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HomeCruiseCarnival stock sails higher on earnings beat, upbeat outlook (NYSE:CCL)

Carnival stock sails higher on earnings beat, upbeat outlook (NYSE:CCL)

Carnival Corporation (NYSE:CCL) shares charted a choppy course in Monday’s trading despite beating Q1 expectations.
The Miami-based cruise operator notched a $0.55 per share loss on $4.43B in revenue for the fiscal first quarter. Analysts had anticipated a $0.60 per share loss on $4.3B in revenue. Adjusted EBITDA for the first quarter was $382M, above prior guidance and the analyst consensus of $304.4M.
Occupancy in the first quarter of 2023 was 91% of pre-pandemic levels while total customer deposits reached a first quarter record of $5.7B. The company credited “strong demand, bundled package offerings and pre-cruise sales” for the record performance.
“We are enjoying a phenomenal wave season, achieving our highest ever quarterly booking volumes and breaking records in both North America and Europe. Our strong performance has extended into March and we expect this favorable trend to continue based on the success of our efforts to drive demand,” CEO Josh Weinstein commented. “With adjusted free cash flow for the year expected to be positive, our revolver renewal behind us, more committed export credit financings in hand, a reduced capex profile going forward and over $8B of liquidity, we believe we are well positioned to pay down near term debt maturities from excess liquidity and therefore have no intention to sell equity (except in connection with our advantageous and non-dilutive stock swap program).”
Occupancy is also expected to return to historical norms by the summer after about a 98% level in the spring in Q2.
Management also expects continued growth in cash from operations through 2023 after cash from operations turned positive in the first quarter of 2023. This is expected to be a key dynamic to reduce debt through the year.
“We believe our debt balance has peaked this quarter and will reduce over time based on our ample liquidity position of $8.1B and the expected cash flow strength of our business,” CFO David Bernstein said.
For the full-year, the company expects adjusted EBITDA of $3.9B to $4.1B, with sequential improvement expected through the year building upon a $600M to $700M expectation in Q2. Both figures are below consensus, however, set at $419.1M and $759.7M, respectively.
Shares of Carnival Corp. (CCL) rose 4.4% just after the market open on Monday on optimism stemming from the Q1 earnings beat. However, that gain was quickly eroded as the below-consensus EBITDA forecast appeared to overshadow the quarterly performance, leading the stock into the red. The stock bounced within a wide range in Monday morning trading, marking a high of $9.72 and a low of $8.94.
Trading volume eclipsed the daily average of about 39M by 11:20AM ET.
Dig into the details of the print.

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