CARNIVAL CORPORATION DELIVERS RECORD SECOND QUARTER REVENUES, NET YIELDS AND ADJUSTED NET INCOME

Accelerates shareholder returns, surpassing $450 million in stock repurchases

MIAMI, June 23, 2026 /PRNewswire/ -- Carnival Corporation (NYSE: CCL) announced financial results for the second quarter 2026 and provided an updated outlook.

"We achieved another quarter of record results, marking our twelfth consecutive quarter of record net yields and delivering over 20 percent more to the bottom line, overcoming extreme geopolitical headwinds and nearly 30 percent higher fuel costs. Continued commercial execution and a step up in our cost efficiency efforts enabled us to exceed our March guidance by $100 million. These results reflect the strong demand for our portfolio of world-class cruise lines and the continued progress we are making across the business," said Carnival Corporation's Chief Executive Officer Josh Weinstein.

Second Quarter 2026 Results

Advance Sales

"Our booked position for the second half of 2026 is higher than last year, at historically high prices (in constant currency), despite navigating more than a full quarter of extreme geopolitical volatility that primarily impacted booking trends for our European deployments, particularly in the Mediterranean region, which were closest in proximity to the conflict in the Middle East. For those deployments, we leaned into the substantial occupancy advantage we had strategically built to deliberately prioritize pricing integrity. We are now 93 percent booked for the year with less inventory remaining for sale than this time last year and are on track for record net yields in the second half of 2026," Weinstein said.

"Looking further out, demand for 2027 and beyond remains strong. Since March, booking volumes and prices for these future sailings have been running ahead of prior year levels, including a substantial increase in bookings for our European deployments next year. These trends reinforce our confidence in the longer-term demand environment."

"Our booking curve remains the furthest out on record, reflecting the power of our world-class portfolio of cruise lines, the durability of our demand generation efforts and the exceptional vacation experiences we deliver. Continued strength in demand is also reflected in higher second quarter onboard revenues, increased pre-cruise onboard sales and record customer deposits," Weinstein noted.

Customer deposits reached an all-time high of $9.0 billion on flat capacity growth over the next twelve months, surpassing the prior year's record by over $450 million, a further reflection of demand momentum and reinforcing the company's strong cash flow profile.

Net income attributable to Carnival Corporation.

See "Non-GAAP Financial Measures" and "Constant Currency."

Second quarter record.

2026 Outlook

"Our second quarter operational outperformance and accelerated cost efficiency efforts have offset the transitory moderation shaped by the prolonged conflict in the Middle East, which is incorporated into our second-half outlook. As conditions continue to normalize, we expect to benefit from the strong demand, pricing and operational improvements embedded throughout our business. Recent booking trends already suggest that we are beginning to see a reversal of these headwinds, reinforcing our confidence in both the near-term outlook and the long-term earnings power of the business," Weinstein added.

For the full year 2026, the company expects:

See "Guidance" for additional information on the company's 2026 outlook, "Non-GAAP Financial Measures," "Reconciliation of Forecasted Data" and "Constant Currency."

Capital Allocation

"Our strong cash flow growth enabled us to launch our current share buyback program, repurchasing over $450 million of stock to date, reinforcing our commitment to accelerate shareholder returns. At the same time, we continued to responsibly invest in return-generating programs across our fleet and exclusive destinations, while further strengthening our financial position. We achieved a net debt to adjusted EBITDA 1 ratio of 3.1x—more than half a point improvement from just one year ago. The continued momentum of our financial performance was recognized by Moody's with a credit rating upgrade and a continued positive outlook," commented Carnival Corporation's Chief Financial Officer David Bernstein.

During the quarter, the company distributed $207 million in dividends, bringing the year to date total to $414 million.

See "Non-GAAP Financial Measures" and "Constant Currency."

