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Fair Value Measurements, Derivative Instruments and Hedging Activities and Financial Risks | 6 Months Ended
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May 31, 2025
Fair Value Disclosures [Abstract] |
Fair Value Measurements, Derivative Instruments and Hedging Activities and Financial Risks | Fair Value Measurements, Derivative Instruments and Hedging Activities and Financial Risks Fair Value Measurements Fair value is defined as the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and is measured using inputs in one of the following three categories: •Level 1 measurements are based on unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment. •Level 2 measurements are based on quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active or market data other than quoted prices that are observable for the assets or liabilities. •Level 3 measurements are based on unobservable data that are supported by little or no market activity and are significant to the fair value of the assets or liabilities. Considerable judgment may be required in interpreting market data used to develop the estimates of fair value. Accordingly, certain estimates of fair value presented herein are not necessarily indicative of the amounts that could be realized in a current or future market exchange. Financial Instruments that are not Measured at Fair Value on a Recurring Basis
| May 31, 2025 |  | November 30, 2024
| Carrying Value |  | Fair Value |  | Carrying Value |  | Fair Value
(in millions) |  | Level 1 |  | Level 2 |  | Level 3 |  | Level 1 |  | Level 2 |  | Level 3
Liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Fixed rate debt (a) | $ | 22,101 |  |  | $ | — |  |  | $ | 22,526 |  |  | $ | — |  |  | $ | 22,449 |  |  | $ | — |  |  | $ | 23,241 |  |  | $ | — |
Floating rate debt (a) | 5,866 |  |  | — |  |  | 5,783 |  |  | — |  |  | 5,764 |  |  | — |  |  | 5,685 |  |  | — |
Total | $ | 27,967 |  |  | $ | — |  |  | $ | 28,309 |  |  | $ | — |  |  | $ | 28,213 |  |  | $ | — |  |  | $ | 28,927 |  |  | $ | — |
(a)The debt amounts above do not include the impact of interest rate swaps or debt issuance costs and discounts. The fair values of our publicly-traded notes were based on their unadjusted quoted market prices in markets that are not sufficiently active to be Level 1 and, accordingly, are considered Level 2. The fair values of our other debt were estimated based on current market interest rates being applied to this debt. Financial Instruments that are Measured at Fair Value on a Recurring Basis
| May 31, 2025 |  | November 30, 2024
(in millions) | Level 1 |  | Level 2 |  | Level 3 |  | Level 1 |  | Level 2 |  | Level 3
Assets |  |  |  |  |  |  |  |  |  |  |
Cash equivalents (a) | $ | 1,648 |  |  | $ | — |  |  | $ | — |  |  | $ | 404 |  |  | $ | — |  |  | $ | — |
Derivative financial instruments | — |  |  | — |  |  | — |  |  | — |  |  | 2 |  |  | — |
Total | $ | 1,648 |  |  | $ | — |  |  | $ | — |  |  | $ | 404 |  |  | $ | 2 |  |  | $ | — |
Liabilities |  |  |  |  |  |  |  |  |  |  |
Derivative financial instruments | $ | — |  |  | $ | 5 |  |  | $ | — |  |  | $ | — |  |  | $ | 4 |  |  | $ | — |
Total | $ | — |  |  | $ | 5 |  |  | $ | — |  |  | $ | — |  |  | $ | 4 |  |  | $ | — |
(a)Consists of money market funds and cash investments with original maturities of less than 90 days. Nonfinancial Instruments that are Measured at Fair Value on a Nonrecurring Basis Valuation of Goodwill and Trademarks As of May 31, 2025 and November 30, 2024, goodwill for our North America segment was $579 million.
| Trademarks
(in millions) | North America Segment |  | Europe Segment |  | Total
November 30, 2024 | $ | 927 |  |  | $ | 234 |  |  | $ | 1,161 |
Exchange movements | — |  |  | 16 |  |  | 16 |
May 31, 2025 | $ | 927 |  |  | $ | 250 |  |  | $ | 1,177 |
Derivative Instruments and Hedging Activities
(in millions) | Balance Sheet Location |  | May 31, 2025 |  | November 30, 2024
Derivative assets |  |  |  |  |
Derivatives designated as hedging instruments |  |  |  |  |
Interest rate swaps (a) | Prepaid expenses and other |  | $ | — |  |  | $ | 2 |
Total derivative assets |  |  | $ | — |  |  | $ | 2 |
Derivative liabilities |  |  |  |  |
Derivatives designated as hedging instruments |  |  |  |  |
Interest rate swaps (a) | Other long-term liabilities |  | $ | 5 |  |  | $ | 4 |
Total derivative liabilities |  |  | $ | 5 |  |  | $ | 4 |
(a)We have interest rate swaps whereby we receive floating interest rate payments in exchange for making fixed interest rate payments. These interest rate swap agreements effectively changed $1.0 billion at May 31, 2025 and November 30, 2024 of SOFR-based variable rate debt to fixed rate debt. As of May 31, 2025 and November 30, 2024, the SOFR-based interest rate swaps settle through 2027 and were designated as cash flow hedges. At November 30, 2024, we had a EURIBOR-based interest rate swap that was not designated as a cash flow hedge and effectively changed $11 million of EURIBOR-based floating rate euro debt to fixed rate euro debt. The EURIBOR-based interest rate swap matured in March 2025. Our derivative contracts include rights of offset with our counterparties. As of May 31, 2025 and November 30, 2024, we did not have any counterparties with multiple derivative contracts. The effect of our derivatives qualifying and designated as hedging instruments recognized in other comprehensive income (loss) and in net income (loss) was as follows:
| Three Months Ended May 31, |  | Six Months Ended May 31,
(in millions) | 2025 |  | 2024 |  | 2025 |  | 2024
Gains (losses) recognized in AOCI: |  |  |  |  |  |  |
Interest rate swaps – cash flow hedges | $ | — |  |  | $ | 20 |  |  | $ | (1) |  |  | $ | 33 |
(Gains) losses reclassified from AOCI – cash flow hedges: |  |  |  |  |  |  |
Interest rate swaps – Interest expense, net of capitalized interest | $ | 2 |  |  | $ | (8) |  |  | $ | 4 |  |  | $ | (20) |
Foreign currency zero cost collars – Depreciation and amortization | $ | 4 |  |  | $ | — |  |  | $ | 3 |  |  | $ | 1 |
Gains (losses) recognized on derivative instruments (amount excluded from effectiveness testing – net investment hedges) |  |  |  |  |  |  |
