Good morning, everyone, and welcome to our second quarter 2017 earnings conference call. I am Arnold Donald, President and CEO of Carnival Corporation & plc. Thank you all for joining us this morning. Today, I'm joined by our Chairman, Micky Arison; David Bernstein, our Chief Financial Officer; and Beth Roberts, Senior Vice President, Investor Relations. Before I begin, please note that some of our remarks on this call will be forward looking. Therefore, I must refer you to the cautionary statement in today's press release. We achieved record second quarter adjusted earnings of $0.52 per share. That's on top of last year's previous record-setting second quarter, and we exceeded the midpoint of our guidance by $0.07. Our second quarter results, combined with our strong booked position, enabled us to again increase the midpoint of our previous full year guidance range and raise our full-year earnings expectations to a range between $3.60 and $3.70. Year-over-year, for the second quarter, despite a $0.12 drag from fuel and currency both moving against us, strong operational improvement contributed $0.13 per share to the bottom line, which when combined with $0.02 of accretion from our share repurchase program, enabled us to exceed the prior year second quarter and the high end of our March guidance range. The efforts of our more than 120,000 employees around the world who deliver exceptional guest experiences every day, combined with the support of our valued travel agent partners, propelled our strong financial performance. Constant currency revenue yield growth this quarter exceeded 5%, on top of the 3.6% improvement achieved in the second quarter last year. Our consistently strong revenue improvement continues to be driven by increasing demand in excess of our measured capacity growth through our ongoing guest experience, marketing and public relations efforts. And as previously indicated, we…

Thank you, Arnold. Before I begin, please note, all of my references to revenue, ticket prices and cost metrics will be in constant currency unless otherwise stated. I'll start today with a summary of our 2017 second quarter results, then I'll provide some insights on booking trends and finish up with an update on our full year 2017 guidance. Our adjusted EPS for the second quarter was a record $0.52. As Arnold indicated, this was $0.07 above the midpoint of our March guidance. The improvement was revenue driven, as increase in the ticket yield benefited from stronger pricing on closed-in bookings on both sides of the Atlantic, while on-boarding other yields continue to benefit from a variety of our ongoing initiatives. Now let's turn to the second quarter operating results versus the prior year. Our capacity increased almost 4%. The North American brands were up almost 6%, while the European, Australian and Asian brands, also known as our EAA brands, were up slightly. Our total net revenue yields were up 5.1%. Now let's break apart the 2 components of net revenue yields. Net ticket yields were up 5.7%. This increase was driven by our North American brands deployment in the Caribbean, Europe and Alaska as well as our EAA brands deployment in both Europe and the Caribbean. These increases were partially offset by decreases in our China deployment as previously indicated. Net onboard and other yields increased 3.5%, with increases on both sides of the Atlantic. In summary, as Arnold indicated, our record second quarter adjusted EPS was better than last year's previous record-setting second quarter, with strong operational improvements of $0.13 and the $0.02 accretive impact of the stock repurchase program, both being partially offset by the impact of higher fuel prices costing $0.11 and the unfavorable impact of…

Thank you, David. Operator, please open the call for questions.

[Operator Instructions] And our first question comes from the line of Steve Wieczynski with Stifel.

I want to ask about the embedded fourth quarter yield guidance, which looks like you're expecting yields to be up, at this point, only slightly. I know last year, I think you had a pretty strong fourth quarter, with yields up about 4%, and I think there was about 100-basis point benefit from that accounting change last year. So I guess the question is, can you help us understand your thought process around your key markets for the fourth quarter? I just -- I guess I would've expected a number a little bit higher than that.

Thank you for your comments. Look, I would say, as you just said, we had a tougher comparison versus last year in the fourth quarter, but our guidance is always our best projection of the future. There are nearly always unexpected challenges and we thought to anticipate that and our EBITDA adjusted to the change of circumstance. But fundamentally, our guidance has remained the same. We added into, as we raised the midpoint of the full year guidance, we added the gains to-date and left the guidance going forward the same. It is not any more complicated than that.

Okay, got you. And then, second question. I guess in your prepared remarks, you didn't really give a lot of color around the Chinese market. Can you just maybe give us an update there in terms of what you're seeing and how the changes that we know, with Korea and stuff like that, have impacted your ability for -- to take price? And then maybe, also, just comment on Majestic Princess. I know that the ship, it was built specifically for China, but it seems like you've decided to remove it for a couple of weeks. And again, I know that's their slower winter months, but is there anything else that drove your decision to move that already?

