Carnival Corporation Reports Narrower Q1 Loss Amid Surging Demand

Key Points

• Carnival Corporation & plc (CCL) reported a Q1 loss of $214 million, a significant improvement from the previous year, beating analyst estimates.
• Revenue for the company increased by 22.0% to $5.406 billion, with strong demand and increased ticket pricing contributing to the growth.
• Carnival expects a substantial increase in adjusted EBITDA for FY 2024 and maintains a strong market consensus with a 'Strong Buy' rating.

In this news

Carnival Corporation & plc (CCL) has reported a significant decrease in its first-quarter loss, outperforming Wall Street's expectations. The company's latest financial results revealed a loss of $214 million, or $0.17 per share, a marked improvement from the $693 million, or $0.55 per share, reported in the same period last year. Adjusted for special items, the loss stood at $180 million, or $0.14 per share, surpassing analysts' predictions of a $0.18 per share loss. The positive outcome is attributed to a 22.0% increase in revenue, reaching $5.406 billion compared to last year's $4.432 billion.

Despite the narrowed loss, Carnival Corporation (CCL) experienced a dip in share prices, which analysts attribute to market pressures rather than company performance. The quarter witnessed robust demand and higher ticket pricing, with customer deposits hitting a record $7 billion. The company's adjusted EBITDA of $871 million exceeded expectations by nearly $70 million. Looking ahead, Carnival anticipates a significant increase in adjusted EBITDA for the fiscal year 2024, projecting over 30% growth to $5.63 billion. The next quarter's adjusted EBITDA is expected to surge by over 50% year-over-year to $1.05 billion.

The company's stock has seen a nearly 20% increase over the past six months, and market consensus maintains a Strong Buy rating for Carnival, with an average price target of $19.78, indicating a potential 20.4% upside. However, this optimistic outlook may be subject to revisions following the impact of the earnings report on market sentiment. Carnival's performance reflects a resilient recovery in the travel industry, with customer demand driving growth despite ongoing economic challenges.