AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-2: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 5/6 · 18/10/2026
Moat—
Insufficient evidence for every rubric criterion; no category score is inferred.
structural advantage · — · Exclusive destinations and advance receipts are real business features, but their competitive superiority and barriers to replication are unestablished.
durability · — · Repeated destination operations establish continuity, but the passages cannot establish the duration of economic protection or excess returns attributable to an advantage.
customer dependency · — · Advance payment and conditional cancellation fees concern individual reservations. They do not establish continuing customer dependency; some deposits are refundable and distribution relationships are nonexclusive.
erosion resilience · — · Operating achievements coexist with actual itinerary disruption and mixed recent results. Without an established structural advantage, its resilience to erosion cannot be graded.
Pricing power50
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
realized pricing · 2/4 · Higher ticket prices contributed $104 million to first-half 2026 revenue growth, separately from currency and capacity. This demonstrates positive but modest pricing realization, without establishing a sustained premium over alternatives.
retention · 2/4 · Record 2025 booking trends, close-in demand and nearly 7% year-over-year deposit growth support continued customer demand indirectly. They do not distinguish repeat guests from new customers or demonstrate durable switching friction.
margin resilience · 2/4 · Operating income rose substantially in 2025. First-half 2026 revenue grew while reported operating income slipped, but second-quarter adjusted operating income increased after accounting for prior-year ship-sale gains. These outcomes support mixed resilience rather than either full cost pass-through or broad pricing failure.
contractual freedom · 2/4 · Carnival manages cabin prices and requires deposits and advance balances, with cancellation fees applicable in some cases. Refundable deposits and absent detail on repricing existing reservations limit demonstrated contractual protection.
Predictability40
Five consecutive annual periods. Equal weights: nondeclining revenue frequency; revenue-growth volatility (5–40pp); positive FCF frequency; FCF-margin volatility (3–20pp). Stability indicator, not a growth forecast.
- Nondeclining revenue years (%)
- 100.00
- Revenue growth volatility (pp)
- 220.15
- Positive FCF years (%)
- 60.00
- FCF margin volatility (pp)
- 160.04
Financial strength5
Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, or reported pretax profit plus reported interest expense when operating income is unavailable. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 0.00
- netDebtEbitGrade
- 0.00
- interestCoverageGrade
- 21.12
- currentRatioGrade
- 0.00
- Debt / FCF (x)
- 10.22
- Net debt / operating income (x)
- 5.51
- Interest coverage (x)
- 3.32
- Current ratio (x)
- 0.32
Capital allocation41
Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income or, if unavailable, EBIT calculated from reported pretax profit plus reported interest expense; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. Nonpositive invested capital has no defined return and remains unavailable. Does not establish acquisition quality or buyback timing.
- 3-year pre-tax operating return (%)
- 9.29
- 3-year average dilution (%)
- 3.63
- 3-year average SBC / revenue (%)
- 0.29
- cashConversionGrade
- 0.00
Management63
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · Refinancing and debt reduction are demonstrated. First-half 2026 operating cash flow of $3.893 billion covered $1.441 billion of property purchases alongside debt repayments, dividends and repurchases. Convertible settlement also issued 69.1 million shares. This is improving but mixed capital discipline; investment-level returns and repurchase value are unestablished.
incentive alignment · 3/4 · Actual 2025 grants used a 60% performance-equity weighting with operating, ROIC, relative shareholder-return and emissions measures, alongside 40% time-based equity. Annual incentives included financial and safety/environmental measures, with existing clawback provisions. This demonstrates substantial alignment in design, without proving eventual award outcomes or exceptional durability.
execution · 3/4 · Higher 2025 operating income, completed refinancing, debt reduction, cash generation and completed May 2026 unification demonstrate execution. This assessment uses operating and transaction outcomes rather than customer-retention statistics. Recent mixed operating performance and unverified unification savings limit the conclusion.
governance · 2/4 · The proxy discloses nine independent directors out of eleven, independent committees and majority voting. It also discloses a longstanding chair who was not independent on appointment and departures from scheduled external board evaluations. These support a mixed assessment; the passages do not fully establish post-unification governance.
Evidence
We operate a portfolio of port destinations and exclusive islands enabling us to offer exceptional experiences to 5.7 million guests by creating a wide variety of high-quality destinations that are uniquely tailored to our guests’ preferences.
Business / Port Destinations and Exclusive Islands / 2023 guest use · Filed 26/01/2024
We operate a portfolio of port destinations and exclusive islands enabling us to offer exceptional experiences to 6.5 million guests by creating a wide variety of high-quality destinations that are uniquely tailored to our guests’ preferences.
