10-Q · May 4, 2026
Norwegian Cruise Line Holdings reported solid Q1 2026 results with revenue of $2.33 billion, a 9.6% increase from the previous year. EPS came in at $0.23, a significant turnaround from a loss of $0.09 year-over-year.…
Earnings analysis · 10-Q
NCLH earnings analysis
Filed August 3, 2026 · Our reading of the company's report
The latest report
NCLH delivered Q2 revenue of $2.641 billion, up 4.9% year over year and 13.3% sequentially from $2.330 billion, while GAAP EPS rose to $0.48 from $0.07 a year earlier and $0.23 in Q1. Underlying operating trends were…
Read full summary
NCLH delivered Q2 revenue of $2.641 billion, up 4.9% year over year and 13.3% sequentially from $2.330 billion, while GAAP EPS rose to $0.48 from $0.07 a year earlier and $0.23 in Q1. Underlying operating trends were weaker: operating margin contracted 3.1 percentage points year over year to 13.8%, and gross margin fell to 30.5% from 33.2%, as capacity-related costs and fuel expense increased. Management’s liquidity assessment is constructive, but below-optimal bookings over the next 12 months, substantial newbuild commitments, and limited near-term benefit from cost actions temper the earnings outlook.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $0.48
What stood out
-
Revenue growth driven by new capacity
Q2 revenue increased 4.9% year over year to $2.641 billion from $2.517 billion, driven primarily by additional Capacity Days from new-ship deliveries. Revenue also rose from $2.330 billion in Q1 2026 to $2.641 billion in Q2.
-
GAAP EPS improves sharply
GAAP net income rose to $222.6 million, or $0.48 diluted EPS, from $30.0 million, or $0.07, a year earlier. EPS also increased from $0.23 in Q1 2026, although the year-over-year comparison benefited from a $33.5 million FX-related gain versus a $156.4 million expense last year.
-
Operating cash flow remains substantial
Six-month operating cash flow was $1.4 billion, supported in part by a $482.0 million increase in advance ticket sales. This was flat with $1.4 billion in the prior-year six-month period.
-
Cost program expands by $100 million
Management is targeting $125 million of annualized marketing, general and administrative savings and identified an additional approximately $100 million of annualized run-rate savings, primarily in capex and SG&A. The incremental savings are expected to have limited impact on 2026 results.
-
Liquidity covers stated 12-month needs
Liquidity was approximately $1.5 billion at June 30, including $218.1 million of cash and $1.3 billion of revolver availability. Management concluded this is sufficient to meet obligations for at least the next 12 months.
What to watch
-
Bookings remain below optimal level
Management says the company remains below its optimal booked position for the next 12 months, citing softer Norwegian Cruise Line demand, execution challenges and the Middle East conflict. This directly limits pricing and load-factor recovery visibility despite Q2 revenue of $2.641 billion.
-
Margins contract amid fuel and cost pressure
Operating profitability weakened despite sales growth: operating income fell to $363.3 million from $423.8 million, and calculated operating margin declined to 13.8% from 16.8%. Gross margin fell to $804.1 million from $835.9 million as fuel expense rose to $219.4 million from $157.4 million.
-
Large debt and newbuild obligations
Capital commitments and leverage remain material. Total debt and ship-construction cash requirements are $37.107 billion, including $18.459 billion of long-term debt requirements, while approximately $15.0 billion of net book value of assets was pledged as collateral.
-
Newbuild capex keeps free cash flow negative
Cash investment exceeded operating cash generation in the first half: operating cash flow was $1.4 billion while investing cash outflow was $1.9 billion, principally for Norwegian Luna. The company also expects $1.3 billion of ship-construction and growth spending for the remainder of 2026.
-
Fuel and euro exposure remain material
Fuel and currency sensitivity remain significant. A 10% increase in weighted-average fuel prices would add an estimated $39.7 million to 2026 fuel expense before a $18.5 million derivative fair-value offset; a 10% euro move would change unhedged construction payments by $1.5 billion.
-
No formal risk-factor changes reported
The filing states there were no material changes to risk factors from the 2025 10-K and prior 10-Q. It nevertheless expands discussion of shipyard, charter and transfer execution risk; the company has 12 effective ships on order with combined contract prices of approximately $19.5 billion.
Management's outlook
The 10-Q contains no explicit quantitative revenue or EPS outlook. Management says it remains below its optimal booked position for the next 12 months, while cost actions and the September 4 opening of expanded Great Stirrup Cay amenities are expected to support demand and margins over time.
Earlier filings 4
10-K · March 2, 2026
NCLH's 2025 10-K reiterates a fleet-led growth strategy — 34 ships (~71,400 berths) today and a pipeline of 17 additional ships from 2026–2037 — supported by export credit financing and revolving credit availability…
10-Q · November 4, 2025
Norwegian Cruise Line reported Q3 revenue of $2,938,142,000, up $131,564,000 versus Q3 2024, with adjusted operating income rising to $768,420,000 and operating income to $749,449,000. However, net income and diluted…
10-Q · August 4, 2025
Norwegian Cruise Line (NCLH) reported Q2 revenue of $2,517,497,000, up $145,005,000 or 6.1% versus Q2 2024, with operating income rising to $423,836,000 (16.8% of revenue). However, net income fell to $29,992,000…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.