NCLH · Norwegian Cruise Line Holdings Ltd.

Revenue reached $2.3 billion in Q1 FY2026, up 9.6% from $2.1 billion in the prior year, primarily driven by increased capacity days following the delivery of Norwegian Luna. This topline expansion reflects our strategic fleet growth, enabling higher guest volumes while maintaining pricing discipline in a competitive cruise market.

Gross profit improved to $953.3 million, a 15.8% increase from $823.6 million, expanding the GAAP gross margin to 40.9%. This margin leverage stems from effective cost management relative to revenue growth, where gross margin is calculated as total revenue less total cruise operating expense and ship depreciation. Despite the costs associated with integrating new ships, our focus on balancing disciplined pricing with guest experience supported this outperformance.

Operating income advanced 15.9% to $232.9 million from $200.9 million, yielding a 10.0% operating margin. The improvement highlights operational efficiencies that offset rises in other operating expenses, which increased 15.7% primarily due to higher marketing, general and administrative costs from elevated advertising, promotions, and severance payments. These investments align with our long-term strategy of enhancing brand visibility and operational optimization.

Net income marked a significant turnaround to $104.7 million profit, or $0.23 diluted EPS, from a prior-year loss of $40.3 million, or -$0.09 EPS—a 359.7% swing. This shift was fueled by stronger core operations, though tempered by net foreign currency remeasurement losses from our increased euro-denominated debt against a dollar-heavy debt portfolio. We adjust for these in supplemental non-GAAP measures to better reflect underlying performance.

Our strategy centers on managing the business for sustained success, optimizing liquidity through potential refinancings to reduce interest expense and extend maturities, while pursuing strategic investments that position us for future demand.