Carnival Corp raised its annual profit forecast on Wednesday, betting on a record year of bookings for its cruises as the industry has its “revenge travel” moment.
Cruise companies are experiencing all-time high booking rates as travelers switch to cheaper sea-borne experiences over expensive land-based alternatives such as booking hotels or flights, allowing operators to hike prices.
However, U.S.-listed shares of the company, which owns the Cunard and Holland America Line cruise lines, reversed course from premarket and were last down about 3%. They have risen about 94% in the last 12 months.
“This has been a fantastic start to the year,” CEO Josh Weinstein said in a statement.
“We delivered another strong quarter that outperformed guidance on every measure, while concluding a monumental wave season that achieved all-time high booking volumes at considerably higher prices.”
The company’s first-quarter revenue rose to $5.41 billion, roughly in line with analysts’ expectations.
Bookings for the rest of 2024 remain the best year on record with total customer deposits reaching a first-quarter all-time high of $7 billion, the company said.
Carnival has estimated an impact of up to $10 million on both adjusted EBITDA and adjusted net income for the full year following the Baltimore’s Francis Scott Key Bridge collapse on Tuesday.
The company said in January that strong demand trends during the year were expected to offset the impact it was seeing due to the re-routing of ships in the Red Sea region.
The cruise operator now expects adjusted profit per share of 98 cents in 2024, compared with its prior forecast of 93 cents. Analysts on average were expecting a profit of $1 per share, according to LSEG data.
Adjusted cruise costs, excluding fuel in constant currency, were up 7.3% in the first quarter, compared with the same period a year earlier.
Carnival posted an adjusted net loss per share of 14 cents, compared to analysts’ expectations of 18 cents.
The company projected an adjusted loss per share of 3 cents in the second quarter, in line with expectations.
Correction: Reuters corrected this story to reflect adjusted net loss per share of 14 cents, not 15 cents.