Other Recent Highlights

Guidance

(See "Non-GAAP Financial Measures," "Reconciliation of Forecasted Data" and "Constant Currency")

3Q 2026

Full Year 2026

Year over year change

Current

Dollars

Constant

Currency

Current

Dollars

Constant

Currency

Net yields

Approx. 1.3%

Approx. 1.2%

Approx. 3.2%

Approx. 1.75%

Adjusted cruise costs excluding fuel per ALBD

Approx. 2.8%

Approx. 3.7%

Approx. 2.4%

3Q 2026

Full Year 2026

ALBDs (in millions) (a)

24.9

97.4

Capacity growth compared to prior year

1.5 %

1.0 %

Fuel consumption in metric tons (in millions)

0.7

2.7

Fuel cost per metric ton consumed (excluding emission allowances)

$ 812

$ 713

Fuel expense (including emission allowances expense) (in billions)

$ 0.62

$ 2.12

Depreciation and amortization expense (in billions)

$ 0.74

$ 2.91

Interest expense, net of capitalized interest and interest income (in billions)

$ 0.27

$ 1.07

Adjusted EBITDA (in billions)

Approx. $2.88

Approx. $7.11

Adjusted net income (in billions)

Approx. $1.86

Approx. $3.07

Adjusted earnings per share - diluted

Approx. $1.35

Approx. $2.22

Weighted-average shares outstanding - basic

1,372

1,377

Adjusted weighted-average shares outstanding - diluted

1,377

1,384

(a)

See "Notes to Statistical Information."

Currencies (USD to 1)

3Q 2026

Full Year 2026

AUD

$ 0.71

$ 0.70

CAD

$ 0.71

$ 0.72

EUR

$ 1.16

GBP

$ 1.34

Sensitivities (impact to adjusted net income in millions)

3Q 2026

Remainder of 2026

1% change in net yields

$ 60

$ 111

1% change in adjusted cruise costs excluding fuel per ALBD

$ 27

$ 58

10% change in fuel cost per metric ton (excluding emission allowances)

$ 56

$ 102

100 basis point change in variable rate debt

—

$ 14

1% change in currency exchange rates

$ 10

$ 17

Capital Expenditures

For the remainder of 2026, newbuild capital expenditures are $0.6 billion and non-newbuild capital expenditures are $1.3 billion. These future capital expenditures will fluctuate with foreign currency movements relative to the U.S. Dollar. In addition, these figures do not include potential stage payments for ship orders that the company may place in the future.

Conference Call

The company has scheduled a conference call with analysts at 10:00 a.m. EDT today to discuss its earnings release. This call can be listened to live and additional information including the company's earnings presentation and debt maturities schedule can be obtained on its website at www.carnivalcorp.com.

Carnival Corporation is the largest global cruise company and among the largest leisure travel companies, with a portfolio of world-class cruise lines – AIDA Cruises, Carnival Cruise Line, Costa Cruises, Cunard, Holland America Line, P&O Cruises, Princess Cruises and Seabourn. Carnival Corporation trades under the ticker symbol CCL on the NYSE and is included in the S&P 500.

Additional information can be found on www.carnivalcorp.com, www.aida.de, www.carnival.com, www.costacruises.com, www.cunard.com, www.hollandamerica.com, www.pocruises.com, www.princess.com, and www.seabourn.com.

To learn more about Carnival Corporation's purpose and its commitment to sustainability, go to Our Impact.

Cautionary Note Concerning Factors That May Affect Future Results

Some of the statements, estimates or projections contained in this document are "forward-looking statements" that involve risks, uncertainties and assumptions with respect to us, including statements concerning future results, operations, strategy, outlooks, plans, goals, reputation, cash flows, liquidity and other events which have not yet occurred. These statements are intended to qualify for the safe harbors from liability provided by Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts are statements that could be deemed forward-looking. These statements are based on current expectations, estimates, forecasts and projections about our business and the industry in which we operate and the beliefs and assumptions of our management. We have tried, whenever possible, to identify these statements by using words like "will," "may," "could," "should," "would," "believe," "depends," "expect," "goal," "aspiration," "anticipate," "forecast," "project," "future," "intend," "plan," "estimate," "target," "indicate," "outlook," and similar expressions of future intent or the negative of such terms.

