News of early bookings raised eyebrows when Viking Holdings reported its financials in mid-November.
With two months left until the end of 2024, Viking says it has 70% of available cabins sold 2025. While all cruise lines book a year or more in advance, few of Viking’s size lock in so much inventory so early. Considering Viking Cruises’ ocean cruising business alone, that number jumps to 74%.
And the three major cruise lines — Carnival Corporation, Royal Caribbean Group and Norwegian Cruise Line Holdings — also Report record booking location This year, none exceeded 70%. The companies reported that nearly half of their 2025 capacity was booked as of September, about four months ahead of schedule, said Matthew Boss, head of leisure and retail at JPMorgan.
Viking goes public It’s early 2024, so last month’s third-quarter report was only the third report Viking has released on its business. Investors are still adjusting to what they say are the cruise lines’ unique business models.
“Viking is a different cruise line than what Wall Street is used to,” said Truist equity analyst Patrick Scholes. “Viking is being booked much further in advance than, say, Carnival.”
Analysts say Viking Cruises’ unusually long booking curve could lead to lower short-term profitability.
For travel advisors, that means popular cabins for prime dates may disappear as their clients become more accustomed to the traditional cruise booking curve. If these customers still want to take a Viking cruise next year, they may need to remain flexible.
Viking founder and chairman Torstein Hagen said on the earnings call that the company’s booking status “reflects how well our product resonates with our target customers.”
Analysts largely agree, but several other factors appear to be at play.
One of them is the economy. Interest rates were high at the start of the year, and many forecasters said a recession would not be a surprise. In this case, it seems prudent to keep the business on the books while demand is stagnant.
But the recession never came.
“I was worried about the economy at the beginning of the year, but bookings didn’t stop,” said Bill Walsh, the company’s president. Cruise travel sale SALEM, N.H. “We’re not really slowing down.”
Another good reason to book early is that 2024 is a presidential election year. As the election approaches and consumers are distracted by the campaign, travel sales have taken a proverbial pause.
Analysts also said that when Virgin becomes a private company, it has the freedom to manage over the long term and avoid bookings to spur quarterly profits. That remains the case, Scholes said.
“If there was any company that seemed to be most focused on the long term, you would probably choose Viking,” he said.
Then there’s the target demographic and geographic profile of Vikings. Viking Cruises is clearly targeting couples over 55, with the vast majority of its cruises sailing in Europe. This means Viking customers have the time and flexibility to book in advance, while the hassle and expense of overseas travel often encourages advance planning.
Carnival Corp., on the other hand, has a younger customer base and most of its cruises depart from U.S. ports. Major cruise lines like Carnival are also managing short-term profits more closely, Scholes said.
“Right now, companies think they have the most pricing power are unsold cabins booked two or three months out, and they are really raising prices,” he said.
The Vikings lost some, but Scholes said, “At the end of the day, being fully booked is a good thing.”
Still, Viking Chief Financial Officer Leah Talactac said the booking curve may not be as accelerated next year.
She acknowledged the impact of the election and told analysts on the call that the company was “starting to accelerate the bookings curve,” accelerating faster this year than before the pandemic. “I think you’re going to start to see a normalization of this,” she said.
This may be good news for travel advisors who are feeling limited on inventory.
Anna WakkamThe Key to World Travel independent contractor near Nashville said she was looking for Explorer suites a few weeks ago for clients looking for a big Viking Europe itinerary next spring or summer. She found only one.
“I was shocked,” she said.
Katie BatesAn independent contractor with Love Travel Connection in Charlotte, N.C., she said her clients are ready to shop for next spring after a recent event she co-sponsored with local Viking representatives.
“I had a hard time finding a cabin with a balcony because that’s what everyone wants,” she said. “Effectively all that’s left are standard rooms with small portholes.”
Lessons learned.
“When you wait until the end with the Vikings, you’re not going to get what you want,” Bates said.
