Royal Caribbean Group sees robust demand drive ‘exceptional’ Q3
Royal Caribbean Group (RCG) has reported an “exceptional” third quarter with robust consumer demand for holiday experiences helping the line achieve a strong forward booked position
The Royal Caribbean International, Silversea and Celebrity Cruises parent saw total revenues of $4.9 billion in the three months to 30 September 2024, net income of $1.1 billion and adjusted EBITDA, a measurement of profit, of $2.1 billion.
Last quarter the company announced plans to expand its private destinations portfolio with Perfect Day Mexico, which is expected to open in 2027, and Silversea’s new 150-room hotel in Puerto Williams, expected to open in 2025.
“We wake up every day obsessively focussed on our mission of delivering a lifetime of the very best vacation experiences to our guests,” said Jason Liberty, RCG president and CEO.
“In pursuit of that mission, we are very excited to further broaden our Perfect Day Collection with Perfect Day Mexico and to develop the southernmost hotel on Earth.
“Together with the expansion of our Icon class, we look to continue to change the game and position ourselves to win a greater share of the $1.9 trillion vacation industry.”
The group’s demand and pricing environment has “accelerated” since the last earnings call, exceeding 2023 levels, and closer-in demand for 2024 sailings exceeded expectations, contributing to higher load factors at higher prices and higher onboard revenue for the third quarter.
Consumer spending onboard, as well as pre-cruise purchases, continue to “significantly exceed” 2023 levels driven by greater participation at higher prices.
“The performance of our business continues to be robust, driven by strong demand and excellent operational execution,” said Naftali Holtz, chief financial officer, Royal Caribbean Group.
“Our strong booked position is exactly where we want to be to further optimise our yield profile and deliver on our formula of success – moderate capacity growth, moderate yield growth and strong cost discipline – positioning us to continue to deliver margin expansion and strong financial returns.”
Royal Caribbean Group reports ‘strong’ demand for 2025
The market response to the company’s new ships, existing hardware, and private destinations has been “excellent and accelerating” – further positioning RCG for yield growth in 2025.
Demand for 2025 is strong with booked load factors in line with prior years and at higher rates, allowing for further pricing and yield growth as 2025 bookings continue to ramp up.
The company expects net yields to increase from 5.1 per cent to 5.6 per cent in constant currency and 5.3 per cent to 5.8 per cent as-reported as compared to the same period in the prior year in Q4.
This expected growth in yield is driven by strong demand for Caribbean itineraries and continued strength in onboard revenue, RCG said, with net yield expectations in the fourth quarter taking into account the negative impact from Hurricane Milton.
“We anticipate earnings per share in 2025 to start with a $14 handle.”
“Our exceptional third quarter results and increased full year expectations reflect the robust demand for our differentiated vacation experiences,” added Liberty.
“We see elevated demand patterns continuing as we build the business for 2025, and although the yield comparable will be a high bar, our proven formula of moderate capacity growth, moderate yield growth and strong cost discipline is expected to continue to deliver strong financial results.
“While we are still very early in the planning process, we anticipate earnings per share in 2025 to start with a $14 handle.”
