Could the enhanced experience lead to higher onboard spend per passenger and how will that be measured?
Answer
The upgraded “Spellbound by Magic Castle” speakeasy on the new Star Princess is designed to boost ancillary revenue – the same driver that has powered most of Carnival & Co.’s recent share‑price gains. By turning a niche entertainment offering into a premium, ticketed venue (e.g., cover‑charge, themed cocktails, exclusive merchandise and magic‑show packages), the cruise line can lift per‑passenger onboard spend (PPP) well above the historic $150‑$180 average for its mid‑tier ships. In practice, the metric will be captured through the “per‑capita spend” line in quarterly earnings, which breaks out food‑and‑beverage, beverage, and other onboard‑services revenue divided by the total number of passengers carried. Analysts will also watch “ancillary revenue per passenger” (a sub‑component of total onboard spend) and the “RevPAR” (revenue per available berth) figures that the company now reports in its Investor Relations releases.
From a trading perspective, the market will price in this upside if the company can sustain a double‑digit YoY growth in per‑capita spend on the Star Princess versus the fleet average. The first data point will appear in the Q3 2025 earnings call (when the ship’s inaugural sail‑through is reported). If the disclosed per‑capita spend beats the consensus (e.g., > $210 vs. the $190 consensus), the stock – CCL – could see a 2–3 % rally on the back of upgraded earnings guidance and a higher EBITDA margin outlook. Conversely, a miss would pressure the stock, especially given the broader cruise‑industry recovery and the premium‑segment premium‑pricing narrative.
Actionable insight: Keep a short‑position in CCL tight until the Q3 2025 results. If the per‑capita spend metric comes in ≥ $210 (≈ 10 % above the current fleet average) and management raises FY 2025 ancillary‑revenue guidance, consider a long entry on any pull‑back, targeting a 5–7 % upside. If the metric falls short of the $200 threshold, stay on the sidelines or trim exposure, as the incremental spend upside may be limited. Monitoring the per‑passenger spend trend in subsequent quarters will be key to confirming whether the “Spellbound” concept translates into a durable revenue premium for Carnival & Co.