Carnival Corp. & plc (NYSE:CCL)

Gross Profit Margin

The gross profit margin displayed a declining trend from early 2019 through early 2021, turning sharply negative beginning mid-2020. The margin reached its lowest point in early 2021, indicating substantial cost pressures or revenue issues. From mid-2021 onward, a gradual recovery is observed, with margins improving steadily and turning positive again by late 2022, reaching 34.81% by early 2024.

Operating Profit Margin

Operating profit margin followed a similar pattern to the gross profit margin, with positive values in 2019 that declined quickly from early 2020 into significant negative territory through 2021. The nadir was reached in early 2021 with extremely large negative margins, signaling severe operational challenges. A recovery began in mid-2021, continuing through 2023 and into early 2024, where operating margins moved back into positive territory but remained below pre-2020 levels.

Net Profit Margin

Net profit margin trends paralleled operating margin movements, starting positively in 2019 and collapsing sharply through 2020 and 2021 to deep negative values. The worst losses occur around early 2021, indicating high net expenses or impairments. A slow but steady improvement was noted from mid-2021 forward, producing a near break-even position by late 2023 and a positive margin by early 2024.

Return on Equity (ROE)

ROE demonstrated a decline from healthy positive returns in 2019 to negative territory starting mid-2020, with values worsening substantially through 2021. Notably, ROE decreased more dramatically compared to profit margins, showing persistent equity base erosion or losses exceeding equity. Improvement is visible beginning in late 2022, yet ROE remained negative through most of 2023 and only approached a modest positive figure by early 2024.

Return on Assets (ROA)

ROA similarly deteriorated from positive returns in early 2019 to negative values starting mid-2020. The decline was less severe than ROE but indicated ongoing asset earning difficulties. Negative returns persisted until late 2023, with gradual recovery signaled by ROA nearing zero and slightly positive by early 2024, reflecting improving asset utilization or profitability.

In summary, the financial ratios reveal a period of significant operational and financial distress beginning in early 2020, likely related to external adverse conditions. The company faced drastic falls in profitability and returns, hitting their lowest points during 2020 and early 2021. Starting mid-2021, a consistent recovery trend emerged across all key margins and returns, with profitability and returns returning to positive territory by early 2024, although some metrics remain below pre-distress levels. This pattern underscores both the severity of challenges faced and a subsequent gradual stabilization and improvement in financial performance.

Revenue Trends

Revenues display significant volatility across the periods analyzed. Initially, revenues were relatively stable, fluctuating around the 4,700 to 6,500 million USD range until early 2020. Starting from May 2020, there was a dramatic drop to as low as 31 million USD by August 2020, reflecting a severe contraction. Following this nadir, a gradual recovery is seen, with revenues increasing steadily and reaching approximately 6,800 million USD by November 2023, before a slight decline to 5,406 million USD in February 2024.

Gross Profit (Loss) Trends

Gross profit exhibited considerable fluctuations correlating with revenue changes. Prior to 2020, gross profit values were positive and relatively stable, peaking at 3,001 million USD in August 2019 and then decreasing moderate to around 1,266 million USD by February 2020. In the following periods, notably from May 2020 to November 2021, gross profit turned negative, indicating losses associated with operational pressures, reaching a low of -1,744 million USD in May 2020. Towards early 2022 and beyond, gross profit showed a recovery trend, oscillating but turning positive again by August 2022 and substantially increasing to over 2,900 million USD by August 2023, before tapering off slightly near 1,700 million USD in early 2024.

Gross Profit Margin Analysis

The gross profit margin percentage reflects the volatility seen in gross profits and revenues. Margins remained in a moderate positive range around 36-40% before 2020, then sharply declined during 2020, entering negative territory as large losses outweighed revenue. Margins reached extreme negative values, exemplifying severe operational inefficiencies or cost pressures during that interval, with the lowest point at approximately -2,332% in May 2021, indicating gross losses vastly larger than revenues. From early 2022 onward, margins improved consistently, moving back to positive percentages, reaching nearly 35% by February 2024—though still below pre-2020 levels.

