The ultimate family vacation has completed construction and is one step closer to its August debut in Port Canaveral (Orlando), FloridaMIAMI, July 10, 2025 /PRNewswire/ -- Royal Caribbean kicked off the countdown to a new era of family vacations, officially welcoming Star of the Seas* into the family. After nearly two years of construction at the Meyer Turku shipyard in Turku, Finland, the keys to the next revolutionary Icon Class ship were officially handed over to Royal Caribbean just a few weeks ahead of ...

Core Insights - Carnival Corporation & plc (CCL) has reported a significant rebound in profitability, achieving its highest second-quarter EBITDA margins in nearly 20 years, with adjusted EBITDA reaching $1.51 billion, an increase from $1.2 billion in the same quarter last year [1][9] - The company attributes its margin improvement to strong pricing and operational leverage, with yields increasing by nearly 6.5% year over year, surpassing guidance by 200 basis points [2][9] - Carnival has exceeded two of its three 2026 SEA Change targets ahead of schedule, with EBITDA per available lower berth day rising 52% from 2023 levels and return on invested capital increasing by 12.5% [3] Financial Performance - The net debt-to-EBITDA ratio improved from 4.1 to 3.7 in the fiscal second quarter, alongside a decline in interest expenses, indicating a positive trend in bottom-line metrics [4] - Carnival has raised its full-year 2025 adjusted EBITDA outlook to approximately $6.9 billion, reflecting a 10% increase from 2024 levels and exceeding previous guidance of $6.7 billion [5][9] Competitive Landscape - Royal Caribbean Cruises Ltd. (RCL) reported EBITDA margins of 35% in the first quarter, a 360 basis point improvement year over year, driven by strong bookings and favorable pricing [6] - Norwegian Cruise Line Holdings Ltd. (NCLH) posted adjusted EBITDA of $453 million in the first quarter of 2025, with a trailing 12-month EBITDA margin of 35.5%, up 280 basis points from the prior year, supported by a company-wide efficiency program [7] Market Performance - CCL shares have increased by 40.5% over the past three months, outperforming the industry growth of 16.8% [8] - CCL trades at a forward price-to-earnings ratio of 13.29X, significantly below the industry average of 18.98X [10] Earnings Estimates - The Zacks Consensus Estimate for CCL's fiscal 2025 and 2026 earnings indicates a year-over-year increase of 38% and 13.4%, respectively, with EPS estimates having risen in the past 30 days [11]

Core Insights - Carnival Corporation & plc (CCL) is shifting towards high-impact marketing strategies to enhance bookings due to limited capacity growth, with no new ship deliveries in 2026 and only three scheduled over the next four years [1][8] Marketing Strategies - In Q1 fiscal 2025, Carnival executed extensive marketing campaigns during Wave season, leveraging cultural events like the Oscars and Super Bowl, featuring brand ambassadors and generating over 5 billion media impressions [2] - Costa Cruises and AIDA Cruises also engaged in promotional activities, with Costa enhancing its visibility through a live performance during the Sanremo Music Festival and AIDA revamping onboard experiences [2] Financial Performance - Carnival reported historically high pricing across all core programs, with over 80% of 2025 capacity booked by the end of Q1 fiscal 2025, and record booking volumes for 2026 [3][8] - The strong marketing execution contributed to a 7.3% year-over-year increase in net yields during the fiscal first quarter [3][8] Competitive Landscape - Royal Caribbean Group (RCL) is focusing on customer loyalty through app adoption and personalization, achieving record demand for new ships and the best Wave season in company history [5] - Norwegian Cruise Line Holdings Ltd. (NCLH) is adopting a targeted approach with experiential upgrades and significant enhancements to its offerings, aiming for brand differentiation and premium pricing [6] Stock Performance and Valuation - CCL shares have increased by 26.7% over the past three months, outperforming the industry growth of 12.7% [7] - CCL trades at a forward price-to-earnings ratio of 12.24X, below the industry average of 18.57X [10] Earnings Estimates - The Zacks Consensus Estimate for CCL's fiscal 2025 and 2026 earnings indicates a year-over-year increase of 30.3% and 12.8%, respectively [11] - Current EPS estimates for fiscal 2025 are 1.85, with a year-over-year growth estimate of 30.28% [12]

