Carnival Q2 Earnings & Revenues Beat Estimates, Both Increase Y/Y

Carnival Corporation & plc CCL reported better-than-expected second-quarter fiscal 2026 (ended May 31) results, with both adjusted earnings and revenues surpassing the Zacks Consensus Estimate. The top and bottom lines also increased on a year-over-year basis.Despite reporting another earnings beat and delivering record quarterly results, Carnival's shares fell 5.7% in pre-market trading today. Investor sentiment was likely weighed down by management's second-half outlook, which reflects the impact of ongoing geopolitical tensions in the Middle East on booking trends for certain European deployments, particularly in the Mediterranean region.Nevertheless, Carnival posted its twelfth consecutive quarter of record net yields and exceeded the March guidance by $100 million, driven by strong commercial execution and improved cost efficiency despite nearly 30% higher fuel costs. Management noted that recent booking trends are beginning to improve, indicating a gradual easing of geopolitical headwinds and reinforcing confidence in demand, pricing and the company's long-term earnings potential.CCL’s Q2 Earnings & RevenuesIn the quarter under review, the company reported adjusted earnings per share (EPS) of 41 cents, beating the Zacks Consensus Estimate of 35 cents. In the year-ago quarter, CCL posted an adjusted EPS of 35 cents.Revenues in the quarter totaled $6.66 billion, beating the consensus mark of $6.64 billion. The metric also increased 5.3% year over year.Carnival Corporation Price, Consensus and EPS Surprise Carnival Corporation price-consensus-eps-surprise-chart | Carnival Corporation QuoteDuring the quarter, passenger ticket revenues amounted to $4.27 billion, up from $4.10 billion reported in the prior-year quarter. Our estimate for passenger ticket revenues was also pegged at $4.23 billion.Onboard and other revenues increased to $2.39 billion from $2.22 billion reported in the year-ago quarter. Our estimate for Onboard and other revenues was pegged at $2.38 billion.Carnival’s FinancialsAdjusted net income in the quarter amounted to $569 million compared with $470 million reported in the prior-year quarter.Adjusted EBITDA totaled $1.58 billion, up from $1.51 billion reported in the prior-year quarter.CCL’s Balance SheetAs of May 31, 2026, cash and cash equivalents were $2.24 billion compared with $1.93 billion as of Nov. 30, 2025. Total debt (current and long-term) as of May 31, 2026, was $24.89 billion compared with $26.64 billion as of Nov. 30, 2025.Booking Update of CarnivalThe company delivered another exceptionally strong booking performance, with its booked position for the second half of 2026 running ahead of last year at historically high prices on a constant-currency basis. This strength was achieved despite more than a full quarter of heightened geopolitical volatility that primarily affected booking trends for European deployments, particularly in the Mediterranean region. Management maintained pricing discipline by leveraging its occupancy advantage, supporting continued yield strength.With 93% of 2026 capacity already booked and less inventory remaining for sale than at the same point last year, Carnival is well positioned to achieve record net yields in the back half of 2026. Demand for 2027 and beyond also remains robust, with booking volumes and pricing for future sailings running ahead of prior-year levels since March, including a significant increase in bookings for European itineraries.The company's booking curve remains the furthest out on record, underscoring the strength of its portfolio of cruise brands and sustained demand generation efforts. Continued demand momentum was also reflected in higher fiscal second-quarter onboard revenues, increased pre-cruise onboard sales and strong customer engagement, providing enhanced revenue visibility.Customer deposits reached an all-time high of $9.0 billion, surpassing the prior year's record by more than $450 million despite flat capacity growth over the next 12 months. The record deposit balance highlights the continued strength in consumer demand and further reinforces Carnival's strong cash flow profile.CCL’s Q3 & FY26 OutlookFor third-quarter fiscal 2026, the company expects adjusted EBITDA to be approximately $2.88 billion. It expects fiscal third-quarter adjusted net income to be nearly $1.86 billion. The company expects fiscal third-quarter adjusted EPS to be $1.35.For fiscal 2026, CCL now expects adjusted EBITDA of approximately $7.11 billion, down from its prior estimate of $7.19 billion. Adjusted net income is projected to be nearly $3.07 billion compared with the earlier expectation of $3.1 billion. Accordingly, adjusted EPS for the year is anticipated to be $2.22, revised up from the previous outlook of $2.21.CCL’s Zacks Rank & Stocks to ConsiderCurrently, Carnival has a Zacks Rank #3 (Hold).Some better-ranked stocks in the Zacks Consumer Discretionary sector are as follows:Flexsteel Industries FLXS currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.The company delivered a trailing four-quarter earnings surprise of 59%, on average. FLXS stock has moved up 65.3% in the past six months. The Zacks Consensus Estimate for Flexsteel’s fiscal 2026 sales and EPS indicates an increase of 14.6% and 3.8%, respectively, from the year-ago levels.Strategic Education, Inc. STRA currently holds a Zacks Rank of 2 (Buy). The company delivered a trailing four-quarter earnings surprise of 11.2%, on average. STRA stock has declined 4.7% in the past six months.The Zacks Consensus Estimate for Strategic Education’s 2026 sales and EPS implies growth of 16.5% and 1.7%, respectively, from the year-ago levels.OneSpaWorld OSW currently carries a Zacks Rank of 2. The company delivered a trailing four-quarter earnings surprise of 31.8%, on average. OSW stock has climbed 33.2% in the past six months.The Zacks Consensus Estimate for OneSpaWorld 2026 sales and EPS implies growth of 17.2% and 7.3%, respectively, from the year-ago levels.Research Chief Names "Single Best Pick to Double"From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks