Speaker 1: Bloomberg Audio Studios, podcasts, radio news. It is so great
Speaker 1: to have back with us. Josh Weinstein. He's president, CEO,
Speaker 1: and chief Climate Officer of Carnival Corporation. Their brands, you
Speaker 1: know them, their namesake, of course, Carnival, Princess, Holland America, Seaborn,
Speaker 1: many more. He joins us right now, Josh does from
Speaker 1: Carnival's headquarters in Miami. Josh, good to have you here
Speaker 1: with us. Happy holidays.
Speaker 2: How are you?
Speaker 3: Thanks for having me at Happy holidays, Carol, Tim nice
Speaker 3: to be here, Thank you.
Speaker 2: Hey.
Speaker 1: Listen, last time we talked in September after earnings, we
Speaker 1: highlighted that nearly I think half of your bookings were
Speaker 1: done so at record ticket prices. Now some two thirds
Speaker 1: of twenty twenty five have been booked. Tell us about
Speaker 1: those bookings. Are they also at record prices?
Speaker 2: Yeah, they are.
Speaker 3: You know our book position as well as we did
Speaker 3: this past year. If you look at where we are
Speaker 3: today versus same time last year, we are hire in occupancy,
Speaker 3: higher in prices. As a matter of fact, it's historical
Speaker 3: levels for both for each of the four quarters for
Speaker 3: twenty twenty five. So, as I heard you saying before,
Speaker 3: I came on. The demand for our cruises is pretty.
Speaker 4: Phenomenal typically this time of year, Josh, how much of
Speaker 4: the following year is booked? How different is this than
Speaker 4: historical averages.
Speaker 3: We don't give that out for various competitive reasons, but
Speaker 3: I'd say it's nicely it's nicely higher.
Speaker 2: To give you a sense of the momentum.
Speaker 3: You know, if you think about what was our booking activity,
Speaker 3: how much activity did we generate in the last quarter,
Speaker 3: So from the period of September through the end of November,
Speaker 3: that beat last year, even though we had less to sell.
Speaker 2: So we sold more.
Speaker 3: For twenty twenty five, and we sold it at higher
Speaker 3: prices versus the same time last year, And at the
Speaker 3: same time, we set a record for booking activity for
Speaker 3: the following year out so in this case twenty twenty six.
Speaker 3: So things are moving really positively across the board. And
Speaker 3: the great thing is this is broad based. So when
Speaker 3: we look back at twenty twenty four and we look
Speaker 3: at our portfolio of world class brands, we were actually
Speaker 3: higher mid single digit to mid teens percentage wise in
Speaker 3: our yields, in the revenue we generate for person per
Speaker 3: day across all of our major brands, all of our
Speaker 3: major trades. So it's really gratifying the team, our global
Speaker 3: team has done a phenomenal job and really a shout
Speaker 3: out to each and every one of them from doing
Speaker 3: what they do.
Speaker 1: Okay, this maybe sounds a little bit stupid, but why
Speaker 1: do you think this is happening? I mean, and I'm
Speaker 1: just curious what is it? Tell us a little bit
Speaker 1: about it and remind us, because you do have a
Speaker 1: portfolio of brands and it reaches across different consumers, if
Speaker 1: you will, of your brand, So give us an idea
Speaker 1: of why you think you are still seeing kind of
Speaker 1: record bookings.
Speaker 3: Will need an hour, right, I mean, there's so many reasons.
Speaker 3: The principle and I remember I remember being on with
Speaker 3: you a year ago and talking about what we'll call
Speaker 3: the price to experience ratio, and the price to experience
Speaker 3: ratio of a cruise versus the price and what you
Speaker 3: pay for a land based alternative is nuts, right, I mean,
Speaker 3: the value that you get from a cruise for what
Speaker 3: we provide is night and day to what you can
Speaker 3: get on land. And people are recognizing that, and so
Speaker 3: we are catching a net much wider into the general
Speaker 3: population for people who will now consider cruising as a
Speaker 3: vacation alternative, people who have never cruised before. As a
Speaker 3: matter of fact, in twenty twenty four we had over
Speaker 3: ten percent more new to cruise than we did the
Speaker 3: prior year, So becoming more mainstream, breaking down myths, and
Speaker 3: that value gap is real. So we can still increase
Speaker 3: our pricing as we've been doing the last few years
Speaker 3: and be an incredible value. And I tell you there's
Speaker 3: so many things that our teams are doing better and
Speaker 3: better every single day, from how we manage the revenue curve,
Speaker 3: the yield curve between the time we launched two and
Speaker 3: a half years in advance to the time we sail.
