Norwegian Cruise Line shares fall on potential softness

Norwegian Cruise Line shares fall on potential softness


The Norwegian Pearl cruise ship anchored off shore on January 07, 2022 in Miami Beach, Florida.

Joe Raedle | Getty Images

The cruise industry is on the lookout for rough seas ahead when it comes to consumer confidence and travel budgets.

For instance, Norwegian Cruise Line Holdings reports some “choppiness” in cruises booked to Europe from the United States in the third quarter.

“It was actually booking really, really well till about a month or two ago. And then the American consumer seemed to be a little skittish about doing far-from-home travel,” CEO Harry Sommer told CNBC Wednesday.

Norwegian shares declined more than 8% following its first-quarter earnings report.

Revenue for the first quarter came in just shy of expectations at $2.13 billion versus estimates of $2.15 billion, according to average estimates compiled by LSEG, and earnings per share were 7 cents adjusted versus a 9 cents expectation.

The company modified its guidance on net yield growth by a percent to a range of 2% to 3% and said its revenues will likely be pressured this year. But Norwegian maintained its guidance on earnings before interest, taxes, depreciation and amortization, or EBITDA, and adjusted earnings per share, projecting cost savings through more favorable foreign currency rates and lower fuel prices.

Despite the pressures, Sommer reiterated the cruise industry’s widely held view that travelers increasingly look to cruises during economic turmoil because of the value of those vacations over land-based holidays.

Royal Caribbean CEO Jason Liberty said on the company’s first-quarter earnings call Tuesday that the company is “certainly not immune to macro volatility.”

“But what we’re seeing on the ground, in our bookings and the real-time spending occurring on our ships is that consumers are still prioritizing experiences, planning to spend more on them this year and are seeking value that we are well positioned to offer,” Liberty said.

The company said it’s 86% booked through the end of 2025.

Royal Caribbean raised its full-year guidance and reported results that beat Wall Street expectations. But its shares were lower Wednesday and off about 8% year to date.

Norwegian shares are off 38% year to date and Carnival Cruise Lines is down 27% so far this year, in spite of record-breaking first-quarter results, announced in March, that surpassed the company’s own guidance.

Norwegian said on-board spending remained steady in April and it’s seen some “return to normalcy.”

“You know, you may have a weak month, a weak quarter, but consumers continue to take vacations,” Sommer said. “It’s sort of one of their God-given rights and they enjoy them. And they come back.”



Source

Mongolia’s ‘ambitious’ plan could boost tourism to 10% of GDP by 2030, says minister
Travel

Mongolia’s ‘ambitious’ plan could boost tourism to 10% of GDP by 2030, says minister

Tourism could comprise 10% of Mongolia’s gross domestic product if the country can attract 2 million annual tourists by 2030, the country’s tourism minister told CNBC Wednesday.   “We have a big, ambitious kind of goal, which is about 2 million tourists by 2030, which will be around a $4 billion contribution towards our GDP,” […]

Read More
Airbnb issues disappointing revenue guidance for second quarter
Travel

Airbnb issues disappointing revenue guidance for second quarter

Airbnb CEO Brian Chesky appears at “The Game Plan: Strategies for Entrepreneurs” at Airbnb Open in Los Angeles on Nov. 19, 2016. Kurt Krieger – Corbis | Getty Images Entertainment | Getty Images Airbnb reported results for the first quarter that were mostly in line with estimates, but the company issued a disappointing revenue forecast […]

Read More
L3 Harris tapped to modify Qatari jet as potential new Air Force One after years of Boeing delays
Travel

L3 Harris tapped to modify Qatari jet as potential new Air Force One after years of Boeing delays

First Lady Melania Trump laughs as she watches US President Donald Trump cut with a saber into a cake representation of the new Air Force One design during the Commander-In-Chief inaugural ball at the Walter E. Washington Convention Center in Washington, DC, on Jan. 20, 2025. Patrick T. Fallon | AFP | Getty Images The […]

Read More