Overall, again -- thanks again for your question. For China, overall, as you know, it's a relatively small percent of our current capacity. As we said in the past, it's an embryonic market, it's a B2B business. So the fact that the Chinese are not currently traveling to Korea, we believe, aggravated our situation there in terms of yield and bookings and what have you. But honestly, at this point, because it is a B2B market, there's still always some negotiations between the trade and the cruise companies likes ourselves. So we believe it had an impact, and the cases would suggest that, but at this point, we can't concretely say Korea produced any effect. But we suspect it did. In terms of overall, look, China is still going to be probably the largest cruise market in the world, over time. It's an embryonic market. It's very small today. Concerning your question on Majestic Princess, we're very excited about Majestic Princess. She is the first purpose-built ship for China. We're excited about the naming ceremony coming up in Shanghai in July. We're really looking forward to that. And in terms of our itinerary planning, we always optimize deployments. And we see the opportunity for Majestic Princess to not only be home ported in China, but also to take travelers from China on fly cruise to other destinations as we do with national dedicated ships in many of our brands. And so we just see that as a way to optimize the first-year deployment and an opportunity to build the appetite for cruising in China, both fly cruise as well as home porting and local destination embarkation. So I hope I answered your question. You can pull this if I missed a part.

Yes, the only thing I'd add to that is, we talked about the challenges in China. But the recent sailings have been at very high occupancy levels and so we were very pleased with that.

Our next question comes from the line of Robin Farley with UBS.

I wanted to focus a little bit on the comment about volumes during the second quarter, that they were in line with last year at prices well ahead. Because I know that investors are always worried that -- would that be due to demand not being higher than last year? Or maybe you can clarify, is that just because you'd rather get higher price and that you don't want to be any further booked ahead than you were at this time last year? In other words, can you comment on how we should be interpreting that? Like is that a function of your yield management strategy that, that's actually what you're worth striving for? Or are you just sort of saying, it's [indiscernible].

I'm sorry. Go ahead, Robin. Continue, please.

I think also, just with a couple of security incidents in Europe, the investor concern might be like is that impacting demand. So maybe you can clarify if it's that or if it's, in fact, that you'd rather get the higher price and didn't want to be further ahead in volume.

Yes. So first of all, yes, absolutely, we haven't been able to measure any kind of impact from the various geopolitical issues and events in Europe and that sort of thing. So we haven't seen any lost momentum. We see strong momentum in the business all the way through. It's very early to be talking about first half of next year. But through the first half of next year, we're up on occupancy, up on pricing against a very tough comparison because, obviously, a strong year this year and a strong year last year. So lost momentum in the business for certain. Your comment about optimization of the booking curve, looking at price versus volume at different points and times and the booking curve is absolutely true. We have our new revenue management tool for a number of other brands and we are constantly always optimizing across 10 brands, across multiple source markets and itineraries. And so that is a fair comment. But with regards to momentum in the business, the momentum is very strong.

Okay, now that's great. And then, just to clarify a little further on your -- so your guidance for Q3 is higher than what Street expectations were and I think there were concerns about Europe. So the Q3 guidance is great. And I know you tend to be conservative, you're looking at Q4, and you said that's kind of your best guess as of now. But just trying to think about -- I mean, you guys have nicely beat your guidance every quarter lately. And so when we look at your guidance for Q4, I'm getting something like 1% to 1.5% yield range. Just trying to think how -- whether should think about that as you're conservative to your guidance and we should look at it through the same lens that we've looked at your guidance the last couple of quarters, and which you has -- you've managed to come in better than. I'm wondering, is there anything in particular, dry docks or something in the comp, that is more concrete that would make the number in that range.

Look, I think the reality is, yes, we have beaten a number of quarters in a row. In one quarter, that won't happen and, hopefully, it's not any quarter soon, but it's bound to happen eventually. We always give our best guesstimate. There are always things that happen in the market, as you know. I mean, we've gone through a lot of stuff, fuel, currency -- fuel and currency moving together at the same time. We have all kinds of other issues with, you can't go to Istanbul, you can't go here, typhoons, hurricanes, cyclones, all that stuff. So we always give our best estimate, but we don't think we're being ultraconservative. But obviously, we do factor in that things can go wrong. And we want to still perform and we will deliver towards a double-digit return on invested capital, which is our commitment. We're marching hard and fast towards that. And we do have tougher comparisons, as Steve pointed out in his question, in the fourth quarter as well than we had in these other quarters where we've done better than 4% et cetera versus prior year.