Cross currency swaps – Interest expense, net of capitalized interest | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 2 |
The amount of gains and losses on derivatives not designated as hedging instruments recognized in earnings during the three and six months ended May 31, 2025 and estimated cash flow hedges’ unrealized gains and losses that are expected to be reclassified to earnings in the next twelve months are not material. Financial Risks Fuel Price Risks We manage our exposure to fuel price risk by managing our consumption of fuel. Substantially all of our exposure to market risk for changes in fuel prices relates to the consumption of fuel on our ships. We manage fuel consumption through fleet optimization, energy efficiency, itinerary efficiency, and new technologies and alternative fuels. Foreign Currency Exchange Rate Risks Overall Strategy We manage our exposure to fluctuations in foreign currency exchange rates through our normal operating and financing activities, including netting certain exposures to take advantage of any natural offsets and, when considered appropriate, through the use of derivative and non-derivative financial instruments. Our primary focus is to monitor our exposure to, and manage, the economic foreign currency exchange risks faced by our operations and realized if we exchange one currency for another. We consider hedging certain of our ship commitments and net investments in foreign operations. The financial impacts of our hedging instruments generally offset the changes in the underlying exposures being hedged. Operational Currency Risks Our operations primarily utilize the U.S. dollar, Euro, Sterling or the Australian dollar as their functional currencies. Our operations also have revenue and expenses denominated in non-functional currencies. Movements in foreign currency exchange rates affect our consolidated financial statements. Investment Currency Risks We consider our investments in foreign operations to be denominated in stable currencies and of a long-term nature. We have euro-denominated debt which provides an economic offset for our operations with euro functional currency. In addition, we have in the past and may in the future utilize derivative financial instruments, such as cross currency swaps, to manage our exposure to investment currency risks. Newbuild Currency Risks Our shipbuilding contracts are typically denominated in euros. At May 31, 2025, our newbuild currency exchange rate risk relates to euro-denominated newbuild contract payments for non-euro functional currency brands. The cost of shipbuilding orders that we may place in the future that are denominated in a different currency than our cruise brands’ functional currency will be affected by foreign currency exchange rate fluctuations. These foreign currency exchange rate fluctuations may affect our decision to order new cruise ships. We have in the past and may in the future utilize derivative financial instruments, such as foreign currency derivatives, to manage our exposure to newbuild currency risks. Our decisions to hedge non-functional currency ship commitments for our cruise brands are made on a case-by-case basis, considering the amount and duration of the exposure, market volatility, economic trends, our overall expected net cash flows by currency and other offsetting risks. Interest Rate Risks We manage our exposure to fluctuations in interest rates through our debt portfolio management and investment strategies. We evaluate our debt portfolio to determine whether to make periodic adjustments to the mix of fixed and floating rate debt through the use of interest rate swaps, refinancing of existing debt and the issuance of new debt. Concentrations of Credit Risk As part of our ongoing control procedures, we monitor concentrations of credit risk associated with financial and other institutions with which we conduct significant business. We seek to manage these credit risk exposures, including counterparty nonperformance primarily associated with our cash and cash equivalents, investments, notes receivables, reserve funds related to customer deposits (when required), future financing facilities, contingent obligations, derivative instruments, insurance contracts and new ship progress payment guarantees, by: •Conducting business with well-established financial institutions, insurance companies and export credit agencies •Diversifying our counterparties •Having guidelines regarding credit ratings and investment maturities that we follow to help safeguard liquidity and minimize risk •Generally requiring collateral and/or guarantees to support notes receivable on significant asset sales and new ship progress payments to shipyards We also monitor the creditworthiness of travel agencies and tour operators and credit and debit card providers to which we extend credit in the normal course of our business. Our credit exposure also includes contingent obligations related to cash payments received directly by travel agents and tour operators for cash collected by them on cruise sales in certain European countries where we are obligated to honor our guests’ cruise payments made by them to their travel agents and tour operators regardless of whether we have received these payments. Concentrations of credit risk associated with trade receivables and other receivables, charter-hire agreements and contingent obligations are not considered to be material, principally due to the large number of unrelated accounts, the nature of these contingent obligations and their short maturities. Normally, we have not required collateral or other security to support normal credit sales and have not experienced significant credit losses.

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- Definition The entire disclosure of the fair value measurement of assets and liabilities, which includes financial instruments measured at fair value that are classified in shareholders' equity, which may be measured on a recurring or nonrecurring basis. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 820 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/820/tableOfContent + Details
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