Forward-looking statements include, but are not limited to, statements that relate to our outlook and financial position, as well as, statements regarding:

• Pricing

• Adjusted net income

• Booking levels

• Adjusted EBITDA

• Occupancy

• Adjusted EBITDA per ALBD

• Interest, tax and fuel expenses

• Adjusted EBITDA margin

• Currency exchange rates

• Adjusted earnings per share

• Goodwill, ship and trademark fair values

• Net debt to adjusted EBITDA

• Liquidity and credit ratings

• Net yields

• Investment grade leverage metrics

• Adjusted cruise costs per ALBD

• Shareholder returns

• Adjusted cruise costs excluding fuel per ALBD

• Estimates of ship depreciable lives and residual values

• Adjusted ROIC

Because forward-looking statements involve risks and uncertainties, there are many factors that could cause our actual results, performance or achievements to differ materially from those expressed or implied by our forward-looking statements. This note contains important cautionary statements of the known factors that we consider could materially affect the accuracy of our forward-looking statements and adversely affect our business, results of operations and financial position. These factors include, but are not limited to, the following:

The ordering of the risk factors set forth above is not intended to reflect our indication of priority or likelihood. There may be additional risks that we consider immaterial or which are unknown. Additional information about the factors that may affect future results is contained in our most recent Annual Report on Form 10-K as well as our other filings with the SEC, all of which are available on the SEC's website at www.sec.gov.

Forward-looking statements should not be relied upon as a prediction of actual results. Subject to any continuing obligations under applicable law or any relevant stock exchange rules, we expressly disclaim any obligation to disseminate, after the date of this document, any updates or revisions to any such forward-looking statements to reflect any change in expectations or events, conditions or circumstances on which any such statements are based.

Forward-looking and other statements in this document may also address our sustainability progress, plans, and goals (including emissions and environmental-related matters). In addition, historical, current, and forward-looking sustainability-related statements may be based on standards and tools for measuring progress that are still developing, internal controls and processes that continue to evolve, and assumptions and predictions that are subject to change in the future and may not be generally shared.

CARNIVAL CORPORATION LTD.

CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)

(in millions, except per share data)

Three Months Ended

May 31,

Six Months Ended

May 31,

2026

2025

2026

2025

Passenger ticket

$ 4,273

$ 4,104

$ 8,296

$ 7,936

Onboard and other

2,390

2,224

4,532

4,202

Total Revenues

6,663

6,328

12,828

12,139

Cruise and tour operating expenses:

Commissions, transportation and other

778

780

1,650

1,631

Onboard and other

697

671

1,316

1,271

Payroll and related

699

640

1,383

1,280

Fuel

595

468

992

933

Food

389

372

771

726

Other operating

1,067

955

2,054

1,813

Total Cruise and tour operating expenses

4,225

3,886

8,165

7,653

Selling and administrative expense

863

816

1,786

1,663

Depreciation and amortization expense

723

692

1,419

1,346

Operating Income

851

934

1,458

1,477

Interest income

Interest expense, net of capitalized interest

(285)

(341)

(577)

(718)

Debt extinguishment and modification costs

—

(4)

—

(255)

Other income (expense), net

(23)

(16)

(70)

(4)

Income Before Income Taxes

555

585

835

517

Income tax expense, net

(17)

(34)

(24)

Net Income

539

568

801

494

Less: net income attributable to noncontrolling

interests

Net Income attributable to Carnival Corporation Ltd.

$ 537

$ 565

$ 795

$ 486

Earnings Per Share

Basic

$ 0.39

$ 0.43

$ 0.58

$ 0.37

Diluted

$ 0.39

$ 0.42

$ 0.57

$ 0.37

Weighted-Average Shares Outstanding - Basic

1,382

1,312

1,381

1,310

Weighted-Average Shares Outstanding - Diluted

1,388

1,400

1,390

1,316

CARNIVAL CORPORATION LTD.

