Even in a quarter clouded by the trade war, American consumers found room in their budgets to splurge on cruises to the tune of billions.
Carnival Cruise Line (CCL), the world’s largest cruise operator, reported record-breaking second-quarter results, signaling surprising strength in discretionary spending.
Carnival, which draws most of its customer base from North America, reported revenue of $6.3 billion and adjusted earnings of $0.35 per share in Q2, both beating Wall Street forecasts.
Adjusted net income jumped 250% year-over-year to $470 million, exceeding its own prior forecast by $185 million.
The blowout quarter led Carnival to raise its full-year guidance. The company now expects adjusted net income to come in roughly $200 million higher than projected in March, with adjusted EBITDA for the year set to reach $6.9 billion.
CEO Josh Weinstein told investors that Carnival remains confident despite a “complex macroeconomic and geopolitical backdrop.” He also confirmed that Celebration Key, the company’s highly anticipated new Bahamas destination, remains on track to open in July.
The results stand in stark contrast to the broader U.S. economy, which recently emerged from a rough first quarter marked by contraction, tariffs, and sticky inflation.
While many Americans pulled back on spending and airlines suffered from weaker demand, the cruise sector has proven remarkably resilient.
Travel analyst Henry Harteveldt of Atmosphere Research Group told Business Insider that cruises offer something airlines can’t match. “Cruises are so extensive in the assortment of brands and itineraries,” he said. “They can appeal to a very broad mix of travelers.”
Carnival stock rallies as Wall Street bets on cruising’s comeback
While Carnival shares still trade roughly 60% below their 2017 peak, the stock has been steadily climbing.
CCL stock is up nearly 20% this year, outperforming the S&P 500. Over the past 12 months, the stock has surged more than 76%, lifting Carnival’s market cap to over $39 billion.
Wall Street’s optimism is growing as well.
Morgan Stanley recently raised its price target on CCL by 25%, suggesting the stock could hit $60 in a bullish scenario, nearly double its current level.
Analysts cited robust cruise demand, favorable currency exchange rates, and falling fuel costs as key drivers for Carnival’s continued rebound.
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