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DATE

Wednesday, February 18, 2026 at 10 a.m. ET

CALL PARTICIPANTS

  • Executive Chairman and Chief Executive Officer — Leonard I. Fluxman
  • President, Chief Operating Officer, and Chief Financial Officer — Stephen B. Lazarus

TAKEAWAYS

  • Total Revenue -- $242.1 million for the quarter, an 11% increase, driven by fleet expansion, a 2% rise in revenue days, and 1% higher average guest spend.
  • Adjusted EBITDA -- $31.2 million, a 17% increase from the prior year's $26.7 million.
  • Net Income -- $12.1 million, or $0.12 per diluted share, down from $14.4 million, or $0.14 per diluted share, due to restructuring and impairment charges totaling $5.7 million.
  • Adjusted Net Income -- $24.2 million, or $0.24 per diluted share, versus $21.4 million, or $0.20 per diluted share.
  • Maritime Segment Growth -- Expansion of operations to 206 ships at year end from 199 ships, with ship personnel rising to 4,582 from 4,352.
  • Medispa Services -- 23%-40% Q4 revenue growth from new technologies including SculpSure FLX, CoolSculpting Elite, and acupuncture LED; adoption expanded to 153 ships from 147.
  • Staff Retention -- Employee retention rate rose by four percentage points, positively impacting revenue per day generated by experienced staff.
  • Shareholder Return -- $93 million returned to shareholders in the year via stock buybacks and quarterly dividends, along with debt reduction efforts.
  • AI Initiatives -- Implementation of machine learning for dynamic price optimization and an onboard virtual assistant, now deployed on 180 vessels, aiming to boost yield and efficiency.
  • Operational Restructuring -- Exited land-based health and wellness centers in Asia and reorganized operations in the United Kingdom and Italy, incurring $2.7 million in restructuring expenses and $3 million in asset impairments.
  • Fiscal Year Revenue -- $961 million, up 7%; adjusted EBITDA grew to $123.3 million, and adjusted net income rose to $102.9 million, or $0.99 per share.
  • Liquidity Position -- Year-end cash of $17.5 million, full availability on a $50 million revolver, and debt reduced to $84 million from $98.6 million.
  • 2026 Guidance -- Total revenue forecast of $1.01 billion to $1.03 billion and adjusted EBITDA of $128 million to $138 million, both representing high single-digit percentage growth at the midpoint.
  • Q1 2026 Guidance -- Expected revenue of $241 million to $246 million and adjusted EBITDA of $30 million to $32 million.
  • Prebooking Platform -- Over 11,500 itineraries open for prebooking; dynamic price optimization model to be phased in starting with prebooking, covering 94% of vessels using this platform.
  • Menu Optimization -- Condensed spa menus focused on popular treatments and higher retail attachment rates, replacing legacy, broader menus.
  • No 2026 Price Increase Assumed -- Management confirmed no service price increases baked into 2026 guidance to date.

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RISKS

  • Restructuring and asset impairment charges of $5.7 million led to lower net income compared to the prior year, reflecting the cost of operational exits and reorganizations.
  • Closure of destination resort locations resulted in a $1.3 million decrease in related revenue, highlighting sensitivity to geographic operational changes.
  • Write-off charges of $300,000 for inventory, attributable to the exit from Asian land-based operations, affected quarterly results.

SUMMARY

The call outlined OneSpaWorld Holdings Limited (OSW +0.47%)’s transition toward higher-margin core business, marked by record cruise ship operations and heightened AI-enabled efficiencies. Comments from management reveal that initial financial benefits from AI and dynamic pricing initiatives are not yet included in 2026 guidance, and that further details on these impacts will follow after second quarter results. Shareholder capital returns continue to be a central focus, underpinned by persistent free cash flow generation and ongoing debt reduction. Fleet expansion and higher-value services, especially innovative Medispa offerings, are strategic levers contributing to revenue growth and operational advancement. Strategic exits in underperforming geographies have incurred costs but aim to sharpen operational focus and profitability.

