Carnival Corp Ltd. 10-Q

Item 1. Financial Statements . CARNIVAL CORPORATION & PLC CONSOLIDATED STATEMENTS OF INCOME (LOSS) (UNAUDITED) (in millions, except per share data) Three Months Ended May 31, Six Months Ended May 31, 2025 2024 2025 2024 Revenues Passenger ticket $ 4,104 $ 3,754 $ 7,936 $ 7,370 Onboard and other 2,224 2,027 4,202 3,817 6,328 5,781 12,139 11,187 Operating Expenses Commissions, transportation and other 780 732 1,631 1,552 Onboard and other 671 628 1,271 1,178 Payroll and related 640 614 1,280 1,237 Fuel 468 525 933 1,030 Food 372 360 726 706 Other operating 955 938 1,813 1,800 Cruise and tour operating expenses 3,886 3,798 7,653 7,502 Selling and administrative 816 789 1,663 1,603 Depreciation and amortization 692 634 1,346 1,247 5,394 5,221 10,662 10,352 Operating Income 934 560 1,477 836 Nonoperating Income (Expense) Interest income 12 25 18 58 Interest expense, net of capitalized interest ( 341 ) ( 450 ) ( 718 ) ( 921 ) Debt extinguishment and modification costs ( 4 ) ( 33 ) ( 255 ) ( 66 ) Other income (expense), net ( 20 ) ( 7 ) ( 12 ) ( 25 ) ( 353 ) ( 464 ) ( 967 ) ( 953 ) Income (Loss) Before Income Taxes 582 96 510 ( 118 ) Income Tax Expense, Net ( 17 ) ( 5 ) ( 24 ) ( 5 ) Net Income (Loss) $ 565 $ 92 $ 486 $ ( 123 ) Earnings Per Share Basic $ 0.43 $ 0.07 $ 0.37 $ ( 0.10 ) Diluted $ 0.42 $ 0.07 $ 0.37 $ ( 0.10 ) The accompanying notes are an integral part of these consolidated financial statements. 4 Table of Content CARNIVAL CORPORATION & PLC CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED) (in millions) Three Months Ended May 31, Six Months Ended May 31, 2025 2024 2025 2024 Net Income (Loss) $ 565 $ 92 $ 486 $ ( 123 ) Items Included in Other Comprehensive Income (Loss) Change in foreign currency translation adjustment 227 7 215 7 Other 6 11 6 12 Other Comprehensive Income (Loss) 233 18 221 19 Total Comprehensive Income (Loss) $ 798 $ 110 $ 708 $ ( 104 ) The accompanying notes are an integral part of these consolidated financial statements. 5 Table of Content CARNIVAL CORPORATION & PLC CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in millions, except par values) May 31, 2025 November 30, 2024 ASSETS Current Assets Cash and cash equivalents $ 2,146 $ 1,210 Trade and other receivables, net 569 590 Inventories 476 507 Prepaid expenses and other 1,158 1,070 Total current assets 4,349 3,378 Property and Equipment, Net 42,751 41,795 Operating Lease Right-of-Use Assets, Net 1,365 1,368 Goodwill 579 579 Other Intangibles 1,178 1,163 Other Assets 943 775 $ 51,165 $ 49,057 LIABILITIES AND SHAREHOLDERS’ EQUITY Current Liabilities Current portion of long-term debt $ 1,392 $ 1,538 Current portion of operating lease liabilities 177 163 Accounts payable 1,198 1,133 Accrued liabilities and other 2,072 2,358 Customer deposits 8,082 6,425 Total current liabilities 12,920 11,617 Long-Term Debt 25,862 25,936 Long-Term Operating Lease Liabilities 1,217 1,239 Other Long-Term Liabilities 1,159 1,012 Contingencies and Commitments Shareholders’ Equity Carnival Corporation common stock, $ 0.01 par value; 1,960 shares authorized; 1,298 shares issued at 2025 and 1,294 shares issued at 2024 13 13 Carnival plc ordinary shares, $ 1.66 par value; 217 shares issued at 2025 and 2024 361 361 Additional paid-in capital 17,208 17,155 Retained earnings 2,543 2,101 Accumulated other comprehensive income (loss) (“AOCI”) ( 1,753 ) ( 1,975 ) Treasury stock, 131 shares at 2025 and 130 shares at 2024 of Carnival Corporation and 72 shares at 2025 and 73 shares at 2024 of Carnival plc, at cost ( 8,364 ) ( 8,404 ) Total shareholders’ equity 10,007 9,251 $ 51,165 $ 49,057 The accompanying notes are an integral part of these consolidated financial statements. 6 Table of Content CARNIVAL CORPORATION & PLC CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (in millions) Six Months Ended May 31, 2025 2024 OPERATING ACTIVITIES Net income (loss) $ 486 $ ( 123 ) Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities Depreciation and amortization 1,346 1,247 Loss on debt extinguishment 253 63 (Income) loss from equity-method investments 3 7 Share-based compensation 45 30 Amortization of discounts and debt issue costs 60 72 Non-cash lease expense 77 67 Gain on sales of ships ( 103 ) — Greenhouse gas regulatory expense 29 15 Other 72 39 2,268 1,417 Changes in operating assets and liabilities Receivables 22 38 Inventories 33 14 Prepaid expenses and other assets ( 209 ) 449 Accounts payable ( 10 ) ( 52 ) Accrued liabilities and other ( 382 ) ( 30 ) Customer deposits 1,596 1,971 Net cash provided by (used in) operating activities 3,317 3,807 INVESTING ACTIVITIES Purchases of property and equipment ( 1,458 ) ( 3,457 ) Proceeds from sales of ships and other 312 — Other ( 45 ) 72 Net cash provided by (used in) investing activities ( 1,191 ) ( 3,384 ) FINANCING ACTIVITIES Principal repayments of long-term debt ( 5,064 ) ( 4,072 ) Debt issuance costs ( 41 ) ( 117 ) Debt extinguishment costs ( 197 ) ( 41 ) Proceeds from issuance of long-term debt 4,082 3,048 Other 10 ( 1 ) Net cash provided by (used in) financing activities ( 1,211 ) ( 1,183 ) Effect of exchange rate changes on cash, cash equivalents and restricted cash 24 ( 6 ) Net increase (decrease) in cash, cash equivalents and restricted cash 940 ( 767 ) Cash, cash equivalents and restricted cash at beginning of period 1,231 2,436 Cash, cash equivalents and restricted cash at end of period $ 2,171 $ 1,669 The accompanying notes are an integral part of these consolidated financial statements. 