RCL 10-K & 10-Q changes, risk factors and insider trading

Disease outbreaks andor an increase in concern about the risk of illness could adversely impact our business and results of operations, and may cause significant disruptions, create new risks, and exacerbate existing risks.

Although our ships can be redeployed, cruise sales and/or pricing may be impacted by the introduction of new ships into the marketplace, reductions in cruise capacity, overall market growth and deployment decisions of ourselves and our competitors. As of December 31, 2024,2025, a total of 5047 new ships with approximately 116,500113,000 berths were on order for delivery through 20282029 in the cruise industry, including sixtwelve ships currently scheduled to be delivered to our Global and Partner Brands. The further net growth in capacity from these new ships and future orders, without an increase in the cruise industry’s demand and/or share of the vacation market, could depress cruise prices and impede our ability to achieve yield improvement.

We opportunistically seek to grow our business through, among other things, expansion into new destinations or source markets and establishment of new ventures complementary to our current offerings. These attempts to expand our business increase the complexity of our business, require significant levels of investment and can strain our management, personnel, operations and systems. In addition, we may be unable to execute our attempts to expand our business. There can be no assurance that these business expansion efforts will develop as anticipated or that we will succeed, and if we do not, we may be unable to recover our investment,investment whichand couldotherwise adverselymay experience an adverse impact on our business, financial condition and results of operations.

Past or pending business acquisitions or potential acquisitions that we may decide to pursue in the future carry inherent risks which could adversely impact our financial performance and condition.

Our principal executive office and principal shoreside operations are located in Florida, and we have shoreside offices throughout the world. Actual or threatened natural disasters (e.g., hurricanes/typhoons, earthquakes, tornadoes, fires or floods), municipal lockdowns, curfews, quarantines, or similar events in these locations may have a material impact on our business continuity, reputation and results of operations. In addition, substantial or repeated information system failures, computer viruses or cybercybersecurity attacks impacting our shoreside or shipboard operations could adversely impact our business. We do not generally carry business interruption insurance for our shoreside or shipboard operations or our information systems. As such, any losses or damages incurred by us could have an adverse impact on our results of operations.

Although we believe we can access sufficient liquidity to fund our operations, investments and obligations as expected, there can be no assurances to that effect. Our ability to access additional funding as and when needed, our ability to timely refinance and/or replace our outstanding debt securities and credit facilities on acceptable terms and our cost of funding will depend upon numerous factors including, but not limited to, the strength of the financial markets, global market conditions, including inflationary pressures, interest rate fluctuations, credit ratings, our financial performance, the performance of our industry in general and the size, scope and timing of our financial needs. In addition, even where financing commitments have been secured, significant disruptions in the capital and credit markets could cause our banking and other counterparties to breach their contractual obligations to us or could cause the conditions to the availability of such funding not to be satisfied. This could include failures of banks or other financial service companies to fund required borrowings under our loan agreements or to pay us amounts that may become due or return collateral that is refundable under our interest rate derivative instruments or other agreements.due. If any of the foregoing occurs for a prolonged period of time it will have a long-term negative impact on our cash flows, our ability to meet our financial obligations, our results of operations and our financial condition.

A change in our tax status under the United Kingdom tonnage tax, the U.S. Internal Revenue Code, or other jurisdictions, may have adverse effects on our results of operations.

Our ability to rely on Section 883 could be challenged or could change in the future. ProvisionsThe provisions of the Internal Revenue Code, including Section 883, are subject to legislative change at any time. Moreover, changes could occur in the future with respect to the identity, residence or holdings of our direct or indirect shareholders, trading volume or trading frequency of our shares, or relevant foreign tax laws of Liberia, such that it no longer qualifies as an equivalent exemption jurisdiction, that could affect our eligibility for the Section 883 exemption. Accordingly, there can be no assurance that we will continue to be exempt from U.S. income tax on U.S. source shipping income in the future. If we were not entitled to the benefit of Section 883, we and our subsidiaries would be subject to U.S. taxation on a portion of the income derived from or incidental to the international operation of our ships, which would reduce our net income.

