Skift Take
Although Norwegian Cruise Line has had to cancel trips to the Middle East this year due to the Israel-Hamas conflict, the company remains optimistic about the strong demand for trips to other regions.
Despite the cancellation of trips to the Middle East, Norwegian Cruise Line is experiencing increased demand for other regions, with a particular focus on the Caribbean.
According to Norwegian Cruise Line CEO Harry Sommer, “Our Caribbean capacity for the brand is expected to increase by approximately 300 basis points in 2024 compared to the previous year,” during the fourth quarter earnings call on Tuesday.
Following a successful 2023, where occupancy reached 102.9% and total revenue per passenger rose by 17% from 2019, Norwegian Cruise Line is projecting occupancy levels for 2024 to be 105.1%.
Despite the positive outlook, Norwegian Cruise Line has made the decision to cancel all trips to Israel for 2024 and reroute cruises sailing through the Red Sea for the rest of the year. Only 4% of the company’s capacity for the full year was expected to visit the Middle East.
Where Norwegian’s Ships Are
Norwegian Cruise Line is focusing on deploying its ships strategically, with around 58% of ships scheduled to be in the Caribbean during the first quarter. This figure drops to 40% in the following quarter and 8% in the third quarter.
About 17% and 34% of Norwegian’s ships are set to be deployed in Alaska and Europe during the second quarter. CFO Mark Kempa noted that there is no significant difference in pricing growth between Europe and the Caribbean.
Norwegian Cruise Line’s 2023 Performance:
In 2023, Norwegian Cruise Line generated $8.5 billion in total revenue, a 32% increase from 2019, and achieved a net income of $166.2 million. While it was the company’s first profitable year since 2019, there was a net loss of $106.5 million during the fourth quarter.
