Norwegian Cruise Line Holdings Ltd. cut its full-year earnings outlook after the Israel-Hamas war and a deadly fire in Hawaii caused cancellations, making it the first major US operator to lower its forecast this reporting season.
Adjusted earnings are now expected to be about 73 cents per share this year, Norwegian said in a statement Wednesday, down from about 80 cents in its prior outlook and below analysts’ expectations of 78 cents. The cruise company’s third-quarter earnings beat expectations and sales were in line with estimates.
“We are prudently moderating short term expectations and keeping a close eye on rapidly evolving global macroeconomic and geopolitical events,” Norwegian’s CEO Harry Sommer said in the statement.
Norwegian has canceled and redirected all cruises to Israel and the surrounding region for the rest of the year, and is working to cancel all 2024 cruises to Israel. Reservations to the Middle East were 7% of available bookings for the fourth quarter and 4% for 2024.
Shares fell as much as 7% before paring losses to trade down about 1% at 9:08 a.m. in New York. Peers Royal Caribbean Cruises Ltd. and Carnival Corp. were also down about 1% in early trading.
Norwegian modified some itineraries to Hawaii following a deadly wildfire in Maui in August. Demand for trips to the island fell but the company said bookings “improved in recent weeks and are now approaching normalized levels.”
Royal Caribbean and Carnival both recently increased their earnings outlooks after the cruise industry enjoyed a post-pandemic summer revival.