Our next question comes from the line of Jaime Katz with Morningstar.

I'm curious, you guys had mentioned some additional investments you are going to be making in the fourth quarter. If you would be willing to elaborate on any of them and how you might think they might add to the economics of the business, longer term.

Absolutely. So the brands all, reviewing their forward plans, they want to all maintain the momentum they're enjoying and we're getting smarter and smarter about how to invest dollars. So while there is a plan to increase spend versus where we were previously planning, because they recognize opportunities in media and some socials, but also some of our proprietary TV programs that David had mentioned. Those are some areas we've looked at. There are other areas too as well, and we're ramping up investment with some onboard efforts on a number of ships and so on. So that's kind of what's driving it, but they're all revenue related, they're all double-digit return on invested capital related. We see them as smart investments and that's why we're taking a look at increasing.

Okay. And then can you talk about the cruising to Cuba, how you guys are thinking about investing in infrastructure over the long term now that it seems like, at least over the near term, the cruise industry won't be disrupted by any government policies that are coming about?

With the disruptive -- it is disruptive in terms of making investments in ports and whatnot. Not sure we have the freedom to do that under the current regulations. But as you look at it long term, of course, we -- as things evolve, when we are able to invest, we would look forward to co-investment with Cuba or investing directly, if they allow that, to develop ports. Cuba is going to really refresh the Caribbean. Obviously, today, it's a teeny tiny portion of our capacity. You won't to be able to even find the numbers in our overall reporting. But we're excited about Carnival with Paradise sailing out of Tampa starting soon, and this month, still, we are in June. And Holland America, starting up in November, December. So we're very excited about those 2 brands going and following on top the historic year we had with Fathom and [ the billing year ] and obviously, we're applying for the other brands to go. But it will be a while before we can actually financially invest in developing port infrastructure. That doesn't mean the Cubans won't do it themselves, though.

Okay. And then just lastly, can you just comment on capital allocation? I know that you noted that there was a new share buyback or an increase to the repurchase authorization. But with prices at really high levels, at least for share prices, how they run up, how do you think about balancing dividend increases versus share repurchases?

Yes, you bet. First of all, the share price are at historical highs, but obviously, we don't think they're high enough. But having said that, we are always opportunistically looking at the repurchase and will continue to buy back shares. The balance is a board decision. But I'd say, our pattern, historically, has been established with the dollar amounts that we've done of over $2.7 billion, I guess since '15 -- 2015 in buybacks. Obviously, we were up to about $1.2 billion in dividend distributions on an annual basis now. So when you look at that, I would say, until the board says otherwise, that's been our historical pattern.

And the only thing I will add to that is we have traditionally said that we're targeting a dividend payout ratio of 40% to 50%. And as Arnold indicated, we recently increased the quarterly dividend in April. Well, the board did.

Our next question comes from the line of David Beckel with Bernstein.

Based on our estimates, it looks as if your China capacity will be declining in 2018, somewhere in the high-single digit range. Some of your peers are also in a similar situation. Kind of following on one of the first questions asked. Under the assumption you're optimizing yield and fly cruise makes sense and all that, but what is it about the China market that you feel needs to change in order for meaningful amounts of capacity to be redeployed into that market?

Thank you. First of all, my expectation is that there will be additional capacity deployed in the coming years. In any given year for any specific balance of ships and brands, for us, our decisions are very specific to our brands and the balancing of itineraries around the world and the balancing of optimizing yield. So we will be down next year in China a little bit on capacity. And again, that's not only about China as much about opportunities around the world because our philosophy is we always want to optimize and -- what we generate from our ships. But I don't -- China, long term, is going to be a huge market. We're extremely excited about our partnership with CSSC. That has moved along very nicely. We still have lots of work to do with the trade there in China, with distribution systems. But again, just please keep in mind, the industry is tiny there. I mean, we're very, very, very small. And these are the moves, hopefully. Hopefully, the fact that there's less capacity next year will create the opportunity for yield improvement in China, hopefully. But you can't even guarantee that because it's still a B2B business. There's an, actually, selling to consumers where consumers are saying, "Oh, if you drop the price, I would cruise more." It's really a business-to-business transaction still at this stage.

Got it. It's very helpful. Just on the revenue management system, is there any color you can give us as to how much, I know this is probably rough math, but how much yields have improved thus far because of specific actions you've implemented on the revenue management side?

