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By James Rogers

Royal Caribbean beat profit expectations and raised its full-year outlook, but revenue missed the mark, as customers are still waiting until the last minute to book cruises

Cruise operator Royal Caribbean Group reported third-quarter results before market open.

Royal Caribbean Group shares fell Tuesday as the cruise operator’s revenue again came up short, despite better-than-expected quarterly profit and an improved full-year outlook.

Consumers are still spending on affordable luxuries such as cruises, Royal Caribbean (RCL) said, noting that demand is accelerating. The company also saw higher-than-expected close-in demand during the third quarter, indicating that consumers waited till the last minute to make bookings.

Last month, rival Carnival Corp.’s (CCL) third-quarter results broke several records amid strong cruise demand.

In a statement, Royal Caribbean Chief Executive Jason Liberty highlighted the company’s “strong booked position,” which he said gives it confidence about 2026 and beyond.

“Consumers continue to prioritize experiences and make room in their budgets for meaningful vacations,” Liberty said during a conference call to discuss the results. Citing Royal Caribbean’s research, the CEO added that roughly three-quarters of consumers intend to spend the same or more on vacations over the next 12 months, a level that has remained consistent for several quarters.

Third-quarter revenue rose to $5.14 billion from $4.89 billion in the prior year’s quarter, but that was just below the average analyst revenue estimate compiled by FactSet of $5.17 billion. That marked the fifth straight quarterly revenue miss.

Investors didn’t seem happy, as Royal Caribbean’s stock fell nearly 9% on Tuesday. Ahead of the results, the stock had already fallen 12.5% since it closed at a record $365.84 on Aug. 28.

Within the company’s total revenue, passenger-ticket revenue rose 4.8% to $3.64 billion. Analysts surveyed by FactSet were looking for $3.66 billion. Onboard and other revenue rose 6.1% to $1.502 billion, just above the FactSet consensus estimate of $1.498 billion.

Net yields, a measure of revenue per available cruise day, rose 2.8%, but that was below expectations for a 3.2% increase.

Net income for the quarter rose to $1.58 billion from $1.11 billion in the prior year’s comparable quarter. Adjusted earnings per share, which excludes special items, rose to $5.75 from $5.20, beating the FactSet consensus estimate of $5.69.

For 2025, Royal Caribbean raised its adjusted EPS outlook to a range of $15.58 to $15.63 from its prior guidance of a range of $15.41 to $15.55. The company maintained its full-year outlook for net yields, which are expected to increase 3.5% to 4%.

For the fourth quarter, Royal Caribbean expects adjusted earnings between $2.74 and $2.79, below the FactSet consensus estimate of $2.90. Net yields are expected to increase 2.6% to 3.1%, driven by both ticket and onboard spending. Analysts surveyed by FactSet are looking for a 3.9% increase.

The company’s results weighed on shares of rivals Carnival, which slid more than 5%, and Norwegian Cruise Line Holdings Ltd. (NCLH), which also fell about 5%.

Royal Caribbean shares have risen 26.3% in 2025, outpacing the S&P 500 index’s SPX gain of 17%.

-James Rogers

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  10-28-25 1849ET
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