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

(in millions, except par values)

May 31, 2026

November 30, 2025

ASSETS

Current Assets

Cash and cash equivalents

$ 2,243

$ 1,928

Trade and other receivables, net

633

678

Inventories

552

505

Prepaid expenses and other

1,063

1,108

Total current assets

4,492

4,219

Property and Equipment, Net

43,616

43,494

Operating Lease Right-of-Use Assets, Net

1,260

1,328

Goodwill

579

Other Intangibles

1,181

1,177

Other Assets

1,100

890

$ 52,228

$ 51,687

LIABILITIES AND SHAREHOLDERS' EQUITY

Current Liabilities

Current portion of long-term debt

$ 1,471

$ 2,603

Current portion of operating lease liabilities

168

175

Accounts payable

1,246

1,245

Accrued liabilities and other

2,092

2,239

Customer deposits

8,457

6,831

Total current liabilities

13,434

13,092

Long-Term Debt

23,418

24,037

Long-Term Operating Lease Liabilities

1,113

1,178

Other Long-Term Liabilities

1,279

1,097

Shareholders' Equity

Carnival Corporation Ltd. common shares, $0.01 par value; 1,960 shares

authorized; 1,514 shares issued at 2026 and 1,298 shares issued at 2025

Carnival plc ordinary shares, $1.66 par value; no shares issued at 2026 and

217 shares issued at 2025

—

361

Additional paid-in capital

15,640

17,253

Retained earnings

4,996

4,817

Accumulated other comprehensive income (loss)

(1,741)

(1,810)

Treasury stock, 142 shares at 2026 and 131 shares at 2025 of Carnival

Corporation Ltd. and no shares at 2026 and 72 shares at 2025 of

Carnival plc, at cost

(5,943)

(8,364)

Total shareholders' equity attributable to Carnival Corporation Ltd.

12,968

12,270

Noncontrolling interests

Total shareholders' equity

12,984

12,284

$ 52,228

$ 51,687

CARNIVAL CORPORATION LTD.

OTHER INFORMATION

OTHER BALANCE SHEET INFORMATION (in millions)

May 31, 2026

November 30, 2025

Debt (current and long-term)

$ 24,889

$ 26,640

Customer deposits (current and long-term)

$ 8,984

$ 7,246

Three Months Ended

May 31,

Six Months Ended

May 31,

CASH FLOW INFORMATION (in millions)

2026

2025

2026

2025

Cash from operations

$ 2,629

$ 2,392

$ 3,893

$ 3,317

Capital expenditures (Purchases of Property and Equipment)

$ 875

$ 850

$ 1,441

$ 1,458

Dividends paid

$ 207

$ —

$ 414

$ —

Three Months Ended

May 31,

Six Months Ended

May 31,

STATISTICAL INFORMATION

2026

2025

2026

2025

Passenger Cruise Days ("PCDs") (in millions) (a)

25.7

25.3

50.2

49.6

ALBDs (in millions) (b)

24.7

24.2

48.4

47.8

Occupancy percentage (c)

104 %

Passengers carried (in millions)

3.4

6.5

Fuel consumption in metric tons (in millions)

0.7

1.4

Fuel consumption in metric tons per thousand ALBDs

28.2

29.9

28.6

30.1

Fuel cost per metric ton consumed (excluding emission

allowances)

$ 793

$ 614

$ 677

$ 628

Currencies (USD to 1)

AUD

$ 0.71

$ 0.63

$ 0.69

$ 0.63

CAD

$ 0.73

$ 0.71

$ 0.73

$ 0.70

EUR

$ 1.16

$ 1.11

$ 1.17

$ 1.08

GBP

$ 1.34

$ 1.31

$ 1.35

$ 1.28

Notes to Statistical Information

(a)

PCD represents the number of cruise passengers on a voyage multiplied by the number of revenue-producing ship operating days for that voyage.

