(Reuters) -Cruise operator Carnival Corp raised its annual profit forecast and beat estimates for first-quarter profit and revenue on Friday, helped by higher ticket prices as well as strong advance bookings and on-board customer spending.
Even though cruise ticket prices have ticked up in recent years, Americans have been more than willing to make early bookings for their getaways during the promotions-heavy “wave season”, which started in January, and are also splurging heavily during their voyages.
This helped Carnival counter the rising costs of operations, including fuel and dock expenses and promotional costs.
However, Carnival shares fell about 5% in early trading after the company forecast adjusted earnings per share of about 22 cents for the current quarter, falling short of estimates of 23 cents, according to data compiled by LSEG.
“While we are not completely immune from the heightened macroeconomic and geopolitical volatility since providing our December guidance, we are still taking up our earnings expectations for the year,” said Carnival CEO Josh Weinstein in a statement.
Economic uncertainty arising from U.S. President Donald Trump’s recent tariff policy could further increase inflation and hinder consumer willingness to spend more on discretionary activities.
The company expects fiscal 2025 adjusted earnings per share of about $1.83, compared with its previous forecast of about $1.70 per share.
On an adjusted basis, Carnival reported a profit of 13 cents per share for the first quarter ended February 28, compared with analysts’ average estimate of 2 cents.
The company posted quarterly revenue of $5.81 billion, compared with analysts’ average estimate of $5.75 billion.
(Reporting by Neil J Kanatt in Bengaluru and Doyinsola Oladipo in New York; Editing by Shinjini Ganguli)
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