If we are unable to keep pace with developments, design, and implementation in technology, our operations or competitive position could become impaired. Our use of emerging technologies, including artificial intelligence, may present business, compliance and reputational risks.

WeIf maywe beare unable to procureadopt appropriatenew technology or systems in a timely manner or wewithin mayreasonable incurcost significantparameters, costsif there are any disruptions, delays or deficiencies in doingdesign, so.development, Aor implementation of such systems, or if we do not achieve the benefits that we anticipate from any new technology or system, our business and results of operations could suffer. Additionally, a failure to adopt the appropriate technology, or a failure or obsolescence in the existing technology that we have adopted, could adversely affect our business or results of operations.

We are exposed to cyber securitycybersecurity attacks and data breaches and the risks and costs associated with protecting our systems and maintaining data integrity and security.

We are subject to cyber securitycybersecurity attacks. These cyber attacks can vary in scope and intent from attacks with the objective of compromising our systems, networks, and communications for economic gain or with the objective of disrupting, disabling or otherwise compromising our maritime and/or shoreside operations. The attacks can encompass a wide range of methods and intent, including phishing attacks, generative artificial intelligence impersonation, illegitimate requests for payment, theft of intellectual property, theft of confidential or non-public information, installation of malware, installation of ransomware and theft of personal or business information. The frequency and sophistication of,as andwell as the methods used to conduct,conduct these attacks, have increased over time.

A successful cyber securitycybersecurity attack may target us directly, or it may be the result of a third party’s inadequate care, or resulting from vulnerabilities in licensed software. In eitherany scenario, the Company may suffer damage to its systems and data that could interrupt our operations, adversely impact our brand reputation, and expose us to increased risks of governmental investigation, litigation, fines, and other liability, any of which could adversely affect our business. Additionally, data security breaches where we or our vendors fail to detect and appropriately respond may expose us to government enforcement actions and private litigation. Furthermore, responding to such an attack and mitigating the risk of future attacks could result in additional operating and capital costs in technology, personnel, monitoring and other investments.

We are also subject to various risks associated with the collection, handling, storage, and transmission of sensitive information. In the regular course of business, we collect employee, customer, and other third-party data, including personally identifiable information, personal health data and individual/business payment data, for various business purposes. Although we have policies and procedures in place to safeguard such sensitive information, this information has been and could be subject to cyber securitycybersecurity attacks and the aforementioned risks. In addition, we are subject to federal, state, and international laws relating to the collection, use, retention, security and transfer of personally identifiable information, personal health data and individual payment data. Those laws include, among others, the European Union General Data Protection Regulation and similar state agencies that impose additional cyberdata securityprivacy and protection requirements. Complying with these and other applicable laws has caused, and may cause, us to incur substantial costs or require us to change our business practices, and our failure to do so may expose us to substantial fines, penalties, restrictions, litigation, or other expenses and adversely affect our business. Further, any changes to laws or regulations, including new restrictions or requirements applicable to our business, or an increase in enforcement of existing laws and regulations, could expose us to additional costs and liability and could limit our use and disclosure of such information.

While we continue to evolve our cyber securitycybersecurity practices in line with our business’ reliance on technology and the changing external threat landscape, and we invest time, effort and financial resources to secure our systems, networks and communications, our security measures cannot provide absolute assurance that we will be successful in preventing or defending from all cyber securitycybersecurity attacks or incidents impacting our operation. There can be no assurance that any breach or incident will not have a material impact on our operations and financial results.

Any breach, theft, loss, or fraudulent use of guest, employee, third-party or company data, could adversely impact our reputation and brand and our ability to retain or attract new customers, and expose us to risks of data loss, business disruption, governmental investigation, litigation and other liability, any of which could adversely affect our business. Significant capital investments and other expenditures could be required to remedy the problem and prevent future breaches, including costs associated with additional security technologies, personnel, experts and credit monitoring services for those whose data has been breached. Further, if we or our vendors experience significant data security breaches or fail to detect and appropriately respond to significant data security breaches, we could be exposed to government enforcement actions and private litigation.impacted.

Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"). (Refer to Note 1. General and Note 2. Summary of Significant Accounting Policies to our consolidated financial statements under Item 8. Financial Statements and Supplementary Data). Certain of our accounting policies are deemed "critical," as they require management's highest degree of judgment, estimates and assumptions. We have discussed these accounting policies and estimates with the audit committee of our board of directors.Board. We believe our critical accounting policies and estimates are as follows:

We use judgment when estimating the period between drydocks, which can result in adjustments to the estimated amortization of drydock costs. If the vessel is disposed of before the next drydock, the remaining balance in deferred drydock is written-off to the gain or loss on disposal of vessel in the period in which the sale takes place. We also use judgment when identifying costs incurred during a drydock which are necessary to maintain the vessel's Class certification as compared to those costs attributable to repairs and maintenance which are expensed as incurred.

TheSimilar to the impairment review for goodwill, the impairment review for indefinite-lived intangible assets can be performed using a qualitative orand, if necessary, a quantitative impairment assessment. The quantitative assessment consists of a comparison of the fair value of the asset with its carrying value. We estimate the fair value of these assets using a probability weighted discounted cash flow model and various valuation methods depending on the nature of the intangible asset, such as the relief-from-royalty method, for trademarks and trade names. The principal assumptions used in the discounted cash flow model for our 20242025 impairment assessment consisted of:

During the fourth quarter of 2025 and 2024, we performed a qualitative analysis as part of our annual impairment review of the Royal Caribbean reporting unit. Based on our qualitative assessment, we concluded that it was more-likely-than-not that the estimated fair value of the Royal Caribbean reporting unit exceeded its carrying value and thus, we did not proceed to the two-stepquantitative goodwill impairment test.analysis. No indicators of impairment exist primarily because the reporting unit's fair value has consistently exceeded its carrying value by a significant margin and forecasts of operating results expected to be generated by the reporting unit appear sufficient to support its carrying value. As a result, we determined no impairment to Royal Caribbean's goodwill.

Silversea Cruises Reporting Unit

During the fourth quarters of 20242025 and 2023,2024, we performed a quantitative analysis as part of our annual impairment review of the Silversea Cruises reporting unit. As of November 30, 2024,2025 and November 30, 2023,2024, the fair value of the Silversea Cruises reporting unit was determined using a probability weighted discounted cash flow model in combination with a market-based valuation approach. As a result of the tests, we determined the fair value of the Silversea Cruises reporting unit exceeded its carrying value by approximately 98% and 63%, as of November 30, 20242025 and 2023,2024, respectively, resulting in no impairment to Silversea Cruises'Silversea's goodwill. The carrying value of goodwill attributable to our Silversea Cruises reporting unit was $509 million as of December 31, 20242025 and 2023.2024.

During the fourth quarters of 20242025 and 2023,2024, we performed our annual impairment reviews of the Silversea Cruises trade name. As a result of the quantitative tests, we determined that the fair value of the Silversea Cruises'Silversea's trade name exceeded its carrying value by approximately 66%90% and 62%,66%, as of November 30, 20242025 and November 30, 2023,2024, respectively, resulting in no impairment to Silversea Cruises'Silversea's trade name.

As of December 31, 20242025 and 2023,2024, the carrying value of indefinite-life intangible assets was $321 million, which primarily relates to the Silversea Cruises trade name.

We did not perform interim impairment evaluations of Silversea Cruises'Silversea's goodwill or trade names during 20242025 and 2023,2024, as no triggering events were identified.