7 Table of Content CARNIVAL CORPORATION & PLC CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (UNAUDITED) (in millions) Three Months Ended Common stock Ordinary shares Additional paid-in capital Retained earnings (accumulated deficit) AOCI Treasury stock Total shareholders’ equity At February 28, 2025 $ 13 $ 361 $ 17,180 $ 1,991 $ ( 1,986 ) $ ( 8,376 ) $ 9,182 Net income (loss) — — — 565 — — 565 Other comprehensive income (loss) — — — — 233 — 233 Issuance of treasury shares for vested share-based awards — — — ( 12 ) — 12 — Share-based compensation and other — — 28 — — ( 1 ) 27 At May 31, 2025 $ 13 $ 361 $ 17,208 $ 2,543 $ ( 1,753 ) $ ( 8,364 ) $ 10,007 At February 29, 2024 $ 13 $ 361 $ 16,679 $ ( 29 ) $ ( 1,938 ) $ ( 8,404 ) $ 6,682 Net income (loss) — — — 92 — — 92 Other comprehensive income (loss) — — — — 18 — 18 Share-based compensation and other — — 22 — — — 22 At May 31, 2024 $ 13 $ 361 $ 16,701 $ 62 $ ( 1,919 ) $ ( 8,404 ) $ 6,814 Six Months Ended Common stock Ordinary shares Additional paid-in capital Retained earnings AOCI Treasury stock Total shareholders’ equity At November 30, 2024 $ 13 $ 361 $ 17,155 $ 2,101 $ ( 1,975 ) $ ( 8,404 ) $ 9,251 Net income (loss) — — — 486 — — 486 Other comprehensive income (loss) — — — — 221 — 221 Issuance of treasury shares for vested share-based awards — — — ( 44 ) — 44 — Share-based compensation and other — — 52 — — ( 5 ) 48 At May 31, 2025 $ 13 $ 361 $ 17,208 $ 2,543 $ ( 1,753 ) $ ( 8,364 ) $ 10,007 At November 30, 2023 $ 12 $ 361 $ 16,712 $ 185 $ ( 1,939 ) $ ( 8,449 ) $ 6,882 Net income (loss) — — — ( 123 ) — — ( 123 ) Other comprehensive income (loss) — — — — 19 — 19 Issuance of treasury shares for vested share-based awards — — ( 47 ) — — 47 — Share-based compensation and other — — 36 — — ( 2 ) 35 At May 31, 2024 $ 13 $ 361 $ 16,701 $ 62 $ ( 1,919 ) $ ( 8,404 ) $ 6,814 The accompanying notes are an integral part of these consolidated financial statements. 8 Table of Content CARNIVAL CORPORATION & PLC NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) NOTE 1 – General The consolidated financial statements include the accounts of Carnival Corporation and Carnival plc and their respective subsidiaries. Together with their consolidated subsidiaries, they are referred to collectively in these consolidated financial statements and elsewhere in this joint Quarterly Report on Form 10-Q as “Carnival Corporation & plc,” “our,” “us” and “we.” Basis of Presentation The consolidated financial statements are unaudited and, in the opinion of our management, contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted as permitted by such Securities and Exchange Commission rules and regulations. The preparation of our interim consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported and disclosed. We have made reasonable estimates and judgments of such items within our financial statements and there may be changes to those estimates in future periods. Our operations are seasonal and results for interim periods are not necessarily indicative of the results for the entire year. Our interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes included in the Carnival Corporation & plc 2024 joint Annual Report on Form 10-K (“Form 10-K”) filed with the U.S. Securities and Exchange Commission (“SEC”) on January 27, 2025. For 2024, we reclassified $ 15 million from other to greenhouse gas regulatory expense in the Consolidated Statements of Cash Flows to conform to the current year presentation. Brand Realignment In March 2025, we sunset the P&O Cruises (Australia) brand and folded its operations into Carnival Cruise Line. Accounting Pronouncements In November 2023, the FASB issued guidance, Segment Reporting - Improvements to Reportable Segment Disclosures . This guidance requires annual and interim disclosure of significant segment expenses that are provided to the chief operating decision maker (“CODM”) as well as interim disclosures for all reportable segments’ measure of profit or loss and assets. This guidance also requires disclosure of the title and position of the CODM and an explanation of how the CODM uses the reported measure of segment profit or loss in assessing segment performance and deciding how to allocate resources. This guidance is effective for us for annual periods beginning in 2025 and interim periods beginning in 2026. While this guidance will not have an effect on our Consolidated Statements of Income (Loss) or Consolidated Balance Sheets , it will affect certain segment reporting disclosures. In December 2023, the FASB issued guidance, Income Taxes - Improvements to Income Tax Disclosures . This guidance requires disaggregation of rate reconciliation categories and income taxes paid by jurisdiction, as well as other amendments relating to income tax disclosures. This guidance is required to be adopted by us in 2026. We are currently evaluating the impact this guidance will have on our consolidated financial statements. In November 2024, the FASB issued guidance, Debt - Debt with Conversion and Other Options - Induced Conversions of Convertible Debt Instruments . This guidance clarifies the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as induced conversions or extinguishments. This guidance is required to be adopted by us in 2027. We are currently evaluating the impact this guidance will have on our consolidated financial statements. In November 2024, the FASB issued guidance, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures - Disaggregation of Income Statement Expenses . This guidance requires annual and interim disclosure of disaggregated information for certain costs and expenses. This guidance is required to be adopted by us in 2028. We are currently evaluating the impact this guidance will have on our consolidated financial statements. 