What happened 

Shares of Carnival (NYSE:CCL) fell as much as 9.3% in trading Thursday after the cruise-ship operator reported third-quarter results and a lowered full-year outlook. Shares ended the day down 8.6% and are now down 22.3% in the last six months. 

So what

Fiscal third-quarter revenue jumped 12% to $6.53 billion, and earnings adjusted for one-time items were $1.8 billion, or $2.63 per share. Analysts were only expecting revenue of $6.17 billion and earnings of $2.53, so the quarter easily topped expectations

Cruise ship with a sunset in the background.

Image source: Getty Images.

What was less positive was management's 2019 earnings guidance of $4.23 to $4.27 per share, down from previous guidance of $4.25 to $4.35. Management said that higher fuel costs are putting pressure on margins, which were responsible for the drop in guidance. 

Now what

There isn't any weakness in demand, with management expecting a 4% rise in revenue for the year. The pressure on earnings comes down to rising fuel costs, which are out of the company's control. I don't think today's drop is a reason to sell the stock if you're a long-term investor, but traders eyeing short-term earnings felt differently and fled the stock quickly today. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.