Royal Caribbean Q4 Earnings Top Estimates, Revenues Miss, Both Up Y/Y

Royal Caribbean Cruises Ltd. RCL reported mixed fourth-quarter 2024 results, with adjusted earnings beating the Zacks Consensus Estimate while the revenues missed the same. Notably, the top and bottom lines increased on a year-over-year basis.See the Zacks Earnings Calendar to stay ahead of market-making news.The company’s performance during the quarter was driven by stronger pricing on close-in demand and continued strength in onboard revenues. Its diversified fleet offerings, accompanied by its commercial and vacation experiences, are witnessing robust demand trends amid an improving global market backdrop. Thanks to these tailwinds, RCL could achieve its Trifecta goals before the schedule, pointing out the benefits it is realizing from the current improving scenario.Meanwhile, higher stock-based compensation expenses, driven by an increase in the company's stock price during the fourth quarter of 2024, along with unfavorable foreign exchange and fuel rates, are headwinds. Nonetheless, its continued focus on executing its strategic initiatives, along with leveraging benefits from the global market trends, is more than offsetting the negative flush.RCL stock climbed 5.2% during Tuesday’s pre-market trading session.RCL’s Q4 Earnings & RevenuesFor the fourth quarter, the company reported adjusted earnings per share (EPS) of $1.63, which beat the Zacks Consensus Estimate of $1.50 by 8.7%. In the prior-year quarter, RCL recorded an adjusted EPS of $1.25.Royal Caribbean Cruises Ltd. Price, Consensus and EPS Surprise Royal Caribbean Cruises Ltd. price-consensus-eps-surprise-chart | Royal Caribbean Cruises Ltd. QuoteQuarterly revenues of $3.76 billion marginally missed the consensus mark of $3.77 billion by 0.3%. However, the reported value was up 12.9% year over year from $3.33 billion. On a constant currency (cc) basis, total revenues were $3.771 billion.Royal Caribbean’s Quarterly HighlightsPassenger ticket revenues amounted to $2.60 billion, up from $2.29 billion in the prior-year quarter. Our estimate for Passenger ticket revenues was $2.51 billion.Onboard and other revenues increased to $1.16 billion from $1.05 billion reported in the year-ago quarter. Our estimate for the metric was $1.20 billion.Total cruise operating expenses amounted to $2.05 billion, up 8.6% year over year. Our estimate for the metric was $2.18 billion.Net yields rose 7.3% on a cc basis and 7% on a reported basis compared with the fourth-quarter 2023 level. Net cruise costs, excluding fuel, per Available Passenger Cruise Day (APCD) rose 13.5% on a cc basis and 13.4% on a reported basis from last year quarter’s figure.Sneak Peek at RCL’s 2024 ResultsRoyal Caribbean reported total revenues of $16.48 billion in 2024, up from $13.9 billion in 2023. Adjusted EPS also increased year over year to $11.80 from $6.77.Total cruise operating expenses during the year increased notably to $8.65 billion from $7.78 billion reported a year ago.Net yields rose 11.6% on a cc basis and 11.5% on a reported basis compared with the 2023 level. Net cruise costs, excluding fuel, per APCD rose 6.8% on cc and reported basis compared with 2023.Other Financial Information of RCLAs of Dec. 31, 2024, Royal Caribbean reported cash and cash equivalents of $388 million compared with $497 million in 2023-end. As of the end of the fourth quarter of 2024, long-term debt decreased to $18.47 billion from $19.73 billion as of 2023-end. The current portion of long-term debt at the end of the quarter was $1.6 billion, down from $1.72 billion in 2023-end.Booking Update of Royal CaribbeanDuring the fourth quarter, the company witnessed increasing trends in its vacation experiences thanks to the favorable demand and pricing environment. Notably, close-in demand was robust on a rate and volume basis, with guest onboard spending and pre-cruise purchases continuing to exceed prior years, driven by greater participation at higher prices, due to RCL’s robust commercial engine.The company is highly optimistic about the demand and pricing landscape for 2025. Its new ships, existing fleet and private destinations have received a strong market response, paving the way for yield growth in 2025.As of Dec. 31, 2024, RCL had $5.5 billion in customer deposits compared with $5.31 billion in the prior-year period.RCL’s Q1 OutlookIn the first quarter of 2025, Royal Caribbean expects depreciation and amortization expenses to be in the range of $410-$420 million. Net interest expenses (excluding loss on extinguishment of debt) are projected to be between $230 million and $240 million. Management estimates adjusted EPS to be in the band of $2.43-$2.53 (compared with $1.77 reported a year ago).The company expects net yields to increase in the band of 3.9-4.4% on a reported basis and 4.75-5.25% at cc on a year-over-year basis. Net cruise costs, excluding fuel, per APCD are expected to increase between 1.3% and 1.8% on a reported basis and between 1.6% and 2.1% at cc.2025 View by RCLFor 2025, the company expects depreciation and amortization expenses to be in the range of $1.715-$1.725 billion. Net interest expenses (excluding loss on extinguishment of debt) are expected to be within $935 -$945 million. Adjusted EPS is anticipated to be between $14.35 and $14.65.The company expects net yields to increase in the band of 1.8-3.8% on a reported basis and 2.5-4.5% at cc on a year-over-year basis.RCL’s Zacks Rank & Recent Consumer Discretionary ReleaseRoyal Caribbean currently carries a Zacks Rank #3 (Hold).Carnival Corporation & plc CCL reported impressive fourth-quarter fiscal 2024 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and the bottom lines increased on a year-over-year basis. The upside was primarily backed by sustained demand strength and increased booking volumes.Carnival continues to enhance shareholder value through improved operational efficiency across its fleet. The company has reached more than 80% of its 2026 SEA Change EBITDA and adjusted ROIC targets, demonstrating significant progress toward its long-term goals. Looking ahead, CCL is focused on maintaining its growth trajectory by implementing an enhanced destination strategy designed to offer exclusive and unique experiences for guests.Stocks to ConsiderAccel Entertainment, Inc. ACEL sports a Zacks Rank of 1 (Strong Buy) at present. ACEL is expected to register a 19.2% decline in earnings in the fourth quarter of 2024. You can see the complete list of today’s Zacks Rank #1 stocks here.It reported better-than-expected earnings in each of the trailing four quarters, with an average surprise of 26.1%.Trip.com Group Limited TCOM currently sports a Zacks Rank of 1. Its earnings for the to-be-reported quarter are expected to decrease 7.1%.TCOM reported better-than-expected earnings in each of the trailing four quarters, with an average surprise of 42.8%.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Carnival Corporation (CCL): Free Stock Analysis Report Royal Caribbean Cruises Ltd. (RCL): Free Stock Analysis Report Trip.com Group Limited Sponsored ADR (TCOM): Free Stock Analysis Report Accel Entertainment, Inc. (ACEL): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks