Cruise line stocks have been on a tear in recent months, with no signs of a slowdown as industry efforts to woo vacationers to the sea show signs of paying off.
Carnival (CCL) shares have rebounded more than 60% from their April lows when tariff turmoil rocked the markets. Norwegian Cruise Line (NCLH) also rose 50%, while Royal Caribbean (RCL) rallied more than 80% over the same period.
Trump’s trades deals have, to some extent, helped the industry gain clarity. Airlines like United (UAL) and Delta (DAL) reinstated financial guidance, crediting a clear picture of signals out of Washington. Similarly, cruise operators noted a sharp improvement in bookings over the last several months.
The rebound in cruise line stocks, Friday’s market sell-off aside, came after April’s market turmoil and subsequent recovery on the heels of President Trump’s broad-based tariff pause.
On Thursday, Norwegian Cruise Line shares jumped 9% after the company posted record second quarter revenue and shared bookings now ahead of historical levels.
“It’s never a single thing that drives the change that we saw from a choppy April to a record May through July,” Harry Sommer, president and CEO of Norwegian Cruise Line Holdings, told analysts during the earnings call. “But I’d say the primary driver was the improvement in the macroeconomic environment.” He added that July was on its way to a record month for the company.
Earlier this week, Royal Caribbean posted record adjusted earnings on strong demand, though the cruise operator’s top line came in below Wall Street expectations. Management credited an acceleration in “close-in demand,” or bookings with little lead-time, allowing operators to keep prices higher for longer.
Strong performances from Royal Caribbean and Norwegian follow Carnival’s record second quarter revenue of $6.3 billion in June.
The industry’s outperformance has been in the making for a while now. In recent years, cruise operators have invested in newer, more advanced ships; thematic voyages; and exclusive destination-led experiences to attract new customers. Those efforts appear to be working as cruises, which often work out cheaper than land-based vacations, have grown in popularity.
The number of cruise passengers rose from 29.7 million in 2019, before the 2020 pandemic, to an estimated 37.7 million projected for 2025. The trend reflects passengers beyond baby boomers taking cruises as interest from first-time travelers rises.
Royal Caribbean management noted this week that millennials and younger travelers now represent about half of its customer base.