Speaker 2: Our marketing is amazing.
Speaker 3: Our brands doing a better better job of creative marketing,
Speaker 3: getting in the consideration set and then performance marketing and
Speaker 3: make sure we close the deal and get the booking,
Speaker 3: you name it. We could talk about it all day,
Speaker 3: but everything is moving in a positive direction.
Speaker 4: Josh, forgive me. We have some breaking news, so I
Speaker 4: want to jump in with that. Speaker Johnson says the
Speaker 4: House to vote on a funding bill today. He said,
Speaker 4: vote on a government funding the House. He says that
Speaker 4: the agreement has been reached on government funding, and he
Speaker 4: says there will be no government shutdown once again, Johnson saying,
Speaker 4: Speaker Johnson saying that agreement has been reached on government
Speaker 4: funding and there will be no government shutdown.
Speaker 1: You know, I got to say, Josh, there's so much
Speaker 1: coming at us, and so many individuals and leaders CEOs
Speaker 1: that we talked to say, you know what, we're kind
Speaker 1: of holding off until we get an idea clear picture
Speaker 1: of what happens in twenty twenty five. You are obviously optimistic.
Speaker 1: You see numbers and data in real time in terms
Speaker 1: of bookings, But I am curious about the upcoming White House.
Speaker 1: Is it good, bad, or neutral for your business?
Speaker 3: You know, we had a great relationship with the Trump
Speaker 3: administration the first time around. We had great relationship with
Speaker 3: the Biden team, and I expected that that great relationship
Speaker 3: we'll pick up with President Trump again. So you know,
Speaker 3: our job is to deliver amazing vacation experiences to millions
Speaker 3: of guests.
Speaker 2: A year around the world.
Speaker 3: That is what we do, and we do it very well,
Speaker 3: and every single year there is something right because we
Speaker 3: are global and the macro economy and the geopolitics are
Speaker 3: what they are when I was with you a year ago. Today,
Speaker 3: we didn't have Red Sea on the radar screen. The
Speaker 3: Baltimore Bridge hadn't collapsed, you know, hurricanes hadn't done the
Speaker 3: damage that they did in the United States, government elections
Speaker 3: getting thrown for a loop in Europe like the UK
Speaker 3: and now Germany.
Speaker 2: None of that was on the radar screen.
Speaker 3: And we outperformed our December guidance by seven hundred million dollars.
Speaker 3: Our job is to deliver no matter what the world
Speaker 3: might bring, and we'll continue to do that.
Speaker 1: So I do wonder when you look at twenty two
Speaker 1: twenty five, what macroeconomic factors, what geopolitical factors concern you
Speaker 1: the most? Josh, you know when you think about the
Speaker 1: company's twenty twenty five performance potential? Oh man, you know, sorry,
Speaker 1: I'm asking you, Chris.
Speaker 3: Yeah, that's all right. I'm not going to single anything out.
Speaker 3: I mean, like I said, our job is to deliver.
Speaker 3: We deal with whatever the world might bring.
Speaker 2: We are nimble.
Speaker 3: Our team is amazing at reacting as they need to.
Speaker 3: But more importantly, we are proactively doing what we need
Speaker 3: to do to position our ships with our guests the
Speaker 3: right way and delivering onboard so the world of turn
Speaker 3: crises will come and go and people will keep cruising.
Speaker 4: You've been President's CEO Chief Climate Officer since August of
Speaker 4: twenty twenty two, so you've been in this position for
Speaker 4: a couple of years. Relative to the last couple of years,
Speaker 4: how would you describe the health of the American consumer
Speaker 4: right now? Same, better, worse.
Speaker 2: We're just seeing continued positive momentum.
Speaker 3: So I think it's hard to say anything, but it's
Speaker 3: just as good now as it has been for the
Speaker 3: last few years for us, in particular, given the record
Speaker 3: yields that we're just coming off of and we're building
Speaker 3: on top of that.
Speaker 2: And you've got to remember we're a global company.
Speaker 3: So yes, the United States is the biggest cruise market
Speaker 3: by far, and we're doing incredibly well in the United States,
Speaker 3: but we are also the biggest in the United Kingdom,
Speaker 3: the biggest in Germany, second biggest thing in Italy, second
Speaker 3: biggest in Spain, Brazil. So we have an incredible global presence.
