Back to top

Image: Bigstock

Norwegian Cruise Stock Down on Q1 Earnings & Revenues Miss

Read MoreHide Full Article

Norwegian Cruise Line Holdings Ltd. (NCLH - Free Report) reported first-quarter 2025 results, with earnings and revenues missing the Zacks Consensus Estimate. Both top and bottom lines decreased on a year-over-year basis. Following the results, the company’s shares declined 8.5% in today’s pre-market trading session.

Results in the quarter were hurt by a 2% decline in Capacity Days, stemming from a higher number of Berths out of service due to larger ships undergoing dry-dock, as well as a strategic move to reduce passenger air participation rates.

NCLH’s Q1 Earnings & Revenues

Norwegian Cruise reported an adjusted earnings per share of 7 cents, missing the Zacks Consensus Estimate of 9 cents. In the prior-year quarter, the company reported an adjusted earnings per share of 16 cents.

Quarterly revenues of $2,127.6 million missed the consensus mark of $2,148 million. The metric also declined 3% year over year. (Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.)

Passenger ticket revenues were $1.41 billion compared with $1.46 billion reported in the prior-year quarter. Our model anticipated passenger ticket revenues to be $1.40 billion.

Onboard and other revenues decreased to $708.9 million from $731.4 million reported in the prior-year quarter. We expected onboard and other revenues to be $755.6 million.

NCLH’s Expenses & Operating Results

Total cruise operating expenses decreased 6% year over year to $1.30 billion, due to lower commissions, transportation and other costs, as well as fuel and food costs. However, this was partially offset by higher onboard and other costs.

During the first quarter, gross cruise costs per Capacity Day were $297.39 compared with $298.11 reported in the prior year period. Adjusted net cruise costs (excluding fuel) per Capacity Day amounted to about $169.33 compared with $169.45 reported in the prior-year period.

Net interest expenses were $217.9 million, down from $218.2 million reported in the year-ago quarter.

NCLH’s Balance Sheet

As of March 31, 2025, the company had cash and cash equivalents of $184.4 million, down from $190.8 million at the end of 2024. Long-term debt was $12.9 billion compared with $11.8 billion as of 2024-end.

Booking Update of NCLH

Despite some softening in its 12-month forward booking trends, the company has maintained its position within the desired booking range, even as broader macroeconomic challenges persist. First-quarter 2025 occupancy was 101.5%, which was in line with the company’s guidance but slightly lower than the previous year, primarily due to more dry-dock activity and repositioning of larger ships. Meanwhile, advance ticket sales, including long-term bookings, rose 2.6% year over year, reaching $3.9 billion by the end of the quarter.

Q2 and 2025 Guidance by NCLH

For second-quarter 2025, NCLH anticipates occupancy to be approximately 103.2% and Capacity Days to be about 6.06 million. For the quarter, adjusted interest expenses are expected to be approximately $175 million, while depreciation and amortization are anticipated to be about $245 million. Adjusted EBITDA is expected to be about $670 million. Adjusted EPS is predicted to be nearly 51 cents.

For 2025, the company anticipates occupancy to be approximately 102.5% compared with the prior guidance of 103.4% and Capacity Days to be about 24.545 million. During the year, adjusted interest expenses are expected to be approximately $700 million. Depreciation and amortization are anticipated at nearly $985 million. Adjusted EBITDA during the year is expected to be nearly $2.72 billion. For 2025, the company continues to expect adjusted EPS of $2.05.

NCLH’s Zacks Rank

Norwegian Cruise currently has a Zacks Rank #3 (Hold).

Key Picks

Some better-ranked stocks from the Zacks Consumer-Discretionary sector are TEGNA Inc. (TGNA - Free Report) , Sportradar Group AG (SRAD - Free Report) and American Outdoor Brands, Inc. (AOUT - Free Report) .

TEGNA presently sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
 
TEGNA delivered a trailing four-quarter earnings surprise of 6.3%, on average. The stock has gained 19.6% in the past year. The consensus estimate for TEGNA’s 2026 sales and EPS implies growth of 11.3% and 93.8%, respectively, from the year-ago levels.
 
Sportradar Group presently carries a Zacks Rank #2 (Buy).
 
The consensus estimate for Sportradar Group’s 2025 sales and EPS implies growth of 15.8% and 172.7%, respectively, from the year-ago levels. Sportradar Group stock has surged 146.9% in the past year.
 
American Outdoor carries a Zacks Rank #2 at present. The company delivered a trailing four-quarter earnings surprise of 79.6%, on average. American Outdoor has gained 42.7% in the past year.
 
The Zacks Consensus Estimate for American Outdoor’s fiscal 2025 sales and EPS indicates growth of 3.7% and 93.8%, respectively, from the year-ago levels.

Published in