Royal Caribbean Group 8-K
PositiveEarningsGuidance raised
Agrees to buy a 50% stake in Sandals and Beaches Resorts to expand its vacation platform into all-inclusive resorts.
Filed 2026-10-27 06:32 ET
- 2.02 Results of Operations
- 9.01 Financial Statements and Exhibits
Summary
Q3 2026 results and raised FY2026 Adjusted EPS guidance. Revenue grew 9% Y/Y to $5.59B as capacity increased 8% and guest count rose 9%; stronger close-in demand in Europe and the Caribbean lifted Net Yields, while expense timing lowered costs. Royal Caribbean also announced an agreement to acquire a 50% interest in Sandals and Beaches Resorts, expanding its vacation platform into all-inclusive resorts.
Key Figures
| Metric | Q3 2026 | 9M 2026 |
|---|---|---|
| Revenue | $5.59B, +9% Y/Y | $14.9B, +9% Y/Y |
| Operating income | $1.87B, +10% Y/Y | $4.34B, +9% Y/Y |
| Net income | $1.74B, +10% Y/Y | $3.82B, +8% Y/Y |
| Net income attributable to Royal Caribbean Cruises Ltd. | $1.73B, +10% Y/Y | $3.80B, +8% Y/Y |
| Adjusted net income attributable to Royal Caribbean Cruises Ltd. (non-GAAP) | $1.76B, +12% Y/Y | $3.87B, +10% Y/Y |
| Diluted EPS | $6.45, +12% Y/Y | $14.12, +10% Y/Y |
| Adjusted diluted EPS (non-GAAP) | $6.57, +14% Y/Y | $14.36, +12% Y/Y |
| Passengers carried | 2.68M, +9% Y/Y | 7.57M, +9% Y/Y |
| Load factor | 112.4%, vs 112.1% | 110.5%, vs 110.4% |
- Net Yields increased 0.9% as reported and 0.6% in constant currency; Net Cruise Costs excluding Fuel per Available Passenger Cruise Day (APCD) decreased 1.9% as reported and 1.8% in constant currency. The yield increase reflected close-in demand in Europe and the Caribbean; lower costs reflected expenses shifted into Q4.
- Sandals and Beaches’ portfolio includes 18 Caribbean resorts, three under development, and more than 1,000 acres of undeveloped land. About 30% of Royal Caribbean guests also take all-inclusive vacations, with a similar share of Sandals and Beaches guests also cruising, creating an opportunity to cross-introduce customers.
- Liquidity was $7.4B, including cash and undrawn revolving credit capacity. The company issued $1.25B of 5.550% senior unsecured notes due 2034 to repay part of its floating-rate term loans and debt maturing in 2027. YTD share repurchases were $1.04B and dividends paid were $1.08B; outstanding shares declined by approximately 2.95M from year-end 2025.
Guidance
| Metric | Period | Guidance | Prior | Direction |
|---|---|---|---|---|
| Revenue growth Y/Y | FY2026 | 9% | — | — |
| Net Yields, as reported / constant currency | FY2026 | ≈2.7% / ≈2.1% | — | — |
| Net Cruise Costs per APCD, as reported / constant currency | FY2026 | ≈1.8% / ≈1.5% increase | — | — |
| Net Cruise Costs excluding Fuel per APCD, as reported / constant currency | FY2026 | ≈0.4% increase / approximately flat | — | — |
| Adjusted EPS (non-GAAP) | FY2026 | $17.85-$17.95 | — | Raised |
| Revenue growth Y/Y | Q4 2026 | 9% | — | — |
| Net Yields, as reported / constant currency | Q4 2026 | 4.4%-4.9% / 4.2%-4.7% | — | Reaffirmed |
| Net Cruise Costs per APCD, as reported / constant currency | Q4 2026 | 1.9%-2.4% / 2.0%-2.5% increase | — | — |
| Net Cruise Costs excluding Fuel per APCD, as reported / constant currency | Q4 2026 | 1.5%-1.0% / 1.4%-0.9% decrease | — | — |
| Adjusted EPS (non-GAAP) | Q4 2026 | $3.48-$3.58 | — | — |
| Fuel expense | Q4 2026 | $379M | — | — |
| Fuel expense | FY2026 | $1.345B | — | — |
| APCDs | Q4 2026 / FY2026 | 14.7M / 56.8M | — | — |
| Capacity change Y/Y | FY2026 | 6.6% | — | — |
| Capacity change Y/Y | 2027 / 2028 / 2029 | ≈4.5% / 6.0% / 6.5% | — | — |
| Capital expenditures | FY2026 | ≈$4.6B, including $1.5B unrelated to new ships | — | — |
| Adjusted EPS CAGR target (non-GAAP) | 2024-2027 | 20% | — | — |
| ROIC target | By end of 2027 | 17% or higher | — | — |
The company expects 2026 fuel consumption of 1.763M metric tons, with 58% hedged via swaps; Q4 consumption is forecast at 463,000 metric tons, also 58% hedged. Forecast consumption hedged via swaps is 53% in 2027, 29% in 2028, and 14% in 2029; average hedge portfolio costs are approximately $471, $405, $424, and $451 per metric ton for 2026-2029, respectively.
Investor Takeaways
- Track 2027 bookings and pricing: bookings for 2027 sailings were up in the high teens, and pacing was ahead of historical levels at higher rates; continued strength would support the company’s yield outlook.
- Watch progress toward the 2027 Perfecta goals: 20% Adjusted EPS CAGR from 2024 and ROIC of at least 17%; the company says it is already above its ROIC target.
- The Sandals and Beaches investment is expected to close in early 2027, subject to customary conditions and regulatory approvals. The company expects its share of earnings to be immediately accretive; closing timing will determine the 2027 contribution and when it is incorporated into 2027 guidance.
The summary is written by an AI model reading the filing.
Model 005 · prompt v111 · 2026-10-27 14:42:26Z