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Sep 30, 2022
Royal Caribbean Q3 2022 Earnings Report
Reported better than expected third quarter earnings due to strong close-in demand and improved onboard revenue and cost performance. The company also introduced the Trifecta Program.
Key Takeaways
Royal Caribbean Group reported a net income of $33.0 million and adjusted earnings per share of $0.26 for Q3 2022. The results were better than expected, driven by strong demand, improved onboard revenue, and better cost performance. The company introduced the Trifecta Program, a three-year initiative to drive superior performance.
Load factors in the third quarter were 96% overall, with Caribbean sailings reaching almost 105%.
Total Revenue in the third quarter was $3.0 billion, Net Income was $33.0 million and Adjusted EBITDA was $742.3 million.
Booking volumes in the third quarter accelerated versus the second quarter of 2022 and remained significantly higher than booking volumes received in the third quarter of 2019 for all future sailings.
For 2023, all quarters are currently booked well within historical ranges at record pricing.
Revenue by Segment
Forward Guidance
For the fourth quarter of 2022, the company expects to generate Total Revenue of approximately $2.6 billion, Adjusted EBITDA of $350 - $400 million and Adjusted Loss per Share of ($1.30) – ($1.50). Fourth quarter load factors are expected to average approximately 95% overall.
Positive Outlook
- All quarters are currently booked well within historical ranges at record pricing.
- Market response to the 9 new ships that joined the fleet since 2019 has been excellent.
- The company expects a return to historical load factors in early summer, record yields and adjusted EBITDA for 2023.
- The company expects to benefit from lower transitory expenses
- The company expects accelerating benefit from actions taken to improve margin
Challenges Ahead
- The company expects Adjusted Loss per Share for the fourth quarter of ($1.30) - ($1.50).
- The company still expects to have transitory costs in the fourth quarter
- Improvement is partially offset by inflationary and supply chain challenges
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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