EPS of $0.27 increased by 863.2% from previous year
Gross margin of 63.1%
Net income of 303.00M
""We expect to hit our 2026 EBITDA per ALBD target a full year early while raising ROIC to just shy of our 12% 2026 target."" - Josh Weinstein
Carnival Corporation plc (CCL) Q4 2024 Financial Results: A Strong Finish to a Transformative Year
Executive Summary
Carnival Corporation plc reported Q4 2024 results demonstrating a robust financial performance, closing the year with an impressive net income of $303 million, driven by record revenues of $5.94 billion, an increase of 10.04% year-over-year. This exceptional quarter marks the seventh consecutive quarter of record revenues, reflecting a strong demand trajectory for cruise travel. Strong closing demand across its portfolio pushed yields and onboard spending levels higher, leading to a year-to-date yield increase of 11%. In addressing operational efficiency, management successfully reduced unit costs by 100 basis points compared to initial guidance. The positive momentum established in 2024 sets the stage for further growth in 2025, with management forecasting yield growth exceeding 4% and expected net income guidance of over $2.3 billion. Key factors impacting future performance include innovative marketing strategies, improved destination offerings, and strategic cost management initiatives. Investors are encouraged to monitor these developments as the company approaches its long-term growth targets.
Key Performance Indicators
Revenue
5.94B
QoQ: -24.80% | YoY:10.04%
Gross Profit
3.75B
63.07% margin
QoQ: 4.23% | YoY:111.94%
Operating Income
561.00M
QoQ: -74.24% | YoY:46.09%
Net Income
303.00M
QoQ: -82.54% | YoY:731.25%
EPS
0.29
QoQ: -79.14% | YoY:863.16%
Revenue Trend
Margin Analysis
Key Insights
**Revenue:** $5.94 billion (YoY increase of 10.04%)
**Gross Profit:** $3.75 billion (YoY increase of 111.94%)
**Operating Income:** $561 million (YoY increase of 46.09%)
**Net Income:** $303 million (YoY increase of 731.25%)
**EPS:** $0.29
Financial Highlights
Financial Metrics Overview:
- Revenue: $5.94 billion (YoY increase of 10.04%)
- Gross Profit: $3.75 billion (YoY increase of 111.94%)
- Operating Income: $561 million (YoY increase of 46.09%)
- Net Income: $303 million (YoY increase of 731.25%)
- EPS: $0.29
- Debt Levels: $27.5 billion
- Net Debt to EBITDA: 4.3 times
- Cash Flow from Operations: ~ $6 billion in 2024
Trends and Management Insights:
- The company reported that onboard spending accelerated sequentially throughout the year, reflecting enhanced guest engagement and marketing efforts.
- Management emphasized operational execution improvements leading to a forecasted reduction in unit costs by 3.7% in 2025, with favorable positioning against behavioral spending trends, suggesting a conducive environment for revenue and yield growth, supporting a strong investment case.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
5.94B
10.04%
-24.80%
Gross Profit
3.75B
111.94%
4.23%
Operating Income
561.00M
46.09%
-74.24%
Net Income
303.00M
731.25%
-82.54%
EPS
0.29
863.16%
-79.14%
Key Financial Ratios
currentRatio
0.29
grossProfitMargin
63.1%
operatingProfitMargin
9.45%
netProfitMargin
5.1%
returnOnAssets
0.63%
returnOnEquity
3.27%
debtEquityRatio
3.12
operatingCashFlowPerShare
$0.7
freeCashFlowPerShare
$0.25
priceToBookRatio
3.57
priceEarningsRatio
27.28
Net Income vs. Revenue
Expense Breakdown
Management Commentary
Key Insights from Management:
- Josh Weinstein, CEO: "We delivered another stellar quarter to close out a phenomenal year. In fact, this was our seventh consecutive quarter achieving record revenues... showing robust demand delivered a full-year 2024 yield increase of 11%."
- David Bernstein, CFO: "During 2024, we made debt payments of over $5 billion... our leverage metrics continued to improve in 2024 as our EBITDA continued to grow and our debt levels continued to shrink."
These quotes underscore management's commitment to strong performance and the effectiveness of their strategies in enhancing profitability.
"We expect to hit our 2026 EBITDA per ALBD target a full year early while raising ROIC to just shy of our 12% 2026 target."
â Josh Weinstein
"The outperformance was up and down the P&L and driven by strong closing demand across the portfolio, which pushed yields, per diems, EBITDA, and operating income all to new highs this year."
â David Bernstein
Forward Guidance
Management provided optimistic guidance for 2025, forecasting a yield increase exceeding 4%, with net income guidance looking towards $2.3 billion. This reflects confidence in a sustainable recovery trend and management's ability to capitalize on strong booking trends and higher price realizations. Key factors for monitoring include:
- Indicator of consumer demand and booking trends for 2025
- Successful launch of 'Celebration Key', enhancing customer experiences at exclusive destinations
- Further operational improvements and optimized cost management in the face of rising costs and inflation
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
CCL Focus
63.07%
9.45%
3.27%
27.28%
RCL
45.40%
16.60%
7.31%
28.55%
ABNB
82.80%
17.30%
5.48%
44.54%
EXPE
89.50%
6.78%
19.20%
20.03%
BKNG
1.00%
31.60%
-26.60%
38.44%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
Carnival Corporation offers a compelling investment outlook driven by its strong recovery trajectory, improving financial metrics, and strategic initiatives focused on enhancing guest experience and operational efficiency. The company's ability to leverage the ongoing consumer demand for travel, combined with innovations in marketing and destinations, positions it well for sustainable growth. Investors should remain vigilant of macroeconomic trends that could impact consumer spending and operational costs, but the foundation laid in 2024 suggests a promising path towards achieving long-term growth targets.
Key Investment Factors
Growth Potential
Carnival is positioned for growth due to the increasing consumer demand for cruise travel, supported by record customer deposits and strong bookings across its major brands. The introduction of exclusive destinations and enhanced guest experiences through marketing strategies will likely drive future revenue growth.
Profitability Risk
Key risks include higher inflation impacting operational costs, geopolitical factors affecting cruise itineraries, potential regulatory changes, and consumer discretionary spending constraints in a volatile economic environment.
Financial Position
Carnival's financial outlook is improving, evidenced by a significant reduction in debt levels and a strong cash flow generation capability. Despite a net debt to EBITDA ratio of 4.3 times, management has indicated plans to achieve investment-grade ratings by 2026.
SWOT Analysis
Strengths
Market leader in the cruise industry with diversified brands.
Strong recovery in demand post-pandemic, achieving record revenue and net income.
Effective cost control measures combined with revenue management strategies.
Weaknesses
High debt levels of $27.5 billion, which may hinder flexibility in financial planning.
Dependence on discretionary spending, which is vulnerable to economic downturns.
Opportunities
Expansion of exclusive cruise destinations and enhancements to onboard guest experiences.
Investment in technology and marketing to improve direct bookings and customer engagement.
Potential for increased pricing power as demand for cruise travel continues to rebound.
Threats
Ongoing inflationary pressures that may increase operational costs.
Geopolitical tensions and adverse weather affecting cruise itineraries.
Emerging competitors and changing consumer preferences may challenge market position.