Royal Caribbean has answered every question about whether it could recover from the Covid pandemic. After being more or less shut down for over a year during those dark days, the cruise line has grown revenue and passenger counts over where they stood in 2019.
That was certainly something that seemed in doubt back in July 2021 when I set sail on Freedom of the Seas on Royal Caribbean’s first post-pandemic voyage. That was a triumphant day, but the ship was filled with diehard fans, not the more casual audience needed to bring the business back.
It took time, but the cruise line’s latest results show it has come all the way back, and even exceeded its 2019 pre-pandemic numbers.
- Total revenues were $17.9 billion.
- Net Income was $4.3 billion or $15.61 per share.
- Adjusted Net Income was $4.3 billion or $15.64 per share, and Adjusted EBITDA was $7.0 billion. Source: Fourth-quarter earnings release
CEO Jason Liberty celebrated the company’s numbers during its fourth-quarter earnings call.
“We delivered a record 9.4 million memorable vacations at a very high customer satisfaction score, achieved nearly $18 billion of total revenue and 33% earnings growth, all while expanding our margins, increasing return on invested capital, and reducing leverage,” he said.
Liberty also announced plans for a massive expansion of the company’s Celebrity Cruises brand.
Celebrity Cruises is exapnding into river cruises.
Celebrity plans huge fleet expansion
Celebrity Cruises will enter the river cruise market in August 2027. That will mark Royal Caribbean Group’s first foray into that lucrative market.
Liberty’s comments during the earnings call suggest that the company, which has already sold out most of the announced sailings for its first two river cruise ships, is confident that the venture will succeed.
“Today, we are announcing a further expansion of Celebrity River Cruises with a commitment for 10 additional ships. This will expand Celebrity’s River Cruise fleet to 20 vessels by 2031. The expansion will make Celebrity River Cruises one of the largest European river cruise operators, offering more itineraries and destinations than ever before,” he said.
The CEO also confirmed a new ship class for the Royal Caribbean brand.
“We are also announcing the launch of the Royal Caribbean brand’s new Discovery Class ships that will redefine how Royal’s guests experience the world,” he added.
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The long-discussed, but never officially announced, Discovery Class ships are expected to be smaller ships that replace the oldest ships in the Royal Caribbean fleet. Smaller ships can stop in ports that Royal Caribbean’s larger, newer ships cannot visit.
Royal Caribbean will add a third Icon Class ship, Legend of the Seas, this summer. It has two more unnamed Icon Class ships and its seventh Oasis Class ship on order, according to the Royal Caribbean Blog, which is not affiliated with the cruise line.
Celebrity Cruises entering a popular market
Stewart Chiron, known as The Cruise Guy, thinks Royal Caribbean has made a smart move in entering the river cruise space.
“What’s interesting is Viking started from the river and went to the oceans. Celebrity is going from the oceans to the river, with a much larger passenger base. Many ocean cruisers have expressed interest in Europe’s rivers but want a much higher class of ships that Celebrity appears to have designed. So demand was extremely strong because it was Celebrity offering with riverboats designed from scratch,” he told Parade.
Alex Sharpe, CEO of Signature Travel Network, said there is “tremendous” opportunity in river cruising and that Celebrity fans would place it high on their list when considering a river cruise, opening the line to a higher-yielding passenger, reported Travel Weekly.
“With river, you are talking about fewer guests and higher-impact guests, spending more money ashore and really digging into local cultures,” Sharpe said.
Karen Quinn-Panzer of Dream Vacations, who specializes in river cruising, said Celebrity could introduce the river cruise industry to a younger audience.
“The demographics of river cruising are changing, and we’re seeing a younger population onboard,” Kellum said. “I think brand loyalty could work to their benefit with a demographic change.”
Daniel Kline has sailed on over 50 cruises with Royal Caribbean and Celebrity Cruises in the past five years.