Skift Take

Viking, the only pure-play luxury cruise line, has reported its first quarterly earnings since it went public. The company is targeting a English-speakers over the age of 55, a demographic with most of the wealth and a broad eagerness to travel.

Viking on Wednesday provided its first earnings report since its IPO earlier this month. The company, which operates 92 luxury river and ocean cruises, gave a broadly upbeat report.

Here are some key takeaways from its presentation.

Betting on over-55s

  • Viking’s core customers are affluent, English-speaking travelers over age 55.
  • “In the U.S., this demographic has a large spending power and holds 70% of the wealth,” said Torstein Hagen, Chairman and CEO. “They’re also the fastest-growing segment of the population, expected to increase from 98 million people in 2020 to 110 million in 2030. To put things in perspective, we carried about 650,000 guests in 2023.”
  • Executives said this demographic likes an all-inclusive product because they like to know their budgets upfront. That said, about 40% of passengers book an upsell, typically a package that includes a stay in a hotel before departure or at the end of a cruise. The company also offers optional excursions while in ports as upsells.

Strong 2024 and 2025 seasons

  • For sailings this season, it has sold 91% of its possible passenger cruise days — a measure of the number of passengers carried multiplied by the number of ship operating days.
  • For the 2025 season, it has sold 39% of its passenger cruise days. That amounts to $2.5 billion in advance bookings so far.
  • “Our current bookings pace is proceeding pretty much as we planned,” Hagen said. “We have had no surprises.”

Growing capacity

  • As the company adds ships, the volume of passengers it can serve obviously grows. Viking will boost its ocean cruise capacity by 17% for next year’s season, compared to the level in 2023, and its river cruise capacity by 12% next season, compared to last year.
  • Viking said it had exercised options with the shipbuilder Fincantieri. It expects delivery of two wholly new 998-guest cruise ships in 2029.

Vague forecasts

  • The company’s executives said that typical fluctuations in the mix of bookings over any given year make it impossible for them to provide a specific forecast for yields. Net yields last year averaged about $500 per passenger per day.
  • A few analysts were disappointed in the lack of detailed guidance. “It seems to us that giving guidance would be easier for you than your peers given that your booking curve is farther out [Viking is better at generating bookings farther in advance] and you don’t really generate much onboard revenue [because] Viking’s ships are smaller,” said Robin Farley, managing director and leisure stock analyst at UBS.
  • “Our goal is always to try to keep [price hike percentages from season to season] in the mid-to-high single digits,” said Linh Banh, executive vice president, finance.

Narrowing losses

  • The operator of river and ocean cruises said it has been reducing its cash burn. Its adjusted EBITDA was negative $214 million in the year through March 31, representing half the loss of the prior comparable period.
  • The company raised about $246 million in net proceeds from its IPO.

Less debt

  • Viking’s net leverage slipped from 3.8x as of year-end to 3.4x trailing yearly adjusted EBITDA as of March 31.
  • “Our balance sheet is probably among the best in the industry,” Hagen said.

Cruise and Tours Sector Stock Index Performance Year-to-Date

What am I looking at? The performance of cruise and tours sector stocks within the ST200. The index includes companies publicly traded across global markets including both cruise lines and tour operators.

The Skift Travel 200 (ST200) combines the financial performance of nearly 200 travel companies worth more than a trillion dollars into a single number. See more cruise and tours sector financial performance.

Read the full methodology behind the Skift Travel 200.


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Tags: cruise, cruise earnings, cruise industry, cruise lines, earnings, viking

Photo credit: An aerial view of a cruise ship run by Viking Cruises, near Geiranger, Norway, and next to Seven Sisters Waterfall tumbling 1,000 feet into the fjord's water. Source: Viking Holdings Viking

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