  • Lazarus directly confirmed, "our current guidance does not include potential impact" from recently implemented AI and pricing technology, postponing any updated projections until later in the year.
  • The virtual assistant now responds to 80% of manager inquiries within seconds, reducing help desk time from up to a day to real-time support on 180 vessels, versus only 40 in the previous quarter.
  • Management described their tighter spa menu as intended to "converts into the higher treatment rates, particularly around face and body," stating there is no intention to revert to broader offerings.
  • Price increases were not implemented in 2025 nor assumed for 2026, although year-to-date data shows "overall higher prices being accepted by the consumer," with discounting not eroding net price per service.

INDUSTRY GLOSSARY

  • Medispa: Medical spa services offering advanced aesthetic or wellness procedures (e.g., injectables, body contouring) conducted in a spa environment onboard ships.
  • Dynamic price optimization: AI-driven process that automatically adjusts service pricing in real time to optimize revenue by responding to shifts in demand, timing, and booking behavior.
  • Prebooking: Customer practice of reserving spa or wellness services before embarking on a cruise, enabling operators to optimize utilization and yield ahead of time.

Full Conference Call Transcript

Joining me today are Leonard I. Fluxman, Executive Chairman and Chief Executive Officer, and Stephen B. Lazarus, President, Chief Operating Officer, and Chief Financial Officer. Leonard will begin with a review of our fourth quarter 2025 performance and provide an update on our key priorities for 2026. Then Stephen will provide more details on the financials and guidance. Following our prepared remarks, we will turn the call over to the operator to begin the question-and-answer portion of the call. I will now turn the call over to Leonard I. Fluxman.

Leonard I. Fluxman: Thank you, Allison. Good morning, and welcome to OneSpaWorld Holdings Limited’s Fourth Quarter and Fiscal Year 2025 Earnings Call. It is a pleasure to speak with you all today about our record fourth quarter. The period capped a year of exceptional performance underpinned by innovation across our global operating platform, and the delivery of extraordinary guest experiences and excellent results for our cruise line and destination resort partners. During the quarter, we advanced our strategic priorities, driving growth in key operating and introducing two new ship builds. This served to further cement our market and resulted in double-digit growth in total revenues and adjusted EBITDA.

Our unique capabilities and the successful execution of our strategy have produced 19 consecutive quarters of year-over-year growth and a fourth consecutive year of record performance of both metrics. We continue to identify ways to elevate our positioning, increase efficiency, and accelerate growth. Innovation, AI, and the reorganization of certain operations at year end, including the strategic decision to exit land-based health and wellness centers in Asia and reorganize operations in the United Kingdom and Italy, have us poised to achieve this objective. We begin 2026 even more strongly positioned to maximize our outstanding standing as the preeminent operator of health and wellness centers at sea.

I am extremely proud of the team that assisted in delivering the year and equally confident that the year ahead will represent another year of outstanding performance. At year end, we operated health and wellness centers on 206 ships with an average ship count of 199 for the quarter. This compares with a total of 199 ships at year end and an average ship count of 188 ships in fiscal 2024. Also, at year end, we had 4,582 cruise ship personnel on vessels compared with 4,352 cruise ship personnel on vessels at year end in fiscal 2024. Along with our strong financial results, the quarter and year included noteworthy progress towards our key strategic priorities.

Let me share some of those highlights with you. First, we captured highly visible new ship growth with current cruise line partners. We continue to solidify our market leadership, introducing two new health and wellness centers aboard two new ship builds, Disney Destiny and Star Seeker, during the quarter, which brought our total ship builds to eight for the year. In 2026, we will introduce health and wellness centers on six new ship builds, three of which are expected to commence voyages in the first half of the year. Second, we continue to expand higher-value services and products. These high-value services include Medispa and acupuncture, to name a few, increasing our addressable market and helping to grow same-ship revenue performance.

