Carnival's North America market continues to be a star performer, and Europe is doing very well. Still, that won't be enough to return Carnival to full health post-pandemic. It needs to speed up growth in Asia and Australia.
Carnival booking volumes continue to exceed their 2019 levels in North America, but they have been slower to catch up to Asia, Australia and China, Carnival executives said during a Monday earnings call.
In the first quarter of 2023, guests continue to book at higher levels despite Carnival charging higher ticket prices. Demand was improving across all regions, said Josh Weinstein, CEO, president, chief climate officer and a director for Carnival Corporation.
The company experienced the highest booking volumes for all future sailings for any quarter in its history, executives said. Since Black Friday, booking volumes have hit record levels, particularly in North America. “We achieved our highest ever quarterly booking volumes in our company’s history, and we actually had our best weekly booking volume for this wave the last week in February,” Weinstein said. Carnival does not disclose specific numbers for bookings.
North America booking volumes have been exceeding 2019 levels for the last six months, and booking lead times are now back at their peak levels, said Weinstein. Europe has been catching up with North America.
Asia and Australia are still far behind in their recovery compared to the U.S. market. The former is two years and the latter is one year behind. Carnival has recently resumed operations in Japan and will also do so in Taiwan this summer.
The loss of China continues to be a sore spot. The country has not reopened to international cruise travel. China accounted for 1 million guests before the pandemic and was especially important to Carnival Cruise’s Costa brand.
In the first quarter, Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) amounted to $382 million. The company’s 91 percent occupancy level was a big contributor. Revenue totaled $4.4 billion, which is 95 percent of its 2019 level.
Carnival has been stepping up its digital face and marketing. The company is learning more into video storytelling. Carnival’s AIDA brand launched a wave campaign that stacked 86 million views on TikTok. The cruise company is also redesigning its websites to increase online traffic, conversion rates and onboard sales.
The cruise company has four ships on order through 2025, its lowest order total in decades. There are no plans for new ships in 2026, said Weinstein.
For the next quarter, the company expects Adjusted EBITDA to be between $600 million and $700 million and occupancy to reach 98 percent. For the full 2023, Carnival expects Adjusted EBITDA to be between $3.9 billion to $4.1 billion. Occupancy will reach 100 percent, and ship capacity will be 4.5 percent higher than in 2019.
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