Norwegian shares fall on earnings despite third quarter record revenue

Financial Performance - Norwegian's third quarter revenues were record revenues, but missed expectations [1] - Norwegian experienced margin expansion up 600 basis points since the end of 2023 [1] - Norwegian stock is down 14.5%, and down 25% year to date [1] Company Strategy & Outlook - Norwegian is focusing on attracting premium families as a growth strategy [1][2] - Norwegian's Q4 occupancy is up, and occupancy next year is projected to be above 2024 and 2023 levels [1] - New ships coming online will increase Norwegian's capacity by 7% in 2026 [1] - Norwegian has three cruise lines: Oiana (luxury), region (ultra luxury), and both are performing extraordinarily well [1] Industry Trends & Challenges - The cruise industry is seeing a trend of private destinations, such as Norwegian's Great Strup K [1] - Expectations for cruise lines are high, with investors wanting to see net yields as high as post-pandemic levels [1] - The travel sector is divided between value-minded and upscale travelers, with the upscale segment performing well [4] - Government shutdowns are negatively impacting the lodging sector due to the reduction in non-essential government travel [4]