Adjusted Earnings (Loss) per Share ("Adjusted EPS") is a non-GAAP measure that represents Adjusted Net Income (Loss) attributable to Royal Caribbean Cruises Ltd. (as defined below) divided by weighted average shares outstanding or by diluted weighted average shares outstanding, as applicable. We believe that this non-GAAP measure is meaningful when assessing our performance on a comparative basis.

Adjusted Net Income (Loss) attributable to Royal Caribbean Cruises Ltd. is a non-GAAP measure that represents netNet income (loss) less net incomeIncome attributable toRoyal noncontrollingCaribbean interest,Cruises Ltd., excluding certain items that we believe adjusting for is meaningful when assessing our performance on a comparative basis. For the periods presented, these items included (i) loss on extinguishment of debt and inducement expense; (ii) restructuring charges and other initiatives expenses; (iii) the amortization of the Silversea intangible assets resulting from the Silversea acquisition; (iv) gain on sale of noncontrolling interest; (v) equity investment impairment, (recovery) of losses and other; (vi) litigation loss contingency, which includes the 2024 release of the loss contingency recorded in 2022 in connection with the Havana Docks litigation inclusive of related legal fees and costs; (iiivii) impairment and credit losses; (iv) equity investment impairment, recovery of losses and other; (v) restructuring charges and other initiatives expense; (vi) the amortization of the Silversea Cruises intangible assets resulting from the Silversea Cruises acquisition in 2018; (viiviii) tax on the sale of PortMiami noncontrolling interest; (viii) Silver Whisper deferred tax liability release; and (ix) gain on sale of controlling interest.interest; and (x) Silver Whisper deferred tax liability release. A reconciliation of Net Income (Loss) attributable to Royal Caribbean Cruises Ltd. to Adjusted Net Income (Loss) attributable to Royal Caribbean Cruises Ltd. is provided below under Results of Operations.

Adjusted Operating Income (Loss) is a non-GAAPNon-GAAP measure that represents operating income (loss) including income (loss) from equity investments and provision for income taxes but excluding (i)certain impairmentitems andfor creditwhich losses;we (ii)believe equityadjusting investmentfor impairment,is recoverymeaningful ofwhen lossesassessing andour other;operating (iii) restructuring charges and other initiatives expense; (iv) the amortization of the Silversea Cruises intangible assets resulting from the Silversea Cruises acquisition in 2018; and (v) taxperformance on thea salecomparative of PortMiami noncontrolling interest.basis. We use this non-GAAP measure to calculate ROIC (as defined below). A reconciliation of Operating Income to Adjusted Operating Income is provided below under Results of Operations.

EBITDA is a non-GAAP measure that represents Net Income (Loss) attributable to Royal Caribbean Cruises Ltd. excluding (i) interest income; (ii) interest expense, net of interest capitalized; (iii) depreciation and amortization expenses; and (iv) provision for income tax benefit or expense.taxes. We believe that this non-GAAP measure is meaningful when assessing our operating performance on a comparative basis. A reconciliation of Net Income (Loss) attributable to Royal Caribbean Cruises Ltd. to EBITDA is provided below under Results of Operations.

Net Cruise Costs and Net Cruise Costs excluding Fuel are non-GAAP measures that represent Gross Cruise Costs excluding commissions, transportation and other expenses, and onboard and other expenses and, in the case of Net Cruise Costs excluding Fuel, fuel expenses (each of which is described above under the Description of Certain Line Items heading). In measuring our ability to control costs in a manner that positively impacts net income, we believe changes in Net Cruise Costs and Net Cruise Costs Excludingexcluding Fuel to be the most relevant indicators of our cost performance. For the periods presented, Net Cruise Costs and Net Cruise Costs Excluding Fuel excludes (i) impairment and credit losses; (ii) restructuring charges and other initiatives expense; and (iii) the gain on sale of controlling interests. A reconciliation of Gross Cruise Costs to Net Cruise Costs and Net Cruise Costs Excludingexcluding Fuel is provided below under Results of Operations. For the periods presented, Net Cruise Costs and Net Cruise Costs excluding Fuel excludes (i) restructuring charges and other initiatives expenses; (ii) impairment and credit losses; and (iii) gain on sale of controlling interest.

