- Full-year 2026 adjusted EPS guidance cut to $1.45-$1.79 from $2.38
- Four Wall Street firms cut price targets on weaker demand, higher costs
- Stock falls more than 8%, with peers Carnival and Royal Caribbean also declining
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Norwegian Cruise Line Plunges 8% After Slashing 2026 Outlook
Norwegian Cruise Line Holdings Ltd. (NYSE: NCLH) shares fell more than 8% after the company cut its full-year profit outlook, citing weaker demand and higher costs stemming from disruptions in the Middle East.
"We delivered strong first quarter results, and more importantly we have already begun taking decisive actions to strengthen execution and accountability across the company," CEO John W. Chidsey said. However, he conceded on an earnings call that the company’s marketing hadn’t been “operating as effectively as it needs to.”
For its first quarter, Norwegian reported adjusted earnings of 23 cents per share on revenue of $2.33 billion. The profit beat the 14-cent consensus estimate, but revenue fell short of the $2.36 billion Wall Street expected. The results prompted four Wall Street firms to lower their price targets on the stock.
The cruise operator now sees full-year 2026 adjusted earnings in a range of $1.45 to $1.79 per share, down sharply from a prior forecast of $2.38. Management attributed the revision to the conflict in the Middle East, which has elevated fuel costs and softened demand for European itineraries. The company’s full-year net yield is now expected to decline between 3 percent and 5 percent, a reversal from a previously flat outlook.
Reflecting the new pressures, Norwegian raised its projected fuel cost for the year to $782 per metric ton from $670. In response, the company announced a cost-saving initiative expected to cut about $125 million from its annual run-rate.
The negative outlook also weighed on competitors. Shares of Carnival Corp. (NYSE: CCL) and Royal Caribbean Group (NYSE: RCL) fell 4 percent and 2.4 percent, respectively.
The guidance cut signals a challenging path ahead for Norwegian as it navigates geopolitical uncertainty and internal operational reviews. Investors will watch for stabilization in bookings and the effectiveness of its cost-saving measures in the company's second-quarter results.
This article is for informational purposes only and does not constitute investment advice.
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