Carnival posts $2.8 billion loss in third quarter after the Delta variant hit summer cruise sales

Carnival Cruise Ship
The average Carnival ship was only 59% full in August, the company said.

  • Carnival Corp recorded a $2.8 billion loss in the third quarter of this year, AP reported.
  • The company said sales were knocked this summer due to the impact of the Delta variant of COVID-19.
  • Shares rose on Friday, however, after the company expects soaring demand for next year.
  • See more stories on Insider’s business page.

Carnival Corp, the world’s biggest cruise line, recorded a $2.8 billion loss in the third quarter of this year as concerns over the Delta variant of COVID-19 impacted sales.

Associated Press reported that shares rose 3% on Friday, however, after the cruise line operator said bookings for the second half of next year are running ahead of 2019 levels.

The average ship was only 59% full in August, Carnival told AP. That was an improvement from 39% in June.

The cruise industry has been one of the hardest-hit sectors following the huge disruption caused by the pandemic. Former and current cruise employees recently told Insider how they had to reckon with loneliness, fear, and uncertainty while being stuck in mandatory quarantines.

AP reported that the big three cruise companies in the US did not receive the same kind of federal relief that was allotted to airlines.

But the future for Carnival looks more assured, thanks to pent-up demand for cruises. In July, it said advance bookings for 2022 were already higher than in 2019, Insider’s Grace Dean reported.

“We reported a significant loss, so we haven’t recovered yet, obviously, but as we look ahead we see brighter days,” Carnival CEO Arnold Donald told AP. “If things continue to trend the way they are (with COVID-19 cases), we should see positive cash flow as we get our fleet sailing broadly again.”

People are spending a lot of money on board, too. The company told AP that while there were fewer passengers on board this summer, they spent 20% more onboard than before the pandemic.

According to Donald, the fact that people haven’t been able to cruise, or travel at all, could be behind the increased spending. “So they are in a mood to spend more because they haven’t had a chance to in a while,” he said.

Eight of Carnival’s nine cruise lines have resumed sailing with reduced schedules, AP reported. The company said it anticipated its full fleet to be operating by spring 2022.

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Carnival Cruise Lines will only serve bacon to guests on alternate days as it’s struggling with a shortage of the breakfast-buffet staple

The Carnival Vista cruise ship.
The Carnival Vista cruise ship.

  • Carnival Cruise Line is dealing with a bacon shortage on its ships.
  • The company will temporarily only serve bacon every other day on its ships to combat the shortage.
  • “If we serve it every day, we will have run out by the end of the week,” said its brand ambassador.
  • See more stories on Insider’s business page.

Bacon is in short supply on the menus of the world’s biggest cruise company, Carnival Cruise.

In a video posted to Facebook, Carnival’s brand ambassador John Heald said suppliers who service the cruise industry are facing challenges sourcing bacon for their ships.

Due to the shortage, Heald said the cruise line will set up a schedule for when bacon is served to passengers. “We are going to have to temporarily move to an every-other-day schedule for bacon at the Lido buffet,” he said.

He added: “If you see a sign saying ‘Today, we’re not serving bacon, don’t worry, it’s going to be back the next day.”

Bacon – and its potential lack of availability – has made further headlines recently. Earlier this month, some restaurant owners raised fears about how a change in animal-welfare rules taking force next year could make bacon difficult to find and more expensive to buy in California.

At the start of next year, California will enforce a welfare proposition, which was approved by voters in 2018. The Farm Animal Confinement Proposition, or Proposition 12, requires more space for breeding pigs, egg-laying chickens, and veal calves.

The idea is that all of those animals should have sufficient space to stretch out their wings, claws, and paws, as Insider’s Hilary Brueck reported. Welfare campaigners have been pushing for the change for years.

Courts or the state could try and intervene between now and January but if they don’t, California could lose almost all of its pork supply and pork producers will likely face higher costs to regain the market, AP reported.

Bacon costs are already rising. Insider’s Anna Cooban reported in June that it cost 13% more than last year, which is apparently due to supply shortages and rising costs of pig feed.

The cost of bacon rose 1.8% between April and May, according to BLS data, although this was a slower increase than March to April, when bacon prices jumped 3.4%.

Despite a shortage of the popular breakfast item on Carnival’s cruise lines, Heald made it clear that the company won’t be rationing bacon. “We are not going to ration you and say you can only have one piece. But if we serve it every day, we will have run out by the end of the week,” he said.

He also added that the new schedule will not be permanent. “This is not a cutback, this is a genuine problem that we, as a company, are having.”

The bacon shortage will not impact Carnival’s ability to stock other breakfast favorites, Heald said. Items such as ham and sausage will still be in good supply.

The cruise industry recently opened its doors to the public following an almost year-long halt in operations due to the pandemic.

Guests were eager to return to the sea and Carnival said that booking volumes skyrocketed as a result.

In a second-quarter business update, the company said that booking volumes for future cruises were 45% higher than during the first quarter, Insider’s Grace Dean reported. Advance bookings for 2022 were already higher than in 2019, according to the report.

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Carnival launches its first cruise from the US since its pandemic shutdown, as the industry races to catch up with soaring demand

Carnival cruise ship.
Carnival cruise ship.

  • Carnival Cruise Line’s first cruise ship left the US since the pandemic halted its operations.
  • The Carnival Vista set sail from Port Galveston, Texas, on Saturday.
  • Passengers were required to confirm they were fully vaccinated for COVID-19 prior to boarding.
  • See more stories on Insider’s business page.

Carnival Corp, the world’s biggest cruise company, on Saturday launched its first ship from a US port since the pandemic shut down its operations.

Vista set sail from Port Galveston, Texas. The week-long cruise is set to visit spots including Roatán, Mahogany Bay, and Cozumel.

Passengers were required to confirm their status as fully vaccinated for COVID-19 and provide proof of vaccination in advance of boarding, which follows strict guest protocols.

But cruise operators are well aware that being fully vaccinated doesn’t completely remove the risk of catching or spreading COVID-19. “If the virus is in the community on land … then of course you can get it on board despite all the things we do,” Carnival’s CEO Arnold Donald recently told Fox Business.

The cruise industry is one of the last sectors to try and regain its pre-pandemic activity following the huge disruption caused by the pandemic. According to Donald, its efforts are largely being welcomed by customers eager to get back on the water.

In a second-quarter business update, the company said booking volumes for future cruises were 45% higher compared with the first quarter. It added that 2022 bookings were already higher than in 2019, as previously reported by Insider’s Grace Dean.

People are itching to spend a lot of money on board, too. The CEO of Celebrity Cruises, Lisa Lutoff-Perlo, said travellers are eager to shell out extra cash on casinos, massages, and luxury meals. “They just want to enjoy themselves,” she told Time.

Celebrating Vista’s departure, Christine Duffy, president of Carnival Cruise Line, said in a video posted to Twitter: “Our crew is so very excited and so ready and prepared for this first cruise.”

She added: “The silver lining that’s kept us going is the support and loyalty of our guests.”

Carnival’s next cruise departing from a US port is the Carnival Breeze, scheduled to leave Galveston on July 15.

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