Business / Port Destinations and Exclusive Islands / 2024 guest use · Filed 27/01/2025
This was caused by: •Capital expenditures of $1.4 billion substantially all attributable to ship improvements, our ongoing new shipbuilding program and development of our portfolio of exclusive destinations •Advances of $46 million to one of our equity method investments During the six months ended May 31, 2025, net cash used in investing activities was $1.2 billion.
MD&A / Investing Activities / first-half 2026 capital expenditures · Filed 26/06/2026
We have been forced to, and in the future may be forced to, alter itineraries, including diverting from our port destinations and exclusive islands, or cancel a cruise or a series of cruises or tours due to these or other types of disruptions.
Risk Factors / actual itinerary alterations and cancellations · Filed 27/01/2026
•Overcapacity and competition in the cruise and land-based vacation industry may negatively impact our cruise sales, pricing and destination options.
Risk Factors / overcapacity and vacation competition · Filed 26/06/2026
Our payment terms generally require an initial deposit to confirm a reservation, with the balance due prior to the voyage.
Revenue disclosures / reservation deposits and advance payment terms · Filed 26/06/2026
We operate with a substantial working capital deficit, largely due to our business model in which guest cruise deposits and the advance purchases of onboard and other services are collected ahead of the sailing date and recorded as a liability until recognized as revenue.
MD&A / Liquidity / advance receipts business model · Filed 26/06/2026
These customer deposits are used alongside other cash sources to fund operations, service debt, and support capital investments.
MD&A / Liquidity / uses of customer deposits · Filed 26/06/2026
These amounts include refundable deposits.
Revenue disclosures / refundable deposits · Filed 26/06/2026
Our customer deposits balance changes due to the seasonal nature of cash collections, which typically results from higher ticket prices and occupancy levels during the third quarter, the recognition of revenue, refunds of customer deposits and foreign currency changes.
Revenue disclosures / seasonality, refunds and currency effects on deposits · Filed 26/06/2026
Certain of these agreements allow the credit card processors to request, under certain circumstances, that we provide a capped reserve fund in cash.
MD&A / Liquidity / processor reserve rights · Filed 27/01/2026
This increase was caused by: •$218 million - net favorable foreign currency translation impact •$104 million - higher ticket prices •$96 million - 1.2% capacity increase in ALBDs These increases were partially offset by a decrease of $62 million in air transportation revenue.
MD&A / Six-month passenger ticket revenue / price, currency and capacity bridge · Filed 26/06/2026
•Record booking trends with continued strong close-in demand throughout the year
MD&A / 2025 business highlights / booking demand · Filed 27/01/2026
•Ended 2025 with record year-end customer deposits, up nearly 7% year over year
MD&A / 2025 business highlights / year-over-year deposits · Filed 27/01/2026
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) (in millions, except per share data) Three Months Ended May 31, Six Months Ended May 31, 2026 2025 2026 2025 Passenger ticket $ 4,273 $ 4,104 $ 8,296 $ 7,936 Onboard and other 2,390 2,224 4,532 4,202 Total Revenues 6,663 6,328 12,828 12,139 Cruise and tour operating expenses: Commissions, transportation and other 778 780 1,650 1,631 Onboard and other 697 671 1,316 1,271 Payroll and related 699 640 1,383 1,280 Fuel 595 468 992 933 Food 389 372 771 726 Other operating 1,067 955 2,054 1,813 Total Cruise and tour operating expenses 4,225 3,886 8,165 7,653 Selling and administrative expense 863 816 1,786 1,663 Depreciation and amortization expense 723 692 1,419 1,346 Operating Income 851 934 1,458 1,477 Interest income 12 12 24 18 Interest expense, net of capitalized interest (285) (341) (577) (718) Debt extinguishment and modification costs — (4) — (255) Other income (expense), net (23) (16) (70) (4) Income Before Income Taxes 555 585 835 517 Income tax expense, net (17) (17) (34) (24) Net Income 539 568 801 494 Less: net income attributable to noncontrolling interests 2 4 6 7 Net Income attributable to Carnival Corporation Ltd.
Consolidated Statements of Income / three and six months ended May 31, 2026 · Filed 26/06/2026
15 Table of Contents The below tables include our calculation of adjusted operating income (loss), our significant segment expenses, and a reconciliation of adjusted operating income (loss) to income before income taxes: Three Months Ended May 31, 2026 (in millions) North America Europe Cruise Support Tour and Other Total Total Revenues $ 4,412 $ 2,122 $ 95 $ 34 $ 6,663 Cruise and tour operating expenses: Commissions, transportation and other 507 303 (32) (d) — Onboard and other 538 138 22 — Payroll and related 380 274 45 — Fuel 390 204 0 — Food 274 114 1 — Other operating (a) 694 302 30 42 Total Cruise and tour operating expenses 2,784 1,334 65 42 4,225 Adjusted selling and administrative expense (b)(c) 493 260 87 5 845 Depreciation and amortization expense 477 203 37 7 723 Adjusted Operating Income (Loss) 658 326 (94) (21) 869 Restructuring expenses (0 ) Other (17) Interest income 12 Interest expense, net of capitalized interest (285) Other income (expense), net (23) Income Before Income Taxes $ 555 Capital Expenditures $ 535 $ 184 $ 145 $ 11 $ 875 (a)Represents other operating expenses, which include port costs that do not vary with guest head counts; repairs and maintenance, including minor improvements and dry-dock expenses; hotel costs; entertainment; freight and logistics; insurance premiums; tour and other expense for our hotel and transportation operations and all other ship operating expenses.
Segment disclosures / second-quarter 2026 adjusted operating income reconciliation · Filed 26/06/2026
16 Table of Contents Three Months Ended May 31, 2025 (in millions) North America Europe Cruise Support Tour and Other Total Total Revenues $ 4,214 $ 2,011 $ 73 $ 31 $ 6,328 Cruise and tour operating expenses: Commissions, transportation and other 491 310 (21) (d) — Onboard and other 526 133 13 — Payroll and related 358 246 36 — Fuel 310 157 0 — Food 262 109 0 — Other operating (a)(b) 697 310 17 32 Total Cruise and tour operating expenses 2,644 1,265 46 32 3,987 Adjusted selling and administrative expense (c) 470 248 90 5 814 Depreciation and amortization expense 450 187 50 6 692 Adjusted Operating Income (Loss) 650 311 (113) (12) 835 Gains on ship sales and impairments 101 Restructuring expenses (2) Interest income 12 Interest expense, net of capitalized interest (341) Debt extinguishment and modification costs (4) Other income (expense), net (16) Income Before Income Taxes $ 585 Capital Expenditures $ 505 $ 158 $ 173 $ 14 $ 850 (a)Represents other operating expenses, which include port costs that do not vary with guest head counts; repairs and maintenance, including minor improvements and dry-dock expenses; hotel costs; entertainment; freight and logistics; insurance premiums; tour and other expenses for our hotel and transportation operations and all other ship operating expenses.
Segment disclosures / second-quarter 2025 adjusted operating income and ship-sale gains · Filed 26/06/2026
Our maritime and/or shoreside operations, including our ability to manage our inventory of cabins held for sale and set pricing, control costs and serve our guests, depends on the reliability of our information technology operations and system networks, as well as our ability to refine and update to more advanced systems and technologies.
Risk Factors / cabin inventory management and price setting · Filed 27/01/2026
Guest cancellation fees, when applicable, are recognized in Passenger ticket revenues at the time of cancellation.
Revenue recognition / applicable guest cancellation fees · Filed 26/06/2026
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (in millions) Six Months Ended May 31, 2026 2025 OPERATING ACTIVITIES Net income $ 801 $ 494 Adjustments to reconcile net income to net cash provided by operating activities Depreciation and amortization 1,419 1,346 Loss on debt extinguishment — 253 Share-based compensation 50 45 Amortization of discounts and debt issue costs 54 60 Non-cash lease expense 85 77 Gain on sales of ships — (103) Greenhouse gas regulatory expense 57 29 Other 101 68 2,566 2,268 Changes in operating assets and liabilities Receivables 42 22 Inventories (48) 33 Prepaid expenses and other assets (230) (209) Accounts payable (4) (10) Accrued liabilities and other (93) (382) Customer deposits 1,660 1,596 Net cash provided by operating activities 3,893 3,317 INVESTING ACTIVITIES Purchases of property and equipment (1,441) (1,458) Proceeds from sales of ships and other property and equipment 3 312 Advances to affiliates (46) (40) Other 3 (5) Net cash used in investing activities (1,481) (1,191) FINANCING ACTIVITIES Principal repayments of long-term debt (1,247) (5,064) Debt issuance costs (29) (41) Debt extinguishment costs — (197) Proceeds from issuance of long-term debt — 4,082 Dividends paid (414) — Share repurchases (381) — Other (33) 10 Net cash used in financing activities (2,104) (1,211) Effect of exchange rate changes on cash, cash equivalents and restricted cash (5) 24 Net increase (decrease) in cash, cash equivalents and restricted cash 303 940 Cash, cash equivalents and restricted cash at beginning of period 1,958 1,231 Cash, cash equivalents and restricted cash at end of period $ 2,260 $ 2,171 The accompanying notes are an integral part of these consolidated financial statements.
Consolidated Statements of Cash Flows / first-half 2026 spending and financing · Filed 26/06/2026
Convertible Notes In December 2025, we settled $1.1 billion principal amount of the 2027 Convertible Notes, resulting in the issuance of 69.1 million shares of Carnival Corporation common stock and a cash payment of $500 million.