(b)

ALBD is a standard measure of passenger capacity for the period that we use to approximate rate and capacity variances, based on consistently applied formulas that we use to perform analyses to determine the main non-capacity driven factors that cause our cruise revenues and expenses to vary. ALBDs assume that each cabin we offer for sale accommodates two passengers and is computed by multiplying passenger capacity by revenue-producing ship operating days in the period.

(c)

Occupancy, in accordance with cruise industry practice, is calculated using a numerator of PCDs and a denominator of ALBDs, which assumes two passengers per cabin even though some cabins can accommodate three or more passengers. Percentages in excess of 100% indicate that on average more than two passengers occupied some cabins.

CARNIVAL CORPORATION LTD.

NON-GAAP FINANCIAL MEASURES

Three Months Ended

May 31,

Six Months Ended

May 31,

(in millions, except per share data)

2026

2025

2026

2025

Net income attributable to Carnival Corporation Ltd.

$ 537

$ 565

$ 795

$ 486

(Gains) losses on ship sales and impairments

—

(101)

—

(101)

Debt extinguishment and modification costs

—

255

Restructuring expense

Other

—

Adjusted net income

$ 569

$ 470

$ 844

$ 643

Interest expense, net of capitalized interest

285

341

577

718

Interest income

(12)

(24)

(18)

Income tax expense, net

Depreciation and amortization expense

723

692

1,419

1,346

Adjusted EBITDA

$ 1,582

$ 1,508

$ 2,849

$ 2,713

Earnings per share - diluted (a)

$ 0.39

$ 0.42

$ 0.57

$ 0.37

Weighted-average shares outstanding - diluted (a)

1,388

1,400

1,390

1,316

Adjusted earnings per share - diluted (a)

$ 0.41

$ 0.35

$ 0.61

$ 0.48

Adjusted weighted-average shares outstanding -

diluted (a)

1,388

1,400

1,390

1,400

(See Non-GAAP Financial Measures)

(a)

Diluted earnings per share includes the add-back of dilutive interest expense related to the company's convertible notes of $18 million for the three months ended May 31, 2025. The convertible notes were antidilutive for the six months ended May 31, 2025, and therefore were excluded from diluted earnings per share. Adjusted earnings per share includes the add-back of dilutive interest expense related to the company's convertible notes of $18 million and $35 million for the three and six months ended May 31, 2025.

CARNIVAL CORPORATION LTD.

NON-GAAP FINANCIAL MEASURES (CONTINUED)

Gross margin yields and net yields were computed by dividing the gross margin and adjusted gross margin by ALBDs as follows:

Three Months Ended May 31,

Six Months Ended May 31,

(in millions, except yields data)

2026

Constant

Currency

2025

2026

Constant

Currency

2025

Total Revenues

$ 6,663

$ 6,328

$ 12,828

$ 12,139

Less: Cruise and tour operating expenses

(4,225)

(3,886)

(8,165)

(7,653)

Depreciation and amortization expense

(723)

(692)

(1,419)

(1,346)

Gross margin

1,714

1,750

3,244

3,140

Less: Tour and other revenues

(34)

(31)

(34)

(33)

Add: Payroll and related

699

640

1,383

1,280

Fuel

595

468

992

933

Food

389

372

771

726

Other operating

1,067

955

2,054

1,813

Depreciation and amortization expense

723

692

1,419

1,346

Adjusted gross margin

$ 5,153

$ 5,052

$ 4,846

$ 9,829

$ 9,535

$ 9,204

ALBDs

24.7

24.2

48.4

47.8

Gross margin yields (per ALBD)

$ 69.42

$ 72.25

$ 67.07

$ 65.71

Net yields (per ALBD)

$ 208.69

$ 204.57

$ 200.07

$ 203.18

$ 197.11

$ 192.61

(See Non-GAAP Financial Measures)

CARNIVAL CORPORATION LTD.

