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Carnival Cuts Profit Outlook as Fuel Costs Jump

Carnival’s lack of fuel hedging leaves it exposed to oil spikes tied to Middle East disruptions.

Overview

  • Carnival, which updated its forecast Friday, now guides to about $2.21 in adjusted earnings per share for 2026 as the stock fell roughly 3% to 4%.
  • Management said the outlook reflects fuel bought in March and early April with Brent crude assumed at $90 a barrel for April and May, $85 in the third quarter, and $80 in the fourth quarter.
  • The company estimated more than $500 million in extra fuel expense this year and plans about $150 million in offsets from higher ticket yields and lower non‑fuel costs.
  • First‑quarter results topped guidance with adjusted EPS of $0.20 on $6.17 billion in revenue, net income of $275 million, record bookings, nearly $8 billion in customer deposits, and about 85% of 2026 capacity already sold.
  • Carnival announced a $2.5 billion share buyback, reinstated a dividend, and introduced PROPEL targets, while noting it is the only major U.S. cruise line without fuel hedges and that a 10% fuel move can swing results by about $160 million or $0.11 per share.