Carnival raises 2026 profit outlook after topping Q3 estimates

Revenue reached $8.44 billion, ahead of the $8.38 billion expected, as the cruise line lifted next year's guidance

Carnival reported third-quarter earnings per share of $1.43, $0.06 above expectations, on revenue of $8.44 billion versus $8.38 billion expected.

The company raised its full-year 2026 adjusted net income outlook by more than $150 million compared with its June guidance. It pointed to better net yields, lower adjusted cruise costs excluding fuel, and reduced fuel consumption, which together offset a $150 million increase in fuel prices. Full-year 2026 net yields in constant currency are now expected to rise about 2.3%, half a percentage point better than the June forecast. Adjusted cruise costs excluding fuel per available lower berth day, in constant currency, are expected to rise about 2.2%, also better than prior guidance. Fourth-quarter 2026 net yields in constant currency are expected to rise about 1.7% from 2025 levels. Full-year 2026 adjusted earnings per share are guided to approximately $2.24.

Chief Financial Officer David Bernstein said Carnival used cash on hand to redeem $500 million of 7% notes during the quarter and continues to expect year-over-year improvement in its balance sheet and leverage metrics. The company has repurchased about $1.2 billion of shares year to date, including roughly $800 million since the start of the third quarter.

The guidance increase carries more weight than the quarter itself, since the June outlook was already the market's baseline for 2026. Raising full-year adjusted net income by more than $150 million while absorbing a $150 million fuel headwind points to pricing power and cost discipline holding up better than expected heading into next year. The pace of buybacks, $800 million since the third quarter began, suggests management views the stock as undervalued relative to that improving outlook.