Royal Caribbean Cruises Ltd.
RCL · NYSE
Next quarter
Reports Oct 27, 2026.
Consensus is $6.35 EPS for Sep 2026 across 8 estimates, ranging $6.29 to $6.43.
RCL Jun 2026
- 6.05%
- +0.33%
- $3.97
- $4.21
- —
- $4.83B
Reported results
- $4.83B
- 47.29%
- $1.31B
- 27.05%
- $1.13B
- $4.20
Highlights
- Earnings beat: Adjusted EPS was $4.21 versus consensus of $3.97, a 6.05% surprise; GAAP diluted EPS was $4.20.
- Revenue growth: Second-quarter revenue rose 6.5% year over year to $4.83 billion, up from $4.45 billion in the first quarter.
- Demand held up: Capacity increased 5% and guests carried rose 6% to 2.4 million, while load factor remained high at 110.2%.
- Yield momentum: Net yields increased 1.9% as reported and 1.2% in constant currency, ahead of guidance on stronger close-in demand.
- Profit comparison: Net income attributable to RCL was $1.13 billion versus $1.21 billion a year ago, but increased 20% from $941 million in Q1.
- Cost pressure: Net cruise costs excluding fuel per APCD rose 4.4% as reported and 3.9% in constant currency, although second-quarter performance benefited from favorable expense timing.
- Guidance raised: Full-year adjusted EPS guidance increased to $17.73-$17.87, implying 14% year-over-year growth; revenue is expected to grow 9%.
- Bookings remain strong: The company is booked at record prices with booking volumes above last year, though geopolitical activity has modestly affected select near-term itineraries.
- Capital returns and liquidity: RCL returned more than $600 million to shareholders in the quarter, including $199 million of repurchases and $404 million of dividends, while liquidity stood at $6.9 billion.
Analysis
Royal Caribbean’s second quarter was an earnings beat and guidance-raise quarter, powered by close-in demand and better-than-expected costs. Adjusted EPS of $4.21 exceeded the $3.97 consensus, while revenue increased 6.5% year over year to $4.83 billion. GAAP net income attributable to RCL fell to $1.13 billion from $1.21 billion a year ago, and diluted EPS declined to $4.20 from $4.41, reflecting higher operating costs, fuel expense, depreciation and interest. Sequentially, however, revenue rose from $4.45 billion in Q1 and net income increased from $941 million; diluted EPS rose from $3.48.
The operating print combined capacity growth with resilient pricing and guest spending. Capacity was up 5%, guests carried rose 6% to 2.4 million and occupancy was 110.2%. Net yields increased 1.9% as reported, while onboard and other revenue grew 11% to $1.49 billion. Cost growth remained a constraint: net cruise costs excluding fuel per APCD rose 4.4% as reported, although management cited favorable expense timing for the quarter’s upside. RCL raised full-year adjusted EPS guidance to $17.73-$17.87 and expects revenue growth of 9%, while acknowledging a modest geopolitical booking impact on selected itineraries.
Demand and yields
The quarter showed continued pricing power despite higher capacity. Strong close-in demand lifted net yield growth above the company’s prior expectations, and guest spending remained a material contributor to revenue growth.
- Capacity and guests: Available passenger cruise days increased 4.9% to 13.6 million, while passengers carried rose 6.4% to 2.40 million.
- Occupancy: Load factor was 110.2%, broadly stable from 110.3% a year ago and ahead of the 109.4% first-half average.
- Revenue mix: Passenger ticket revenue rose 4.5% to $3.34 billion; onboard and other revenue increased 11% to $1.49 billion, including an $83 million benefit from higher onboard spending per passenger.
- Bookings: Booking volumes were above last year and the company remained booked at record prices, although prolonged geopolitical activity created a modest near-term impact on select itineraries. Management said early 2027 booking trends were ahead of historical levels.
Costs and profitability
Revenue growth did not fully translate into year-over-year profit growth because expenses rose faster than revenue. The quarter nevertheless exceeded expectations, with lower-than-anticipated costs and favorable joint-venture performance supporting adjusted earnings.
- Operating costs: Total cruise operating expenses increased 11.6% to $2.55 billion, driven by $111 million from capacity growth, $76 million of additional crew payroll and $76 million of higher fuel expense.
- Unit costs: Net cruise costs excluding fuel per APCD increased 4.4% as reported and 3.9% in constant currency, versus 4.5% growth in gross cruise costs per APCD.
- Margins: Adjusted EBITDA was $1.83 billion, with margin declining to 37.9% from 40.8% a year ago; adjusted EBITDA per APCD fell to $134.84 from $143.00.
- Below the line: Interest expense increased to $236 million from $228 million, while equity investment income fell to $67 million from $107 million, partly offsetting operating performance.
Raised 2026 outlook
Management raised its full-year earnings outlook after the second-quarter beat and a better view of the remaining year. The outlook still incorporates some geopolitical conservatism, but points to continued double-digit earnings growth.
- Full-year guidance: Adjusted EPS is now $17.73-$17.87, representing 14% year-over-year growth and above the prior outlook.
- Revenue and yields: Revenue is expected to grow 9%, with net yields up 2.35%-2.85% as reported and 1.75%-2.25% in constant currency.
- Cost discipline: Net cruise costs excluding fuel per APCD are expected to increase approximately 0.4% as reported and be approximately flat in constant currency.
- Next quarter: Third-quarter revenue is expected to grow 8% with approximately flat net yields, while adjusted EPS guidance is $6.26-$6.36 and net cruise costs excluding fuel per APCD are expected to decline 1.7%-1.2% as reported.
Fleet investment and liquidity
RCL is continuing to fund an aggressive ship and destination pipeline while returning capital to shareholders. Legend of the Seas was delivered in the quarter, adding capacity but also increasing debt and depreciation.
- Investment: Full-year 2026 capital expenditures are expected to be approximately $4.7 billion, primarily for new ships and land-based destinations.
- Pipeline: Ships on order represented approximately $16.5 billion of cost at June 30, 2026, with $1.3 billion deposited; planned capacity growth is 4% in 2027, 6% in 2028 and 7% in 2029.
- Funding: Total debt was $23.4 billion at quarter-end, including $1.9 billion borrowed to finance Legend of the Seas; scheduled debt maturities are $0.9 billion in the remainder of 2026 and $2.7 billion in 2027.
- Shareholder returns: The company repurchased $199 million of stock and paid $404 million of dividends in the quarter, with $805 million remaining under its repurchase authorization.
- Liquidity: Liquidity was $6.9 billion, including $875 million of cash and $6.0 billion of undrawn revolving capacity; the facility was expanded by another $250 million in July.