9 Table of Content NOTE 2 – Revenue and Expense Recognition Guest cruise deposits and advance onboard purchases are initially included in customer deposits when received. Customer deposits are subsequently recognized as cruise revenues, together with revenues from onboard and other activities, and all associated direct expenses of a voyage are recognized as cruise expenses, upon completion of voyages with durations of ten nights or less and on a pro rata basis for voyages in excess of ten nights. The impact of recognizing these shorter duration cruise revenues and expenses on a completed voyage basis versus on a pro rata basis is not material. Certain of our product offerings are bundled and we allocate the value of the bundled services and goods between passenger ticket revenues and onboard and other revenues based upon the estimated standalone selling prices of those goods and services. Future travel discount vouchers are included as a reduction of cruise passenger ticket revenues when such vouchers are utilized. Guest cancellation fees, when applicable, are recognized in passenger ticket revenues at the time of cancellation. Our sales to guests of air and other transportation to and from airports near the home ports of our ships are included in passenger ticket revenues, and the related expenses of these services are included in prepaid expenses and other when paid prior to the start of a voyage and are subsequently recognized in transportation expenses at the time of revenue recognition. The cost of prepaid air and other transportation expenses at May 31, 2025 and November 30, 2024 were $ 228 million and $ 219 million. The proceeds that we collect from the sales of third-party shore excursions are included in onboard and other revenues and the related expenses are included in onboard and other expenses. The amounts collected on behalf of our onboard concessionaires, net of the amounts remitted to them, are included in onboard and other revenues as concession revenues. All of these amounts are recognized on a completed voyage or pro rata basis as discussed above. Fees, taxes and charges that vary with guest head counts are expensed in commissions, transportation and other expenses when the corresponding revenues are recognized. The remaining portion of fees, taxes and charges are expensed in other operating expenses when the corresponding revenues are recognized. Revenues and expenses from our hotel and transportation operations, which are included in our Tour and Other segment, are recognized at the time the services are performed. Customer Deposits Our payment terms generally require an initial deposit to confirm a reservation, with the balance due prior to the voyage. Cash received from guests in advance of the cruise is recorded in customer deposits and in other long-term liabilities on our Consolidated Balance Sheets. These amounts include refundable deposits. We had total customer deposits of $ 8.5 billion as of May 31, 2025 and $ 6.8 billion as of November 30, 2024. During the six months ended May 31, 2025 and 2024, we recognized revenues of $ 5.1 billion and $ 4.7 billion related to our customer deposits as of November 30, 2024 and 2023. 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. Trade and Other Receivables Although we generally require full payment from our customers prior to or concurrently with their cruise, we grant credit terms to a relatively small portion of our revenue source. We have receivables from credit card merchants and travel agents for cruise ticket purchases and onboard revenue. These receivables are included within trade and other receivables, net and are less allowances for expected credit losses. Contract Costs We recognize incremental travel agent commissions and credit and debit card fees incurred as a result of obtaining the ticket contract as assets when paid prior to the start of a voyage. We record these amounts within prepaid expenses and other and subsequently recognize these amounts as commissions, transportation and other at the time of revenue recognition or at the time of voyage cancellation. We had incremental costs of obtaining contracts with customers recognized as assets of $ 445 million as of May 31, 2025 and $ 336 million as of November 30, 2024 . 10 Table of Content NOTE 3 – Debt May 31, November 30, (in millions) Maturity Rate (a) 2025 2024 Secured Subsidiary Guaranteed Notes Notes Jun 2027 7.88 % $ 192 $ 192 Notes Aug 2028 4.00 % 2,406 2,406 Notes Aug 2029 7.00 % 500 500 Loans Floating rate Aug 2027 - Oct 2028 SOFR + 2.00 % (b) 2,449 2,449 Total Secured Subsidiary Guaranteed 5,547 5,547 Senior Priority Subsidiary Guaranteed Notes (c) May 2028 10.38 % — 2,030 Unsecured Subsidiary Guaranteed Notes Notes (d) Mar 2026 7.63 % — 1,351 Notes Mar 2027 5.75 % 2,722 2,722 Convertible Notes Dec 2027 5.75 % 1,131 1,131 Notes May 2029 6.00 % 2,000 2,000 EUR Notes Jan 2030 5.75 % 569 528 Notes Mar 2030 5.75 % 1,000 — Notes (e) Jun 2030 10.50 % — 1,000 Notes Jun 2031 5.88 % 1,000 — Notes Feb 2033 6.13 % 2,000 — Loans EUR floating rate (f) Apr 2025 EURIBOR + 3.25 % — 211 Export Credit Facilities Floating rate Dec 2031 SOFR + 1.20 % (g) 480 514 Fixed rate Aug 2027 - Dec 2032 2.42 - 3.38 % 2,176 2,370 EUR floating rate Oct 2026 - Nov 2034 EURIBOR + 0.55 - 0.80 % 2,596 2,590 EUR fixed rate Feb 2031 - Sep 2037 1.05 - 4.00 % 5,523 5,386 Total Unsecured Subsidiary Guaranteed 21,197 19,803 Unsecured (No Subsidiary Guarantee) Notes Notes Jan 2028 6.65 % 200 200 EUR Notes Oct 2029 1.00 % 682 633 Loans EUR floating rate (f) Apr 2029 EURIBOR + 1.95 % 341 — Total Unsecured (No Subsidiary Guarantee) 1,223 833 Total Debt 27,967 28,213 Less: unamortized debt issuance costs and discounts ( 713 ) ( 738 ) Total Debt, net of unamortized debt issuance costs and discounts 27,254 27,475 Less: current portion of long-term debt ( 1,392 ) ( 1,538 ) Long-Term Debt $ 25,862 $ 25,936 11 Table of Content (a) The reference rates, together with any applicable credit adjustment spread, for all of our variable debt have 0.00 % to 0.75 % floors. (b) As part of the repricing of our senior secured term loans, we amended the loans’ margin from 2.75 % to 2.00 %. Se e “Repricing of Senior Secured Term Loans” below. (c) See “2033 Senior Unsecured Notes” below. (d) See “2031 Senior Unsecured Notes” below. (e) See “ 2030 Senior Unsecured Notes ” below. (f) In April 2025, the euro floating rate loan agreement was amended to increase the principal amount by $ 112 