To be honest with you, we obviously have internal estimates and stuff on that, which we wouldn't disclose. But the fact of the reality is there's so many variables moving at once. What we do know is that the rollout is progressing very nicely. As we shared with you before, about 1/3 of the inventory, of the brands, the 6 brands that happen to use in the tool, that's -- 1/3 of the inventory is impacted. And it will be close to 100% for those brands in 2018. The brands are tremendously excited about it. It's definitely contributing to a positive result, there's no question about that, and we will continue to contribute positive results for the rest of this year and beyond across multiple brands with it. But I won't segment how much is yield, though, versus how much is other dynamics in the business, demand creation and so on. It's the cumulative effect of all of it. But I have lots of anecdotal things I could share with you on specific itineraries, where yield would mean a difference, but the cumulative effect is definitely positive.

Would it -- if I could, could I ask about one specific anecdote to maybe highlight your point?

Yes, absolutely. So U.K. team was working on a particular itinerary, and the tool suggested a certain pricing. The team thought that didn't make any sense. They went back in to take a hard look at the tool itself to see what was wrong with it, why was it suggesting this. They couldn't find anything wrong with it, so they decided to trial on that particular itinerary and ended up generating -- consuming more yield because they ended up, instead of dropping price, taking the price up. And when they further analyzed it, the tool gives you a lot more granularity. When they further analyzed it, they can see, by meta, what was going on and why the tool recommended an increase in certain metas and then leaving the meta where they were being challenged, flat as opposed to reducing the price. And so in the end, it produced significantly more yield in that particular itinerary that would have been achieved otherwise. So there's lots of those kinds of examples. But overall, it's allowing our people, to a much more granular level, look at itineraries at different points in time. The tool provides great inquiry in the end. It requires yield management by our yield experts and young revenue scientists. But it allows just much, much more granular inquiry and execution in terms of smaller and more frequent price rules.

And meta is a cabin category.

Yes, meta is a cabin category. Beth wanted to make sure you understood what that was.

Our next question comes on the line of Harry Curtis with Nomura.

To follow up on your comments about the fourth quarter, sorry to beat a dead horse. But can you -- are there any specifics that you're really worried about? And has the tone of the business in your key markets changed in the fourth quarter to lead you to have a bit more conservative outlook?

There's nothing in terms of the business that we're particularly concerned about, just the normal stuff that happens every year. But as I mentioned before, part of the yield difference is the fact of a tougher comparison, fourth quarter last year, fourth quarter this year versus the other quarters to the previous quarter. But other than that one specific dynamic that would drive something that looks differently, there's nothing in particular that we're concerned about, looking ahead, that's different than we would be every year, at this time of year.

Okay. And then a quick question on supply growth. It looks to me like your supply growth in 2018 should be up just under 2%, and I'm curious how you see just the overall supply growth shaping up in 2018 for your core markets in Europe and the Caribbean.

Sure. Yes, we can give you that detail.

Caribbean for 2018 versus 2017, for us, is up 4% to 5%. The Europe market is up 3% globally. Alaska is up 7% to 8%. In total, we're up 2.5%. So we are seeing capacity reductions in Australia and slightly in China.

And for the industry?

The industry capacity...

In 20...

In 2018, it's 5.9%.

Yes, it's 5%, almost 6% at this point.

Okay. And last question...

And -- go head.

Well, I just wanted to shift gears. You had commented that you had an outlook, including the next 3 quarters, and David, if you could talk about what percentage you've roughly booked for the first quarter of next year's. Typically, it should be around 35% to 40% at this point. And kind of how's the tone looking, at least at the early part of next year, in terms of occupancy and pricing.

Okay. Yes, I can give you. So Harry, we have traditionally said that like for the next few quarters, for the current quarter, we're 80% to 90% booked is the historical range. For the next quarter out, which would be fourth quarter, 50% to 70% is the historic range. First quarter would be 30% to 50%, and second quarter would be 15% to 25%. And we are approaching the high end of all the historical ranges, as with the current booking curve.

Okay. And at prices that are nicely ahead or well ahead or blowing the doors off ahead?

As we said -- as Arnold said for next year, where the prices are ahead, I'd rather not give some particular adjectives to describe them at this point only because it's early and we're not ready to give guidance for next year.

Our next question comes from the line of Tim Conder with Wells Fargo.

