Royal Caribbean Cruises .(US:RCL)2025-10-28 20:54Financial Performance - Net Income attributable to Royal Caribbean Cruises Ltd. for Q3 2025 was $1.6 billion, up from $1.1 billion in Q3 2024[162]. - Adjusted Net Income for the nine months ended September 30, 2025, was $3.5 billion, compared to $2.8 billion for the same period in 2024[163]. - Total revenues increased by $253 million for Q3 2025 and by $952 million for the nine months ended September 30, 2025, primarily due to increased capacity, ticket prices, and onboard spending[164]. - Total revenues for Q3 2025 reached $5,139 million, a 5.2% increase from $4,886 million in Q3 2024[165]. - For the nine months ended September 30, 2025, total revenues were $13,676 million, a 7.5% increase from $12,724 million in the same period of 2024[166]. - Diluted earnings per share for Q3 2025 were $5.74, compared to $4.21 in Q3 2024, reflecting strong profitability growth[167]. - Total revenues for 2025 increased by $253 million to $5.1 billion from $4.9 billion in 2024, with passenger ticket revenues comprising 70.8% of total revenues[174]. - Passenger ticket revenues for 2025 increased by $166 million, or 4.8%, to $3.6 billion from $3.5 billion in 2024[174]. Operating Expenses - Total cruise operating expenses rose by $88 million for Q3 2025 and by $241 million for the nine months ended September 30, 2025, mainly due to increased capacity[164]. - Total cruise operating expenses for Q3 2025 were $2,479 million, a 3.7% increase from $2,391 million in Q3 2024[165]. - Total cruise operating expenses for 2025 increased by $88 million to $2.5 billion from $2.4 billion in 2024, primarily due to a 2.9% increase in capacity[175]. - Marketing, selling and administrative expenses for 2025 increased by $71 million, or 15.8%, to $522 million from $451 million in 2024[176]. - Interest expense for 2025 decreased by $355 million to $248 million from $603 million in 2024, primarily due to a loss on extinguishment of debt in 2024 that did not recur[177]. Cash Flow and Investments - Net cash provided by operating activities was $4.8 billion for the nine months ended September 30, 2025, compared to $3.8 billion for the same period in 2024[191]. - Net cash used in investing activities was $3.5 billion for the nine months ended September 30, 2025, compared to $2.8 billion for the same period in 2024[192]. - Net cash used in financing activities was $1.3 billion for the nine months ended September 30, 2025, compared to $1.1 billion for the same period in 2024[193]. Capital Expenditures and Financing - As of September 30, 2025, the aggregate expected cost of ships on order is $9.7 billion, with $1.0 billion already deposited[194]. - Total capital expenditures for 2025 are anticipated to be approximately $5 billion, primarily for existing ships on order and land-based destination initiatives[195]. - Material cash requirements total $14.666 billion, including $4.978 billion for interest on debt and $7.666 billion for ship purchase obligations[196]. - As of September 30, 2025, the company has $8.8 billion of committed financing for ships on order, with obligations due through September 30, 2026, primarily consisting of $3.1 billion related to debt maturities[205]. - Liquidity as of September 30, 2025, is $6.8 billion, which includes $0.4 billion in cash and cash equivalents and $6.4 billion of undrawn revolving credit facility capacity[206]. Strategic Developments - In July 2025, Royal Caribbean completed the acquisition of the Port of Costa Maya and adjacent land in Mahahual, Mexico, for $294 million[164]. - The company amended its revolving credit facilities, increasing total capacity to $6.4 billion and extending one facility's termination date to October 2030[164]. - In February 2025, TUI Cruises, a 50% joint venture, took delivery of Mein Schif Relax[164]. - In March 2025, Royal Caribbean exchanged approximately $213 million in Convertible Senior Notes for about 3 million shares of common stock and $214 million in cash[164]. - The remaining $106 million of 6.00% Convertible Senior Notes matured in August 2025, settled with $109 million in cash and approximately 1.8 million shares of common stock[164]. Future Outlook - The company is targeting a 20% compound annual growth rate in Adjusted EPS by the end of 2027 under its Perfecta Program[159]. - The company has historically relied on cash flows from operations, credit facilities, and additional debt to fund obligations[205]. - The company is in compliance with its financial covenants as of September 30, 2025, and estimates continued compliance for at least the next twelve months[209]. - Future capital commitments primarily consist of new ship orders, with a total of 35,700 approximate berths expected from the ships on order[194]. - Approximately 60.0% of the aggregate cost of ships on order is exposed to fluctuations in the Euro exchange rate as of September 30, 2025[194].