Render of Carnival Sunrise

Carnival Corp. Announces Q2 2020 Losses


  • U.S. GAAP net loss of $(4.4) billion, or $(6.07) diluted EPS, for the second quarter of 2020, which includes $2.0 billion of non-cash impairment charges.
  • Second quarter 2020 adjusted net loss of $(2.4) billion, or $(3.30) adjusted EPS.
  • Total revenues for the second quarter of 2020 were $0.7 billion, lower than $4.8 billion in the prior year.
  • The company’s guest cruise operations have been in a pause for a majority of the second quarter. In addition, the company is unable to definitively predict when it will return to normal operations. As a result, the company is currently unable to provide an earnings forecast. The pause in guest operations is continuing to have material negative impacts on all aspects of the company’s business. The longer the pause in guest operations continues the greater the impact on the company’s liquidity and financial position. The company expects a net loss on both a U.S. GAAP and adjusted basis for the second half of 2020.
  • Cash burn rate in the second quarter 2020 was generally in line with the previously disclosed expectation.
  • Second quarter 2020 ended with $7.6 billion of available liquidity, and the company expects to further enhance future liquidity, including through refinancing scheduled debt maturities. In addition, the company has $8.8 billion of committed export credit facilities that are available to fund ship deliveries originally planned through 2023.
  • Total customer deposits balance at May 31, 2020 was $2.9 billion, including $475 million related to cruises during the second half of 2020.
AIDAnova auf See während der Erprobungsfahrt.


The company expects to resume guest operations, after collaboration with both government and health authorities, in a phased manner, with specific ships and brands returning to service over time to provide its guests with enjoyable vacation experiences. The company anticipates that initial sailings will be from a select number of easily accessible homeports. The company expects future capacity to be moderated by the phased re-entry of its ships, the removal of capacity from its fleet and delays in new ship deliveries.

In connection with its capacity optimization strategy, the company intends to accelerate the removal of ships in fiscal 2020 which were previously expected to be sold over the ensuing years. The company already has preliminary agreements for the disposal of 6 ships which are expected to leave the fleet in the next 90 days and is currently working toward additional agreements.

Carnival Vista Class

Health and Safety Protocols

In preparation for the resumption of its cruises, and consistent with its commitment to provide its guests with a safe and healthy environment, the company is proactively consulting and working in close cooperation with various medical policy experts and public health authorities to develop enhanced procedures and protocols for health and safety onboard its ships. The company appreciates the excellent working relationship with the health authorities of federal states and local port authorities in Germany, as well as the Italian Coast Guard, Italian Ministry of Transportation, Italian Ministry of Health and others around the world. A comprehensive restart protocol may include areas such as medical care, screening, testing, mitigation and sanitization addressing arrival and departure at cruise terminals, the boarding and disembarkation process, onboard experiences and shore excursions.

Update on Bookings

The company’s brands have announced various incentives and flexibility for certain booking payments on select sailings to support guest confidence in making new bookings. These incentives vary by brand and sailing and include onboard credits and reduced or refundable deposits. In addition, the company is providing flexibility to guests with bookings on sailings cancelled due to the pause by allowing guests to receive enhanced future cruise credits (“FCC”) or elect to receive refunds in cash. Enhanced FCCs increase the value of the guest’s original booking or provide incremental onboard credits. As of May 31, 2020, approximately half of guests affected have requested cash refunds. Despite substantially reduced marketing and selling spend, the company is seeing growing demand from new bookings for 2021. For the six weeks ending May 31, 2020, approximately two-thirds of 2021 bookings were new bookings. The remaining 2021 booking volumes resulted from guests applying their FCCs to specific future cruises.

As of May 31, 2020, the current portion of customer deposits was $2.6 billion with $121 million relating to third quarter sailings and $353 million relating to fourth quarter sailings. The company expects any decline in the customer deposits balance in the second half of 2020, all of which is expected to occur in the third quarter, to be significantly less than the decline in the second quarter of 2020.

As of May 31, 2020, cumulative advanced bookings for the full year of 2021 capacity currently available for sale are within historical ranges at prices that are down in the low to mid-single digits range including the negative yield impact of FCCs and onboard credits applied, on a comparable basis. For the full year of 2021, booking volumes for the six weeks ending May 31, 2020, were running meaningfully behind the prior year. However, the company saw an improvement in booking volumes for the six weeks ending May 31, 2020 compared to the prior six weeks.


In the face of the impact of the COVID-19 global pandemic, the company paused its guest cruise operations in mid-March. In response to this unprecedented situation, the company acted to ensure the health and safety of guests and shipboard team members, optimize the pause in guest operations and maximize its liquidity position.

Ensuring the Health and Safety of Guests and Team Members

During this period the company has taken and will continue to take the following actions:

  • Returned over 260,000 guests to their homes, coordinating with a large number of countries around the globe. The company chartered aircraft, utilized commercial flights and even used its ships to sail home guests who could not fly
  • Working around the clock with various local governmental authorities to repatriate shipboard team members as quickly as possible. 49 cruise ships have traveled more than 400,000 nautical miles and the company has chartered hundreds of planes to repatriate approximately 60,000 of its shipboard team members to more than 130 countries around the globe. The company expects substantially all of the approximately 21,000 remaining shipboard team members to be able to return home by the end of June. The safe manning team members will remain on the company’s ships
  • For those shipboard team members experiencing extended stays onboard, the company is focusing on their physical and mental health. The company is providing most shipboard team members with single occupancy cabin accommodations, many with a window or balcony. Shipboard team members have access to fresh air and other areas of the ship, movies and internet, and available counseling

Optimizing the Pause in Guest Operations

The company estimates that its ongoing ship operating and administrative expenses will be approximately $250 million per month once all ships are in paused status. The company continues to seek ways to further reduce this monthly requirement.

Reduced Operating Expenses

The company has taken significant actions to reduce operating expenses during the pause in guest operations:

  • While maintaining safety, environmental protection and compliance, the company significantly reduced ship operating expenses, including crew payroll, food, fuel, insurance and port charges by transitioning ships into paused status, either at anchor or in port and staffed at a safe manning level
  • Currently 62 of the company’s ships are in their final expected pause location. The company expects substantially all of its ships to reach their full pause status during the third quarter
  • Significantly reduced marketing and selling expenses
  • Implemented a combination of layoffs, furloughs, reduced work weeks and salary and benefit reductions across the company, including senior management
  • Instituted a hiring freeze across the organization, significantly reduced consultant and contractor roles

Reduced Capital Expenditures

The company has reduced capital expenditures and estimates $300 million of non-newbuild capital expenditures during the second half of 2020, which largely consists of previously committed expenditures.

The company previously had four ships scheduled to be delivered between May and October of 2020. The company believes COVID-19 has impacted shipyard operations and will result in delivery delays of the ships this year and is working with the shipyards on revised timing. The company has committed future financing, comprised of ship export credit facilities, associated with these newbuilds.