Carnival's Q1 loss lower than forecast, bookings hit all-time high

The company raised its full-year profit outlook to 98 cents per share, a penny under the Wall Street consensus.

CCL shares traded up following the earnings call.

'Fantastic start to the year'

'This has been a fantastic start to the year. 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,' Carnival Corp. & plc CEO Josh Weinstein said.

'These results are a continuation of the strong demand we have been generating across our brands and all core deployments, leading to an upward revision of full year expectations by more than a point of incremental yield improvement and setting us up nicely to deliver a nearly double-digit improvement in net yields.'

With much of the business for 2024 on the books, Weinstein said Carnival has 'even greater conviction in delivering record revenues and EBITDA, along with a step change improvement in operating performance, and have begun turning more of our attention to delivering an even stronger 2025.'

Pricing (constant currency) on bookings for the remainder of the year for the North American brands segment was considerably higher in Q1 compared to the prior year, with its Europe segment up double digits.

First quarter

The adjusted net loss of $180m, or 14 cents per share, was better than the company's December guidance and lower than Wall Street's expectation of a loss of 18 cents per share. US GAAP net loss was $214m, or 17 cents/share. Revenues were $5.4b.

Adjusted EBITDA of $871m exceeded December guidance by over $70m. Record net yields (constant currency) of 17.2% and record net per diems (constant currency), up 5%, both significantly exceeded 2023 levels. Occupancy was 102%.

Cruise costs per available lower berth day were up 7.9% compared to 2023. Adjusted cruise costs excluding fuel per ALBD (constant currency) were better than December guidance due to the timing of expenses between the quarters and up 7.3% compared to 2023.

2024 outlook

Following a successful wave season that started early, Carnival raised its full year 2024 net yield guidance (constant currency) by over a point to approximately 9.5% compared to 2023 based on continued strength in demand and improved its adjusted cruise costs excluding fuel guidance (constant currency) by $35m as compared to its December guidance.

The company forecasts adjusted EBITDA of approximately $5.63b, over 30% growth compared to 2023, and better than December guidance, despite the impact of Red Sea reroutings of approximately $130m, or 9 cents adjusted EPS through November.

Q2 EPS guidance

Carnival's full-year EPS projection goes to 98 cents, up from 93 cents, but just under Wall Street's concensus 99-cent/share forecast.

Q2 guidance is for a loss of approvimately 3 cents/share, equal to the consensus expectation.

Baltimore impact

Not included in the projection is the impact of the closure of Baltimore Harbor following the collapse of Baltimore's Francis Scott Key Bridge Tuesday. Carnival Cruise Line operates one ship there.

The company estimates up to $10m impact on both adjusted EBITDA and adjusted net income for full year 2024 due to the Baltimore change. For now, Carnival Cruise Line will be turning around in Norfolk, Virginia instead.

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