million , extend its maturity from April 2025 to April 2029, amend the loan’s margin from 3.25 % to 1.95 % and remove the subsidiary guarantee . (g) Includes applicable credit adjustment spread. As of May 31, 2025, Carnival Corporation and/or Carnival plc was the primary obligor of all our outstanding debt excluding the following: • $ 3.0 billion under an undrawn $ 1.9 billion, € 0.9 billion and £ 0.1 billion multi-currency revolving credit facility (“Revolving Facility”) of Carnival Holdings (Bermuda) II Limited (“Carnival Holdings II”), a subsidiary of Carnival Corporation • $ 0.9 billion under an export credit facility of Sun Princess Limited, a subsidiary of Carnival Corporation • $ 0.2 billion under an export credit facility of Sun Princess II Limited, a subsidiary of Carnival Corporation As of May 31, 2025, all of our outstanding debt was issued or guaranteed by substantially the same entities with the exception of the following: • The Revolving Facility of Carnival Holdings II, which does not guarantee our other outstanding debt • The export credit facilities of Sun Princess Limited and Sun Princess II Limited, which do not guarantee our other outstanding debt As of May 31, 2025, the scheduled maturities of our debt are as follows: (in millions) Year Principal Payments Remainder of 2025 $ 692 2026 1,400 2027 4,958 2028 6,758 2029 4,780 Thereafter 9,378 Total $ 27,967 Revolving Facility As of May 31, 2025, Carnival Holdings II had $ 3.0 billion available for borrowing under the Revolving Facility. New Revolving Facility In June 2025, Carnival Corporation and Carnival plc entered into a $ 4.5 billion unsecured multi-currency revolving credit facility (“New Revolving Facility”). The New Revolving Facility replaced the Revolving Facility of Carnival Holdings II. The New Revolving Facility matures in June 2030 and contains an accordion feature, allowing for up to $ 1.0 billion of additional revolving commitments. We may borrow or utilize available amounts under the New Revolving Facility through June 2030, subject to the satisfaction of the conditions in the facility. Borrowings under the New Revolving Facility will bear interest at a rate of term SOFR, EURIBOR, or daily compounding SONIA, as applicable, plus a margin based on the long-term credit ratings of Carnival Corporation. In addition, we are required to pay certain fees on the aggregate commitments under the New Revolving Facility. Repricing of Senior Secured Term Loans In January 2025, we entered into amendments with the lender syndicate to reprice the outstanding principal amounts of our first-priority senior secured term loan facility maturing in 2027 and our first-priority senior secured term loan facility maturing 12 Table of Content in 2028 (“Repriced Loans”), which are included within the total Secured Subsidiary Guaranteed Loans balance in the debt table above. The Repriced Loans bear interest at a rate per annum equal to SOFR with a 0.75 % floor, plus a margin equal to 2.00 %. 2030 Senior Unsecured Notes In February 2025, we issued $ 1.0 billion aggregate principal amount of 5.75 % senior unsecured notes due 2030. We used the net proceeds from the issuance, together with cash on hand, to redeem the outstanding principal amount of the 10.50 % senior unsecured notes due 2030. 2033 Senior Unsecured Notes In February 2025, we issued $ 2.0 billion aggregate principal amount of 6.13 % senior unsecured notes due 2033. We used the net proceeds from the issuance, together with cash on hand, to redeem the outstanding principal amount of the 10.38 % senior priority notes due 2028. 2031 Senior Unsecured Notes In May 2025, we issued $ 1.0 billion aggregate principal amount of 5.88 % senior unsecured notes due 2031. We used the net proceeds from the issuance, together with cash on hand, to redeem the outstanding principal amount of the 7.63 % senior unsecured notes due 2026. Debt Extinguishment and Modification Costs During the three and six months ended May 31, 2025, we recognized a total of $ 4 million and $ 255 million of debt extinguishment and modification costs, including $ 197 million of premium paid on redemption during the six months ended May 31, 2025, within our Consolidated Statements of Income (Loss) as a result of the above transactions. Export Credit Facility Borrowings Our export credit facilities are due in semi-annual installments through 2037. As of May 31, 2025, we had $ 8.4 billion of undrawn export credit facilities to fund ship deliveries planned through 2033. As of May 31, 2025, the net book value of our ships subject to negative pledges pursuant to export credit facilities was $ 18.7 billion. Collateral and Priority Pool As of May 31, 2025, the net book value of our ships and ship improvements, excluding ships under construction, is $ 39.8 billion. Our secured debt is secured on a first-priority basis by certain collateral, which includes ships and certain assets related to those ships and material intellectual property (combined net book value of approximately $ 22.7 billion, including $ 21.1 billion related to ships and certain assets related to those ships) as of May 31, 2025 and certain other assets. As of May 31, 2025, $ 2.8 billion in net book value of our ship and ship improvements relate to the priority pool ships included in the priority pool of three unencumbered ships (the “Revolving Facility Subject Ships”) for our Revolving Facility. As of May 31, 2025, there was no change in the identity of the Revolving Facility Subject Ships. Covenant Compliance As of May 31, 2025, our Revolving Facility, unsecured loan and export credit facilities contain certain covenants listed below: • Maintain minimum interest coverage (adjusted EBITDA to consolidated net interest charges, as defined in the agreements) as follows: ◦ For our export credit facilities and our Revolving Facility, at a ratio of not less than 2.0 to 1.0 for the May 31, 2025 testing date, at a ratio