July 28 (Reuters) – Royal Caribbean cut its annual revenue forecast on Tuesday, warning that prolonged geopolitical tensions were weighing on bookings for some sailings.
The cruise operator now expects 2026 revenue to grow about 9%, compared with its previous forecast for about 10%. Its shares were down about 1% in premarket trading.
The Miami, Florida-based company, however, raised its annual adjusted profit forecast to $17.73 to $17.87 per share from $17.10 to $17.50 previously, citing stronger-than-expected second-quarter results and an improved outlook for the remainder of the year.
Royal Caribbean said it had factored in a “modest booking impact for select itineraries primarily due to prolonged geopolitical activity,” even as overall demand for cruises remained resilient.
“Consumer demand for our vacation experiences is strong, and guests continue to demonstrate a desire to spend on memorable experiences with us,” said Naftali Holtz, chief financial officer.
Although it is still early, 2027 bookings were running ahead of historical levels, including for itineraries hit by geopolitical disruptions this year, he added.
Cruise operators have also faced higher fuel costs linked to Middle East tensions, but Royal Caribbean’s updated earnings forecast suggests strong onboard spending and tight cost controls are helping offset those pressures.
It reported a 27% rise in quarterly fuel expenses to $355 million from a year earlier. But it reduced its full-year fuel expense forecast to about $1.34 billion from its previous forecast of $1.35 billion.
The cruise operator reported a 6% rise in revenue to $4.83 billion for the quarter ended June 30, beating analysts’ estimates of $4.82 billion, according to data compiled by LSEG.
On an adjusted basis, the company earned $4.21 per share, compared with analysts’ estimates of $3.98 per share.
(Reporting by Sanskriti Shekhar in Bengaluru ; Editing by Tasim Zahid)
Comments