Royal Caribbean Raises Annual Profit Forecast on Record Bookings and Ticket Prices

Royal Caribbean Group raised its annual profit forecast for the second time due to record first-quarter bookings and higher ticket prices, leading to a 4% increase in premarket trading. The cruise industry has seen a surge in demand for sea-based vacations, allowing operators to raise ticket prices and close the price gap with land-based vacations to boost profits. Royal Caribbean exceeded expectations in quarterly profit and revenue, with half of the revenue growth attributed to higher ticket prices.

CEO Jason Liberty highlighted the success of their fleet and the market response to the launch of Icon of the Seas. The company now expects adjusted full-year earnings between $10.70 and $10.90 per share, up from the previous forecast. Higher ticket prices helped offset higher net cruise costs anticipated for the year, with a 5.5% increase expected. Despite some challenges, Royal Caribbean’s stock has risen by 126% in the past year.

The company reported carrying 2.05 million passengers in the quarter, a nearly 14% increase from the previous year. Quarterly revenue beat expectations at $3.73 billion. Analysts were impressed by Royal Caribbean’s performance, with adjusted earnings per share surpassing market expectations. Shareholders and investors, such as Peter Ahluwalia of Belinvest Global Equity Fund, are pleased with the company’s return on equity of almost 45%.

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