NON-GAAP FINANCIAL MEASURES (CONTINUED)

Cruise costs per ALBD, adjusted cruise costs per ALBD and adjusted cruise costs excluding fuel per ALBD were computed by

dividing cruise costs, adjusted cruise costs and adjusted cruise costs excluding fuel by ALBDs as follows:

Three Months Ended May 31,

Six Months Ended May 31,

(in millions, except costs per ALBD data)

2026

Constant

Currency

2025

2026

Constant

Currency

2025

Cruise and tour operating expenses

$ 4,225

$ 3,886

$ 8,165

$ 7,653

Selling and administrative expense

863

816

1,786

1,663

Less: Tour and other expenses

(47)

(37)

(65)

(56)

Cruise costs

5,041

4,665

9,886

9,260

Less: Commissions, transportation and other

(778)

(780)

(1,650)

(1,631)

Onboard and other costs

(697)

(671)

(1,316)

(1,271)

Gains (losses) on ship sales and

impairments

—

101

—

101

Restructuring expense

(2)

Other

(17)

—

(34)

—

Adjusted cruise costs

3,548

3,498

3,312

6,887

6,732

6,458

Less: Fuel

(595)

(594)

(468)

(992)

(991)

(933)

Adjusted cruise costs excluding fuel

$ 2,953

$ 2,904

$ 2,845

$ 5,895

$ 5,741

$ 5,525

ALBDs

24.7

24.2

48.4

47.8

Cruise costs per ALBD

$ 204.13

$ 192.61

$ 204.37

$ 193.78

Adjusted cruise costs per ALBD

$ 143.68

$ 141.65

$ 136.75

$ 142.37

$ 139.17

$ 135.14

Adjusted cruise costs excluding fuel per ALBD

$ 119.60

$ 117.60

$ 117.45

$ 121.86

$ 118.68

$ 115.62

(See Non-GAAP Financial Measures)

Non-GAAP Financial Measures

We use non-GAAP financial measures and they are provided along with their most comparative U.S. GAAP financial measure:

Non-GAAP Measure

U.S. GAAP Measure

Use Non-GAAP Measure to Assess

• Adjusted net income, adjusted

EBITDA, adjusted EBITDA

per ALBD and adjusted

EBITDA margin

• Net income attributable to

Carnival Corporation Ltd.

• Company Performance

• Adjusted earnings per share

• Earnings per share

• Company Performance

• Net debt to adjusted EBITDA

—

• Company Leverage

• Net yields

• Gross margin yields

• Cruise Segments Performance

• Adjusted cruise costs per

ALBD and adjusted cruise

costs excluding fuel per ALBD

• Cruise costs per ALBD

• Cruise Segments Performance

• Adjusted ROIC

—

• Company Performance

The presentation of our non-GAAP financial information is not intended to be considered in isolation from, as a substitute for, or superior to the financial information prepared in accordance with U.S. GAAP. It is possible that our non-GAAP financial measures may not be exactly comparable to the like-kind information presented by other companies, which is a potential risk associated with using these measures to compare us to other companies.

Adjusted net income and adjusted earnings per share provide additional information to us and investors about our future earnings performance. These measures represent net income attributable to Carnival Corporation Ltd., excluding certain gains, losses and expenses that we believe are not part of our core operating business and are not an indication of our future earnings performance. We believe that gains and losses on ship sales, impairment charges, debt extinguishment and modification costs, restructuring costs and certain other gains, losses and expenses are not part of our core operating business and are not an indication of our future earnings performance.

Adjusted EBITDA, adjusted EBITDA per ALBD and adjusted EBITDA margin provide additional information to us and investors about our core operating profitability, including on a per ALBD basis, by excluding certain gains, losses and expenses that we believe are not part of our core operating business and are not an indication of our future earnings performance as well as excluding interest, taxes and depreciation and amortization. In addition, we believe that the presentation of adjusted EBITDA provides additional information to us and investors about our ability to operate our business in compliance with the covenants set forth in our debt agreements. We define adjusted EBITDA as adjusted net income adjusted for (i) interest, (ii) taxes and (iii) depreciation and amortization. There are material limitations to using adjusted EBITDA. Adjusted EBITDA does not take into account certain significant items that directly affect our net income attributable to Carnival Corporation Ltd. These limitations are best addressed by considering the economic effects of the excluded items independently and by considering adjusted EBITDA in conjunction with net income attributable to Carnival Corporation Ltd. as calculated in accordance with U.S. GAAP. We define adjusted EBITDA margin as adjusted EBITDA divided by total revenues.

