MIAMI -- Shares of cruise line operator Carnival Corp. fell Thursday after the company reported a 20% drop in quarterly profit and cut its full-year earnings forecast partly because of the Trump administration's decision to ban cruises between the U.S. and Cuba.
Carnival earned $451 million in its fiscal second quarter, which ended May 31, down from $561 million a year earlier. The results, however, were better than analysts had expected.
The Miami company said it expects to earn between $4.25 and $4.35 per share for the fiscal year that runs through next February. That is down from an earlier forecast of $4.35 to $4.55 per share.
Cruise operators were caught off guard this month when the Trump administration announced a ban on cruise travel to Cuba over the Cuban government's support for Venezuela's beleaguered president.
Carnival and other operators scrambled to reroute passengers -- some of whom showed up at docks in Florida with Cuban itineraries, but were unsure where they were going that day. Other customers said they would cancel bookings and ask for refunds.
While other Caribbean destinations have been popular, the cruise lines were able to charge higher prices for trips to Cuba.
Carnival CEO Arnold Donald told analysts that Cuba cruises are "not in the plans for next year, and therefore that higher-yielding itinerary is off the table."
Carnival said the Cuba ban will cut its earnings by between 4 and 6 cents per share, while rerouting passengers booked on its Carnival Vista ship, now undergoing repairs, will cost 8 to 10 cents per share.
On top of that, bookings in Europe are being hurt by slowing economic growth. And Carnival is paying more for fuel.
Carnival's second-quarter profit was down $110 million from a year earlier. Still, the company said that excluding unusual items it earned 66 cents per share, beating the forecast of 61 cents per share among analysts surveyed by FactSet.
Revenue rose 11% to $4.84 billion, topping the analysts' estimate of $4.54 billion. But spending also increased, led by a jump of more than 13% for fuel.
Carnival shares fell $4.04, or 7.7%, to close at $48.80. They were down nearly 13% earlier in the session before making a partial recovery.