Thursday, June 26, 2025
Carnival Corp is sailing ahead with a significantly raised profit forecast for the year, after surpassing second-quarter expectations with its best margins in nearly 20 years. The cruise line operator reported stellar financial results, with high demand for sea-based vacations—especially among budget-conscious travelers—driving growth. Carnival’s increased margins, higher ticket prices, and strong onboard spending have helped the company weather economic uncertainty. As bookings surge, shares of Carnival rose nearly 8% in early trading, marking a strong upward trajectory for the company.
Carnival’s Remarkable Performance
Carnival Corp. has been riding high on the wave of strong demand for cruise vacations. The company reported a revenue of $6.33 billion for the second quarter, surpassing analyst expectations of $6.21 billion. This growth was fueled by high onboard spending, last-minute bookings, and increased ticket prices, marking the highest profit margins Carnival has seen in almost two decades.
CEO Josh Weinstein noted on a post-earnings call that the margins achieved this past quarter were “the highest we’ve achieved in nearly 20 years,” a testament to the resilience and popularity of Carnival’s offerings during these volatile times.
Affordability Continues to Drive Cruise Demand
Amid economic challenges, sea-based vacations have become a more attractive option, particularly for lower-income customers seeking more affordable travel alternatives to land-based vacations. Carnival’s continued ability to offer these affordable cruise options has been a key factor in driving bookings and maintaining high demand, even as the global economic environment fluctuates.
This strong demand comes as no surprise, given that Carnival’s cruises offer an attractive value proposition, making vacations more accessible for a wider range of customers. As travelers increasingly seek good value and flexibility, last-minute bookings have surged, driving the company’s impressive performance.
A Bright Outlook for 2025 and Beyond
Carnival has raised its fiscal 2025 earnings forecast, projecting adjusted earnings per share of approximately $1.97, up from the previous estimate of $1.83. This upward revision reflects the company’s strong performance and growing optimism for the second half of the year. Analyst Patrick Scholes from Truist equity noted that favorable exchange rates will add about $40 million, or roughly 3 cents per share, to the company’s overall outlook.
The positive momentum is expected to continue, with Carnival’s advanced bookings for 2026 already matching the record levels seen in 2025. Additionally, the company’s customer deposits reached an all-time high of $8.5 billion, further bolstering its confidence in sustained growth.
Exceeding SEA Change Targets Early
One of the most significant achievements this quarter is Carnival’s early success in meeting its 2026 SEA Change financial targets. These targets, which include adjusted return on invested capital and adjusted EBITDA per available lower berth day, have now been exceeded 18 months ahead of schedule. These metrics reflect the company’s growing profitability and operational efficiency, both key indicators of Carnival’s continued success.
What’s Next for Carnival?
With rising customer demand and a robust forward-looking strategy, Carnival is well-positioned to maintain its upward trajectory. The company’s ability to exceed financial targets, coupled with the growing appeal of its cruises, indicates that the strong growth trend will continue well into the coming years.
As the cruise industry remains a key player in global travel, Carnival’s ability to innovate and adapt will determine how it performs in the long term. With an expanding customer base, high satisfaction levels, and a growing share of the market, Carnival is set to continue riding the wave of success.
