentioned initiatives to mitigate the 200 basis points of headwinds anticipated for 2026 (50bps loyalty, 100bps dry docks, 50bps island build-out).

Answer

CEO Josh Weinstein clarified that 'unprecedented' for 2027 bookings refers to a record number of bookings in the 13-week Q3 window. For 2026, he expressed confidence, attributing it to improved commercial execution across brands. To mitigate 2026 headwinds, Mr. Weinstein highlighted several positives: 50% booked (longest curve), stronger Q3 bookings, absence of an election cycle, full-year benefit of Celebration Key, half-year benefit of Half Moon Cay, continued onboard revenue strength, and minimal capacity growth. He also mentioned ongoing efforts to enhance efficiency and cost mitigation, including upcoming meetings with brands for 2026 operating plans.

Steve Wieczynski asked for clarification on Boyd Gaming's use of proceeds from the FanDuel transaction, questioning what 'other growth opportunities' might entail and if it signals potential M&A activity.

Answer

President and CEO Keith Smith stated the FanDuel deal is not a precursor to another transaction but a move to monetize an undervalued asset. He explained that while proceeds will initially reduce debt, the goal is to deploy the capital into higher-returning investments. Smith reiterated that the company's balanced capital allocation strategy, including its approach to M&A, remains unchanged.