Return on Invested Capital ("ROIC") represents Adjusted Operating Income (Loss) divided by Invested Capital. We believe ROIC is a meaningful measure because it quantifies how efficiently we generated operating income relative to the capital we have invested in the business.

2025 performance was exceptionally strong. We took delivery of two new ships (UtopiaStar of the Seas and SilverCelebrity RayXcel), announcedand continued to expand our vacation ecosystem with the opening of Royal Beach Club Paradise Island, closing on the acquisition of the port of Costa Maya in 2025, and the announcements of Celebrity River Cruises, launching in 2027, and the expansion of our private destination portfolio with Royal Beach Club Cozumel and Perfect Day Mexico, and reinstated a dividend to our shareholders.Santorini. We achieved strong financial performance, including 23.8%8.5% Gross Margin Yield growth as-reported, Net Yields increased 11.5%3.8% as-reported (11.6%3.7% in Constant-Currency), Net Income of $2.9$4.3 billion and Adjusted EBITDA of $6.0$7.0 billion, Operating Income of 4.1$4.9 billion, and ROIC of 16.1%.18.0%. AsWe announcedmaintained ona Julystrong 25,balance 2024,sheet we alsoand achieved ourinvestment-grade Trifectaratings goals 18 months ahead of schedule. In addition, we made significant progress in strengthening our balance sheet, refinancing approximately $6.1 billion of high cost debt, eliminating restrictions on our ability to return capital to shareholders, and eliminatingacross all securitythree andmajor guarantees.credit rating agencies.

Our 2025 Net Income attributable to Royal Caribbean Cruises Ltd. was $4.3 billion, or $15.61 per diluted share, compared to the 2024 Net Income attributable to Royal Caribbean Cruises Ltd. wasof $2.9 billion, or $10.94 per diluted share, compared to Net Income attributable to Royal Caribbean Cruises Ltd. of $1.7 billion, or $6.31 per diluted share in 2023.share. Adjusted Net Income attributable to Royal Caribbean Cruises Ltd. for 20242025 was $3.2$4.3 billion, or $11.80$15.64 per diluted share, compared to Adjusted Net Income attributable to Royal Caribbean Cruises Ltd. of $1.8$3.2 billion, or $6.77$11.80 per diluted share in 2023.2024.

Total revenues in 20242025 increased by $1.5 billion and were $17.9 billion, exceeding the previous record of $16.5 billion compared to $13.9 billion in 20232024, driven by strong ticket revenue and growth of onboard revenue performance, inclusive of capacity growth. As a result of this,result, Gross Margin Yields increased 23.8%8.5% as-reported, and Net Yields increased 11.5%3.8% as-reported (11.6%3.7% in Constant-Currency), both compared to 2023.2024. TheIn strength2025 we generated $6.5 billion in revenue and improvedoperating cash flow, combinedmaintained withan ourunsecured marginbalance expansionsheet, effortsmanaged alloweddebt usmaturities, and returned $2.0 billion in capital to accelerateshareholders debtthrough repayment, improving our debt maturity profiledividends and strengtheningshare our balance sheet.repurchases.

In 2025,2026, we expect our capacity to increase by 5.4%6.7% compared to 2024,2025, with thea additionfull year of Star of the Seas in late summer and Celebrity Xcel in late 2025,Xcel, and a full yeardelivery of operations for UtopiaLegend of the Seas andin Silverthe Ray.summer. In addition, theour firstportfolio Royalof Beachexclusive Club,land-based destinations is expected to reach 8 by 2028, with additions of Silversea’s Cormorant at Paradise55 Island in the Bahamas, is set to open towards the end of the year, and Wonder of the Seas will join Utopia of the Seas focused on short Caribbean itineraries. We also expect to advance development of theSouth, Royal Beach Club Cozumel,Santorini, and Royal Beach Club Cozumel on the horizon. In addition, we will continue development of Perfect Day Mexico,Mexico and Silversea’sRoyal newBeach hotelClub in Puerto Williams, Chile that will provide a further-elevated and seamless guest experience for its Antarctica expeditions.Lelepa. Our new ships, optimized deployment, continued load factor growth and enhanced onboardproduct offerings are expected to drive growth in Net YieldsYields, total revenues, and Total Revenues.earnings.

