What's Going On With Cruise Operator Carnival's Stock Today?

Carnival Corp CCL CUK reported third-quarter FY23 sales growth of 59% year-on-year to $6.85 billion, beating the analyst consensus of $6.69 billion.

Passenger Cruise Days (PCD) increased 45% Y/Y to 25.8 million. Occupancy for Q3 was 109%. Available lower berth days (ALBD) for Q3 were 23.7 million.

Total customer deposits as of August 31, 2023, totaled $6.3 billion. Selling and administrative expenses rose 14% to $713 million.

The operating income for the quarter was $1.6 billion compared to a loss of $(279) million last year. The operating margin was 23.6%.

The company held $2.8 billion in cash and equivalents as of August 31, 2023. Operating cash flow for the quarter was $1.8 billion, with an adjusted free cash flow of $1.1 billion.

Adjusted EBITDA for the quarter was $2.22 billion, exceeding the June guidance range of $2.05 billion to $2.15 billion.

Adjusted EPS of $0.86 beat the consensus of $0.75. 

Carnival CEO Josh Weinstein commented, "The outperformance was driven by strength in demand, with both our North America and Australia segment and Europe segment equally outperforming expectations."

"I continue to be encouraged with our revenue trajectory heading into next year as we see no signs of slowing from our consumers."

Outlook: Carnival sees FY23 adjusted EBITDA of $4.10 billion - $4.20 billion (prior view $4.10 billion - $4.25 billion).

The company sees adjusted loss per share of $(0.12) - $(0.04) (prior view $(0.20) - $(0.08) against the consensus of $(0.16); Occupancy of 100% or higher.

The company expects Q4 adjusted EBITDA of $800 million - $900 million and adjusted loss per share of $(0.18) - $(0.10) (consensus $(0.10); Occupancy rate of 101% or higher.

The company expects Q4 net yields (in constant currency) up mid-single digits compared to 2019 with occupancy in line with historical levels and net per diems (in constant currency) up 7.0% to 8.0% compared to 2019.

Price Action: CCL shares are trading lower by 4.7% at $13.77 on the last check Friday.

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