Royal Caribbean Cruises 10-Q 2025-06-30

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

For the quarterly period ended June 30, 2025

OR

For the transition period from to

Commission File Number: 1-11884

ROYAL CARIBBEAN CRUISES LTD.

(Exact name of registrant as specified in its charter)

1050 Caribbean Way, Miami, Florida 33132

(Address of principal executive offices) (zip code)

(305) 539-6000

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

There were 271,627,660 shares of common stock outstanding as of July 25, 2025.

ROYAL CARIBBEAN CRUISES LTD.

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION

ROYAL CARIBBEAN CRUISES LTD.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(unaudited; in millions, except per share data)

Certain amounts may not add due to use of rounded numbers.

The accompanying notes are an integral part of these consolidated financial statements

ROYAL CARIBBEAN CRUISES LTD.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(unaudited; in millions, except per share data)

Certain amounts may not add due to use of rounded numbers.

The accompanying notes are an integral part of these consolidated financial statements

ROYAL CARIBBEAN CRUISES LTD.

CONSOLIDATED BALANCE SHEETS

(in millions, except share data)

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Cautionary Note Concerning Forward-Looking Statements

The discussion under this caption "Management's Discussion and Analysis of Financial Condition and Results of Operations" and elsewhere in this Quarterly Report on Form 10-Q includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact, including statements regarding our expectations for future periods, business and industry prospects or future results of operations or financial position, made in this Quarterly Report on Form 10-Q are forward-looking. Words such as "anticipate," "believe," "considering," "could," "driving," "estimate," "expect," "goal," "intend," "may," "plan," "project," "seek," "should," "will," "would," and similar expressions are intended to further identify any of these forward-looking statements. Forward-looking statements reflect management's current expectations, but they are based on judgments and are inherently uncertain. Furthermore, they are subject to risks, uncertainties and other factors that could cause our actual results, performance or achievements to differ materially from the future results, performance or achievements expressed or implied in those forward-looking statements. Examples of these risks, uncertainties and other factors include, but are not limited to, those discussed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 and, in particular, the risks discussed under the caption "Risk Factors" in Part I, Item 1A therein.

All forward-looking statements made in this Quarterly Report on Form 10-Q speak only as of the date of this filing. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Overview

The discussion and analysis of our financial condition and results of operations is organized to present the following:

• a review of our financial presentation, including discussion of certain operational and financial metrics we utilize to assist us in managing our business;

• a discussion of our results of operations for the quarter and six months ended June 30, 2025, compared to the same period in 2024; and

• a discussion of our liquidity and capital resources, including our future capital and material cash requirements and potential funding sources.

Critical Accounting Policies and Estimates

For a discussion of our critical accounting policies and estimates, refer to Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations within our Annual Report on Form 10-K for the year ended December 31, 2024.

Seasonality

Our revenues are seasonal based on demand for cruises. Demand has historically been strongest for cruises during the Northern Hemisphere’s summer months and holidays. In order to mitigate the impact of the winter weather in the Northern Hemisphere and to capitalize on the summer season in the Southern Hemisphere, our brands have historically focused on deployment to the Caribbean, Asia and Australia during that period.

Financial Presentation

Description of Certain Line Items

Revenues

Our revenues are comprised of the following:

• Passenger ticket revenues, which consist of revenue recognized from the sale of passenger tickets and the sale of air transportation to and from our ships; and

• Onboard and other revenues, which consist primarily of revenues from the sale of goods and/or services onboard our ships not included in passenger ticket prices, casino operations, cancellation fees, sales of vacation protection insurance, pre- and post-cruise tours and fees for operating certain port facilities. Onboard and other revenues also include revenues we receive from independent third-party concessionaires that pay us a percentage of their revenues in exchange for the right to provide selected goods and/or services onboard our ships, as well as revenues received for procurement and management related services we perform on behalf of our unconsolidated affiliates.