We continue to introduce these services to more ships and expand offerings with the latest innovations and adding to our growth. In addition, we continue to elevate innovation in our MedSpa services, with the expansion

Operator: of further rollout of next generation technology

Leonard I. Fluxman: with SculpSure FLX, CoolSculpting Elite, and acupuncture LED, which offer improved results and reduce treatment time by up to 50%. These new technologies generated between 23–40% revenue growth in Q4 versus last year. In addition, the adoption of LED light therapy with acupuncture remains a high-conversion add-on to the treatment. At year end, MediSpa services were available on 153 ships, up from 147 ships at year end of fiscal 2024. We expect to have Medispa offerings on 157 ships by year end 2026. Thirdly, we focused on enhancing health and wellness center productivity.

This is best reflected in the delivery of across-the-board increases in key operating metrics including revenue per passenger per day, weekly revenue, pre-cruise revenue, and revenue per stop per day. Our unique ability to identify, onboard, and retain staff is leading to this performance. We continue to be known as a great place to work and take pride in being a desired employer, striving to create an environment that fosters retention. These and other onboard employee initiatives have led to a four percentage point increase in staff retention versus 2024. Importantly, experienced staff generate significantly higher revenue per day versus first-contract staff.

And lastly, we possess a strong and durable balance sheet, which, combined with our ongoing successful growth, enabled us to advance each of our capital allocation objectives in the quarter. These are invest in our future growth, return value to our shareholders, and reduce debt. During the year, we returned nearly $93,000,000 to shareholders through our stock buyback and quarterly dividend and reduced outstanding debt. Our asset-light business model delivers consistent after-tax free cash flow. This, combined with our positive long-term growth prospects, has us poised to continue to advance our value creation objectives going forward. We remain confident in our ability to continue our strong performance in 2026.

Our positive outlook is supported by the continued innovation of our product and service offering and the unwavering commitment to service excellence by our outstanding staff, further buoyed by the implementation of emerging AI technologies that enhance our unique global positioning. These growth drivers are complemented by the contribution from the annualization of new ships that entered service in 2025, six of which commenced voyages in the second half of the year, as well as the introduction of six new health and wellness centers beginning voyages in 2026.

In summary, we believe our highly visible revenue growth, along with the continued discipline with which we execute our asset-light business model, positions us very well to deliver strong results for our stakeholders and shareholders in the near and long term. As Stephen will share momentarily, we have reiterated our 2026 guidance and expect total revenues, excluding revenues associated with restructured operations, and adjusted EBITDA to increase high single digits at the midpoint of the range. With that, I will turn the call over to Stephen, who will provide more details on our fourth quarter financial results and guidance. Stephen? Thank you, Leonard. Good morning, everyone. We ended the year on a high note, delivering record

Stephen B. Lazarus: performance in total revenues and adjusted EBITDA in the fourth quarter and continued strong and predictable cash flow generation. This record performance reflects our investment in breakthrough technology applications across our business, reinforcing our market-leading strengths and deepening our cruise line and resort partnerships. At year end, we implemented strategic actions to focus operational and capital investment on our highest growth and most profitable operations, exiting land-based health and wellness centers in Asia and reorganizing operations in the United Kingdom and Italy. In addition, our initiatives in AI will serve to accelerate our strategic growth initiatives and increase efficiency to further build our revenue and profitability growth potential. Let me provide some highlights prior to reviewing our financials and guidance.

First, as it relates to revenue enhancement, as I mentioned with our Q3 results, we have implemented a machine learning algorithmic engine to improve revenue and utilization, which is progressing well. In addition, we recently began work that allows us to implement a true dynamic price optimization model that we will start to introduce with prebooking. Today, we have over 11,500 itineraries open for prebooking, which makes it virtually impossible to have true dynamic pricing with only humans involved, and we are confident that adding these agentic AI

Operator: tools

Stephen B. Lazarus: will improve utilization and yield. By leveraging advanced recommendations and algorithmic optimization, this initiative aims to unlock additional revenue. Second, on the operational efficiency and scalability side, we are seeing early success with our rollout of our onboard virtual assistant. This AI assistant helps our managers receive and respond to questions immediately and meaningfully reduces help desk hours. For example, this tool enables our managers to close voyages and start booking the next cruise faster than before. Currently, 80% of all questions are answered within seconds by the virtual assistant, which is compared to perhaps a day or more if only humans were involved.