of not less than 2.5 to 1.0 for the August 31, 2025 and November 30, 2025 testing dates, and at a ratio of not less than 3.0 to 1.0 for the February 28, 2026 testing date onwards and as applicable through their respective maturity dates ◦ For our unsecured loan, at a ratio of not less than 2.0 to 1.0 for the May 31, 2025 testing date through the maturity date • For certain of our unsecured loan and export credit facilities, maintain minimum issued capital and consolidated reserves (as defined in the agreements) of $ 5.0 billion • Limit our debt to capital (as defined in the agreements) percentage to a percentage not to exceed 65 % • Maintain minimum liquidity of $ 1.5 billion 13 Table of Content • Adhere to certain restrictive covenants through August 2027 (subject to such covenants terminating if we reach an investment grade credit rating in accordance with the agreement governing the Revolving Facility) • Limit the amounts of our secured assets as well as secured and other indebtedness At May 31, 2025 , we were in compliance with the applicable covenants under our debt agreements. Generally, if an event of default under any debt agreement occurs, then, pursuant to cross-default and/or cross-acceleration clauses therein, substantially all of our outstanding debt and derivative contract payables could become due, and our debt and derivative contracts could be terminated. Any financial covenant amendment may lead to increased costs, increased interest rates, additional restrictive covenants and other available lender protections that would be applicable. NOTE 4 – Contingencies and Commitments Litigation We are routinely involved in legal proceedings, claims, disputes, regulatory matters and governmental inspections or investigations arising in the ordinary course of or incidental to our business. We have insurance coverage for certain of these claims and actions, or any settlement of these claims and actions, and historically the maximum amount of our liability, net of any insurance recoverables, has been limited to our self-insurance retention levels. We record provisions in the consolidated financial statements for pending litigation when we determine that an unfavorable outcome is probable and the amount of the loss can be reasonably estimated. Legal proceedings and government investigations are subject to inherent uncertainties, and unfavorable rulings or other events could occur. Unfavorable resolutions could involve substantial monetary damages. In addition, in matters for which conduct remedies are sought, unfavorable resolutions could include an injunction or other order prohibiting us from selling one or more products at all or in particular ways, precluding particular business practices or requiring other remedies. An unfavorable outcome might result in a material adverse impact on our business, results of operations, financial position or liquidity. As previously disclosed, on May 2, 2019, the Havana Docks Corporation filed a lawsuit against Carnival Corporation in the U.S. District Court for the Southern District of Florida under Title III of the Cuban Liberty and Democratic Solidarity Act, also known as the Helms-Burton Act, alleging that Carnival Corporation “trafficked” in confiscated Cuban property when certain ships docked at certain ports in Cuba, and that this alleged “trafficking” entitles the plaintiffs to treble damages. On March 21, 2022, the court granted summary judgment in favor of Havana Docks Corporation as to liability. On December 30, 2022, the court entered judgment against Carnival Corporation in the amount of $ 110 million plus $ 4 million in fees and costs. We appealed. On October 22, 2024, the Court of Appeals for the 11 th Circuit reversed the District Court’s judgment against us. On March 6, 2025, Havana Docks filed a petition for certiorari with the Supreme Court of the United States and we responded. Following resolution of that petition, the case will be remanded to the District Court for further proceedings. We believe the ultimate outcome of this matter will not have a material impact on our consolidated financial statements. As of May 31, 2025, two purported class actions brought against us by former guests in the Federal Court in Australia and in Italy remain pending, as previously disclosed. These actions include claims based on a variety of theories, including negligence, gross negligence and failure to warn, physical injuries and severe emotional distress associated with being exposed to and/or contracting COVID-19 onboard our ships. On October 24, 2023, the court in the Australian matter held that we were liable for negligence and for breach of consumer protection warranties as it relates to the lead plaintiff. The court ruled that the lead plaintiff was not entitled to any pain and suffering or emotional distress damages on the negligence claim and awarded medical costs. In relation to the consumer protection warranties claim, the court found that distress and disappointment damages amounted to no more than the refund already provided to guests and therefore made no further award. Further proceedings will determine the applicability of this ruling to the remaining class participants. On March 31, 2025, the court in the Italian matter returned a ruling rejecting most of the plaintiffs’ claims and awarding a half-price fare reduction for certain passengers. Plaintiffs have appealed the ruling. We continue to take actions to defend against the above claims. We believe the ultimate outcome of these matters will not have a material impact on our consolidated financial statements. Regulatory or Governmental Inquiries and Investigations We have been, and may continue to be, impacted by breaches in data security and lapses in data privacy, which occur from time to time. These can vary in scope and range from inadvertent events to malicious motivated attacks. 