Royal Caribbean Group (RCL) Q2 FY26 earnings call: guidance and Q&A

Inquired about the drivers of continued strong onboard spending as a consumer health indicator, and asked for details on 2027 booking and pricing trends across regions.

Jason Liberty attributed strong onboard spending to elevated consumer spend, effective use of technology and data for pre-cruise bookings, and increased spending in beverage and shore excursions. For 2027, he noted very strong demand, high booking volumes, and higher pricing across the portfolio, reaffirming confidence in reaching "Perfecta" by year-end 2027.

“We have seen very strong demand for 2027. So as we said there at historical, which are very high volumes -- I'm sorry, booking volumes are in a great place. And of course, we're trying to optimize our yield, not trying to just be better than historical levels just to be better than historical levels. So we feel very good about our book position, and that's all at higher rates.”

asked by Matthew Boss · answered by Jason Liberty

Asked if increased competitor promotions in the Caribbean impacted Royal Caribbean's pricing power and if yield guidance would have been raised without European headwinds.

Jason Liberty confirmed that without European geopolitical headwinds, yield guidance would have been raised. He stated that Royal Caribbean's differentiated assets, loyalty programs, and technology insulate them from competitor promotions in the Caribbean, allowing them to maintain strong demand and pricing, supported by high Net Promoter Scores. Michael Bayley highlighted the success of Royal Beach Club and Perfect Day.

“I mean Europe was off to an incredible start at the beginning of the year. And obviously, the results of geopolitical activity in the region and the impact on fuel et cetera, did curtail to a degree the demand for Europe. Now that's not to say that European yields are down. Our European yields are still very good for this year, but they are less than what we had expected to. And so to the point we would have raised the back half of the year, if not for those activities.”

asked by Steven Wieczynski · answered by Jason Liberty

Sought clarification on whether 2027 pacing being "up" referred to load factor or booking volumes, and if "record pricing" for 2027 meant year-over-year improvement.

Naftali Holtz confirmed that 2027 is pacing very well at higher prices. Jason Liberty added that load factor is at an elevated level, comparable to prior years, but at higher prices, driven by sophisticated AI-driven models optimizing yield across millions of price points.

“But it's more or less in line where we have been booked on a load factor basis. Now as Naftali said, that's at -- when we used to term record pricing, which means higher pricing than we saw in the previous period. So that's all very positive news.”

asked by Robin Farley · answered by Jason Liberty

Asked for Royal Caribbean's perspective on recent demand fluctuations (step back in May, improvement in June) and July trends, seeking a barometer for future direction.

Jason Liberty generally agreed with the observed pattern of a slight dip in May followed by strong demand in June and July. He emphasized that geopolitical events cause small, marginal changes, and that the business is resilient, with consumers prioritizing travel. He noted strong demand across products and brands, with high booking volumes and pricing for 2026 and 2027.

“But we saw really -- most of June and certainly in July, a very strong demand environment. We're seeing strong volumes and we're seeing, as we've commented on the pricing here for 2026 and into 2027.”

asked by James Hardiman · answered by Jason Liberty

Asked if the apparent trend of shorter average itinerary lengths is intentional and strategic, and how it impacts locations.

Jason Liberty confirmed it's intentional, driven by consumer preference for shorter, more frequent vacations, especially among millennials. He noted that guests spend similar amounts on shorter trips as longer ones. Michael Bayley added that while short products are growing, the classic 7-night itineraries remain popular, especially with new Icon class ships. Naftali Holtz clarified that the mix of short itineraries isn't significantly higher this year, just growing with overall capacity.

“We're doing this because the consumer, especially keep in mind, half of our guests are millennials younger now, their profile for a vacation today as they start -- as their kids start to get older, et cetera, where they start going in and getting married and moving towards that direction, in their current state, they like to take shorter vacations, though [indiscernible] more frequently. But they tend to spend the same amount of money that they would spend on a short vacation as they went on a long vacation.”

asked by David Katz · answered by Jason Liberty

Asked if cruise bookers are becoming desensitized to geopolitical situations or if recent booking strength is due to a mix shift (e.g., more Caribbean).

Jason Liberty stated that geopolitical events have little impact on long-term bookings (6+ months out) and that the business is resilient. He believes consumers aren't "desensitized" but rather, as situations normalize, they prioritize building memories. He noted that while destination preferences might shift in the short term, overall demand for Europe, Caribbean, and Alaska remains high across their brands.

“But I think that as things get resolved or moved into a different place, or maybe it becomes a little bit more of a new normal. They're then back-end focused on what is critically important to them and building memories and experiences with their friends and family are at the very highest of their priority list.”

asked by Vince Ciepiel · answered by Jason Liberty

Inquired about the long-term impact of Celebrity River's introduction on the pricing dynamics of the Celebrity Ocean brand, drawing a comparison to a competitor's strategy.

Jason Liberty expressed high ambitions for Celebrity River, leveraging their customer database for an elevated experience. He noted that River pricing is higher than competitors and expects it to create tailwinds for Celebrity brand yields and the broader "lifetime of vacations" ecosystem. Michael Bayley added that Royal Caribbean guests also show interest in Celebrity River.

“Now over time, we expect that our -- that all this will be great tailwinds to our yields for our Celebrity brand and for our other brands again, as we get more and more reps in our ecosystem and this -- and our goal of this lifetime of vacations.”

asked by Trey Bowers · answered by Jason Liberty