Shares of Royal Caribbean Group (RCL) surged 2.2% in premarket trading on Thursday following the announcement of their impressive Q3 financial results. The cruise ship operator exceeded profit and sales projections and also raised its full-year outlook. This comes as consumer spending on experiences continues to gain momentum.
Strong Financial Performance
Net income for Royal Caribbean Group soared to $1.01 billion, or $3.65 per share, compared to $33.0 million, or 13 cents per share, in the same period last year. Adjusted earnings per share, excluding nonrecurring items, were reported at $3.85, surpassing the FactSet consensus of $3.46.
Robust Revenue Growth
The company also reported a significant increase in revenue, which climbed 39% to reach $4.16 billion. This exceeded the FactSet consensus of $4.08 billion. Passenger ticket revenue accounted for a substantial portion of this growth, surging by 45.5% to $2.94 billion. Onboard and other revenue also experienced solid growth, rising by 25.4% to $1.22 billion.
Upgraded Outlook for 2023
Following the strong performance in Q3, Royal Caribbean Group revised its adjusted EPS guidance for 2023. The new guidance range is set at $6.58 to $6.63, up from the previous range of $6.00 to $6.20. Chief Executive Jason Liberty expressed confidence in the company’s future prospects, stating, “The strength of our brands and the acceleration of consumer spending on experiences have propelled us towards another outstanding quarter and a robust 2023.”
Despite recent market volatility, Royal Caribbean Group remains optimistic about its long-term outlook. Over the past three months, the stock has experienced a decline of 18.5%, while the S&P 500 has lost 8.3%.
In conclusion, Royal Caribbean Group’s Q3 results demonstrate a strong performance, with both profit and revenue exceeding expectations. The increased guidance for 2023 reflects the company’s confidence in its ability to capitalize on the growing demand for experiential consumer spending.