Key Takeaways
- Royal Caribbean’s earnings beat estimates on higher prices and lower expenses.
- The cruise ship operator said strong close-in demand helped drive the gains.
- Royal Caribbean raised its full-year adjusted profit forecast.
Royal Caribbean Group (RCL) reported quarterly profit exceeded forecasts and it boosted its outlook as it benefited from higher prices and lower costs.
The company reported first-quarter adjusted earnings per share (EPS) of $2.71 on revenue that increased 7% year-over-year to $4.00 billion. Analysts surveyed by Visible Alpha expected $2.57 and $4.02 billion, respectively.
Royal Caribbean said net yield growth, which measures revenue minus certain costs per available passenger cruise day (APCD), was more than anticipated “mainly due to higher pricing across key products driven by strong close-in demand.” Gross cruise costs per APCD was down 1%, which the company noted was mostly because of timing.
CEO Jason Liberty explained that as the company navigates “the complexities of the current macroeconomic landscape, we remain focused on what we can control—delivering the best vacation experiences, optimizing revenue, and managing costs, while continuing to invest in our future and drive further differentiation.”
Royal Caribbean now sees full-year adjusted EPS of $14.55 to $15.55, up from its previous guidance of $14.35 to $14.65.
After initially rising on the news, shares of Royal Caribbean Group turned lower and remain down about 8% year-to-date.
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