NORWEGIAN Cruise Line Holdings raised full-year profit forecast on Wednesday (May 1) after it topped first-quarter earnings estimates, betting on higher ticket prices and record demand for cruise vacations to destinations like the Caribbean.

However, its shares dropped 9 per cent after quarterly revenue fell short of analysts’ expectations.

Operators are seeing all-time high booking rates for cruise vacations this year, as travellers continue to opt for sea-based sojourns over expensive land-based holidays, giving them enough room to hike prices.

Last week, rival Royal Caribbean Group raised its annual profit forecast for the second time since February.

“The challenge for NCLH shares this year and likely today as well is that RCL has set a very high bar with several massive beat & raises this year,” said Truist Securities analyst Patrick Scholes.

Norwegian’s quarterly revenue increased to US$2.19 billion, but missed expectations of US$2.24 billion, according to LSEG data.

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It earned an adjusted profit of 16 cents per share in the quarter, beating estimates of 11 cents per share.

That was despite lingering costs of labour, fuel and raw materials that drove cruise operating expenses about 8.4 per cent higher. Norwegian also faces rising expenses from dry dock days, or the time ships spend under maintenance.

“We kicked off 2024 with impressive momentum, with record bookings in the first quarter,” said CEO Harry Sommer.

To cater to the growing demand, Norwegian last month said it had placed an order for eight new ships across its three brands, which are scheduled for delivery between 2026 and 2036.

It expects an adjusted profit of US$1.32 per share for the full year, compared with a previous forecast of US$1.23 per share.

Occupancy levels in the first quarter were broadly in line with what Norwegian had projected earlier. REUTERS