v3.25.2
Summary of Significant Accounting Policies (Policies)
 6 Months Ended
Jun. 30, 2025
Accounting Policies [Abstract]  
Liquidity, Basis of Presentation

Liquidity

As of June 30, 2025, we had liquidity of approximately $2.4 billion, including cash and cash equivalents of $178.1 million, $2.0 billion available under our Revolving Loan Facility and a €200 million commitment that could be used for future newbuild payments which was available through July 2025. We believe that we have sufficient liquidity to fund our obligations and expect to remain in compliance with our financial covenants for at least the next twelve months from the issuance of these financial statements.

We will continue to pursue various opportunities to optimize our liquidity, refinance future debt maturities to reduce interest expense and/or extend the maturity dates associated with our existing indebtedness and obtain relevant financial covenant amendments or waivers, if needed.

Basis of Presentation

The accompanying consolidated financial statements are unaudited and, in our opinion, contain all normal recurring adjustments necessary for a fair statement of the results for the periods presented.

Our operations are seasonal and results for interim periods are not necessarily indicative of the results for the entire fiscal year. Historically, demand for cruises has been strongest during the Northern Hemisphere’s summer months. The interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2024, which are included in our most recent Annual Report on Form 10-K filed with the SEC on February 27, 2025.
Segment Reporting

Segment Reporting

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which aims to improve reportable segment disclosure requirements primarily through enhanced disclosures about significant segment expenses. ASU 2023-07 has been applied retrospectively.

The below table includes our calculation of adjusted operating income, our significant segment expenses therein, and a reconciliation of adjusted operating income to net income (loss) before income taxes (in thousands):

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Three Months Ended

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Six Months Ended

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June 30, 

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June 30, 

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2025

    

2024

    

2025

    

2024

Total revenue

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$

2,517,497

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$

2,372,492

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$

4,645,050

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$

4,563,707

Cruise operating expense

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​

​

​

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Commissions, transportation and other

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487,835

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501,039

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883,178

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​

937,249

Onboard and other

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​

187,684

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​

171,707

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​

326,542

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​

303,743

Adjusted payroll and related (1)

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340,173

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324,783

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669,300

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​

663,731

Fuel

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157,377

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​

174,964

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​

332,391

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​

372,698

Food

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​

81,323

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​

77,046

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156,911

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​

161,754

Other

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196,495

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199,421

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381,126

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​

391,875

Adjusted total cruise operating expense

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1,450,887

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1,448,960

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2,749,448

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​

2,831,050

Other operating expense

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​

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​

​

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Adjusted marketing, general and administrative (2)

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371,824

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334,954

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747,605

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680,078

Depreciation and amortization

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243,760

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222,405

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475,057

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​

445,334

Adjusted total other operating expense

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615,584

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557,359

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1,222,662

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​

1,125,412

Adjusted operating income

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$

451,026

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$

366,173

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$

672,940

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$

607,245

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Adjusted operating income

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$

451,026

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$

366,173

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$

672,940

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$

607,245

Non-cash compensation (3)

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(26,451)

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(23,702)

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(47,285)

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(46,369)

Interest expense, net

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(260,013)

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(205,765)

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(504,235)

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(453,183)

Other income (expense), net

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(167,729)

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151,323

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​

77,457

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​

165,874

Net income (loss) before income taxes

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$

(3,167)

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$

288,029

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$

198,877

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$

273,567

(1)Excludes non-cash share-based compensation expenses related to equity awards for shipboard officers (see Note 9 – “Employee Benefits and Compensation Plans”) and non-cash deferred compensation expenses related to the crew pension plan as follows (in thousands):

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Three Months Ended

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Six Months Ended

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June 30, 

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June 30, 

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2025

    

2024

    

2025

    

2024

Service cost

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$

552

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$

718

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$

1,105

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$

1,437

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(2)Excludes non-cash share-based compensation expenses related to equity awards for corporate employees (see Note 9 – “Employee Benefits and Compensation Plans”).
(3)Includes non-cash deferred compensation expenses related to the crew pension plan and non-cash share-based compensation expenses related to equity awards, which are included in payroll and related expense and marketing, general and administrative expense.
Foreign Currency

Foreign Currency

The majority of our transactions are settled in U.S. dollars. We remeasure assets and liabilities denominated in foreign currencies at exchange rates in effect at the balance sheet date. The resulting gains or losses are recognized in our consolidated statements of operations within other income (expense), net. We recognized a loss of $158.5 million and a gain of $2.3 million for the three months ended June 30, 2025 and 2024, respectively, and a loss of $181.0 million and a gain of $15.6 million for the six months ended June 30, 2025 and 2024, respectively, related to remeasurement of assets and liabilities denominated in foreign currencies. Remeasurements of foreign currency related to operating activities are recognized within changes in operating assets and liabilities in the consolidated statement of cash flows.

Depreciation and Amortization Expense

Depreciation and Amortization Expense

The amortization of deferred financing fees and debt discounts are included in depreciation and amortization expense in the consolidated statements of cash flows; however, for purposes of the consolidated statements of operations they are included in interest expense, net.
Recently Issued Accounting Guidance

Recently Issued Accounting Guidance

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), which requires improvements to income tax disclosures primarily related to the rate reconciliation and income taxes paid information as well as certain other amendments to improve the effectiveness of income tax disclosures. The amendments in this update are effective for annual periods beginning after December 15, 2024 and will be applied on a prospective basis. We are evaluating the impact of ASU 2023-09 on our notes to the consolidated financial statements.

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In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”), which requires disaggregation of certain costs and expenses, including employee compensation, and requires other improvements to disclosures. The amendments in this update are effective for annual periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. The update may be applied on a prospective or retrospective basis. We are evaluating the impact of ASU 2024-03 on our notes to the consolidated financial statements.