01—Abstract
Summary
Summary of the 10-Q filed April 30, 2026. Cited figures are marked; the original filing is the authoritative source.
Royal Caribbean Cruises Ltd. (RCL) reported a strong first quarter for 2026, with total revenues increasing by 11.3% year-over-year to $4.5 billiona.
This growth was driven by a combination of increased capacity and higher pricing, leading to a significant rise in both passenger ticket revenues and onboard and other revenues. Net income attributable to Royal Caribbean Cruises Ltd. surged to $941 millionb, up from $730 million in the prior year, with diluted earnings per share rising to $3.48 from $2.70. The company also successfully managed its expenses, with total cruise operating expenses increasing at a slower pace than revenues, contributing to improved operating income and a higher operating margin.
The company's balance sheet remains robust, with total assets increasing to $41.99 billionc. While long-term debt saw an increase to $19.67 billion (from $18.17 billion), this was primarily due to strategic debt issuances for refinancing and expansion.
Customer deposits also saw a substantial increase to $6.55 billiond, indicating strong future booking demand. RCL continues to invest in its fleet, with significant capital expenditures planned for new ship deliveries, underscoring its commitment to long-term growth and capacity expansion.
02—Key points
Key Highlights
- Total revenues increased by 11.3% to $4.5 billion in Q1 2026 compared to Q1 2025, driven by capacity growth and higher pricing.
- Net income attributable to Royal Caribbean Cruises Ltd. rose significantly to $941 million, a substantial increase from $730 million in the prior year.
- Diluted earnings per share (EPS) improved to $3.48, up from $2.70 in the first quarter of 2025, reflecting strong profitability.
- The company experienced a significant increase in customer deposits, reaching $6.55 billion, indicating robust forward bookings.
- RCL's fleet expansion continues with several new ships on order, with aggregate expected costs of approximately $16.2 billion.
- The company reported strong operational performance with an 8.3% capacity growth and improved net yields.
- Cash flow from operations remained strong, providing $1.8 billion in net cash for the first quarter of 2026.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2026, Royal Caribbean Cruises Ltd kept $0.21.
- Revenue$4.45B100.0%
- Cost of revenue−$2.25B50.5%
- Gross profit$2.21B49.5%
- Operating costs−$1.04B23.4%
- Operating income$1.16B26.1%
- Interest, other & tax−$221.0M5.0%
- Net income$941.0M21.1%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2026filed April 30, 2026Financial Statements
Q1 FY2026 against Q1 FY2025
| Line item | Q1 FY2026Q1 FY2025 | Change |
|---|---|---|
| Revenue | $4.45B$4.00B | +11.3% |
| Cost of Revenue | $2.25B$2.08B | +8.1% |
| Gross Profit | $2.21B$1.92B | +14.8% |
| SG&A Expenses | $582.00M$562.00M | +3.6% |
| Operating Income | $1.16B$945.00M | +23.0% |
| Net Income | $941.00M$730.00M | +28.9% |
| EPS (Basic) | $3.49$2.71 | +28.8% |
| EPS (Diluted) | $3.48$2.70 | +28.9% |
| Shares Outstanding (Basic) | 270.00M269.00M | +0.4% |
| Shares Outstanding (Diluted) | 271.00M276.00M | −1.8% |
05—Questions
Frequently Asked Questions
What were the primary drivers of revenue growth in Q1 2026?
Revenue growth was primarily driven by an 8.3% increase in capacity, attributed to the addition of new ships like Star of the Seas and Celebrity Xcel, and yield growth stemming from higher pricing for passenger tickets and increased onboard spending per passenger.
How has the company managed its debt and financial obligations?
Royal Caribbean Cruises Ltd. issued $2.5 billion in senior notes in February 2026 to refinance existing debt. While long-term debt increased, the company maintains strong liquidity with $0.5 billion in cash and $6.4 billion in undrawn revolving credit facility capacity. They also confirmed compliance with all debt covenants and estimate continued compliance for the next twelve months.
What is the company's outlook for future growth and fleet expansion?
The company has a substantial new ship order pipeline, with an aggregate expected cost of approximately $16.2 billion. This includes new builds across various classes and brands, indicating a strong commitment to expanding capacity and enhancing guest offerings in the coming years.
What is the current status of the Havana Docks Action lawsuit?
The Havana Docks Action lawsuit has progressed through various court levels. While a lower court initially ruled in favor of the plaintiff, an appeals court reversed the judgment. The case is now before the United States Supreme Court, and its ultimate outcome remains uncertain, though the company previously released a significant portion of its loss contingency related to this case.
06—Continue