Our virtual assistant tool has now been deployed across 180 vessels, up from 40 vessels in the third quarter.

Leonard I. Fluxman: Third,

Stephen B. Lazarus: automation and streamlining are part of our broad efficiency initiative to continue to explore and develop solutions to reduce manual work, simplify operations shoreside, and improve scalability at our corporate locations. Although still in the early stages, our steering committee meets regularly to analyze different metrics such as time to implementation, cost of implementation, potential impact and difficulty, return on investment, and the prioritization of where to focus next. This is very exciting work for all of us with strong buy-in across our organization, and we hope it will further enhance productivity, operational scalability, and our key operating metrics over time.

Overall, our AI initiatives demonstrate our commitment to leveraging cutting-edge technology to strengthen our market position and deliver value for our shareholders. Turning now to a review of the fourth quarter and fiscal year. Starting with the quarter, total revenue increased 11% to $242,100,000 compared to $217,200,000 for 2024. Growth was driven by fleet expansion from 2025 new ship builds, a 2% increase in revenue days, and a 1% increase in average guest spend, contributing $15,500,000, $8,700,000, and $2,100,000, respectively, to the increase in total revenues. Of this, $2,800,000 was attributable to increased guest spend from prebook services.

Growth in our Maritime total revenue was offset by a $1,300,000 decrease in Destination Resorts total revenue, partially due to the closure of hotels where we had previously operated. Cost of services increased $18,500,000, attributable to the $21,500,000 increase in service revenues compared to 2024. Cost of product increased $3,400,000 attributable to the $3,400,000 increase in product revenue compared to 2024, a $300,000 quarter-over-quarter increase in freight expense related to the timing of purchases, and $300,000 of nonrecurring inventory write-off charges in 2025 related to the exit from our land-based health and wellness centers in Asia.

Admin expenses were $4,900,000 compared to $5,800,000 in 2024, with the decrease being primarily attributable to higher professional fees incurred in the prior year quarter, including approximately $700,000 related to incremental public company costs such as Sarbanes-Oxley compliance. Salaries, benefits, and payroll taxes were $8,900,000 compared to $9,300,000 in 2024. This decrease was primarily attributable to lower incentive compensation of approximately $500,000 compared to the fourth quarter of the prior year. Restructuring expenses were $2,700,000 in 2025, attributable to the aforementioned reorganization of operations in the United Kingdom and Italy and the exiting of resort health and wellness operations in Asia.

Long-lived asset impairment was $3,000,000 compared to $400,000 in 2024 due to exiting resort operations in Asia; 2025 included a $2,800,000 impairment charge with respect to the value of associated long-lived assets: $2,200,000 attributable to intangible assets, and $600,000 attributable to property and equipment and right-of-use assets. Net income was $12,100,000, or net income per diluted share of $0.12, as compared to net income of $14,400,000, or net income per diluted share of $0.14 for the prior year. The decrease was primarily attributable to the recognition of these restructuring expenses and long-lived asset impairments totaling $5,700,000 during the current quarter, partially offset by $4,400,000 improvement in income from operations.

Adjusted net income was $24,200,000, or adjusted net income per diluted share of $0.24, as compared to adjusted net income of $21,400,000, or adjusted net income per diluted share of $0.20 in the fourth quarter of the prior year. And finally, adjusted EBITDA was $31,200,000 compared to adjusted EBITDA of $26,700,000 in 2024. For the fiscal year, total revenue of $961,000,000 increased 7% compared to $895,000,000 for the prior year. Adjusted net income rose 15% to $102,900,000, or $0.99 per diluted share, from adjusted net income of $89,700,000, or $0.85 per diluted share in 2024. And adjusted EBITDA increased 10% to $123,300,000 as compared to adjusted EBITDA of $112,100,000 in fiscal 2024.