•In February 2025, TUI Cruises, our 50% joint venture, took delivery of the Mein Schiff Relax.

For•In furtherJuly information2025, regardingwe took delivery of Star of the debtSeas. and lease transactions discussed above, referRefer to Note 8. Debt, and Note 9. LeasesDebt to our consolidated financial statements under Item 8. Financial Statements and Supplementary Data for further information.information on the financing of the ship.

(1)•In ForOctober 2024,2025, includeswe $119took milliondelivery of inducementCelebrity expense related to the partial settlement of our 6.00% convertible notes due 2025. These amounts are included in Interest expense, net of interest capitalized within our consolidated statements of comprehensive income (loss).Xcel. Refer to Note 8. Debt to our consolidated financial statements under Item 8. Financial Statements and Supplementary Data for further information.information on the financing of the ship.

(2) For 2024,further representsinformation regarding the releasedebt oftransactions thediscussed lossabove, contingency recorded in 2022, in connection with the Havana Docks litigation inclusive of related legal fees and costs. These amounts are included in Other income (expense) within our consolidated statements of comprehensive income (loss). Referrefer to Note 17.8. Commitments and ContingenciesDebt, to our consolidated financial statements under Item 8. Financial Statements and Supplementary Data for further information.

•a discussion of our results of operations for the quarter and six months ended MarchJune 31,30, 2026, compared to the same period in 2025; and

Adjusted EBITDA is a non-GAAP measure that represents EBITDA (as defined below) excluding certain items that we believe adjusting for is meaningful when assessing our profitability on a comparative basis. For the periods presented, these items included (i) other income; and (ii) restructuring charges and other initiative expenses.expenses; and (iii) equity investment impairment, (recovery) of losses and other. A reconciliation of Net Income attributable to Royal Caribbean Cruises Ltd. to Adjusted EBITDA is provided below under Results of Operations.

Adjusted Net Income attributable to Royal Caribbean Cruises Ltd. is a non-GAAP measure that represents Net Income attributable to Royal Caribbean Cruises Ltd., excluding certain items that we believe adjusting for is meaningful when assessing our performance on a comparative basis. For the periods presented, these items included (i) loss on extinguishment of debt and inducement expense; (ii) restructuring charges and other initiativesinitiative expenses; and (iii) the amortization of the Silversea intangible assets resulting from the Silversea acquisition.acquisition; (iv) gain on sale of noncontrolling interest; and (v) equity investment impairment, recovery of losses, and other. A reconciliation of Net Income attributable to Royal Caribbean Cruises Ltd. to Adjusted Net Income attributable to Royal Caribbean Cruises Ltd. is provided below under Results of Operations.

Net Income attributable to Royal Caribbean Cruises Ltd. and Adjusted Net Income attributable to Royal Caribbean Cruises Ltd. for the firstsecond quarter of 2026 was $941$1.1 million and $975 million,billion, respectively, compared to Net Income attributable to Royal Caribbean Cruises Ltd. and Adjusted Net Income attributable to Royal Caribbean Cruises Ltd. of $730$1.2 million and $744 million,billion, respectively, for the firstsecond quarter of 2025.

Significant items for the quarter and six months ended MarchJune 31,30, 2026 include:

•Total revenues increased $453$294 million and $747 million for the quarter and six months ended MarchJune 31,30, 2026 as compared to the same period in 2025. The increase was primarily due to an increase in capacity and yield growth as a result of higher pricing in 2026 compared to the same period in 2025.