Summary Insights

The data reveals a period of significant financial distress starting early 2020, which aligns temporally with broader market disruptions. The company experienced drastic revenue contractions and substantial gross losses, leading to deeply negative gross profit margins. A recovery phase commenced around mid-2021, marked by increasing revenues, returning gross profits, and improving margins. While full prior profitability levels have not been entirely restored, the recent positive trends indicate strengthening operational performance and better cost control, resulting in renewed gross profitability and margin improvement heading into 2024.

The financial data reveals distinct trends in operating income, revenues, and operating profit margins over the periods analyzed. Initial quarters show robust performance with positive operating income and stable revenues, followed by a notable deterioration coinciding with the global disruption starting early 2020. Subsequently, gradual signs of recovery are observable towards the end of the timeline.

Operating Income (Loss)

Operating income was strong and positive through 2019, peaking notably in August 2019. A sharp decline begins in the first quarter of 2020, transitioning into substantial losses from May 2020 through late 2021. Although losses remain, their magnitude diminishes gradually beginning early 2022. By late 2023 and early 2024, the company returns to positive operating income levels, indicating a recovery phase. However, the income remains volatile with some fluctuations between positive and negative quarters.

Revenues

Revenues remained relatively stable and strong throughout 2019, reaching a peak in August 2019. The impact of external factors becomes evident in early 2020, with revenues plummeting sharply in the immediate quarters following February 2020, hitting a low in August and November 2020. From 2021 onward, revenues exhibit a progressive recovery trend, achieving higher levels gradually. By late 2023, revenues surpass pre-2020 figures, demonstrating a significant rebound.

Operating Profit Margin

Operating profit margins align closely with the trends in operating income. Margins were solid and positive throughout 2019, consistently above 15%. Beginning in February 2020, margins plunge dramatically, turning deeply negative and hitting extreme lows especially through 2020 and early 2021. Over the period from 2022 to early 2024, margins steadily improve, crossing into positive territory again by late 2023 and maintaining a positive trend through early 2024. This improvement signals enhanced operational efficiency or recovery in cost structure alongside increasing revenues.

Overall, the data depicts a significant disruption impacting financial performance starting in early 2020, likely related to external challenges. The company experienced sustained losses and severely depressed profitability during this period. Recovery appears underway from 2022 onwards, with both revenues and operating income improving, and operating margins returning to positive values by the beginning of 2024. Despite volatility, the trajectory suggests resilience and gradual restoration of operational stability and profitability.

The analysis of the recent quarterly financial data reveals distinct trends and fluctuations in key profitability metrics.

Net Income (Loss)

Net income exhibited strong positive performance through most of 2019, peaking notably at 1,780 million USD in August 2019. However, starting from early 2020, there was a pronounced and sustained decline into negative territory, coinciding with the onset of global disruptions. The losses reached their most severe levels in mid-2020, with a peak negative value of -4,374 million USD in May 2020. Subsequently, net losses remained substantial though somewhat improved but persisted into negative figures up till early 2023. There was a brief return to positive net income in August 2023, registering 1,074 million USD, before again slipping back into losses by early 2024.

Revenues

Revenue figures followed a generally positive trajectory throughout 2019, with quarterly revenues ranging between approximately 4.7 billion and 6.5 billion USD. There was a dramatic drop in revenues starting in the first half of 2020, plummeting to as low as 31 million USD in August 2020, indicating a severe contraction in sales activity. From late 2020 onwards, revenues showed a steady recovery trend, increasing steadily through 2021 and 2022, reaching over 6.8 billion USD in November 2023. The recovery appears consistent, reflecting gradual normalization of business operations.

Net Profit Margin

The net profit margin closely mirrors the trends observed in net income, illustrating profitability challenges beginning in 2020. Margins were healthy and stable throughout 2019, ranging between approximately 14% and 16%. The margin deteriorated rapidly starting in early 2020, becoming deeply negative and reaching extreme lows, such as -7,426.76% in May 2021, reflecting disproportionate losses relative to revenues during the period of minimal revenue. While negative margins started to improve from mid-2021 onward, they remained below zero through much of 2022 and early 2023. By early 2024, the margin has returned to a slightly positive but minimal 1.79%, indicating a tentative return to profitability.

