A goal to bring more families with children onboard is prompting a shift in Norwegian Cruise Line booking patterns, a deliberate strategy that is increasing occupancy while decreasing price overall, executives of parent company Norwegian Cruise Line Holdings said during Tuesday's Q3 earnings call.
While NCL is charging more overall for the first two guests in a cabin, price adjustments for third and fourth guests who are children "naturally dilute" pricing, said CEO Harry Sommer. The company expects to see more of this pattern in early 2026 due to a 40% increase in short itineraries and the opening of the first additions to NCL's Bahamian private island Great Stirrup Cay.
That strategy led to a decrease in net yield growth expectations for the full year from 2.5% to a range of between 2.4% and 2.5%, said CFO Mark Kempa.
"The end result remains strong yield growth and strong margin expansion," Sommer said. "This is an intentional, planned trade-off to drive margins and profitability higher in both the short and long term."
While the shortest sailings are in the Caribbean, NCL is also shortening itineraries in Europe to more seven-day sailings, "which should allow for a slightly larger family market, as well," Sommer said.
All three NCLH brands -- NCL, Oceania and Regent Seven Seas -- are aiming to minimize the number of single cabins, Sommer said.
NCLH's third quarter met or exceeded expectations for occupancy and key financial benchmarks including adjusted net income and adjusted EBITDA.
Revenue was a record $2.9 billion and 5% up from last year, but analysts had anticipated higher results of $3.02 billion, according to Reuters.
Bookings were up 20% over last year across the company's three brands, indicating a stronger consumer, Sommer said.
Gross cruise costs were down in the quarter, from $314 per capacity day last year to $302 this year. An occupancy rate of 106.4% exceeded guidance of 105.5%.