Debt disclosures / December 2025 convertible-note settlement and share issuance · Filed 26/06/2026
In December 2025, we successfully completed our $19 billion refinancing plan in less than a year and reduced total debt by over $10 billion since our peak in January 2023.
MD&A / refinancing completion and debt reduction through December 2025 · Filed 27/01/2026
Our consolidated operating income increased by $909 million to $4.5 billion in 2025 from $3.6 billion in 2024.
MD&A / 2025 consolidated operating income · Filed 27/01/2026
DLC Unification and Redomiciliation In May 2026, we completed the unification of the dual listed company structure under a single company, Carnival Corporation Ltd., listed solely on the New York Stock Exchange.
Note 1 / completed May 2026 corporate unification · Filed 26/06/2026
Our 2025 compensation program included: • Performance metrics for our 2025 annual cash bonus delivered through our MIP focus on Normalized Adjusted Operating Income (80%) as the primary performance measure with the remainder focused on critical environmental and safety initiatives (20%).
Compensation Discussion and Analysis / actual 2025 annual incentive metrics · Filed 27/02/2026
• Structure of our 2025 equity-based incentive program: • PBS (performance-based share) grants, weighted at 60%, designed to support our return to profitable growth, align with shareholder interest and reward long-term success by measuring Normalized Operating Income per adjusted lower berth days (“ALBD”), adjusted ROIC, relative TSR and GHG intensity reductions for fiscal years 2025, 2026 and 2027.
Compensation Discussion and Analysis / 2025 performance equity weighting and measures · Filed 27/02/2026
• TBS (time-based share) grants, weighted at 40%, to support our retention objectives by providing for annual vesting over a three-year period subject to continued employment.
Compensation Discussion and Analysis / time-based equity weighting and vesting · Filed 27/02/2026
In April 2025, PBS grants were made based on the grant values approved in January 2025 and were converted into a target number of PBS based on the average of the closing prices of a share of Carnival Corporation common stock over a 10-business day period ending on April 16, 2025 (the effective date of grant), being $17.54.
Compensation Discussion and Analysis / April 2025 performance grants actually made · Filed 27/02/2026
The pre-existing clawback provisions give the Compensation Committees authority to recover equity grants and annual bonus incentives from Executive Officers and non-executives in the event Carnival Corporation & plc is required to restate its financial statements due to fraud or other misconduct, or in the event of other specified detrimental activity, including a breach of confidentiality or restrictive covenants, any activity that would be grounds for termination for cause, or maligning, denigrating or disparaging Carnival Corporation & plc, its directors or its employees.
Compensation / existing clawback provisions · Filed 27/02/2026
2025 Business Highlights CARNIVAL CORPORATION & PLC 2026 PROXY STATEMENT | 1 TABLE OF CONTENTS Proxy Summary Corporate Governance Highlights Corporate Governance Highlights Corporate Governance Best Practices 9 of our 11 Directors are independent, including all members of the Audit, Compensation, Compliance, Health, Environmental, Safety and Security (“HESS”) and Nominating & Governance (“N&G”) Committees Presiding Director and Senior Independent Director, with defined responsibilities Backgrounds and qualifications of Directors represent a variety of skills, attributes, experiences and perspectives Balance of new and experienced Directors Majority voting for Directors in uncontested elections Stock ownership policy for Directors and executives Director overboarding policy (included in our Corporate Governance Guidelines) Annual Director evaluation and Committee assessment to ensure Board effectiveness, supplemented by third party independent evaluations as needed Regular shareholder engagement, including participation of independent Directors All Directors attended over 75% of fiscal 2025 meetings Regular executive sessions of independent Directors Robust risk oversight Board review of our financial performance, strategy and succession planning Code of Business Conduct and Ethics Commitment to corporate social responsibility and sustainability Comprehensive processes to support reporting of concerns, including anonymously via a dedicated hotline Coordinated internal audit, compliance and incident investigation functions with reporting lines to relevant Board Committees Our governance documents, including the Corporate Governance Guidelines, the Committee Charters and the Code of Business Conduct and Ethics, are available at www.carnivalcorp.com/governance and www.carnivalplc.com/governance.
Proxy Summary / board independence and governance practices · Filed 27/02/2026
Our Chair of the Board of Directors of Carnival plc has been in his post for longer than nine years and was not considered independent on appointment.
Corporate Governance Report / chair tenure and independence exception · Filed 27/02/2026
The Boards consider this approach effective and may engage an external third-party facilitator on an as-needed basis, but not necessarily according to a strict schedule.
Corporate Governance Report / external board evaluation scheduling exception · Filed 27/02/2026
Our travel agents’ relationships are generally not exclusive and travel agents generally receive a base commission, plus the potential of additional commissions, including discounts or complimentary tour conductor cabins, based on the achievement of pre-defined sales terms.
Business / Marketing Activities / nonexclusive travel-agent relationships · Filed 27/01/2026
