This post was originally published on this site
https://i-invdn-com.investing.com/trkd-images/LYNXMPEJ701D7_L.jpg
Cruise operators have been wrestling with higher borrowing costs as well as elevated costs associated with food, raw materials, fuel, a stronger U.S. dollar and labor due to the pandemic, which are now exacerbated by the Russia-Ukraine war.
Despite undertaking price hikes, higher costs and spiraling marketing expenses have eroded the benefits of a recent resurgence in demand from affluent customers.
Norwegian’s total cruise operating expenses were up 29% at $1.38 billion in the quarter ended June 30.
Rival Carnival (NYSE:CCL) has forecast third-quarter profit below estimates, signalling that rising marketing and labor costs were eating into its gains from higher ticket prices and steady demand.
Shares of rival Carnival and Royal Caribbean (NYSE:RCL) Cruises were down about 3.1% and 2.1%, respectively, following Norwegian’s results.
Norwegian Cruise expects third-quarter adjusted profit of 70 cents per share, compared with analysts’ average estimate of 79 cents, according to data from Refinitiv.
However, the cruise operator expects full-year adjusted profit of 80 cents per share, compared with its earlier forecast of 75 cents.
