Hagen sees no consumer slowdown, and Viking's 'ahead of the curve'

'We haven't seen anything that gives us pause for concern for 2025,' Chairman/CEO Torstein Hagen said Thursday. The week ending July 31 was the company's highest grossing ever and included its single best sales day in history. Bookings into August have remained strong.

'We haven't seen any sign of weakness. It may come, but we haven't seen it,' Hagen told analysts during Viking's second quarter earnings call.

Shares off 5%

Despite a good quarter and outlook, VIK shares were trading down 5% Thursday morning, at around $34.63. After debuting at $26.15 on May 1, the stock has traded as high as $37.25.

Boomer clout

Opening the earnings call, Hagen reiterated the clout of Viking's age 55-plus target market and spending power, with baby boomers currently accounting for 73% of US wealth, a figure that's been rising.

The company has a database of more than 55m households and the emails for 5m.

Spending $8K for a vacation

During Q2, Viking carried 200,000 passengers who spent an average of almost $8,000 for their vacation.

The company's sold 95% of its 2024 inventory and is 55% booked for 2025, at higher pricing. So it has good visiblity. Hagen indicated it may be that the booking curve for the river business in both years is a little ahead of where it needed to be, and 'It might be reasonsable to slow down a bit in future.'

US election year

He elaborated that in US election years, Viking typically tries to get a little ahead of the sales curve. (Consumers sometimes hold back spending in general in election years due to uncertainty.)

'We may have gotten further ahead than we needed to be,' Hagen said.

Marketing, not pricing action

To temper demand, Viking would pull back on marketing.

As a direct marketing powerhouse, 'We generate demand ourselves,' Hagen said. 'Marketing is not an expense as such. It's a revenue generator. So we would market less.'

And to fill the remaining 45% of 2025 inventory, is discounting expected? an analyst asked.

'We're in a good spot ... There's no need for any negative pricing action,' the Viking chief said. 

'We are able to generate demand through marketing,' CFO Leah Talactac added. 'We have a number of levers to use, and pricing would not be our first lever.'