Norwegian Cruise Line Holdings has raised its full-year profit forecast for a second time in less than three weeks, betting on record demand for cruise vacations and higher ticket prices.
More travelers are choosing sea-based vacations that offer a range of fun activities under one roof, compared to expensive land-based holidays, benefiting cruise operators and giving them room to raise prices.
Expectations have also been high for the Miami-based Norwegian after strong booking trends drove up results and shares last year, and rival Royal Caribbean Group raised its profit target for a second time last month.
"There's a strong intent to return (to cruises) across every single demographic, including Millennial and Generation Z," CEO Harry Sommer said at the company's investor day.
The cruise operator now expects an adjusted profit of $1.42 per share, compared to its previous forecast of $1.32.
Approximately 34.7 million passengers are expected to take cruise holidays this year - around 17% more than the 29.7 million passengers that sailed in 2019, according to a report from the Cruise Lines International Association.
Last month, Norwegian ordered eight new ships across its three brands to cater to the rising demand.
The company said it expects to earn an adjusted profit of $2.45 per share, representing a two year compound-annual-growth-rate (CAGR) from 2024 to 2026 of over 30%.
It also expects to generate total revenue of about $9 billion this year, up from about $8.55 billion in 2023.
Earlier in May, Norwegian's shares had dropped as much as 15% after it missed its first-quarter revenue estimates despite raising its full-year profit target.
