Royal Caribbean Q2 Profit Tops Estimates, Lifts 2023 Adj. EPS Guidance By 33%; Stock Jump Over 10%

Royal Caribbean (RCL) reported second quarter net income of $458.8 million or $1.70 per share compared to a net loss of $0.5 billion or $2.05 per share, prior year. Adjusted net income was $491.7 million or $1.82 per share compared to a loss of $0.5 billion or $2.08 per share, previous year. On average, 13 analysts polled by Thomson Reuters expected the company to report profit per share of $1.55, for the quarter. Analysts’ estimates typically exclude special items.

The company said earnings results were significantly better than its guidance due to stronger pricing on closer-in demand and further strength in onboard revenue.

Royal Caribbean Group noted that the booking volumes in the second quarter remained significantly higher than the corresponding period in 2019 and at record pricing levels. Demand for 2023 sailings has significantly exceeded expectations and bookings for 2024 sailings are up significantly versus all prior years at record price, the company said.

Second quarter total revenues increased to $3.52 billion from $2.18 billion, last year. Analysts on average had estimated $3.41 billion in revenue. Passenger ticket revenues were $2.44 billion compared to $1.42 billion.

The company said its second quarter revenue significantly exceeded its guidance due to higher pricing and higher shipboard revenue across the key itineraries, including the Caribbean and Europe. Load factor for the second quarter was 105%.

For the third quarter, the company estimates adjusted EPS in a range of $3.38 to $3.48. For fiscal 2023, the company projects adjusted EPS in a range of $6.00 to $6.20.

As of June 30, 2023, the Group’s liquidity position was $3.7 billion.

Shares of Royal Caribbean are up 10% in pre-market trade on Thursday.

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