Carnival Reports $1.9 Billion Quarterly Loss Amid Omicron Fears

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Cruise lines will continue to face hurdles as new lockdowns mount. But they will also need to step up on transparency when it comes to Covid outbreaks on board, lest consumer confidence takes an even bigger hit in 2022.

Carnival Corp said on Monday Omicron has hurt near-term bookings, but demand for cruises late next year and 2023 suggest that the impact from new coronavirus variants could be shortlived.

Shares of the company fell marginally after the cruise operator also missed fourth-quarter revenue estimates as people avoided cruises due to higher chances of infections in crowded and enclosed spaces.

The fast-spreading Omicron variant has been a cause of concern globally over the last month. Unsure of its severity or effectiveness of vaccinations against it, people are reassessing their immediate travel plans.

New restrictions could hit cruises operators once again who were only crawling back to full capacity after having their ships anchored offshore or docked at ports for a year and a half due to the pandemic.

Carnival’s rival Royal Caribbean Group also said on Monday 48 of 6,091 guests on its Symphony of the Seas cruise ship tested positive for COVID-19, although nearly all of them were fully vaccinated.

Carnival forecast a net loss for the first half of 2022 before turning profitable in the second half.

Cash from operations turned positive in the month of November, Carnival’s Chief Executive Officer Arnold Donald said, adding the cruise operator expects positive cash flow beginning in the second quarter of 2022.

The company, which owns Cunard and Holland America Line brands, said bookings for the second half of next year and first half of 2023 were at the higher end of historical ranges and at higher prices.

The company’s fourth-quarter adjusted net loss widened to $1.96 billion from $1.86 billion as it spent heavily on preparing its ships across its several brands for sailings.

Revenue rose to $1.29 billion from $34 million a year earlier, while analysts had expected $1.41 billion, according to IBES data from Refinitiv.

(Reporting by Ananya Mariam Rajesh and Praveen Paramasivam in Bengaluru; Editing by Anil D’Silva and Shinjini Ganguli)

This article was from Reuters and was legally licensed through the Industry Dive publisher network. Please direct all licensing questions to [email protected].

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