How Royal Caribbean Makes Money

North America and Europe segments generate the most cruise itinerary revenue

Reviewed by Thomas Brock

Royal Caribbean Group (RCL) is one of the leading cruise companies in the world. It boasts a global fleet of 64 ships traveling to over 1,000 destinations. Royal Caribbean Group owns and operates three cruise brands: Royal Caribbean International, Celebrity Cruises, and Silversea Cruises, and is a 50% owner of a joint venture that operates TUI Cruises and Hapag-Lloyd Cruises. 

Key Takeaways

• Royal Caribbean operates three global cruise brands: Royal Caribbean International, Celebrity Cruises, and Silversea Cruises.
• The company’s Europe and North America regions represent the largest revenue share.
• Royal Caribbean’s direct competitors include Carnival Corporation and Norwegian Cruise Line Holdings Ltd.

Royal Caribbean’s Industry

Royal Caribbean’s direct competitors include rivals in the cruise industry such as Carnival Corp. (CCL) and Norwegian Cruise Line Holdings Ltd. (NCLH). The company also competes against companies outside the cruise industry but within the broader travel and tourism industry.

Royal Caribbean’s separate cruise brands maintain similar itineraries and have similar economic characteristics, types of consumers, and regulatory environments. Royal Caribbean calculates a breakdown of total revenue across four geographic regions plus other operations:

• North America: Cruise itineraries in the U.S., Canada, Mexico, and the Caribbean.
• Asia/Pacific: Includes itineraries in Southeast Asia, East Asia, South Asia, and Oceania. These itineraries comprise cruises to Singapore, Thailand, the Philippines, China, Japan, India, Australia, and other nearby countries.
• Europe: Cruises in the Nordic countries, Germany, France, Italy, Spain, and the U.K.
• Other Regions Plus South America and Latin America: Includes cruises from South and Latin American countries in its Other Regions category.
• Other Revenues: Includes passenger cancellation fees, vacation protection insurance, pre-and post-cruise tours, fees for operating port facilities, and other services that Royal Caribbean performs for affiliates.

Royal Caribbean’s Financials

For fiscal year (FY) 2023 ending Dec. 31, 2023, Royal Caribbean reported a total annual revenue of $13.9 billion compared to $8.8 billion for 2022. The company had a net income gain of $1.7 billion million in 2023.

Revenues in 2023 were driven by strong ticket revenue and onboard revenue performance, inclusive of capacity growth. The strength in revenue and improved cash flow, accelerated debt repayment, improving debt maturity profile.

History and Leadership

In 2024, Jason T. Liberty is the President and Chief Executive Officer (CEO) of Royal Caribbean Group.In 1968, Ed Stephan and three Norwegian ship owners, Sigurd Skaugen, Anders Wilhemsen, and Gotaas Larsen, created a cruise line to sail the Caribbean. The first ship, Song of Norway, set sail on her maiden voyage from Miami on November 7, 1970.

Recent Developments

Royal Caribbean ordered ten additional ships in 2023. Capacity is expected to increase in 2024 with the addition of Silver Ray and Utopia of the Seas and a full year of operations for Silver Nova, Celebrity Ascent, and Icon of the Seas.

Royal Caribbean will return to China in 2024 for the first time since 2019. As of 2024, construction is in process for the first Royal Beach Club at Paradise Island, Bahamas, set to open in 2025.

What Are Royal Caribbean’s Sustainability Efforts?

Royal Caribbean is dedicated to improving energy efficiency, treating used water, and limiting landfill use. Additionally, Royal Caribbean supports the University of Miami’s OceanScope program to share ocean life data using the company’s ships.

How Has Royal Caribbean Incorporated Artificial Intelligence (AI)?

Royal Caribbean hopes to achieve net-zero emissions by 2050. The company equips ships with technologies that allow them to operate efficiently and adapt to new solutions. Royal Caribbean uses AI to plot the most energy-efficient routes.

How Many Employees Does Royal Caribbean Have?

As of 2023, Royal Caribbean had 98,300 employees.

The Bottom Line

Royal Caribbean operates three global cruise brands that directly compete with its main competitors, Carnival Corporation and Norwegian Cruise Line. In 2023, Royal Caribbean reported a positive net income after two negative years following the COVID-19 pandemic.

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