Carnival expects full-year adjusted profit of $1.50 to $1.70 a share, which came up short of the estimate of $1.72 from analysts polled by Thomson Reuters. The company also forecast a loss of 2 cents a share to a profit of 2 cents a share for the current quarter ending in May thanks mostly to higher selling and administrative costs. Analysts expected a profit of 7 cents a share.
Carnival also expects net revenue yields on a constant-dollar basis to decline in fiscal 2014. Net revenue yields, which combine ticket sales and money spent on ships, dipped 2.1% in the first quarter.
The company reported a net loss of $15 million, or 2 cents a share, down year over year from a profit of $37 million, or 5 cents a share. Carnival just broke even on a per-share basis, excluding items. Revenue dipped to $3.58 billion. Analysts expected a loss of 8 cents a share on revenue of $3.56 billion.
Royal Caribbean (RCL), the second-largest cruise operator, increased its full-year earnings forecast in January and said its European ticket sales were improving.
Carnival's weak guidance stems from the company's price cuts in order to attract customers after several incidents have hurt demand for its cruises in recent years. Passengers who were stranded on the Carnival Triumph for five days in the Gulf of Mexico after a ship fire in February last year sued the company earlier this month.