Circling back, Arnold, to the demand creation comments in fourth quarter to drive team. Is that would you say, skewed to any one region, in particular more so than the other? I mean, it looks like Europe and North America are performing the best. Would it be skewed any way to Australia, New Zealand, Asia? Or is that fairly well balanced across regions?

I would say, most of the request for increases are in the core markets, it's in U.S. and Europe. They're very strong markets, but people see opportunities to have them be even stronger. And that's where the requests are today and what we factored into the guidance.

Okay. And if you would, David or Beth, just maybe repeat your commentary on Australia and China as far as your capacity in those markets. And then to follow-on to that question, you said the industry is going to be up 5.9%. Any color on the industry level by those regions that you gave for Carnival core?

Yes, we won't -- Tim, we'll have the industry data at the third quarter call. Today, we've got our data in total for 2018.

Just another comment on that. Obviously, we had some significant capacity increase, for example, in the Caribbean this year. I remember a number of analysts were expressing consolation last year about that. And obviously, we've done very, very well. I think the reality is as long as we're creating the demand to absorb the capacity, then the industry can continue to do very well. We certainly plan to do well because we are going to create the demand. We are going to measure capacity growth for our brands, and we are doing the things necessary through enhanced revenue management, techniques using yield in our existing platforms that we already have for Carnival and Costa.

And as far as China and Australia are concerned, we're talking about mid-single-digit capacity declines in each of those deployment markets.

And then just to pile on a little bit, because we're getting a lot of questions on the fourth quarter, I just want to emphasize to you all that fourth quarter is ahead of a record fourth quarter last year, and there's absolutely no loss of momentum.

One last question. As you rightly said before, Arnold, in China, you get SARS one year, typhoons, you get South Korea, whatever. I mean, there's always something going on. So the normal -- I guess that is the normal. But have you seen, just in general, over the last 12 months, for yourselves, the industry, however you want to comment on this, has the cost structure, profitability structure changed in any way materially, either up or down, over the last 12 months?

Over the last 12 months, not so much. I would say the biggest change over the last 12 months, if you look at our quarter -- our earnings call today and compare it to earnings last year, is the double whammy of fuel and currency. Historically, it never moved together. And for the past year or so, they have been moving together and often in a negative way. And so that's a big thing to overcome. We've overcome it operationally with performance, but that would be the one fundamental thing that I would say changed. And despite all of the stuff going on, we've had 4 quarters of 4% yield improvement.

Our next question comes from the line of Jared Shojaian with Wolfe Research.

Just a quick clarification. The 5.9% global industry supply growth that you referenced, is that net or gross? And then, can you give us the comparable number in 2017?

Sure. It is a gross number. The only thing we do is anything that we know of, we would take out. But obviously, at this point, there could very well be some unplanned retirements. And...

And 2017 was 5.3%.

Okay, that's really helpful. And then, you talked about some tougher comparisons in fourth quarter, but you're also going to have tougher comparisons once we get into 2018. So how should we think about that 1% implied yield in the fourth quarter in relation to 2018? I guess what I'm asking is, a 1% exit rate going into 2018 would imply that demand has to get better in order for you to do better than a 1% yield in 2018. Is that the right way to think about that? Or is there anything I'm missing? I know there's geographical differences in the fourth quarter versus 2Q and 3Q next year. But can you help me think about that a little better?

Yes, we're not ready, obviously, to give guidance for 2018 yet. We were just giving you guys an early preliminary tone, which you shouldn't read too much into because it's such a small percent of the business at this point that we have line of sight on. So we're not ready to give any guidance, but all the things you just mentioned are true. There's a mixed difference. We have to see what we actually do. We're giving you a guidance for the fourth quarter. We have to see what we actually perform before we can begin to have line of sight on how we're going to perform more clearly before we give some. But it is ahead at higher prices, and that's what we can say, but we're not ready to give guidance in terms of percent.

And the booking currency are at the high end of historical range, and we've got good booking momentum and we feel very good about the business.

That's great. And then just one last one. You called out some incremental costs for this year. Are those 50 basis points of incremental costs unique to this year? Or will you expect them to be recurring again in 2018?

We've been able to maintain the momentum that I shared with you guys previously of targeting $75 million a year in cost savings. And as I've told you, some of that will go to the bottom line and some we might reinvest to drive yield. So right now, the brands have put forth some pretty convincing arguments of additional revenue improvement by making investments, so we're doing it. But we'll be reviewing that as we go. I wouldn't consider it a pattern or projection for we're going to always do anything like that. But in this particular case, with the specific proposals they presented, with the evidence they put with it, it seems like a smart investment to make.