Speaker 3: And the fact is economic cycles come and go, prises
Speaker 3: come and go, macroeconomics will flow different times in different
Speaker 3: places around the world. So our portfolio approach of being
Speaker 3: in these phenomenal markets really serves as a great hedge
Speaker 3: for us because things will come in their cycles and
Speaker 3: leave their cycles at different times.
Speaker 4: So, of those geographic markets that you mentioned, even those
Speaker 4: that you didn't mention, where you do operate, where you
Speaker 4: do play, where are you most bullish?
Speaker 2: Oh? Where am I not? You?
Speaker 3: You know, if you think about cruising right and you
Speaker 3: think about our brands, we're about a third of the market.
Speaker 3: Let's just say, in broad terms, if you take the
Speaker 3: whole cruise market and you put it into a bucket
Speaker 3: with all of the vacation alternatives at the same time,
Speaker 3: we're about two to three percent of the overall vacation market.
Speaker 3: And so how can you not be bullish when we
Speaker 3: are so underpenetrated as a global industry. I mean, it
Speaker 3: is remarkable what inroads we can make by just getting
Speaker 3: people who have never cruised before to consider cruising. And
Speaker 3: I'll tell you what, I don't know a Disney's strategy
Speaker 3: anymore than anybody else does from the outside, But I
Speaker 3: do know that they talked them awful lot lately about
Speaker 3: reducing the investment in their land because they want to
Speaker 3: build more investment into cruise and double the size of
Speaker 3: their fleet. I think that is very, very telling, and
Speaker 3: I think it's a brilliant idea.
Speaker 1: Okay, and you guys have invested in your fleet. And
Speaker 1: I'm also curious about you know, when I did a
Speaker 1: deep dive on the company and I got off at
Speaker 1: Grand Turk, you guys have a port there, and I
Speaker 1: am curious about these offshore destinations for Carnival travelers. How
Speaker 1: significant is the July twenty twenty five opening of your
Speaker 1: Celebration Key private island destination to the companies full your
Speaker 1: revenue out look, I am curious about how this moves
Speaker 1: the financial needle, these offshore ports that are yours. You
Speaker 1: know that you guys highlight.
Speaker 3: Yeah, absolutely, They're a critical piece of our strategy. So
Speaker 3: even today without Celebration Key, we've got six jewels in
Speaker 3: and around the Caribbean, and we carry We took about
Speaker 3: six and a half million guests to one of our
Speaker 3: destinations in that geography. That's about equal to the rest
Speaker 3: of the industry combined with theirs. On top of this,
Speaker 3: we've got Celebration Key, which is going to be a
Speaker 3: phenomenal guest experience built from the ground up for Carnival
Speaker 3: Cruise Line. And their idea of fun and just a
Speaker 3: wonderful guest experience on board, and there's a lot that
Speaker 3: we can go into, but it's going to be phenomenal.
Speaker 2: Now.
Speaker 3: With respect to twenty twenty five, it's really not that
Speaker 3: much of an impact because we don't open until July
Speaker 3: with a handful of cruises and then we build up.
Speaker 3: So for the corporation overall, it's only about five percent
Speaker 3: of our itineraries in twenty five we'll touch Celebration Key.
Speaker 3: That ratchets up to about fifteen percent when we get
Speaker 3: to twenty twenty six. On top of this, we've announced
Speaker 3: that we're doing some major investment in one of our
Speaker 3: other existing destinations, traditionally known as Half Moon Key and
Speaker 3: rebranded relax Away at half Moon Key, because it's a
Speaker 3: different vibe than Celebration Key. It is a beautiful tropical paradise,
Speaker 3: white sand beaches, and what we want you to do
Speaker 3: there is lean into the beauty and the pristiness of
Speaker 3: that location and the crystal blue waters and relax and
Speaker 3: enjoy yourself and unwind.
Speaker 2: And we're going to be able to.
Speaker 3: Marry these two types of experiences on the same itinerary,
Speaker 3: so you get the idyllic and the ultimate beach days
Speaker 3: across those portfolios.
Speaker 2: Well.
Speaker 1: Listen, great to check in with you. You and investors
Speaker 1: are certainly respecting the optimism that you have put out,
Speaker 1: certainly in earnings and then on your call with analysts.
Speaker 1: I'm so glad we could get some time with you. Josh.
Speaker 1: Happy holidays to you and your family, and look forward
Speaker 1: to talking to you in the new year. Josh Weinstein Folks, President, CEO,
Speaker 1: and Chief Climate Officer of Carnival Corporation, joining us from
Speaker 1: Miami