14 Table of Content We have incurred legal and other costs in connection with cyber incidents that have impacted us. The penalties and settlements paid in connection with cyber incidents over the last three years were not material. While these incidents did not have a material adverse effect on our business, results of operations, financial position or liquidity, no assurances can be given about the future and we may be subject to future attacks, incidents or litigation that could have such a material adverse effect. On March 14, 2022, the U.S. Department of Justice and the U.S. Environmental Protection Agency notified us of potential civil penalties and injunctive relief for alleged Clean Water Act violations by owned and operated vessels covered by the 2013 Vessel General Permit. We are working with these agencies to reach a resolution of this matter. We believe the ultimate outcome will not have a material impact on our consolidated financial statements. Under the European Union Treaty certain economic benefits that are provided under Italian law are subject to approval on a periodic basis by the European Commission. In May 2025, the European Commission announced it had approved these benefits through December 31, 2033. The full text of the decision is yet to be made public. One of our subsidiaries continues to receive and recognize these benefits. We will assess the details of the decision once made public. If the European Commission denied a portion of the benefits we recognized, the Italian Government may be required to retroactively disallow them and seek reimbursement from us, which would result in a reversal of their recognition. We do not expect the outcome to have a material impact on our consolidated financial statements. Other Contingent Obligations Some of the debt contracts we enter into include indemnification provisions obligating us to make payments to the counterparty if certain events occur. These contingencies generally relate to changes in taxes or changes in laws which increase the lender’s costs. There are no stated or notional amounts included in the indemnification clauses, and we are not able to estimate the maximum potential amount of future payments, if any, under these indemnification clauses. We have agreements with a number of credit card processors that transact customer deposits related to our cruise vacations. Certain of these agreements allow the credit card processors to request, under certain circumstances, that we provide a capped reserve fund in cash. Although the agreements vary, these requirements may generally be satisfied either through a withheld percentage of customer payments or providing cash funds directly to the credit card processor. Ship Commitments As of May 31, 2025, our new ship growth capital commitments were $ 0.9 billion for the remainder of 2025 and $ 0.5 billion, $ 1.6 billion, $ 1.4 billion, $ 1.8 billion and $ 6.3 billion for the years ending November 30, 2026, 2027, 2028, 2029 and thereafter. NOTE 5 – Fair Value Measurements, Derivative Instruments and Hedging Activities and Financial Risks Fair Value Measurements Fair value is defined as the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and is measured using inputs in one of the following three categories: • Level 1 measurements are based on unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment. • Level 2 measurements are based on quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active or market data other than quoted prices that are observable for the assets or liabilities. • Level 3 measurements are based on unobservable data that are supported by little or no market activity and are significant to the fair value of the assets or liabilities. Considerable judgment may be required in interpreting market data used to develop the estimates of fair value. Accordingly, certain estimates of fair value presented herein are not necessarily indicative of the amounts that could be realized in a current or future market exchange. 15 Table of Content Financial Instruments that are not Measured at Fair Value on a Recurring Basis May 31, 2025 November 30, 2024 Carrying Value Fair Value Carrying Value Fair Value (in millions) Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Liabilities Fixed rate debt (a) $ 22,101 $ — $ 22,526 $ — $ 22,449 $ — $ 23,241 $ — Floating rate debt (a) 5,866 — 5,783 — 5,764 — 5,685 — Total $ 27,967 $ — $ 28,309 $ — $ 28,213 $ — $ 28,927 $ — (a) The debt amounts above do not include the impact of interest rate swaps or debt issuance costs and discounts. The fair values of our publicly-traded notes were based on their unadjusted quoted market prices in markets that are not sufficiently active to be Level 1 and, accordingly, are considered Level 2. The fair values of our other debt were estimated based on current market interest rates being applied to this debt. Financial Instruments that are Measured at Fair Value on a Recurring Basis May 31, 2025 November 30, 2024 (in millions) Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Assets Cash equivalents (a) $ 1,648 $ — $ — $ 404 $ — $ — Derivative financial instruments — — — — 2 — Total $ 1,648 $ — $ — $ 404 $ 2 $ — Liabilities Derivative financial instruments $ — $ 5 $ — $ — $ 4 $ — Total $ — $ 5 $ — $ — $ 4 $ — (a) Consists of money market funds and cash investments with original maturities of less than 90 days. Nonfinancial Instruments that are Measured at Fair Value on a Nonrecurring Basis Valuation of Goodwill and Trademarks As of May 31, 2025 and November 30, 2024 , goodwill for our North America segment was $ 579 million. Trademarks (in millions) North America Segment Europe Segment Total November 30, 2024 $ 927 $ 234 $ 1,161 Exchange movements — 16 16 May 31, 2025 $ 927 $ 250 $ 1,177 16 Table of Content Derivative Instruments and Hedging Activities (in millions) Balance Sheet Location May 31, 2025 November 30, 2024 Derivative assets Derivatives designated as hedging instruments