Royal Caribbean Group today reported second quarter Earnings per Share of $4.41 and Adjusted EPS of $4.38.
The company said these results were better than the company’s guidance due to strong close-in demand, lower costs driven primarily by timing, and favorability below the line driven primarily by the outperformance of TUI Cruises and lower net interest expense.
The company said it is increasing its full year 2025 Adjusted EPS guidance to $15.41 to $15.55. The increase in earnings expectations is driven mainly by the stronger than expected second quarter performance, lower than expected spend, and continued favorability below the line for the remainder of the year.
“Demand for our portfolio of brands and our industry-leading experiences continues to accelerate. Grounded in our mission to deliver the best vacations responsibly, we remain keenly focused on delivering exceptional value for our guests and shareholders – not just by executing today, but by staying ahead of where demand is going,” said Royal Caribbean Group President and CEO Jason Liberty.
“We are well on our way to achieving our Perfecta financial targets by the end of 2027. As we look beyond 2027, we see another step change in growth as we deepen our moat with a powerful pipeline of incredible new ships, the ramp-up of our highly differentiated new destinations and river cruising, and continued investments in disruptive technology, personalization and loyalty,” Liberty added.
Second Quarter 2025:
Full Year 2025 Outlook:
Second Quarter 2025 Results
Net Income for the second quarter of 2025 was $1.2 billion or $4.41 per share compared to Net Income of $0.9 billion or $3.11 per share for the same period in the prior year. Adjusted Net Income was $1.2 billion or $4.38 per share for the second quarter of 2025 compared to Adjusted Net Income of $0.9 billion or $3.21 per share for the same period in the prior year. The company also reported total revenues of $4.5 billion and Adjusted EBITDA of $1.9 billion.
Capacity for the second quarter was up 5.8% year over year and the company delivered memorable vacations to 2.3 million guests, a 10% increase year over year at high guest satisfaction scores. Gross Margin Yields increased 11.0% as-reported, and Net Yields increased 5.3% as-reported (5.2% in Constant Currency), when compared to the second quarter of 2024. Load factor for the quarter was 110%, up two percentage points versus prior year, driven by contribution of new ships that carry higher load factors. Net Yield growth in the quarter was split evenly between new and like for like hardware, and was driven by both ticket pricing and onboard spend. Net Yield growth exceeded the company’s guidance mainly due to stronger close-in demand across all key products.
Gross Cruise Costs per APCD increased 0.8% as-reported, compared to the second quarter of 2024. NCC, excluding Fuel, per APCD increased 2.5% as-reported (and increased 2.1% in Constant Currency), when compared to the second quarter of 2024. Cost growth was 180 bps better than the company’s guidance driven entirely by shifting of timing of operating expenses into the second half of the year. In addition, favorability below the line was driven mainly by better than expected income from TUI Cruises and lower net interest expense.
Update on Bookings and Onboard Revenue
Booked load factors remain in line with prior years and at higher rates for both 2025 and 2026. Bookings have accelerated since the last earnings call, particularly for close-in sailings, leading to second quarter outperformance. The company continues to experience strong demand across all key products and source markets. Commercial channels, particularly digital channels, are performing exceptionally well for both bookings and pre-cruise purchases. Guest spending onboard and pre-cruise purchases continue to exceed prior years, driven by greater participation at higher prices.
Bookings for Star of the Seas and Celebrity Xcel, both debuting this year, are performing extremely well and building on the success of their respective classes. In addition, Royal Beach Club Paradise Island recently became available for sale, and early demand has been very robust.
“The strong demand we are seeing across our new ships and land-based destinations reinforces that our strategy is working and resonating with today’s traveler,” said Jason Liberty, president and CEO, Royal Caribbean Group. “As consumer preferences continue to evolve – toward more frequent vacations, closer-in vacation planning, and a greater focus on meaningful, experience-driven travel – our experiences are designed to meet these evolving expectations. These trends, combined with our pipeline of bold, guest-centric initiatives, position us not only to create value for our shareholders, but to continue winning share of the growing $2 trillion global vacation market.”
Third Quarter 2025
Capacity in the third quarter is expected to increase 2.9% compared to third quarter 2024, driven by the introduction of Star of the Seas in mid-August. Net Yields are expected to increase 2.3% to 2.8% as-reported and 2.0% to 2.5% in Constant Currency as compared to the same period in the prior year. Net Yield growth in the third quarter is driven by an increase in both ticket and onboard spend across all key products. As expected, Net Yield growth in the third quarter is almost entirely driven by like for like hardware, and includes a 150 bps headwind due to delivery timing of Star of the Seas. Net Yield growth in the third quarter is on top of 7.9% growth in the third quarter of 2024.
NCC, excluding Fuel, per APCD, is expected to increase 6.4% to 6.9% as-reported and 6.0% to 6.5% in Constant Currency as compared to the same period in the prior year. Approximately 230 bps of cost growth is attributable to the timing of delivery of Star of the Seas, and the cost timing shift from the second quarter.
Based on current fuel pricing, interest rates, currency exchange rates and the factors detailed above, the company expects third quarter Adjusted EPS to be in the range of $5.55 to $5.65.