AI Takeaway
NCLH delivered a strong Q1 FY2026 with net income swinging to $104.7M from a prior-year loss of $40.3M, driven by a 15.9% jump in operating income and robust operating cash flow of $811.5M, though the balance sheet remains highly leveraged with a debt-to-equity ratio of 8.79.
Cost of Revenue
$1.38B
++5.67% YoY
EPS (Basic)
$0.23
++355.56% YoY
Operating Income
$232.94M
++15.93% YoY
Filed · Analysis updated · Source: SEC EDGAR 10-Q filing
Net income surged to $104.7M in Q1 FY2026 compared to a net loss of $40.3M in Q1 FY2025, representing a 359.7% year-over-year improvement, signaling a meaningful recovery in the cruise business.
Source: Source: 10-Q Income Statement
Operating income grew 15.9% year-over-year to $232.9M despite cost of revenue rising 5.7% to $1.38B and SG&A expenses climbing 17.5% to $459.7M, indicating that revenue growth is outpacing cost inflation.
Source: Source: 10-Q Income Statement
Operating cash flow increased 19.5% year-over-year to $811.5M, reflecting improved earnings quality and working capital dynamics, providing meaningful liquidity to service the company's substantial debt load.
Source: Source: 10-Q Cash Flow Statement
2 more insights available
Upgrade to unlockNCLH carries a debt-to-equity ratio of 8.79 and total liabilities of $21.4B against stockholders' equity of only $2.43B. This level of leverage leaves the company highly sensitive to interest rate changes and limits financial flexibility in a downturn.
Source: Source: 10-Q Balance Sheet
Unlock 4 more detailed risk analysis
Upgrade to unlockReported EPS of $0.23 versus the $0.15 analyst consensus — a +58.3% beat for Q1 FY2026.
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Cost of Revenue | $1.38B | $1.3B | +5.67% |
Operating Income | $232.94M | $200.94M | +15.93% |
Net Income | $104.67M | $-40.3M | +359.75% |
EPS (Basic) | $0.23 | $-0.09 | +355.56% |
EPS (Diluted) | $0.23 | $-0.09 | +355.56% |
SG&A Expense | $459.68M | $391.38M | +17.45% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $23.79B | $21.35B | +11.43% |
Current Assets | $1.31B | $1.15B | +14.17% |
Total Liabilities | $21.36B | $19.94B | +7.15% |
Current Liabilities | $6.22B | $6.09B | +2.02% |
Stockholders' Equity | $2.43B | $1.42B | +71.65% |
Cash & Equivalents | $185.05M | $184.36M | +0.37% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $811.45M | $679.22M | +19.47% |
Investing Cash Flow | $-1.44B | $-1.53B | +6.03% |
Financing Cash Flow | $603.53M | $846.62M | -28.71% |
D&A | $281.39M | $250.53M | +12.31% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
ROE | 4.3% | — | — |
ROA | 0.4% | — | — |
Current Ratio | $0.21 | — | — |
Debt to Equity | $8.786 | — | — |
Other companies in Hotels, Resorts & Cruise Lines
NCLH reported net income of $104.7M and diluted EPS of $0.23 in Q1 FY2026, a dramatic improvement from a net loss of $40.3M and EPS of -$0.09 in Q1 FY2025. Whether this beat Wall Street consensus estimates would require comparison to analyst forecasts not included in the filing.
The headline story is NCLH's return to profitability with net income of $104.7M and operating income growth of 15.9% to $232.9M. Operating cash flow was also strong at $811.5M, up 19.5% year-over-year, though the company's debt-to-equity ratio of 8.79 and current ratio of 0.21 highlight ongoing balance sheet risks.
Cost of revenue increased 5.7% year-over-year to $1.38B, while SG&A expenses rose a steeper 17.5% to $459.7M in Q1 FY2026. Despite these cost increases, operating income still grew 15.9%, suggesting revenue growth was sufficient to absorb the higher expense base.
NCLH's financial health shows improvement in profitability but remains strained on the balance sheet, with total liabilities of $21.4B, a debt-to-equity ratio of 8.79, and a current ratio of just 0.21. On the positive side, stockholders' equity grew 71.6% to $2.43B and operating cash flow was a healthy $811.5M.
Based on the financial data, the most prominent risks include extreme financial leverage (debt-to-equity of 8.79), a very low current ratio of 0.21 indicating tight near-term liquidity, and rising SG&A costs up 17.5% year-over-year. The company also continues to invest heavily in its fleet with investing outflows of -$1.44B in the quarter.