The Royal Caribbean Cruises Ltd (NYSE: RCL) stock price rallied 8.72% after the cruise line operator released its second-quarter earnings results and updated its full-year guidance. The company generated earnings per share of $1.70 and adjusted earnings per share of $1.82.
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The cruise operator also revealed that its revenues surged 61% to $3.52 billion, beating analysts' expectations. These results were significantly better than the company's guidance, driven by more robust pricing on closer-in demand and further strength in onboard revenue.
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Due to the high demand for cruises, Royal Caribbean increased its 2023 Adjusted Earnings per Share guidance by 33% to $6.00 – $6.20. The company noted that booking volume remained significantly higher than at the same time in 2019 before the COVID-19 lockdowns devastated the industry.
The cruise line operator was also able to sell its vacations at record prices, underpinned by the significant demand. The Royal Caribbean share price rose to its highest since February 2020 on yesterday’s earnings results.
Royal Caribbean was able to charge more for its tickets for both European and North American travel itineraries, which led to high revenues combined with customers spending more while onboard its ships leading to robust onboard revenues.
The company reported that its Gross Margin Yields increased 13.1% As-Reported, and Net Yields increased 12.9% in Constant-Currency (12.6% As-Reported), both compared to the second quarter of 2019.
RCL expects its Net Yields for the full year to increase 11.5% to 12.0% in Constant-Currency and As-Reported, compared to 2019.
Jason Liberty, the President and CEO of Royal Caribbean Group, said: “Our brands continue to fire on all cylinders, resulting in record yields and second-quarter earnings significantly exceeding our expectations. Demand for cruising and our brands is exceptionally strong, and we have seen another step change in booking volumes and pricing, leading us to now expect double-digit net yield growth for the full year. We also expect to achieve record Adjusted EBITDA per APCD and Return on Invested Capital this year and are well on our way toward achieving our Trifecta goals.”
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Royal Caribbean (RCL) stock price chart.
The Royal Caribbean (RCL) stock price surged 8.72% on the upbeat Q2 earnings results.
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