Ladies and gentlemen, thank you for standing by. My name is Desiree, and I will be your conference operator today. At this time, I would like to welcome everyone to the Lindblad Expeditions Third Quarter Earnings Call. [Operator Instructions] I would now like to turn the conference over to Rick Goldberg, CFO. You may begin.

Thank you, operator. Good morning, everyone, and thank you for joining us for Lindblad's Third Quarter 2025 Earnings Call. With me on today's call is Natalya Leahy, our Chief Executive Officer. Natalya will begin with some opening comments, and I'll follow with details on our Q3 financial results and updated expectations for the full year before we open the call for Q&A. As always, you can find our latest earnings release in the Investor Relations section of our website. But before we get to all of that, I'd like to remind everyone that the company's comments today may include forward-looking statements. Those expectations are subject to risks and uncertainties that may cause actual results and performance to be materially different from these expectations. The company cannot guarantee the accuracy of any forecast or estimates and we undertake no obligation to update any such forward-looking statements. If you would like more information on the risks involved in forward-looking statements, please see the company's SEC filings. In addition, our comments may reference non-GAAP financial measures. A reconciliation of the most directly comparable GAAP financial measures and other associated disclosures are contained in the company's earnings release. With that out of the way, I'll turn the call over to Natalya.

Thank you, Rick, and welcome, everyone, to our third quarter earnings call. I want to start a bit differently today. Our guests are in the center of everything we do, and I want to share a remarkable highlight from this quarter. We achieved our highest guests Net Promoter Scores ever, both for quarter 3 and year-to-date since we began measuring them. That milestone made me pause and reflect on where we came from on the history and legacy that make us who we are today and differentiate us and set us up for success going forward. In January 1966, Lars-Eric Lindblad led to very first nonscientific expedition to Antarctica, followed a year later by the first citizen voyage to the Galapagos. These were the expeditions that started it all, the beginning of expedition travel and in many ways, the birth of ecotourism, now one of the fastest-growing segments in global travel. That legacy still defines us in our industry, experience and expertise truly matter and those take decades to build. It's this foundation built over nearly 60 years of pioneering exploration that continues to drive the exceptional guest experiences and results we are seeing today. Talking about results. We are pleased to report another quarter of very strong performance with revenue and adjusted EBITDA both exceeding expectations. Consolidated revenues increased 16.6% with our Lindblad and Land Segments growing 13.4% and 21.1%, respectively. Within our Lindblad segment, occupancy reached 88%, 6 points higher than last year on a 5% increase in capacity in the quarter, resulting in a record level of available guest nights of any quarter of our company's history. Net yields increased 9% to $1,314, the higher third quarter yields in the company's history. We were particularly pleased to see our core Alaska trade performed exceptionally well, achieving almost…

Thank you so much, Natalya. This was an outstanding quarter with strong top line growth as we continue to drive occupancy back to historical levels and solid bottom line performance as we advance our cost innovation initiatives to improve margins. Total company revenues for Q3 2025 were $240 million, an increase of $34 million or 16.6% versus Q3 2024. Lindblad segment revenues were $138 million, an increase of $16 million or 13.4% compared to the prior year. Occupancy increased 6 percentage points from 82% to 88% despite a 5% increase in available guest nights, and net yield per available guest night increased 9% to $1,314, the highest third quarter yield in company history. Land Experience segment revenues were $103 million, an increase of $18 million or 21.1% compared to Q3 2024, driven by a 12% increase in guests and an 8% increase in revenue per guest. Turning now to the cost side of the business. Operating expenses before stock-based compensation, transaction-related expenses, depreciation and amortization, interest and taxes increased $22.7 million or 14% versus Q3 2024. Specifically, cost of tours increased $14.6 million or 13%, driven by operating additional voyages and trips. Fuel costs were 4.5% of Lindblad segment revenue, which was flat to Q3 2024. Sales and marketing costs increased $5.1 million or 20%, primarily due to higher royalties and commission expense and investments in demand generation efforts. We expect marketing expenses to remain elevated in Q4, reflecting investments in initiatives designed to drive growth into 2026 and 2027. General and administrative costs, excluding stock-based compensation and transaction-related expenses increased $1.7 million or 7% versus a year ago, driven by higher personnel costs, partially offset by $1.8 million of employee retention tax credits realized in Q3 2025. Adjusted EBITDA for the quarter was $57.3 million, the highest quarterly result…

Thank you. We will now begin the question-and-answer session. [Operator Instructions] And our first question comes from the line of Steve Wieczynski with Stifel.

So Natalya or Rick, you gave some high-level color around '26 bookings, and I think you noted bookings for next year in 2027 are running. I don't remember what your adjectives were, but it sounds like well ahead of this point last year. So just wondering if you could give a little more color around those booking trends, maybe where demand is right now across maybe some of your different itineraries, maybe your more important itineraries in next year. And then maybe also some color -- a little bit more color around your commentary about the uptick in bookings from your Disney travel partners, which I think is -- which is obviously pretty important.

Steve. Well, thank you. Great question as usual. So we are not giving '26 guidance yet. It's coming next time, but I will give you a little bit more of a commentary. So as I mentioned, our booking cost [ side had on ] '26 in both segments, and it's important to note is quite significantly and actually seeing some recent uptakes which are encouraging. On Lindblad segment, as we mentioned several times, we are working with all the commercial initiatives. As you know, we just implemented them throughout this year. So they have a lot of run rate to deliver results. We are working towards delivering historical occupancy levels, which are around 90%, and we are, I would say, well on track for that, which will result definitely into yield growth combined with managing pricing. As of Disney relationships, we are just starting to see the fruits of all the initiatives that we're implementing there. So we are seeing some results that are coming this year, and I certainly expect more to come in forward years.

Okay. Got you. Second question is also going to be kind of a '26 question, so you might not answer this one, but I'm going to ask it in a way that hopefully, you give some kind of answer. So based on where you guys are booked today, obviously, as we kind of think about yields and pricing next year, you're going to be coming off of a -- what Rick say, 12% to 14% kind of growth year from a yield perspective. So not sure if you can kind of help us think a little bit more about maybe how pricing, how yields potentially could look into next year? Just I guess, coming off 12% to 14% growth, what could that potentially look like?

Yes. Well, as you are mentioning, we are coming out of double-digit yield growth year-to-date, which is very largely driven by a step change increase in our occupancy in addition to pricing integrity. Obviously, [ anniversarying ] it will normalize yield growth as we'll continue to increase occupancy, but it's not going to be double-digit increases that we've seen this year. So hopefully, it gives you some confidence. In terms of pricing, we continue to maintain price integrity as we increase occupancy.

Our next question comes from the line of Eric Wold with Texas Capital Securities.

I guess first question, kind of a follow-up on the last one. Natalya, kind of on the maintaining price integrity as you kind of go into next year, is that more -- as you think about that, should we think about that more as kind of the avoidance of discounting as you move into next year? Or do you think you actually have pricing power as you move into next year and the ability to actually take price up in both the Lindblad and the Land-based segments as you look into next year? I guess as you -- as your price, as you think about what you've been booking and how things are priced into next year, maybe talk about what the pricing has been looking like next year versus this year?

So again, we will be guiding for '26 during next earnings call. I think, Eric, we are clearly communicating that we are seeing an uptick in demand. We've been increasing our capacities through charter additions, through new ships we added this year. We have been communicating that we're actively looking to expand our capacity, whether it's through adding more charters or new builds or buying ships. And that's because we are seeing a demand, particularly for some of our very popular destinations such as Alaska. We had a giant waitlist in Alaska this year, and delivered exceptional pricing power. Our [ flight ] cruise in Antarctica have been doing extremely well and pretty much selling out the moment we deploy it, and we continue to take price increases there. Galapagos is doing very well, and we now have 4 ships operating there where we basically increased capacity by 40% this quarter versus last quarter and continue to see this momentum. So we sell to over 100 destinations. Of course, there is a variable demand for each one of them. But overall, I think we are seeing exceptional demand for our product.

Yes. And if I can just add a couple of quick things. I mean, we're also continuing to build out our revenue management function, which is going to be critical to building out our price growth over time on the expedition cruise side. And then our Land Experiences segment experienced an 8% increase in revenue per guest here in Q3. And so we feel really good about our continued ability to take price in that segment as well.

And then my second question. Rick, on the guidance, I think [indiscernible] the updated EBITDA guidance still does imply a decline in Q4 EBITDA compared to last year's Q4, even with revenue up materially. I know on the last call, you noted expectation for some pressure in second half EBITDA. We obviously didn't see that in Q3. So maybe help us bridge kind of what you expect in Q4, what may be causing the expectation for Q4 EBITDA pressure.

