Royal Caribbean’s third quarter was marked by a positive market reaction as the company delivered results that aligned with Wall Street’s revenue expectations and outperformed on adjusted earnings per share. Management highlighted accelerating demand for cruise vacations, citing higher passenger cruise days and strong onboard spending, particularly in Europe and the Caribbean. CEO Jason Liberty attributed the success to a combination of increased capacity, high guest satisfaction, and effective use of technology and loyalty programs to deepen customer engagement. He stated, “Travel remains the number one leisure category where consumers intend to increase spending.”
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Royal Caribbean (RCL) Q3 2026 highlights:
- Revenue $5.59 billion vs S&P analysts’ estimates of $5.61 billion (8.8% year-on-year growth, in line)
- Adjusted EPS $6.57 vs S&P analysts’ estimates of $6.38 (3% beat)
- Adjusted EBITDA $2.54 billion vs analyst estimates of $2.46 billion (45.4% margin, 3.2% beat)
- Adjusted EPS guidance Management slightly raised its full-year adjusted EPS guidance to $17.90 at the midpoint
- Operating margin 33.5%, in line with the same quarter last year
- Passenger cruise days up 1.34 million year on year
- Market capitalization $79.79 billion
While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our top 5 analyst questions from Royal Caribbean’s Q3 earnings call
- Matthew Boss (JPMorgan) asked about multi-year earnings growth prospects and market share opportunities. CEO Jason Liberty responded that the company remains confident in its ability to capture more of the expanding global vacation market, emphasizing technology and loyalty as key differentiators.
- Steve Wieczynski (Stifel) questioned the contribution of the Sandals deal and the development potential of its land holdings. CFO Naftali Holtz clarified that the Sandals transaction will have minimal impact on next year’s results, with room expansion and greenfield opportunities supporting future growth.
- Trey Bowers (Wells Fargo) sought clarity on high booking growth rates for future sailings. Liberty explained that the increase reflects both higher booking positions and stronger rates, driven by customer willingness to pay for enhanced experiences.
- Ben Chaiken (Mizuho) inquired about cross-brand vacation overlap between Royal Caribbean and Sandals. Holtz noted that while overlap exists, there is significant room to capture more guest occasions within the company’s ecosystem through loyalty and marketing initiatives.
- Brandt Montour (Barclays) asked about shifts in booking patterns and consumer behavior. Liberty attributed close-in demand to product adjustments and the preferences of younger guests, highlighting resilient onboard spend as a positive indicator.
Catalysts in upcoming quarters
Looking ahead, the StockStory team will be monitoring (1) the integration progress and early cross-selling impact of the pending Sandals and Beaches Resorts partnership, (2) continued momentum in advance bookings and the balance between new and repeat guests, and (3) cost discipline in the face of fuel and currency volatility. Additional signposts include the performance of new ships and destinations, and the expansion of the loyalty ecosystem across cruise and resort brands.
Royal Caribbean currently trades at $309.01, up from $280.67 just before the earnings. Is there an opportunity in the stock? See for yourself in our full research report (it’s free).
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