Royal Caribbean Cruises posted revenue that was 37 percent less than the a year ago during the busiest quarter of the year. The cruise line was not disappointed with the earnings report, but with all the bad news over the past few months, cruising as a whole has taken a hit.
Profit in the January-through-March quarter dipped to $119.5 million from $189.6 million. Revenue fell 2 percent to $1.15 billion from $1.17 billion.
But the world’s second-largest cruise ship operator managed to beat Wall Street’s expectations, as its stock rose $1.22 to $42.77 in New York Stock Exchange trading.
Wall Street analysts were encouraged that onboard spending remained strong, pushing revenue for each cabin, known as yields, up 1.9 percent. Royal Caribbean now expects yields will rise 3 percent to 4 percent for the year, based on a positive “pace of bookings.”
Royal Caribbean’s upbeat outlook contradicted a more cautionary note that sounded last month by its Miami-based rival Carnival Corp.
”This was a positive surprise for everybody,” said Felicia Kantor Hendrix, an analyst at Lehman Brothers in New York. “The Caribbean could be challenging for them, but they have so much going on that they’re able to offset that.”