Carnival Corp Stock (CCL) Up 22% YTD Ahead of Earnings – What To Expect

Carnival Corporation & plc (CCL) is heading into its earnings announcement this morning on a high note, with the stock price trading above $31 in pre-market hours. This caps off a year-to-date gain of 22.87%, signaling strong market confidence in the cruise giant's trajectory. The company's performance is underpinned by robust cruise demand, effective financial management, and a generally favorable market environment.

Analysts project that Carnival will report earnings per share (EPS) of $1.32 for the upcoming quarter, slightly above the $1.27 EPS reported in the same period last year, indicating modest year-over-year earnings growth. Revenue is expected to reach $8.11 billion, reflecting a 2.68% increase compared to the previous year, driven by continued strong demand in the cruise industry. These estimates suggest steady performance improvements, supported by robust bookings and onboard spending.

Carnival's strong performance is primarily driven by unprecedented cruise demand. Back in June 2025, the company revised its annual profit forecast upwards following impressive second-quarter results. This was attributed to last-minute bookings and increased onboard spending, demonstrating the resilience of the cruise industry and consumers' willingness to spend on travel experiences. Revenue for the quarter reached $6.33 billion, exceeding analyst expectations of $6.21 billion, while adjusted net income soared to $470 million, or 35 cents per share, surpassing the estimated 24 cents.

CEO Josh Weinstein has emphasized the continued strength of demand, noting that future bookings are at record levels. The affordability of cruise vacations amidst economic uncertainty is a key factor driving this trend. Customer deposits have reached a record $8.5 billion, and advanced bookings for 2026 are matching the record-setting pace of 2025, with historically high pricing. As a result, Carnival has increased its 2025 adjusted earnings forecast to $1.97 per share, up from $1.83.

Looking to the future, Carnival is investing in its fleet and enhancing passenger experiences. The company has plans to add new vessels, including three new ships from Fincantieri scheduled for delivery in the summers of 2029, 2031, and 2033.

These ships will be among the largest in Carnival's fleet, capable of accommodating nearly 8,000 passengers. Furthermore, the company's decision to name its next two Excel-class ships Carnival Festivale and Carnival Tropicale, honoring historic vessels, demonstrates a commitment to its heritage and brand identity.

Institutional backers are also showing faith in Carnival's potential. Korea Investment CORP, for example, increased its holdings in Carnival by 36.7% in March, acquiring an additional 293,154 shares, bringing its total to 1,090,909 shares valued at approximately $27.2 million. Such investments signal institutional belief in the company's long-term prospects.

Macroeconomic factors are also playing a role in Carnival's success. Recent data indicates that inflation is showing signs of stabilization, which could lead to more predictable interest rates. This would benefit Carnival by controlling variable-rate interest expenses and facilitating debt refinancing, further strengthening its financial position.

However, the stock's impressive year-to-date performance may have already priced in much of the anticipated good news. A slight miss in earnings, even if still positive, could trigger a sell-off. Furthermore, the reliance on last-minute bookings, while currently beneficial, could indicate a lack of long-term planning among consumers and vulnerability to sudden economic shocks.

The assumption that cruise demand will remain consistently high, even in the face of potential economic headwinds, may be overly optimistic. It is also worth noting the potential impact of over-tourism on cruise destinations, potentially leading to restrictions or increased port fees, impacting Carnival's profitability.