Our strong balance sheet included total cash of $17,500,000 at year end, reflecting the disbursement of $17,500,000 throughout the year in quarterly dividend payments, investment of $75,400,000 to repurchase 3,900,000 of our common shares, and payment of $15,000,000 on our term loan. In addition, we had full availability of our $50,000,000 revolving line of credit, giving us total liquidity of $67,500,000 at year end. Total debt, net of deferred financing costs, was $84,000,000 at 12/31/2025, compared to $98,600,000 at 12/31/2024. Also, at quarter end, we had $37,500,000 remaining on our prior $75,000,000 share repurchase authorization.

We expect disciplined execution of our growth initiatives and strong cash flow generation driven by our asset-light business model to enable the payment of our ongoing quarterly dividend while evaluating opportunities to repurchase our shares and retire debt. We believe this positions us well to create long-term value for our shareholders. Turning now to guidance. We are reaffirming our fiscal 2026 outlook and begin the year with strong momentum and confidence to deliver another record performance. Based on our market outlook, outstanding team, proven strategies and execution, scaling innovations, new ship builds, and strong capitalization, we expect fiscal 2026 total revenues to exceed the $1,000,000,000 mark for the first time.

Total revenues are expected in the range of $1,010,000,000 to $1,030,000,000, representing high single-digit increases at the midpoint of our guidance range from actual 2025 results, excluding exited and reorganized operations mentioned previously. Adjusted EBITDA continues to be expected in the range of $128,000,000 to $138,000,000, representing high single-digit increases at the midpoint of our guidance from actual fiscal 2025 results. And for the first quarter of 2026, we expect total revenue in the range of $241,000,000 to $246,000,000, with adjusted EBITDA expected in the range of $30,000,000 to $32,000,000. Please bear in mind that exited and reorganized revenue contributed $5,300,000 to first quarter 2025 revenue, and $23,000,000 to fiscal 2025 revenues. We will now open the call for questions.

Gary, if you could take over, please.

Operator: We will now begin the question-and-answer session. If you are using a speakerphone, please pick up your handset before pressing the keys. Please limit yourself to one question and one follow-up. If you have additional questions, you may rejoin the queue. At this time, we will pause momentarily to assemble our roster. Our first question today is from Jackson Gibb with Stifel, on behalf of Steven Moyer Wieczynski. Please go ahead. Hey, guys. This is Jackson Gibb on for Steven Moyer Wieczynski. Thank you for taking my questions.

Jackson Gibb: I wanted to dig in a little further on the AI integration, and with another quarter under your belt, is there any more color you can give on the potential benefits you could realize from this investment, whether that is on the cost side or the revenue side? And any updated thoughts on how that might impact margins? Up to this point, you have kind of talked about these starting to show up meaningfully in 2026. Is that cadence still accurate? And would we be correct to assume you have not factored in any of this potential impact to current full-year guidance?

Leonard I. Fluxman: Yes, Jackson. Good morning.

Stephen B. Lazarus: As previously mentioned and you reiterated, we did say that we will begin to talk about that after our second quarter results with more specificity. So we remain on track to do that. We are encouraged, obviously, by the initial results, and that is reflected in the incremental rollout of these initiatives to vessels and the starting of additional initiatives as well. So we remain pleased with where we are at. And to your last point, yes, our current guidance does not include potential impact from these initiatives.

Jackson Gibb: And then switching gears for my follow-up, I was hoping to get a little bit more detail around how consumer trends are shaping up, specifically attachment rates and how you are going about discounting. Are you seeing any differences worth calling out in these metrics, or anything that stands out as far as changes in spend patterns across different brands, geographies, ship sizes, etcetera? And then how are you thinking about your ability to take price throughout 2026 relative to price action taken in 2025?

