Royal Caribbean Raises Annual Profit Forecast Amid Surging Cruise Demand
The Royal Caribbean Group has announced an increase in its annual profit forecast for the second time, attributing the rise to a record demand for cruises and significant onboard spending by passengers. The upward revision reflects an adjusted profit expectation ranging from $10.70 to $11.90 per share, marking an increase from the previous forecast of $9.10 per share. This optimistic projection comes as the company surpassed first-quarter revenue estimates, leading to a roughly 5% increase in its share value.
The cruise industry, according to the Cruise Lines International Association, anticipates 35.7 million passengers to embark on cruises this year, surpassing pre-pandemic figures by 20%. In response to this demand surge, cruise operators, including Royal Caribbean, are planning to raise ticket prices and boost onboard spending opportunities.
Amid this favorable market environment, Royal Caribbean's first-quarter performance showcased strong results, with total revenues hitting $3.7 billion and net income reaching $360 million, or $1.35 per share. Adjusted net income, EBITDA, and operating cash flow were reported at $1.3 billion. The company's CEO, Jason Liberty, expressed confidence that the financial goals for 2024, known as the Trifecta, will be achieved, allowing the company to capitalize on the growing $1.9 trillion global vacation market and deliver enhanced long-term returns for shareholders.