Core Insights - Royal Caribbean Cruises Ltd. (RCL) shares have increased by 17.8% in the past month, outperforming the Zacks Leisure and Recreation Services industry's 10.1% rise and the S&P 500's growth of 6.3% [1][2] Group 1: Growth Drivers - Strong demand for cruise vacations is evident, with record-breaking bookings during the 2025 WAVE season, indicating consumer willingness to spend on leisure travel [7] - Fleet expansion is a significant catalyst, with new ships like Icon of the Seas and Utopia enhancing guest satisfaction and premium pricing [9] - Operational efficiency has improved margins, with a reported 35% EBITDA margin in Q1 2025, reflecting a 360-basis-point improvement year over year [10] Group 2: Financial Performance - Earnings per share (EPS) estimates for 2025 have been revised upward from $14.95 to $15.36 over the past 60 days, indicating strengthened analyst confidence [12] - RCL's forward 12-month price-to-earnings (P/E) multiple is 16.33X, below the industry average of 18.16X, suggesting an attractive investment opportunity [20] Group 3: Strategic Initiatives - Investments in digital innovation and exclusive private destinations are enhancing competitive advantages, with initiatives like the Royal Beach Club aimed at offering differentiated experiences [11] - Enhanced loyalty programs and app-based engagement are increasing guest retention and pre-cruise spending [11] Group 4: Challenges - Despite strong demand, RCL faces macroeconomic uncertainties and rising costs, which could impact consumer spending behavior [17] - Transitional pressures from fleet expansion and new ship rollouts may temporarily affect yield performance [19]

Key Takeaways CCL's onboard revenue strategy is gaining traction on strong close-in demand. Upgrades like chef partnerships and tech enhancements are boosting guest engagement and spend. CCL aims to sustain momentum with high bookings through fiscal 2025.Carnival Corporation & plc (CCL) is seeing an encouraging lift in onboard revenues, highlighting a strategic shift, which is adding muscle to its bottom line. In the first quarter of fiscal 2025, onboard revenues grew approximately 10% year over year and ...

Financial Data and Key Metrics Changes - The company reported adjusted earnings per share of $2.71 for the first quarter, which was $0.23 higher than guidance, driven by better revenue and favorable timing of expenses [10][21] - Yields grew by 5.6% in constant currency compared to the first quarter of 2024, exceeding initial guidance by 60 basis points [21] - Adjusted EBITDA margin was 35%, which is 360 basis points better than the previous year [22] Business Line Data and Key Metrics Changes - Bookings in the first quarter outpaced last year across all products, resulting in the best wave season in the company's history [10][11] - Onboard spending and pre-cruise purchases exceeded prior years, driven by increased participation in onboard activities and experiences at higher prices [11][12] - The Caribbean accounted for 57% of deployment this year and 49% of capacity in the second quarter [22] Market Data and Key Metrics Changes - The company expects capacity to grow by 5.5% in 2025, supported by the introduction of new ships [15] - Europe is projected to account for 15% of capacity for the year, while Alaska is expected to account for 6% [24] - The company reported that 7 out of 10 consumers intend to spend the same or more on leisure travel over the next twelve months [12] Company Strategy and Development Direction - The company is focused on delivering exceptional vacation experiences, optimizing revenue, managing costs, and executing long-term strategies [7][8] - The introduction of seven new ships over the next three years is expected to enhance customer experiences and drive growth [18] - The company aims for a 20% compound annual growth rate in adjusted earnings per share through 2027 [16] Management's Comments on Operating Environment and Future Outlook - Management acknowledged heightened uncertainty in the macro landscape but emphasized strong consumer demand for cruising experiences [6][7] - The company remains confident in its growth strategy and the opportunity to capture a larger share of the $2 trillion vacation market [7][15] - Recent booking trends and disciplined cost management position the company well for strong earnings growth despite macroeconomic uncertainties [15][28] Other Important Information - The company ended the quarter with $4.5 billion in liquidity and received an investment-grade credit rating upgrade from S&P Global Ratings [30][31] - The company repurchased 1 million shares under its $1 billion share repurchase program [31] Q&A Session Summary Question: Drivers of better than planned performance in Q1 - Management noted strong close-in demand and the ability to raise pricing during this period, alongside high-quality customers spending well on the ship [38][39] Question: Areas of guidance expansion due to macro backdrop - Management expanded guidance ranges to account for broader external factors while maintaining confidence in long-term growth strategies [46][48] Question: Pricing strategy for new ships and potential headwinds - New ships entering service later in the year may create a headwind due to lower average passenger cruise days initially [54][56] Question: Onboard spending and consumer behavior - Management indicated that consumer spending remains strong, with no significant trade-down behavior observed among loyalty program members [78][79] Question: Capital allocation and share repurchase strategy - The company is focused on maintaining a strong balance sheet while also returning capital to shareholders through dividends and share repurchases [92][94]