Stephen B. Lazarus: I will address the last part first. As you know, in 2025, we effectively did not take service price increases. We do always continue to evaluate that, and if there is opportunity to do so in 2026, we will certainly act upon it. Again, from a guidance perspective, we are not assuming any service price increases embedded at this point in time. We will see how things play out. Regarding the consumer, we had previously mentioned in the fourth quarter of last year a little bit of softness in November. We did not see that reoccur in December, which was great. So far, year to date, we are definitely seeing overall higher prices being accepted by the consumer.

So on a net basis, we are selling at a higher price. There may be slightly additional discounting, but at the end of the day, the net that is going to the customer remains high in our percentage. And it is also, therefore, a reflection of, as you will have noted, our first quarter guidance, which we feel good about and is above consensus, and we think is a reflection of what we anticipate going forward with the consumer.

Operator: Again, if you have a question, please press star then 1. The next question is from Gregory Jay Miller with Truist. Please go ahead.

Stephen B. Lazarus: Thank you. Good morning. I would like to ask first about the dynamic

Gregory Jay Miller: price optimization model that you spoke about in your prepared remarks.

Stephen B. Lazarus: Unless I missed it,

Gregory Jay Miller: in your remarks this morning, have you discussed in terms of detail, in terms of the rollout, are there certain banners or itineraries or vessels that you are going to start this implementation first, or is this going to be a broader rollout across the fleet?

Leonard I. Fluxman: Specifically, as it relates

Stephen B. Lazarus: to that initiative, Greg, the first place we will begin with is action on prebooking. So, effectively, it will cover 94% of the vessels that today are on that prebooking platform. I would like to say it is still relatively early stages. Obviously, we are excited about it because, as mentioned, the sheer volume of itineraries available on the prebooking platform make it effectively impossible for humans to have a true dynamic pricing impact that can literally look at day to day, even ultimately hour to hour, where we might want to adjust things. So we are excited about it. When we roll it out, the phases will be number one,

Operator: prebooking

Stephen B. Lazarus: once we get that working and finalized, there will be a relatively quick rollout to the remaining vessels. But realistically, we are talking here into the back half of the year.

Gregory Jay Miller: Okay. Thanks. Shifting gears,

Assia Georgieva: I was on one of your ships recently, and I noticed that the spa menu appeared reformatted. It looked like the offers were perhaps more condensed and just different stylistically than what I have seen in the past. And I am curious if you have any intentions of a broader rollout of reformatting your spa menus in terms of the offerings that you are presenting to passengers on board?

Leonard I. Fluxman: No. Actually, we took a very proactive approach in doing that, so I am glad you noticed. We decided to condense and rather focus guest choice on the more popular items versus a full Chinese menu of everything and anything, as opposed to top choices that everybody takes, but also a focus to moving people into specific price points and time slots. So it is much more manageable and converts into the higher treatment rates, particularly around face and body. I just think narrowing the aperture to the more popular treatments that we want to sell with a higher retail attachment is the strategy and science behind the narrower menu.

We have no intention of broadening it because from what we did and looked at statistically, there was no purpose in having an extensive menu that we did

Stephen B. Lazarus: sort of, like, three years ago.

Assia Georgieva: Understood. Thank you both.

Operator: Once again, if you have a question, please press star then 1. Please standby as we poll for questions. Showing no further questions, this concludes our question-and-answer session. I would like to turn the conference back over to Leonard I. Fluxman for any closing remarks.

Leonard I. Fluxman: Thank you, everybody, for joining us today. As Stephen mentioned, we have got off to a great start here in the first quarter and look forward to speaking with you all on our next investor call as well as conferences that we may attend through the first quarter entering the second quarter. Thank you, and we look forward to speaking to you next time. Thank you.

Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.