Cruise Operating Expenses

Our cruise operating expenses are comprised of the following:

• Commissions, transportation and other expenses, which consist of those costs directly associated with passenger ticket revenues, including travel advisor commissions, air and other transportation expenses, port costs that vary with passenger head counts and related credit card fees;

• Onboard and other expenses, which consist of the direct costs associated with onboard and other revenues, including the costs of products sold onboard our ships, vacation protection insurance premiums, costs associated with pre- and post-cruise tours and related credit card fees, as well as the minimal costs associated with concession revenues, as the costs are mostly incurred by third-party concessionaires, and costs incurred for the procurement and management related services we perform on behalf of our unconsolidated affiliates;

• Payroll and related expenses, which consist of costs for shipboard personnel (costs associated with our shoreside personnel are included in Marketing, selling and administrative expenses);

*•*Food expenses, which include food costs for both guests and crew;

*•*Fuel expenses, which include fuel and related delivery, storage and emission consumable costs and the financial impact of fuel swap agreements; and

• Other operating expenses, which consist primarily of operating costs such as repairs and maintenance, port costs that do not vary with passenger head counts, vessel related insurance, entertainment and gains and/or losses related to the sale of our ships, if any.

We do not allocate payroll and related expenses, food expenses, fuel expenses or other operating expenses to the expense categories attributable to passenger ticket revenues or onboard and other revenues since they are incurred to provide the total cruise vacation experience.

Selected Operational and Financial Metrics

We utilize a variety of operational and financial metrics which are defined below to evaluate our performance and financial condition. As discussed in more detail herein, certain of these metrics are non-GAAP financial measures. These non-GAAP financial measures are provided along with the related GAAP financial measures as we believe they provide useful information to investors as a supplement to our consolidated financial statements, which are prepared and presented in accordance with GAAP. The presentation of non-GAAP financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

Adjusted Earnings per Share ("Adjusted EPS") is a non-GAAP measure that represents Adjusted Net Income attributable to Royal Caribbean Cruises Ltd. (as defined below) divided by weighted average shares outstanding or by diluted weighted average shares outstanding, as applicable. We believe that this non-GAAP measure is meaningful when assessing our performance on a comparative basis.

Adjusted EBITDA is a non-GAAP measure that represents EBITDA (as defined below) excluding certain items that we believe adjusting for is meaningful when assessing our profitability on a comparative basis. For the periods presented, these items included (i) other income, (ii) equity investment impairment, recovery of losses, and other, (iii) restructuring charges and other initiative expenses, and (iv) impairment losses. A reconciliation of Net Income attributable to Royal Caribbean Cruises Ltd. to Adjusted EBITDA is provided below under Results of Operations.

Adjusted Gross Margin represents Gross Margin, adjusted for payroll and related, food, fuel, other operating, and depreciation and amortization expense. Gross Margin is calculated pursuant to GAAP as total revenues less total cruise operating expenses, and depreciation and amortization.

Adjusted Net Income attributable to Royal Caribbean Cruises Ltd. is a non-GAAP measure that represents net income less net income attributable to noncontrolling interest, excluding certain items that we believe adjusting for is meaningful when assessing our performance on a comparative basis. For the periods presented, these items included (i) loss on extinguishment of debt and inducement expense, (ii) the amortization of the Silversea Cruises intangible assets resulting from the Silversea Cruises acquisition, (iii) restructuring charges and other initiative expenses, (iv) equity investments impairment, recovery of losses, and other, (v) impairment losses, and (vi) gain on sale of noncontrolling interest. A reconciliation of Net Income attributable to Royal Caribbean Cruises Ltd. to Adjusted Net Income attributable to Royal Caribbean Cruises Ltd. is provided below under Results of Operations.

Adjusted Operating Income represents operating income including income from equity investments and income taxes but excluding certain items for which we believe adjusting for is meaningful when assessing our operating performance on a comparative basis. We use this non-GAAP measure to calculate ROIC (as defined below).

Available Passenger Cruise Days (“APCD”) is our measurement of capacity and represents double occupancy per cabin multiplied by the number of cruise days for the period, which excludes canceled cruise days and cabins not available for sale. We use this measure to perform capacity and rate analysis to identify our main non-capacity drivers that cause our cruise revenue and expenses to vary.

Constant Currency is a significant measure for our revenues and expenses, which are denominated in currencies other than the U.S. Dollar. Because our reporting currency is the U.S. Dollar, the value of these revenues and expenses in U.S. Dollar will be affected by changes in currency exchange rates. Although such changes in local currency prices are just one of many elements impacting our revenues and expenses, it can be an important element. For this reason, we also monitor our revenues and expenses in "Constant Currency" - i.e., as if the current period's currency exchange rates had remained constant with the comparable prior period's rates. For the 2025 period presented, we calculate "Constant Currency" by applying the average for 2024 period exchange rates for each of the corresponding months, so as to calculate what the results would have been had exchange rates been the same throughout both periods. We do not make predictions about future exchange rates and use current exchange rates for calculations of future periods. It should be emphasized that the use of Constant Currency is primarily used by us for comparing short-term changes and/or projections. Over the longer term, changes in guest sourcing and shifting the amount of purchases between currencies can significantly change the impact of the purely currency-based fluctuations.

EBITDA is a non-GAAP measure that represents Net Income attributable to Royal Caribbean Cruises Ltd. excluding (i) interest income; (ii) interest expense, net of interest capitalized; (iii) depreciation and amortization expenses; and (iv) income tax expense. We believe that this non-GAAP measure is meaningful when assessing our operating performance on a comparative basis. A reconciliation of Net Income attributable to Royal Caribbean Cruises Ltd. to EBITDA is provided below under Results of Operations.

Gross Cruise Costs represent the sum of total cruise operating expenses plus marketing, selling and administrative expenses.

Gross Margin Yields represent Gross Margin per APCD.

Invested Capital represents the most recent five-quarter average of total debt (i.e., Current portion of long-term debt plus Long-term debt) plus the most recent five-quarter average of Total shareholders' equity. We use this measure to calculate ROIC (as defined below).

Net Cruise Costs and Net C**ruise Costs Excluding Fuel are non-GAAP measures that represent Gross Cruise Costs excluding commissions, transportation and other expenses, and onboard and other expenses and, in the case of Net Cruise Costs Excluding Fuel, fuel expenses (each of which is described above under the Description of Certain Line Items heading). In measuring our ability to control costs in a manner that positively impacts net income, we believe changes in Net Cruise Costs and Net Cruise Costs Excluding Fuel to be the most relevant indicators of our performance. A reconciliation of Gross Cruise Costs to Net Cruise Costs and Net Cruise Costs Excluding Fuel is provided below under Results of Operations. For the periods presented, Net Cruise Costs and Net Cruise Costs Excluding Fuel excludes impairment losses, and restructuring charges and other initiative expenses.

Net Yields represent Adjusted Gross Margin per APCD. We utilize Adjusted Gross Margin and Net Yields to manage our business on a day-to-day basis as we believe that they are the most relevant measures of our pricing performance because they reflect the cruise revenues earned by us net of our most significant variable costs, which are commissions, transportation and other expenses, and onboard and other expenses.

Occupancy ("Load factor"), in accordance with cruise vacation industry practice, is calculated by dividing Passenger Cruise Days (as defined below) by APCD. A percentage in excess of 100% indicates that three or more passengers occupied some cabins.

Passenger Cruise Days ("PCD") represent the number of passengers carried for the period multiplied by the number of days of their respective cruises.

Perfecta Program refers to the multi-year Adjusted EPS and ROIC goals we are seeking to achieve by end of 2027. Under our Perfecta Program, we are targeting 20% compound annual growth rate in Adjusted EPS compared to 2024 and ROIC of 17% or higher by the end of 2027.

Return on Invested Capital ("ROIC") represents Adjusted Operating Income divided by Invested Capital. We believe ROIC is a meaningful measure because it quantifies how efficiently we generated operating income relative to the capital we have invested in the business.

The use of certain significant non-GAAP measures, such as Net Yields, Net Cruise Costs and Net Cruise Costs Excluding Fuel, allows us to perform capacity and rate analysis to separate the impact of known capacity changes from other less predictable changes which affect our business. We believe these non-GAAP measures provide expanded insight to measure revenue and cost performance in addition to the standard GAAP based financial measures. There are no specific rules or regulations for determining non-GAAP measures, and as such, they may not be comparable to other companies within the industry.

Results of Operations

Summary

Net Income attributable to Royal Caribbean Cruises Ltd. and Adjusted Net Income attributable to Royal Caribbean Cruises Ltd. for the second quarter of 2025 was $1.21 billion and $1.20 billion, compared to Net Income and Adjusted Net Income of $854 million and $882 million, respectively, for the second quarter of 2024.

Net Income attributable to Royal Caribbean Cruises Ltd. and Adjusted Net Income attributable to Royal Caribbean Cruises Ltd. for the six months ended June 30, 2025 was $1.94 billion and $1.95 billion, compared to Net Income and Adjusted Net Income of $1.2 billion and $1.4 billion, respectively, for the six months ended June 30, 2024.

Significant items for the quarter and six months ended June 30, 2025 include:

• Total revenues increased $428 million and $699 million for the quarter and six months ended June 30, 2025 as compared to the same periods in 2024. The increase was primarily due to an increase in capacity, ticket prices and onboard spending in 2025, compared to same period in 2024.

• Total cruise operating expenses, increased $131 million and $153 million for the quarter and six months ended June 30, 2025 as compared to the same periods in 2024. The increase was primarily due to an increase in capacity in 2025 compared to the same periods in 2024.

• In February 2025, TUI Cruises, our 50% joint venture, took delivery of Mein Schiff Relax.

• In March 2025, we completed privately negotiated exchange with certain holders of 6.00% Convertible Senior Notes due 2025 to exchange approximately $213 million in aggregate principal amount for approximately 3 million shares of common stock and $214 million in cash.

• In May 2025, we amended our two revolving credit facilities, bringing our aggregate revolving credit capacity to $6.4 billion, and extended the termination date of one of the revolving credit facilities from October 2026 to October 2030.

For further information regarding the debt transactions discussed above, refer to Note 6*. Debt* to our consolidated financial statements under Item 1. Financial Statements.

Operating results for the quarters and six months ended June 30, 2025 compared to the same periods in 2024 are shown in the following tables (in millions, except per share data):

We reported Net Income attributable to Royal Caribbean Cruises Ltd., Adjusted Net Income attributable to Royal Caribbean Cruises Ltd., Earnings per Share and Adjusted Earnings per Share as shown in the following table (in millions, except per share data. Certain amounts may not add due to use of rounded numbers):

(1)For 2025, includes $10 million of inducement expense related to the partial settlement of our 6.00% convertible notes due 2025. These amounts are included in Interest expense, net of interest capitalized within our consolidated statements of comprehensive income (loss). Refer to Note 6*. Debt* to our consolidated financial statements under Item 1. Financial Statements for further information.

(2)Represents the amortization of the Silversea Cruises intangible assets resulting from the 2018 Silversea Cruises acquisition.

(3)These amounts are included in Marketing, selling and administrative expenses within our consolidated statements of comprehensive income (loss).

(4)For 2024, represents property and equipment impairment charges related to certain construction in progress assets which we determined would no longer be completed. These amounts are included in Other operating within our consolidated statements of comprehensive income (loss).

(5)Represents gain on sale of noncontrolling interest of Floating Docks and Grand Bahama Shipyard. These amounts are included in Other income within our consolidated statements of comprehensive income (loss).

(6)Diluted EPS includes the add-back of dilutive inducement and interest expense related to our convertible notes of $1 million and $16 million for the quarter and for the six months ended June 30, 2025, respectively, and $19 million and $38 million for the quarter and six months ended June 30, 2024, respectively. Refer to Note 4*. Earnings Per Share* to our consolidated financial statements under Item 1. Financial Statements for further information.

(7)Adjusted Diluted EPS includes the add-back of dilutive interest expense related to our convertible notes of $1 million and $6 million for the quarter and six months ended June 30, 2025, respectively, and $19 million and $38 million for the quarter and six months ended June 30, 2024, respectively.

Selected statistical information is shown in the following table:

EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin were calculated as follows (in millions, except APCD and per APCD data. Certain amounts may not add due to use of rounded numbers; reported EBITDA, Adjusted EBITDA, and per APCD and Margin amounts are calculated from the underlying dollar amounts):

(1)These amounts are included in Other expense within our consolidated statements of comprehensive income (loss).

