Carnival shares surge on strong earnings and ceasefire boost; analysts upbeat

Carnival Corporation shares rose sharply by more than 7% on Tuesday after the cruise operator delivered better-than-expected second-quarter earnings and raised its full-year forecast, offering a fresh wave of optimism for the travel and leisure sector.

The company reported adjusted earnings of 35 cents per share, topping analyst expectations of 24 cents, according to LSEG.

Revenue climbed to a record $6.3 billion, exceeding the projected $6.2 billion. Net income soared to $565 million, a dramatic increase from $92 million a year earlier.

Carnival CEO Josh Weinstein told analysts the company is seeing “strong momentum across all of the company’s brands,” reinforcing confidence in its post-pandemic recovery trajectory.

Full-year guidance raised as demand holds steady

Buoyed by its Q2 outperformance, Carnival revised its full-year guidance upwards.

It now expects adjusted net income to be about 40% higher than in 2024—roughly $200 million more than the company had projected in March.

Carnival also raised its full-year adjusted EBITDA forecast to $6.9 billion, up from $6.7 billion previously.

Weinstein noted the company is weeks away from launching its new private destination, Celebration Key in the Bahamas, scheduled to open on July 19.

The launch is expected to further strengthen brand differentiation and revenue potential.

Carnival, other cruise stocks gain from ceasefire as well

The cruise sector, which suffered heavily during the COVID-19 pandemic, continues to rebound.

According to NerdWallet, stronger pricing and fuller ships are pushing industry profits back toward pre-pandemic levels.

Investors appeared to agree.

Carnival shares were already up about 3% in premarket trading Tuesday, aided by a sharp 4.5% decline in oil prices after news of a cease-fire agreement between Israel and Iran.

Following the earnings release, the stock jumped as much as 9.5% to $26.32 in midmorning trading.

Peer cruise operators also gained. Royal Caribbean rose 3%, while Norwegian Cruise Line Holdings was up 6.2%, as investor sentiment across the sector brightened.

All three operators have experienced notable volatility largely driven by fluctuations in oil prices but have rebounded more than 10% over the past month.

In March, Carnival posted strong first-quarter results and raised its full-year profit outlook.

However, investor concerns over weakening demand overshadowed the positive earnings, leading to a steep 48% drop in the stock — from about $29 on Jan. 31 to $15 by April 7.

Concerns about rising fuel costs and escalating Middle East tensions had recently clouded the sector’s outlook. But with both issues easing in a matter of hours, investor sentiment has brightened considerably.

Analysts upbeat, but volatility remains

Mizuho analyst Ben Chaiken described the Q2 results as “better than feared,” noting Carnival’s strong outlook.

He reiterated an Outperform rating and set a $33 price target on the stock.

Despite the rally, cruise stocks have been choppy this year, pressured by rising fuel costs and geopolitical instability.

Carnival, in particular, saw a sharp 48% plunge from January to April as market fears mounted over softening travel demand.

But with those pressures now easing, the tone has shifted.

“Our strong results, booked position and outlook are a testament to the success of our ongoing strategy to deliver same-ship, high-margin revenue growth,” said Weinstein.

“We continue to set ourselves up well for 2026 and beyond, with so much more potential to take our margins, returns and results even higher over time.”

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