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Carnival Corp raised its outlook for the year on Friday amid broader concern about consumer spending.
“Good times and bad times, people take vacations,” said CEO Joshua Weinstein when discussing quarterly results.
“The onboard spend that we’ve seen in the first couple of weeks of March hasn’t slowed down,” Weinstein said, addressing investor concerns about potential consumer weakness. “We do feel good about the strength of our consumer.”
Why it Matters: Some U.S. airlines recently flagged softness in domestic basic economy and close-in bookings. There is fear that trade wars and U.S. government spending cuts could slow economic growth, and a declining stock market could cause wealthy households to pull back on traveling.
Weinstein said his team wasn’t seeing a slowdown across their portfolio spanning contemporary, premium, and luxury brands.
“We are different from airlines and even different from hotels,” he said. “We don’t rely on business travel.”
“Does it mean that people want to think hard about how they spend their vacation dollar? Absolutely. Is it more important when times are stressful that they get away and take a vacation, does it mean more to them? Absolutely,” Weinstein said.
The cruise giant’s booking curve extends further than ever recorded, with 2026 sailings seeing all-time high volumes at higher prices. About 80% of 2025 capacity is already booked at premium rates.
When questioned about Canadian operations, Weinstein noted they represent just “3% to 4%” of the company’s business, contextualizing the limited exposure to recent volatility in that market. He also noted that his company can shift cruise ships to higher-demand ports as needed.
The company raised its full-year earnings forecast by $185 million to $2.5 billion.
Carnival’s First Quarter 2025:
Record Q1 Revenue: $5.8 billion, up over $400 million from prior year
Record Q1 Operating Income: $543 million, nearly double 2024’s figure
Record Net Yield: 7.3% net yield, which is the money remaining per available passenger cruise day after variable expenses, such as commissions to travel agents.
Looking Ahead
The company continues to make strategic investments, including the upcoming opening of Celebration Key, its new destination in the Caribbean.
“We’re on track for our July opening,” Weinstein said about the project.
The CEO said the new private island, plus minimal capacity growth, will help the company reach its 2026 financial targets a year early. It only has three ships on order.
Earlier this month, the company sunsetted its P&O Cruises Australia brand by folding its two remaining ships into Carnival Cruise Line. Executives said this should streamline operations and marketing.
Potential changes to income tax policy under the incoming Trump administration went unaddressed during the call, despite Commerce Secretary Howard Lutnick’s recent comments about closing cruise line tax loopholes.
Cruise Lines’ Next Big Bet: Billion-Dollar ‘Private Destinations’
If your customers are leaving your ships to go spend money on beaches, you should own the beaches. That’s the apparent logic of cruise line operators like Royal Caribbean in building private destinations. It’s like vertical integration for vacations.