•Total cruise operating expenses increased $168$264 million and $433 million for the quarter and six months ended MarchJune 31,30, 2026 as compared to the same period in 2025. The increase was primarily due to an increase in capacity in 2026 compared to the same period in 2025.

Operating results for the quarterquarters and six months ended MarchJune 31,30, 2026 compared to the same period in 2025 are shown in the following tabletables (in millions, except per share data):

(1)For 2026, includes the loss on extinguishment of debt associated with redemptions of the senior notes maturing in 2026. Refer to Note 6. Debt to our consolidated financial statements under Item 1. Financial Statements for further information. For 2025, includes $10 million of inducement expense related to the settlements of the 2025 6.00% convertible notes. These amounts are included in Interest expense, net of interest capitalized within our consolidated statements of comprehensive income (loss).

(45)For 2025, Diluteddiluted EPS includes the add-back of dilutive inducement and interest expense related to our convertible notes of $15$1 million and $16 million for the quarter and for the six months ended MarchJune 31,30, 2025.2025, respectively. Refer to Note 4. Earnings Per Share to our consolidated financial statements under Item 1. Financial Statements for further information.

(56)For 2025, Adjusted Diluted EPS includes the add-back of dilutive interest expense related to our convertible notes of $5$1 million and $6 million for the quarter and six months ended MarchJune 31,30, 2025.2025, respectively.

Quarter Ended MarchJune 31,30, 2026 Compared to Quarter Ended MarchJune 31,30, 2025

In this section, references to 2026 refer to the quarter ended MarchJune 31,30, 2026 and references to 2025 refer to the quarter ended MarchJune 31,30, 2025.

Total revenues increased $0.5$294 billion,million, or 11.3%,6.5%, to $4.5$4.8 billion in 2026 from $4$4.5 billion in 2025.

Passenger ticket revenues comprised 68%69% of our 2026 total revenues. Passenger ticket revenues increased by $277$145 million, or 10.1%4.5% to $3$3.3 billion in 2026 from $2.7$3.2 billion in 2025. The increase was primarily duedriven by a 4.9% capacity growth as a result of the addition of Star of the Seas and Celebrity Xcel compared to: the same period in 2025.

•$72$83 million driven by yield growth as a result of higher onboard spending on a per passenger basis in 2026 compared to the same period in 2025.

Total Cruise operating expenses increased by $168$264 million, or 8.1%,11.6%, to $2.2$2.5 billion in 2026 from $2.1$2.3 billion in 2025. The increase was primarily due to the capacity growth which increased cruise operating expenses in 2026 compared to the same period in 2025.:

Other comprehensive (loss) income for 2026 increaseddecreased by $113$307 million, or 105.6%,174.4%, to $220a loss of $(131) million in 2026 from $106.8a gain of $176 million in 2025. The increasedecrease was primarily due to Gaina (loss) on cash flow derivative hedges of $221$(137) million in 2026 compared to $128a gain of $181 million in 2025, mostly as a result of a significant increase in the fair value of our fuel swaps in 2026 compared to 2025, partially offset by a significant decrease in the fair value of our FX forward swaps and fuel swaps in 2026 compared to 2025.

Cash flow generated from operations provides us with a significant source of liquidity. Net cash provided by operating activities was $1.8$3.7 billion for the threesix months ended MarchJune 31,30, 2026, compared to $1.6$3.4 billion in 2025.

Net cash used in investing activities increased by $89$2.1 millionbillion to $0.5$3.2 billion for the threesix months ended MarchJune 31,30, 2026, compared to $0.4$1.1 billion in 2025. The change of $89$2.1 millionbillion was primarily attributable to increased capital expenditures in 2026 compared to 2025.

