by (Bloomberg) — Shares of Royal Caribbean Cruises Ltd. (RCL) fell after its earnings outlook for this quarter came in below expectations due to the impact of Hurricane Milton.
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The world’s most valuable cruise line said in a statement Tuesday that its adjusted earnings per share would be between $1.40 and $1.45 in the fourth quarter. Analysts had taken into account an average of $1.58. The storm, coupled with shifting costs from the third quarter, lowered its forecast by 24 cents.
The softer-than-expected view sent chills down the spine of cruise stocks. Royal Caribbean fell as much as 5.6% in premarket trading, while peers Carnival Corp. (CCL) and Norwegian Cruise Line Holdings Ltd. (NCLH) lost more than 2% each.
Still, demand for cruises shows no signs of slowing, with booking rates for 2025 cruises equal to or higher than previous years. This should also lead to better pricing, the company said.
“While we are still very early in the planning process, we expect earnings per share in 2025 to start at a level of $14,” CEO Jason Liberty said in the release.
The company raised its full-year earnings outlook to between $11.57 and $11.62 per share, while Wall Street expected $11.51. Previously, the cruise line saw between $11.35 and $11.45 per share.
Royal’s shares have risen more than 50% this year, more than double those of rivals, as passengers flocked to its cruises in record numbers.
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