Interest rate swaps (a) Prepaid expenses and other $ — $ 2 Total derivative assets $ — $ 2 Derivative liabilities Derivatives designated as hedging instruments Interest rate swaps (a) Other long-term liabilities $ 5 $ 4 Total derivative liabilities $ 5 $ 4 (a) We have interest rate swaps whereby we receive floating interest rate payments in exchange for making fixed interest rate payments. These interest rate swap agreements effectively changed $ 1.0 billion at May 31, 2025 and November 30, 2024 of SOFR-based variable rate debt to fixed rate debt. As of May 31, 2025 and November 30, 2024 , the SOFR-based interest rate swaps settle through 2027 and were designated as cash flow hedges. At November 30, 2024, we had a EURIBOR-based interest rate swap that was not designated as a cash flow hedge and effectively changed $ 11 million of EURIBOR-based floating rate euro debt to fixed rate euro debt. The EURIBOR-based interest rate swap matured in March 2025. Our derivative contracts include rights of offset with our counterparties. As of May 31, 2025 and November 30, 2024 , we did not have any counterparties with multiple derivative contracts. The effect of our derivatives qualifying and designated as hedging instruments recognized in other comprehensive income (loss) and in net income (loss) was as follows: Three Months Ended May 31, Six Months Ended May 31, (in millions) 2025 2024 2025 2024 Gains (losses) recognized in AOCI: Interest rate swaps – cash flow hedges $ — $ 20 $ ( 1 ) $ 33 (Gains) losses reclassified from AOCI – cash flow hedges: Interest rate swaps – Interest expense, net of capitalized interest $ 2 $ ( 8 ) $ 4 $ ( 20 ) Foreign currency zero cost collars – Depreciation and amortization $ 4 $ — $ 3 $ 1 Gains (losses) recognized on derivative instruments (amount excluded from effectiveness testing – net investment hedges) Cross currency swaps – Interest expense, net of capitalized interest $ — $ — $ — $ 2 The amount of gains and losses on derivatives not designated as hedging instruments recognized in earnings during the three and six months ended May 31, 2025 and estimated cash flow hedges’ unrealized gains and losses that are expected to be reclassified to earnings in the next twelve months are not material. Financial Risks Fuel Price Risks We manage our exposure to fuel price risk by managing our consumption of fuel. Substantially all of our exposure to market risk for changes in fuel prices relates to the consumption of fuel on our ships. We manage fuel consumption through fleet optimization, energy efficiency, itinerary efficiency, and new technologies and alternative fuels. 17 Table of Content Foreign Currency Exchange Rate Risks Overall Strategy We manage our exposure to fluctuations in foreign currency exchange rates through our normal operating and financing activities, including netting certain exposures to take advantage of any natural offsets and, when considered appropriate, through the use of derivative and non-derivative financial instruments. Our primary focus is to monitor our exposure to, and manage, the economic foreign currency exchange risks faced by our operations and realized if we exchange one currency for another. We consider hedging certain of our ship commitments and net investments in foreign operations. The financial impacts of our hedging instruments generally offset the changes in the underlying exposures being hedged. Operational Currency Risks Our operations primarily utilize the U.S. dollar, Euro, Sterling or the Australian dollar as their functional currencies. Our operations also have revenue and expenses denominated in non-functional currencies. Movements in foreign currency exchange rates affect our consolidated financial statements. Investment Currency Risks We consider our investments in foreign operations to be denominated in stable currencies and of a long-term nature. We have euro-denominated debt which provides an economic offset for our operations with euro functional currency. In addition, we have in the past and may in the future utilize derivative financial instruments, such as cross currency swaps, to manage our exposure to investment currency risks. Newbuild Currency Risks Our shipbuilding contracts are typically denominated in euros. At May 31, 2025, our newbuild currency exchange rate risk relates to euro-denominated newbuild contract payments for non-euro functional currency brands. The cost of shipbuilding orders that we may place in the future that are denominated in a different currency than our cruise brands’ functional currency will be affected by foreign currency exchange rate fluctuations. These foreign currency exchange rate fluctuations may affect our decision to order new cruise ships. We have in the past and may in the future utilize derivative financial instruments, such as foreign currency derivatives, to manage our exposure to newbuild currency risks. Our decisions to hedge non-functional currency ship commitments for our cruise brands are made on a case-by-case basis, considering the amount and duration of the exposure, market volatility, economic trends, our overall expected net cash flows by currency and other offsetting risks. Interest Rate Risks We manage our exposure to fluctuations in interest rates through our debt portfolio management and investment strategies. We evaluate our debt portfolio to determine whether to make periodic adjustments to the mix of fixed and floating rate debt through the use of interest rate swaps, refinancing of existing debt and the issuance of new debt. Concentrations of Credit Risk As part of our ongoing control procedures, we monitor concentrations of credit risk associated with financial and other institutions with which we conduct significant business. We seek to manage these credit risk exposures, including counterparty nonperformance primarily associated with our cash and cash equivalents, investments, notes receivables, reserve