And keep in mind, we do round everything to the nearest 0.5 point, so it's not necessarily a full 50 basis points.

The next question comes from the line of Brian Egger with Bloomberg Intelligence.

Just a follow-up question regarding the per city cost question. I think you've kind of covered this. But to understand it, to the extent that you've seen increases in investments in proprietary TV program, advertising costs, is the change, albeit small in cost, unit cost guidance for the full year, a function of the timing of things like marketing advertising or the absolute level? Or -- any color you can add there would be helpful.

No, it would be absolute level. We were actually looking at investing more than we would have at the beginning of the year. So we see the opportunity and we're taking advantage of it.

The next question comes from the line of [ Peter McMullin ] with [ Tiger Management ].

Several of us were impressed with the depth...

[ Peter ]?

[ Peter ], can you hear us?

Are you guys there? Hello?

Operator?

[indiscernible]

I can hear somebody. Now we can hear you, [ Peter ].

He just disconnected. Our next question comes from the line of Dan McKenzie with Buckingham Research.

Arnold, following up on your commentary about [ under-penetrated ] cruise markets around the world. I believe there are a number of ports in China that are developed but not yet home ports for the industry. And I'm wondering what the plans are today to expand the number of points there. And at what point would that make sense?

As you mentioned, there are several new cruise berths being added in China, where we have berths being constructed in Dailing, Shanghai, Sanya, Hainan Island. There are several others moving forward toward construction on the approval process. So there are quite a few ports being developed, which again, reinforces the point we've been making that, over time, we expect China to be the largest cruise market in the world. We'll obviously take advantage of those. We have to build the distribution. But as you know, China often builds in anticipation of demand coming. But we are obviously in discussion with all those ports about existing tonnage that we have in the country and possible new tonnage that we will bring in future years.

Understood. And then, just a second question here, just given kind of the revenue management system, I'm wondering what the opportunity is to source elsewhere in the region for the China cruises. So in Hong Kong, Singapore, Taiwan, even Malaysia, I'm wondering what you're doing today, if anything. And is there a revenue opportunity from optimizing these various sourcing markets?

I think that's a great point. There's considerably opportunity not only in China but throughout Southeast Asia, both as source markets and, clearly obviously, as destinations now that Chinese travelers are already traveling to and could choose to take advantage of a cruise option in those travels. So both from a sourcing standpoint, Malaysia, Vietnam, Thailand, but clearly, as destination opportunities for Chinese travelers. And so we have an overall strategic footprint in place and have strategic plans in place to take advantage of both the fly cruise opportunity as well as sourcing more from those regions.

We have a follow-up question from the line of [ Peter McMullin ], [ Peter McMullin Consulting ].

Let me try again. Just some of us were wowed by the potential of the Medallion, and I'm just wondering if you could review what benefits you see for the company long term.

As you know, we're excited about it. It's going to launch in November. The first ship experience for the public will be then. Progress has been very exciting with it. Our -- one of the fun things for me to see is how excited our crew is because the technology for us, as you know, [ Peter ], is about enhancing the hospitality experience and it's about enhancing our crew's ability to deliver to the guests what they want, when they want, how they want it, and exactly when they want it. And so we're very excited about that. In terms of the impact, first of all, we'll have to see. We think there's all kinds of opportunities, onboard revenue opportunities, ticket pricing opportunities. There's lot of excitement. But it's brand-new, it's brand-new technology and systems, and we have to leave it out, but we're very excited.

But in the early days, it would be a competitive advantage to Carnival?

Well, the reality is, as you know, we consider our competition land-based vacations, and not the other cruise coming back because we think we're so much better than them or anything. It's just because if you add up all of the cruise companies to get all the cabins, it's less than 2% of the hotel rooms. And that's why we say we're under penetrated in every market in the world. And so there's great opportunity for cruise for ourselves as well as the other cruise companies. So land-based vacation is really the challenge. We think we already have a great value and experience offering compared to land-based vacations, and we think Ocean will just take that up on a whole other level, but we'll see.

We have no further questions on the phone line.

Excellent. Thank you all very much. We greatly appreciate your interest. We look forward to meeting with you on the earnings call in the next time and seeing you in between. So everybody, be safe and good luck on draft day. Hopefully, your team will get the player you want. Have fun. Take care.

Bye-bye, everybody.

Ladies and gentlemen, that concludes today's call. We thank you for your participation and ask you to please disconnect your lines.