Royal Caribbean Raises 2026 Earnings Forecast to $17.85–$17.95 a Share
Key Facts
Royal Caribbean raised its 2026 adjusted earnings-per-share forecast to a range of $17.85–$17.95 after third-quarter results exceeded the company’s guidance. Adjusted earnings per share came to $6.57, while earnings per share were $6.45, according to the company’s statement issued on October 27. The group said third-quarter results were better than expected and attributed the annual range revision in part to stronger-than-expected quarterly performance. Revenue was $5.591 billion, compared with $5.139 billion in the same period a year earlier, an annual increase of 9%. But higher-than-expected fuel costs and foreign exchange rates offset part of the improvement in the annual forecast.
Net income was $1.7 billion in the third quarter, or $6.45 a share, compared with $1.6 billion and $5.74 a share a year earlier. Adjusted net income rose to $1.8 billion, or $6.57 a share, from $1.6 billion and $5.75 a share in the third quarter of 2025. The comparison shows year-over-year improvement in income and earnings per share, alongside revenue growth. The company presented adjusted figures as a separate measure from reported net income and earnings per share. Both reported and adjusted results came in above management’s quarterly guidance.
Cruise capacity rose 8% year over year, and the company served 2.7 million passengers, an increase of 9%. The load factor was 112% during the quarter, according to the group’s statement. Net yields rose 0.9% on a reported basis and 0.6% excluding the impact of currency changes, compared with the same period a year earlier. The company said improved yields were driven by better-than-expected close-in demand for sailings in Europe and the Caribbean. Growth in passenger numbers and capacity provides operating context for the quarterly revenue increase.
By contrast, net cruise costs excluding fuel per available passenger cruise day fell 1.9% on a reported basis and 1.8% excluding the impact of currencies. The company attributed the decline to the timing of expenses, some of which shifted to the fourth quarter. The quarter therefore combined demand-driven yield improvement with a temporary decline in costs, while deferred expenses are expected to appear in the following period. The group said this timing was one factor behind results exceeding guidance. In its full-year earnings estimate, quarterly strength was partly offset by higher-than-expected fuel costs and foreign exchange rates.
The previous 2026 adjusted earnings-per-share range was $17.73 to $17.87, according to the company’s forecast issued on July 28. The new range raises the low and high ends to $17.85 and $17.95, respectively. Alongside earnings per share, the group expects annual revenue growth of 9% and net yield growth of about 2.7% on a reported basis or 2.1% excluding the impact of currencies. It estimates capacity will rise 6.6% in 2026 compared with 2025. The company also reported liquidity of $7.4 billion on September 30.
For the fourth quarter, the company expects adjusted earnings of $3.48 to $3.58 a share and revenue growth of 9%. Its guidance for the period includes fuel expense of $379 million, based on expected consumption of 463 thousand metric tons, with 58% of expected consumption covered by swap agreements. Capacity estimates point to increases of about 4.5% in 2027, 6.0% in 2028 and 6.5% in 2029. The group forecast capital spending of about $4.6 billion in 2026, including $1.5 billion for projects unrelated to building new ships. During the quarter, it also issued $1.25 billion of senior unsecured notes due in 2034 and used the proceeds to repay part of its variable-rate loans and debt due in 2027.
The company said bookings have accelerated since its last earnings call, with booking volumes across major channels up at a mid-teens rate, while bookings for 2027 sailings rose at a high-teens rate. Chief Executive Jason Liberty said 2027 bookings were ahead of historical levels and at higher prices. These indicators describe bookings and pricing as management sees them; they are not realized financial results. Liberty said the group remained on track to meet its “Perfecta” targets, which include compound annual growth of 20% in adjusted earnings per share between 2024 and 2027, or reaching a level of about $20 a share in 2027. The Sandals and Beaches portfolio includes 18 resorts in the Caribbean and three resorts under development, as well as more than 1,000 acres of undeveloped land in the region.