Norwegian Cruise Line’s second quarter saw a positive market reaction, with shares rising after the company’s revenue growth and margins improved, despite sales coming in below Wall Street expectations. Management highlighted strong demand across all brands, especially higher onboard spend and a successful cost control initiative. CEO Harry Sommer emphasized that “net yield outperformed our expectations, growing 3.1% as a result of strong close-in demand and onboard spend.” The company also benefited from the timing of certain expenses, supporting non-GAAP profit results that aligned with analyst estimates. New ship deliveries and enhancements to existing offerings contributed meaningfully to quarterly performance.
Is now the time to buy NCLH? Find out in our full research report (it’s free).
Norwegian Cruise Line (NCLH) Q2 CY2025 Highlights:
- Revenue: $2.52 billion vs analyst estimates of $2.56 billion (6.1% year-on-year growth, 1.7% miss)
- Adjusted EPS: $0.51 vs analyst estimates of $0.52 (in line)
- Adjusted EBITDA: $694 million vs analyst estimates of $675.1 million (27.6% margin, 2.8% beat)
- Management reiterated its full-year Adjusted EPS guidance of $2.05 at the midpoint
- EBITDA guidance for the full year is $2.72 billion at the midpoint, in line with analyst expectations
- Operating Margin: 16.8%, up from 14.4% in the same quarter last year
- Passenger Cruise Days: 6.29 million, up 211,226 year on year
- Market Capitalization: $10.95 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Norwegian Cruise Line’s Q2 Earnings Call
- Steven Moyer Wieczynski (Stifel) asked about changes to European deployments in 2026 and booking trends. CEO Harry Sommer and CFO Mark Kempa explained they shifted to shorter itineraries and reduced European exposure, seeing strong forward bookings as a result.
- Elizabeth Dove (Goldman Sachs Asset Management) probed the expected ROI of Great Stirrup Cay enhancements and the impact of shifting more capacity to the Caribbean. Sommer noted the approach optimizes profitability, while Kempa emphasized maintaining high guest satisfaction alongside operational changes.
- Conor T. Cunningham (Melius Research) questioned the close-in booking opportunity and how shorter Caribbean itineraries affect revenue management. Sommer pointed to sophisticated booking algorithms and noted both close-in and advance bookings remain strong.
- Matthew Robert Boss (JPMorgan) inquired about demand momentum in July and early response to the new waterpark. Sommer highlighted record July bookings and a surge in website engagement following the waterpark announcement.
- Robin Margaret Farley (UBS) sought clarity on the mix of price versus volume in bookings and CapEx for the waterpark. Management responded that pricing has remained consistent and the waterpark investment was already included in CapEx guidance.
Catalysts in Upcoming Quarters
In coming quarters, the StockStory team will be monitoring (1) guest response and incremental revenue from the rollout of new amenities at Great Stirrup Cay, (2) the impact of deployment shifts toward the Caribbean and away from longer European sailings on occupancy and profitability, and (3) continued execution on cost savings initiatives without compromising guest experience. We will also track early results from leadership changes in technology and marketing as potential contributors to revenue growth and guest engagement.
Norwegian Cruise Line currently trades at $24.26, up from $23.42 just before the earnings. Is the company at an inflection point that warrants a buy or sell? See for yourself in our full research report (it’s free).
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