With a Hefty Level of Advance Bookings, Carnival Well Positioned for Rising Cash Flow Generation

Carnival remains the largest company in the cruise industry, with nine global brands and 92 ships at the end of fiscal 2023. The global cruise market has historically been underpenetrated, offering cruise companies a long-term demand opportunity. Additionally, the ability to reposition and redeploy ships to faster-growing and underrepresented regions like Asia-Pacific helped balance the supply in high-capacity regions like the Caribbean and Mediterranean prior to the pandemic, a factor that the firm can again choose to utilize to help optimize forward pricing. Although the European demand and occupancy profiles are converging on normalized levels, we believe there is still support for improving economic performance at Carnival.