Yes. So I think there's 2 important dynamics happening in Q4. The first is a shift in the timing of our marketing spend in order to set the stage for wave season. And the second is an increase in the number of dry and wet docks in Q4. We had 6 happening in Q4 2025 versus only 2 in Q4 of 2024.

Got it. And just quick, should we assume that's a recurring schedule going forward? Or is that more of a '25 specific?

What I would say is the timing of dry and wet docks is variable every year based on our decisions around deployment as well as shipyard availability.

Next question comes from the line of Eric Des Lauriers with Craig-Hallum.

Congrats on strong results. So the increase in occupancy in guest nights, obviously, very impressive here. It's clear that all the changes you've made since joining and the expanded NatGeo Disney partnership are providing some nice tailwinds here. On the flip side, are you guys seeing any headwinds at this point from the macro environment? Obviously, your customers are typically higher net worth so less sensitive to the macro. But just wondering if you're seeing sort of any offsetting headwinds to call out amid all the sort of positive news otherwise.

Eric, I think that -- I mean, we are always very mindful of geopolitical environment and always watching that. Our guests are a bit more resilient to economic vulnerabilities. And we've seen that this year as the economy kind of changed that the demand remained pretty stable. So we hope that it will continue moving forward. We always watch for macroeconomic environment. The only headwinds I will remind everyone is, as Rick mentioned several times, we do expect a step up in royalties in '26.

Yes. No, that's clear. And I think, I mean, if '26 is anything like what we've seen very early on from this expanded partnership, those royalties will be well worth it. Next question for me. So you mentioned the benefit from increasing the mix of charters for a few quarters now. You also stated, Rick, that you expect to aggressively pursue accretive growth opportunities, including Land Experiences. So just kind of a bit of a higher-level question here, but how do you view your current mix of revenues? And is there anything that you would like to sort of increase or decrease from a mix perspective as you look out over the next 5 years or so, whether that's different channels or charters or what have you?

So I'll start by saying we're very comfortable with the mix that we have today. We currently have 10 charter ships that will operate in 2026. These are a great way for us to deliver our product in unique destinations at attractive margins without capital intensity. There are natural limitations of expanding capacity through this channel as there are just a limited number of ships available to satisfy our guest experience criteria. However, along with new builds and acquisitions, this is an important tool in our toolbox as we think about growing capacity and we're especially excited to launch a handful of innovative charter voyages this morning for our 2027 season, including on European Rivers, Egypt, India and Vietnam.

Next question comes from the line of David Hargreaves with Barclays.

Congrats on getting your bond refinancing done. And thinking of growth opportunities, I'm just wondering how you're thinking of financing alternatives and where you feel comfortable with leverage?

So I'd say we're very pleased with the results of our recent financing. And as we sit here with a strengthened balance sheet, we feel like that positions us well to aggressively pursue expansion opportunities, whether that's on the expedition cruise side, through charters, acquisitions and/or new builds or expanding on our portfolio of world-class Land Experience companies.

I guess I'm wondering [indiscernible] thinking bite-size type of expansion opportunities like the last couple of ships you acquired? Or I think you mentioned possibly new builds. Which way are you leaning?

I think that this is our -- we are evaluating and considering various different types of opportunities again. It is charter businesses, which have very great way to, as Rick mentioned, to expand capacity in specific destinations. But there are some limitations to that. We are definitely looking at buying existing tonnage if we find something that is accretive as a return on investment and satisfies our brand criteria, and we are evaluating new build opportunities as well. So I would say stay tuned, and you will hear more on that.

And sorry, Rick, I kind of cut you off. Were you going to say something on leverage sort of where your comfort zone is? Would you consider taking leverage higher?

I would say we now have delivered 10 consecutive quarters of deleveraging, and we're confident in our ability to continue to delever as we drive EBITDA growth.

[Operator Instructions] There are no more further questions at this time. I would like to turn the call back over to Rick Goldberg for closing remarks.

Just want to thank everyone for your continued interest and support of Lindblad Expeditions. Have a great day. Bye now.

Ladies and gentlemen, that concludes today's call. Thank you all for joining, and you may now disconnect.