Core Viewpoint - Royal Caribbean Cruises Ltd. (RCL) reported mixed first-quarter 2025 results, with adjusted earnings exceeding expectations while revenues fell short, although both metrics showed year-over-year growth [1][3]. Financial Performance - Adjusted earnings per share (EPS) for Q1 2025 were $2.71, surpassing the Zacks Consensus Estimate of $2.53 by 7.1%, compared to $1.77 in the prior-year quarter [3]. - Quarterly revenues reached $4 billion, missing the consensus mark by 0.2%, but up 7.3% from $3.72 billion year-over-year [3]. - Passenger ticket revenues increased to $2.74 billion from $2.54 billion in the prior-year quarter, aligning with estimates [4]. - Onboard and other revenues rose to $1.26 billion from $1.19 billion year-over-year, exceeding estimates [4]. - Total cruise operating expenses were $2.08 billion, up 1.1% year-over-year, below estimates [4]. Cost and Yield Metrics - Net yields increased by 5.6% on a constant currency basis and 4.7% on a reported basis compared to Q1 2024 [5]. - Net cruise costs, excluding fuel, per Available Passenger Cruise Day (APCD) decreased by 0.1% on a constant currency basis and 0.3% on a reported basis year-over-year [5]. Balance Sheet and Cash Flow - As of March 31, 2025, cash and cash equivalents were $386 million, slightly down from $388 million at the end of 2024 [6]. - Long-term debt decreased to $17.99 billion from $18.47 billion at the end of 2024, with the current portion of long-term debt also declining [6]. Booking Trends - The company experienced strong booking trends during the WAVE season, with April bookings surpassing the same period last year [7]. - Customer deposits as of March 31, 2025, were $6.33 billion, up from $5.5 billion in the prior-year period [8]. Management Outlook - Management expressed optimism regarding ongoing consumer enthusiasm for new offerings, which is expected to drive yield growth throughout 2025 [9]. - For Q2 2025, the company anticipates adjusted EPS between $4 and $4.10, with net yields projected to increase by 4.4-4.9% on a reported basis [10][11]. - For the full year 2025, adjusted EPS is expected to be between $14.55 and $15.55, an increase from previous expectations [12].

Financial Data and Key Metrics Changes - The company reported adjusted earnings per share of $2.71 for the first quarter, which was $0.23 higher than guidance, driven by better revenue and favorable timing of expenses [10][21] - Yields grew by 5.6% in constant currency compared to the first quarter of 2024, exceeding initial guidance by 60 basis points [21] - Adjusted EBITDA margin was 35%, which is 360 basis points better than the previous year [22] Business Line Data and Key Metrics Changes - Bookings for 2025 are outpacing last year, with the best wave season in the company's history [10][11] - Onboard spending and pre-cruise purchases have exceeded prior years, driven by increased participation in onboard activities [11][12] - The Caribbean represents 57% of the company's deployment for the year, with 49% of capacity in the second quarter [22][23] Market Data and Key Metrics Changes - The company is seeing strong demand across all commercial channels, particularly in direct-to-consumer channels [11] - Europe is expected to account for 15% of capacity for the year, while Alaska will account for 6% [23] - Consumer sentiment around leisure vacations remains positive, with 70% of surveyed consumers intending to spend the same or more on leisure travel over the next twelve months [12][13] Company Strategy and Development Direction - The company aims for a 20% compound annual growth rate in adjusted earnings per share through 2027, focusing on moderate capacity and yield growth along with strong cost control [16][24] - Investments are being made in new ships and exclusive destinations to enhance guest experiences and drive loyalty [18][19] - The company is focused on maintaining price integrity while optimizing revenue through a global yield management platform [64] Management's Comments on Operating Environment and Future Outlook - Management acknowledges heightened macroeconomic uncertainty but remains confident in the company's ability to deliver strong financial performance [6][7] - The company is well-positioned to capitalize on the growing $2 trillion vacation market, with a strong balance sheet and cash flow generation [7][15] - Recent booking trends and disciplined cost management are expected to support another year of strong earnings growth [15][28] Other Important Information - The company ended the quarter with $4.5 billion in liquidity and received an investment-grade credit rating upgrade from S&P Global Ratings [30][31] - Share repurchase programs are ongoing, with $1 billion authorized for repurchases, and the company has repurchased 1 million shares [31][32] Q&A Session Summary Question: Drivers of better than planned performance in Q1 - Management noted strong close-in demand and the ability to raise pricing during this period, alongside high-quality customer spending [38][39] Question: Areas of guidance expansion due to macro backdrop - Management expanded guidance ranges to account for broader external factors while maintaining confidence in long-term growth strategies [46][48] Question: Pricing strategy for new ships and potential headwinds - New ships entering service later in the year may create a temporary headwind due to lower average passenger cruise days [54][56] Question: Onboard spending and close-in pricing outlook - Management remains optimistic about consumer spending and has not seen significant changes in cancellation rates or customer behavior [60][62] Question: Capital allocation and share repurchase strategy - The company is focused on maintaining a strong balance sheet while also returning capital to shareholders through dividends and share repurchases [92][94]

Royal Caribbean Cruises (RCL) Q4 2024 Earnings Call January 28, 2025 10:00 AM ET Company Participants Blake Vanier - Vice President, Investor RelationsJason Liberty - Chief Executive OfficerNaftali Holtz - Chief Financial OfficerSteven Wieczynski - Managing DirectorRobin Farley - Managing DirectorMichael Bayley - President and CEO of Royal Caribbean International Conference Call Participants Brandt Montour - AnalystJames Hardiman - Director - Leisure and Travel AnalystMatthew Boss - AnalystConor Cunningham ...