Net debt to adjusted EBITDA provides additional information to us and investors about our overall leverage. We define net debt to adjusted EBITDA as total debt less cash and cash equivalents divided by twelve-month adjusted EBITDA.

Net yields enable us and investors to measure the performance of our cruise segments on a per ALBD basis. We use adjusted gross margin rather than gross margin to calculate net yields. We believe that adjusted gross margin is a more meaningful measure in determining net yields than gross margin because it reflects the cruise revenues earned net of only our most significant variable costs, which are travel agent commissions, cost of air and other transportation, certain other costs that are directly associated with onboard and other revenues and credit and debit card fees.

Adjusted cruise costs per ALBD and adjusted cruise costs excluding fuel per ALBD enable us and investors to separate the impact of predictable capacity or ALBD changes from price and other changes that affect our business. We believe these non-GAAP measures provide useful information to us and investors and expanded insight to measure our cost performance. Adjusted cruise costs per ALBD and adjusted cruise costs excluding fuel per ALBD are the measures we use to monitor our ability to control our cruise segments' costs rather than cruise costs per ALBD. We exclude gains and losses on ship sales, impairment charges, restructuring costs and certain other gains and losses that we believe are not part of our core operating business as well as excluding our most significant variable costs, which are travel agent commissions, cost of air and other transportation, certain other costs that are directly associated with onboard and other revenues and credit and debit card fees. We exclude fuel expense to calculate adjusted cruise costs excluding fuel. The price of fuel, over which we have no control, impacts the comparability of period-to-period cost performance. The adjustment to exclude fuel provides us and investors with supplemental information to understand and assess the company's non-fuel adjusted cruise cost performance. Substantially all of our adjusted cruise costs excluding fuel are largely fixed, except for the impact of changing prices once the number of ALBDs has been determined.

Adjusted ROIC provides additional information to us and investors about our operating performance relative to the capital we have invested in the company. We define adjusted ROIC as the twelve-month adjusted net income before interest expense and interest income divided by the monthly average of debt plus equity minus construction-in-progress, excess cash, goodwill and intangibles.

Reconciliation of Forecasted Data

We have not provided a reconciliation of forecasted non-GAAP financial measures to the most comparable U.S. GAAP financial measures because preparation of meaningful U.S. GAAP forecasts would require unreasonable effort. We are unable to predict, without unreasonable effort, the future movement of foreign exchange rates and fuel prices. We are unable to determine the future impact of gains and losses on ship sales, impairment charges, debt extinguishment and modification costs, restructuring costs and certain other non-core gains and losses.

Constant Currency

Our operations primarily utilize the U.S. dollar, Australian dollar, euro and sterling as functional currencies to measure results and financial condition. Functional currencies other than the U.S. dollar subject us to foreign currency translational risk. Our operations also have revenues and expenses that are in currencies other than their functional currency, which subject us to foreign currency transactional risk.

Constant currency reporting removes the impact of changes in exchange rates on the translation of our operations plus the transactional impact of changes in exchange rates from revenues and expenses that are denominated in a currency other than the functional currency.

We report adjusted gross margin, net yields, adjusted cruise costs excluding fuel and adjusted cruise costs excluding fuel per ALBD on a "constant currency" basis assuming the current periods' currency exchange rates have remained constant with the prior periods' rates. These metrics facilitate a comparative view for the changes in our business in an environment with fluctuating exchange rates.

Examples:

SOURCE Carnival Corporation Ltd.