Royal Caribbean’s second quarter 2024 earnings have just been announced.
It can be said that the company is having a very good time, probably due to the huge investments that have brought new modern ships into the fleet.
According to the data, bookings are very much on the rise compared to the same period in 2023.
More and more passengers therefore want to travel with Royal Caribbean, but what are the reasons for these positive results?
The New Ships and Investment
Certainly, the company’s strength lies in the new launches that have been made in recent years.
In January, Icon of the Seas, the world’s largest cruise ship, was launched.
Its inauguration had an international resonance. Every major media outlet in the world reported the news, and the ceremony was held in grand style in Miami with Lionel Messi christening the ship.
The ship was also well received by passengers and immediately occupied an excellent position on the list of the Royal Caribbean ships from best to worst.
In addition, in mid-July 2024, the Utopia of the Seas, a ship with a capacity of over 6,700 passengers, began its service following several months of strong bookings.
This last ship will do 3- and 4-night continuous cruises between Port Canaveral and the Bahamas. So, it aims at a specific audience: those who prefer short cruises.
Jason Liberty, president and CEO of Royal Caribbean Group said:
Exceptional demand for our vacation experiences has accelerated our performance by generating significant yield growth over the past several years.
The results
Now let’s look at the data, which, as mentioned at the beginning of the article, are quite positive.
The company reported a total revenue of $4.1 billion for Q2 with a net income of $854 million. This has increased by $459 million if we compare it with the previous year.
The net income per share went from $1.70 to $3.11, a substantial increase that led Royal Caribbean to raise its financial outlook for the whole year.
Our momentum continues! We met our financial targets 18 months earlier than expected, have our balance sheet in a strong position, reinstated our dividend, and … we are just getting started,” said Jason Liberty.
What Should We Expect For The Future?
Analysts also seem to be positive about the company’s future.
Citigroup lifted their price target on Royal Caribbean from $165.00 to $204.00 and gave the stock a “buy” rating.
JPMorgan Chase & Co. also increased their price objective on Royal Caribbean from $175.00 to $210.00 and gave the company an “overweight” rating. According to the report, fourteen analysts have assigned a buy rating to the stock while only three have rated the stock with a hold.
In addition, for the future, other ships are already under construction.
At the moment, two more ships have been confirmed to enter service in Q2 2025 and Spring 2026.
Royal Caribbean is also working on two different Royal Beach Clubs.
The first one will open in the Bahamas in 2025 and will be a 17-acre exclusive beachside experience.
The second one will open in Cozumel and will be a mix of experiences, attractions, beaches, pools, bars, and restaurants.
Royal Caribbean will spend more than $240 million on both these projects, hoping for a great return for shareholders.
Not sure which cruise line to choose? Take a look at the 10 biggest differences between Royal Caribbean and Carnival.
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