In summary, the data reflect a sharp financial downturn beginning in early 2020, characterized by collapsing revenues and significant losses, likely tied to extraordinary operational disruptions. The subsequent quarters demonstrate a measured recovery in revenue generation accompanied by improvements in profitability metrics, yet the company has only recently begun to approach normalized profitability levels. Volatility remains evident, underscoring ongoing sensitivity to external factors impacting financial performance.

Net Income (Loss)

The net income exhibited significant volatility over the reported periods. Up until early 2020, the company showed generally positive net income, peaking notably in August 2019 at 1780 million US dollars. However, starting from February 2020, there was a marked shift to substantial losses, with the largest negative figures recorded between May 2020 and November 2021. While losses gradually diminished from early 2022 onward, occasional fluctuations persisted, including a return to a positive figure in August 2023, followed by minor losses in subsequent quarters.

Shareholders’ Equity

Shareholders’ equity showed a downward trend during the observed timeframe. From a high point above 25 billion US dollars in late 2019, equity decreased significantly, particularly from early 2020 onward, falling to levels below 7 billion US dollars by early 2024. This decline suggests sustained financial strain and erosion of equity capital over the period, despite some minor fluctuations.

Return on Equity (ROE)

The ROE reflected the profitability challenges faced by the company. Initially stable and positive near 12% in 2019, it declined sharply starting in early 2020, plunging into large negative territory and reaching a low point of approximately -111% in May 2022. Although there has been a gradual recovery since this trough, the ROE remained negative or near zero up to early 2024, with a modest positive rebound to around 6% in the last quarter reported.

Overall Analysis

The data indicates that the company encountered severe financial difficulties commencing in early 2020, likely attributable to extraordinary external factors affecting its operations. The sharp decline in net income coupled with eroding shareholders’ equity and a steep drop in ROE highlights sustained challenges in maintaining profitability and capital base integrity. While there are signs of partial stabilization and modest recovery in the most recent quarters, overall financial health remains under pressure relative to the pre-2020 period.

Net Income (Loss) Trend

The net income demonstrates significant volatility over the observed periods. Initially, net income was positive and relatively strong, reaching a peak of 1,780 million US dollars in August 2019. However, starting in February 2020, the company experienced a marked turnaround into losses, with the most severe negative result of -4,374 million US dollars recorded in May 2020. Although losses gradually decreased after this low point, net income remained negative for most subsequent periods until a brief return to profitability of 1,074 million US dollars in August 2023. This positive spike was short-lived as net income again declined to negative figures by February 2024.

Total Assets Trend

Total assets showed a steady upward trend from the beginning of the period until November 2020, increasing from approximately 43,930 million US dollars to 53,593 million US dollars. After peaking around early 2021 near 57,226 million US dollars, total assets experienced a slight but consistent decline, stabilizing at just below 50,000 million US dollars towards the end of the observed timeframe. This indicates a contraction or a strategic divestment phase following earlier asset accumulation.

Return on Assets (ROA) Trend

The ROA percentage started at a healthy level, ranging between 6.64% and 7.05% in the early periods, indicating effective utilization of assets to generate profits. From February 2020 onward, ROA sharply deteriorated, falling into negative territory in parallel with the net income losses, reaching a nadir of approximately -19.1% in November 2020. Although the ROA remained negative, it showed a gradual improvement over subsequent periods, moving toward zero and achieving slightly positive at 0.81% by February 2024. This trend mirrors the movement in net income and suggests incremental recovery in asset efficiency.

Overall Analysis

The financial trends suggest that the company faced a significant downturn starting around early 2020, likely due to external adverse factors, as evidenced by major losses and declining ROA. Despite the gradual recovery in profitability metrics and asset utilization efficiency in recent periods, the figures have not returned to earlier positive levels consistently. Total assets grew until a peak in early 2021, followed by a modest reduction and stabilization, possibly reflecting a conservative asset management strategy in response to the challenging financial environment.