Net cash used in financing activities increaseddecreased by $1.4 billion to $0.4 billion to $1.6 billion for threethe six months ended MarchJune 31,30, 2026, compared to $1.2$1.9 billion in 2025. The change of $0.4$1.4 billion was primarily attributable to an increase in debt proceeds of $2.3$5 billion related to the issuance of senior notes,notes and the loan to finance Legend of the Seas, offset by repayment of debt of $1.9$2.2 billion in 2026 compared to the same period in 2025. Additionally, an increase of $0.6$0.8 billion in repurchaserepurchases of common stock in 2026 part of the previously authorized share repurchase program compared to the same period in 2025, an increase of $0.1$326 billionmillion on dividend payments, and an increase of $0.1$129 billionmillion related to payments of withholding tax on stock awards in 2026 compared to the same period in 2025.

Our future capital commitments consist primarily of new ship orders. As of MarchJune 31,30, 2026, the dates that the ships on order by our Global and Partner Brands are expected to be delivered, and their approximate berths are as follows:

Our future capital commitments consist primarily of new ship orders. As of MarchJune 31,30, 2026, the aggregate expected cost of our ships on order presented in the table above, excluding any ships on order by our Partner Brands, was approximately $16.2$16.5 billion, of which we had deposited $1.3 billion. Approximately 52.9%52.6% of the aggregate cost was exposed to fluctuations in the Euro exchange rate at MarchJune 31,30, 2026. Refer to Note 8. Commitments and Contingencies and Note 11. Fair Value Measurements and Derivative Instruments to our consolidated financial statements under Item 1. Financial Statements for further information.

As of MarchJune 31,30, 2026, we anticipate overall full year capital expenditures, based on our existing ships on order, will be approximately $5$4.7 billion for 2026 . This amount does not include any ships on order by our Partner Brands.

As of MarchJune 31,30, 2026, our material cash requirements were as follows (in millions):

(12)Long-term debt obligations mature at various dates through fiscal year 2042 and bear interest at fixed and variable rates. Interest on variable-rate debt is calculated based on forecasted debt balances, including the impact of interest rate swap agreements, using the applicable rate at MarchJune 31,30, 2026. Debt denominated in other currencies is calculated based on the applicable exchange rate at MarchJune 31,30, 2026.

As of MarchJune 31,30, 2026, other than the items described above, we are not party to any other off-balance sheet arrangements, including guarantee contracts, retained or contingent interest, certain derivative instruments and variable interest entities, that either have, or are reasonably likely to have, a current or future material effect on our financial position.

We have significant contractual obligations of which our debt service obligations and the capital expenditures associated with our ship purchases represent our largest funding needs. As of MarchJune 31,30, 2026, we had approximately $14.0$14.3 billion of committed financing for our ships on order, which excludes ships on order for Celebrity River Cruises. As of MarchJune 31,30, 2026, our obligations due through MarchJune 31,30, 2027 primarily consisted of $1.4$1.6 billion related to debt maturities, $1.0$1.1 billion related to interest on debt and $2.4$0.8 billion related to progress payments on our ship orders, including the final installments payable due upon the delivery of Legend of the Seas given the expected delivery date in 2026.orders. We have historically relied on a combination of cash flows provided by operations, draw-downs under our available credit facilities, the incurrence of additional debt and/or the refinancing of our existing debt and the issuance of additional shares of equity securities to fund our obligations.

As of MarchJune 31,30, 2026, we had liquidity of $6.9 billion, including cash and cash equivalents of $0.5$0.9 billion, and $6.4$6 billion of undrawn revolving credit facility capacity.

Our export credit facilities and our non-export credit facilities, and certain of our credit card processing agreements contain covenants that require us, among other things, to maintain a fixed charge coverage ratio, and limit our net debt-to-capital ratio. As of MarchJune 31,30, 2026, we were in compliance with our financial covenants and we estimate that we will be in compliance for at least the next twelve months.

The declaration of dividends shall at all times be subject to the final determination of our Board that a dividend is prudent at that time in consideration of the needs of the business. During the quarter ended MarchJune 31,30, 2026, our Board declared a dividend of $1.50 per share, which was paid in AprilJuly 2026.