funds related to customer deposits (when required), future financing facilities, contingent obligations, derivative instruments, insurance contracts and new ship progress payment guarantees, by: • Conducting business with well-established financial institutions, insurance companies and export credit agencies • Diversifying our counterparties • Having guidelines regarding credit ratings and investment maturities that we follow to help safeguard liquidity and minimize risk • Generally requiring collateral and/or guarantees to support notes receivable on significant asset sales and new ship progress payments to shipyards 18 Table of Content We also monitor the creditworthiness of travel agencies and tour operators and credit and debit card providers to which we extend credit in the normal course of our business. Our credit exposure also includes contingent obligations related to cash payments received directly by travel agents and tour operators for cash collected by them on cruise sales in certain European countries where we are obligated to honor our guests’ cruise payments made by them to their travel agents and tour operators regardless of whether we have received these payments. Concentrations of credit risk associated with trade receivables and other receivables, charter-hire agreements and contingent obligations are not considered to be material, principally due to the large number of unrelated accounts, the nature of these contingent obligations and their short maturities. Normally, we have not required collateral or other security to support normal credit sales and have not experienced significant credit losses. NOTE 6 – Segment Information The chief operating decision maker, who is the Chief Executive Officer of Carnival Corporation and Carnival plc assesses performance and makes decisions to allocate resources for Carnival Corporation & plc based upon review of the results across all of our segments. The operating segments within each of our reportable segments have been aggregated based on the similarity of their economic and other characteristics, including geographic guest sourcing. Our four reportable segments are comprised of (1) North America cruise operations (“North America”), (2) Europe cruise operations (“Europe”), (3) Cruise Support and (4) Tour and Other. Our Cruise Support segment includes our portfolio of leading port destinations and exclusive islands as well as other services, all of which are operated for the benefit of our cruise brands. Our Tour and Other segment represents the hotel and transportation operations of Holland America Princess Alaska Tours and other operations. 19 Table of Content Three Months Ended May 31, (in millions) Revenues Operating expenses Selling and administrative Depreciation and amortization Operating income (loss) 2025 North America (a) $ 4,214 $ 2,600 $ 473 $ 450 $ 691 Europe 2,011 1,208 248 187 368 Cruise Support 73 46 90 50 ( 113 ) Tour and Other 31 32 5 6 ( 12 ) $ 6,328 $ 3,886 $ 816 $ 692 $ 934 2024 North America (a) $ 3,984 $ 2,580 $ 464 $ 414 $ 525 Europe 1,697 1,135 230 164 168 Cruise Support 63 39 90 49 ( 114 ) Tour and Other 37 44 6 6 ( 19 ) $ 5,781 $ 3,798 $ 789 $ 634 $ 560 Six Months Ended May 31, 2025 (in millions) Revenues Operating expenses Selling and administrative Depreciation and amortization Operating income (loss) 2025 North America (a) $ 8,120 $ 5,036 $ 993 $ 884 $ 1,207 Europe 3,841 2,478 499 356 508 Cruise Support 145 91 163 95 ( 204 ) Tour and Other 33 47 9 12 ( 34 ) $ 12,139 $ 7,653 $ 1,663 $ 1,346 $ 1,477 2024 North America (a) $ 7,558 $ 4,982 $ 966 $ 813 $ 797 Europe 3,466 2,386 464 328 288 Cruise Support 122 75 162 94 ( 210 ) Tour and Other 41 59 10 12 ( 40 ) $ 11,187 $ 7,502 $ 1,603 $ 1,247 $ 836 (a) Beginning in the first quarter of 2025, we renamed the North America and Australia segment to the North America segment. Revenue by geographic areas, which are based on where our guests are sourced, were as follows: Three Months Ended May 31, Six Months Ended May 31, (in millions) 2025 2024 2025 2024 North America $ 3,774 $ 3,542 $ 7,243 $ 6,663 Europe 1,964 1,631 3,590 3,199 Australia 315 355 735 781 Other 275 252 570 545 $ 6,328 $ 5,781 $ 12,139 $ 11,187 20 Table of Content NOTE 7 – Earnings Per Share Three Months Ended May 31, Six Months Ended May 31, (in millions, except per share data) 2025 2024 2025 2024 Net income (loss) $ 565 $ 92 $ 486 $ ( 123 ) Interest expense on dilutive Convertible Notes 18 — — — Net income (loss) for diluted earnings per share $ 582 $ 92 $ 486 $ ( 123 ) Weighted-average shares outstanding 1,312 1,267 1,310 1,265 Dilutive effect of equity awards 4 4 6 — Dilutive effect of Convertible Notes 84 — — — Diluted weighted-average shares outstanding 1,400 1,271 1,316 1,265 Basic earnings per share $ 0.43 $ 0.07 $ 0.37 $ ( 0.10 ) Diluted earnings per share $ 0.42 $ 0.07 $ 0.37 $ ( 0.10 ) Antidilutive shares excluded from diluted earnings per share computations were as follows: Three Months Ended May 31, Six Months Ended May 31, (in millions) 2025 2024 2025 2024 Equity awards — — — 5 Convertible Notes — 127 84 127 Total antidilutive securities — 127 84 132 NOTE 8 – Supplemental Cash Flow Information (in millions) May 31, 2025 November 30, 2024 Cash and cash equivalents (Consolidated Balance Sheets) $ 2,146 $ 1,210 Restricted cash (included in prepaid expenses and other and other assets) 25 21 Total cash, cash equivalents and restricted cash (Consolidated Statements of Cash Flows) $ 2,171 $ 1,231 NOTE 9 – Property and Equipment Ship Sales During 2025, we completed the sales of one North America segment ship and one Europe segment ship, which represents a passenger-capacity reduction of 460 berths for our North America segment and 2,700 berths for our Europe segment. We will continue to operate the North America segment ship through May 2026 and the Europe segment ship through September 2026 under bareboat charter agreements. 21 Table of Content