Royal Caribbean Group reported second quarter Earnings per Share of $4.41 and Adjusted EPS of $4.38. 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 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:
- Load factor in the second quarter was 110%.
- Gross Margin Yields were up 11.0% as-reported. Net Yields were up 5.3% as-reported and 5.2% in Constant Currency.
- Gross Cruise Costs per Available Passenger Cruise Days (“APCD”) increased 0.8% as-reported. Net Cruise Costs (“NCC”), excluding Fuel, per APCD increased 2.5% as-reported and 2.1% in Constant Currency.
- Total revenues were $4.5 billion, Net Income was $1.2 billion or $4.41 per share, Adjusted Net Income was $1.2 billion or $4.38 per share, and Adjusted EBITDA was $1.9 billion.
Full Year 2025 Outlook:
- Net Yields are expected to increase 3.5% to 4.0% as-reported and in Constant Currency.
- NCC, excluding Fuel, per APCD is expected to increase approximately 0.5% as-reported and 0.3% in Constant Currency.
- Adjusted EPS is expected to grow approximately 31% year over year and be in the range of $15.41 to $15.55.
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.
Fuel Expense
Bunker pricing, net of hedging, for the second quarter was $663 per metric ton and consumption was 422,000 metric tons.
The company does not forecast fuel prices and its fuel cost calculations are based on current at-the-pump prices, net of hedging impacts. Based on current fuel prices, the company has included $298 million of fuel expense in its third quarter guidance at a forecasted consumption of 433,000 metric tons, which is 64% hedged via swaps. Forecasted consumption is 66%, 60%, 47%, and 16% hedged via swaps for 2025, 2026, 2027, and 2028, respectively. The annual average cost per metric ton of the hedge portfolio is approximately $482, $474, $393, and $426 for 2025, 2026, 2027, and 2028, respectively.
The company provided the following guidance for the third quarter and full year 2025:
| FUEL STATISTICS | Third Quarter 2025 | Full Year 2025 |
| Fuel Consumption (metric tons) | 433,000 | 1,718,000 |
| Fuel Expenses | $298 million | $1,143 million |
| Percent Hedged (fwd. consumption) | 64 % | 66 % |
| GUIDANCE | As-Reported | Constant Currency |
| Third Quarter 2025 | ||
| Net Yields vs. 2024 | 2.3% to 2.8% | 2.0% to 2.5% |
| Net Cruise Costs per APCD vs. 2024 | 5.4% to 5.9% | 5.0% to 5.5% |
| Net Cruise Costs per APCD ex. Fuel vs. 2024 | 6.4% to 6.9% | 6.0% to 6.5% |
| Full Year 2025 | ||
| Net Yields vs. 2024 | 3.5% to 4.0% | 3.5% to 4.0% |
| Net Cruise Costs per APCD vs. 2024 | Approximately (0.6%) | Approximately (0.8%) |
| Net Cruise Costs per APCD ex. Fuel vs. 2024 | Approximately 0.5% | Approximately 0.3% |
| Third Quarter 2025 | Full Year 2025 | |
| APCDs | 13.7 million | 53.3 million |
| Capacity change vs. 2024 | 2.9 % | 5.5 % |
| Depreciation and amortization | $425 to $435 million | $1,700 to $1,710 million |
| Net Interest, excluding loss on extinguishment of debt | $235 to $245 million | $930 to $940 million |
| Adjusted EPS | $5.55 to $5.65 | $15.41 to $15.55 |
| SENSITIVITY | Third Quarter 2025 | Full Year 2025 |
| 1% Change in Net Yields | $40 million | $141 million |
| 1% Change in NCC excluding Fuel | $16 million | $68 million |
| Third Quarter 2025 | Remainder of Year 2025 | |
| 1% Change in Currency | $7 million | $12 million |
| 10% Change in Fuel prices | $15 million | $27 million |
| 100 basis pt. Change in SOFR | $2 million | $7 million |
| Exchange rates used in guidance calculations | ||
| GBP | $1.34 | |
| AUD | $0.65 | |
| CAD | $0.73 | |
| EUR | $1.16 | |
Liquidity and Financing Arrangements
As of June 30, 2025, the company’s liquidity position was $7.1 billion, which includes cash and cash equivalents and undrawn revolving credit facility capacity.
During the first half of this year, the company received investment grade ratings by all three major credit rating agencies, reflecting the strength of its financial position, consistent performance, and disciplined capital allocation strategy.
In addition, the company amended and upsized its two unsecured revolving credit facilities during the quarter, bringing the combined revolving credit facilities commitments to $6.4 billion, and extending the maturity of one facility to October 2030.
The company noted that as of June 30, 2025, the scheduled debt maturities for the remainder of 2025, 2026, 2027, and 2028 were $0.8 billion, $2.9 billion, $2.6 billion and $3.1 billion, respectively.
Capital Expenditures and Capacity Guidance
Capital expenditures for the full year 2025 are expected to be approximately $5 billion, based on current foreign exchange rates, and are predominantly related to the new ship order book and land-based destination initiatives. Non-new ship related capital expenditures are expected to be $1.6 billion.
Capacity changes for 2025 are expected to be 5.5% compared to 2024. Capacity changes for 2026, 2027, and 2028 are expected to be 6%, 5%, and 6%, respectively. These figures do not include potential ship sales or additions that the company may elect in the future.