(2)Represents net non-operating income. The amount excludes income tax expense, included in the EBITDA calculation above.

(3)These amounts are included in Marketing, selling and administrative expenses within our consolidated statements of comprehensive income (loss).

(4)For 2024, represents property and equipment impairment charges related to certain construction in progress assets. These amounts are included in Other operating within our consolidated statements of comprehensive income (loss).

Gross Margin Yields and Net Yields were calculated by dividing Gross Margin and Adjusted Gross Margin by APCD as follows (in millions, except APCD and Yields. Certain amounts may not add due to use of rounded numbers; reported Adjusted Gross Margin and Yields are calculated from the underlying dollar amounts):

Gross Cruise Costs, Net Cruise Costs and Net Cruise Costs excluding Fuel were calculated as follows (in millions, except APCD and costs per APCD. Certain amounts may not add due to use of rounded numbers; reported Gross Cruise Costs, Net Cruise Costs, Net Cruise Costs excluding Fuel, and per APCD amounts are calculated from the underlying dollar amounts):

(1)For 2024, represents property and equipment impairment charges related to certain construction in progress assets. This amount is included in Other operating within our consolidated statements of comprehensive income (loss).

(2)These amounts are included in Marketing, selling and administrative expenses within our consolidated statements of comprehensive income (loss).

Quarter Ended June 30, 2025 Compared to Quarter Ended June 30, 2024

In this section, references to 2025 refer to the quarter ended June 30, 2025 and references to 2024 refer to the quarter ended June 30, 2024.

Revenues

Total revenues for 2025 increased $428 million to $4.5 billion from $4.1 billion in 2024.

Passenger ticket revenues comprised 70.5% of our 2025 total revenues. Passenger ticket revenues for 2025 increased by $312 million, or 10.8% to $3.2 billion from $2.9 billion in 2024. The increase was primarily due to:

• $167 million driven by 5.8% capacity growth as a result of the additions of Utopia of the Seas and Silver Ray compared to same period in 2024, and

• $144 million driven by yield growth as a result of higher load factors and higher pricing on both existing ships and new hardware in 2025 compared to the same period in 2024.

The remaining 29.5% of 2025 total revenues was comprised of Onboard and other revenues, which increased $116 million, or 9.5% to $1.3 billion in 2025 from $1.2 billion in 2024. The increase was primarily due to:

• $71 million driven by 5.8% capacity growth as a result of the additions of Utopia of the Seas and Silver Ray compared to same period in 2024; and

• $45 million driven by yield growth as a result of higher load factors and higher pricing on both existing ships and new hardware in 2025 compared to the same period in 2024.

Cruise Operating Expenses

Total Cruise operating expenses for 2025 increased $131 million to $2.3 billion from $2.2 billion in 2024. The increase was primarily due to the 5.8% increase in capacity noted above which increased cruise operating expenses by $125 million in 2025 compared to the same period in 2024.

Other Income (Expense)

Interest expense, net of interest capitalized for 2025 decreased $70 million, to $228 million from $298 million in 2024. The decrease was primarily due lower interest expense resulting from the extinguishment and refinancing of certain indebtedness at lower rates compared to the same period in 2024. Additionally, loss on extinguishment of debt of $17 million in 2024 compared to none in during the same period in 2025.

Equity investment income for 2025 increased $51 million, to $107 million from $57 million in 2024. The increase in income was primarily due to an increase in income from TUI Cruises, one of our equity investments.

Other comprehensive income (loss)

Other comprehensive income (loss) was $176 million in 2025 compared to a loss of $(37) million for the same period in 2024. The increase of $213 million was primarily due to a Gain on cash flow derivative hedges of $181 million in 2025 compared to loss of $(31) million in 2024, mostly as a result of a significant increase in the fair value of our FX forward swaps in 2025 compared to 2024.

Six Months Ended June 30, 2025 Compared to Six Months Ended June 30, 2024

In this section, references to 2025 refer to the six months ended June 30, 2025 and references to 2024 refer to the six months ended June 30, 2024.

Revenues

Total revenues for 2025 increased $0.7 billion to $8.5 billion from $7.8 billion in 2024.

Passenger ticket revenues comprised 69.6% of our 2025 total revenues. Passenger ticket revenues for 2025 increased by $0.5 billion, or 9.4% to $5.9 billion from $5.4 billion in 2024. The increase was primarily due to:

• an increase of $274 million driven by yield growth as a result of higher load factors and higher pricing on both existing ships as well as the benefit of new ships, compared to the same period in 2024; and

• an increase of $239 million driven by 4.4% capacity growth as a result of the additions of Utopia of the Seas and Silver Ray compared to the same period in 2024.

The remaining 30.4% of 2025 total revenues was comprised of Onboard and other revenues, which increased $186 million, or 7.7% to $2.6 billion in 2025 from $2.4 billion in 2024. The increase was primarily due to:

• a $106 million increase driven by an 4.4% capacity growth as a result of the additions of new ships noted above compared to the same period in 2024; and

• a $79 million increase driven by yield growth as a result of higher load factors and higher pricing on both existing ships and new ships in 2025 compared to the same period in 2024.

Cruise Operating Expenses

Total Cruise operating expenses for 2025 increased $153 million to $4.4 billion from $4.2 billion in 2024. The increase was primarily due to:

*•*the increase in capacity noted above increased cruise operating expenses by $186 million, offset by:

• a decrease of $29 million reduced fuel expenses in 2025 compared to the same period in 2024.

Marketing, Selling and Administrative Expenses

Marketing, selling and administrative expenses for 2025 increased $70 million, or 7%, to $1.1 billion from $1.0 billion in 2024. This increase primarily relates to an increase in payroll and benefits expense driven by increased headcount and higher spending on marketing in 2025 compared to the same period in 2024.

Other Income (Expense)

Interest expense, net of interest capitalized for 2025 decreased $244 million, to $0.5 billion from $0.7 billion in 2024. The decrease was primarily due to the $133 million loss on extinguishment of debt in 2024 compared to an immaterial amount during the same period in 2025. Additionally, lower interest expense resulting from extinguishment and refinancing of certain indebtedness at lower rates compared to the same period in 2024.

Equity investment income for 2025 increased $58 million, to $155 million from $97 million in 2024. The increase in income was primarily due to an increase in income from TUI Cruises, one of our equity investments.

Depreciation and Amortization Expenses

Depreciation and amortization expenses for 2025 increased $49 million, or 6.3%, to $829 million from $780 million in 2024. The increase was primarily due to the additions of Utopia of the Seas and Silver Ray compared to the same period in 2024.

Other comprehensive income (loss)

Other comprehensive income was $283 million in 2025 compared to $20 million for the same period in 2024. The increase of $263 million, was primarily due to a Gain on cash flow derivative hedges of $309 million in 2025 compared to $13 million in 2024, mostly as a result of a significant increase in the fair value of our FX forward swaps in 2025 compared to 2024.

Future Application of Accounting Standards

Refer to Note 2*. Summary of Significant Accounting Policies* to our consolidated financial statements under Item 1. Financial Statements.

Liquidity and Capital Resources

Sources and Uses of Cash

Cash flow generated from operations provides us with a significant source of liquidity. Net cash provided by operating activities was $3.4 billion and $2.9 billion for the six months ended June 30, 2025, and 2024, respectively. Cash flows from operating activities increased $0.5 billion primarily driven by an increase in operating income.

Net cash used in investing activities was $1.1 billion for the six months ended June 30, 2025, compared to $2.5 billion for the same period in 2024. The decrease of $1.3 billion in Cash flows used in investing activities was primarily attributable capital expenditures related to the delivery of Utopia of the Seas and Silver Ray in 2024, compared to no ship deliveries during the same period in 2025.

Net cash used in financing activities was $1.9 billion for the six months ended June 30, 2025, compared to $0.5 billion for the same period in 2024. The change of $1.4 billion was primarily attributable to a net decrease in debt proceeds of $939 million, and $589 million related to payment of dividends and purchase of treasury stock, offset by a decrease of $102 million of premium on repayments of debt in 2025 compared to the same period in 2024.

Future Capital Commitments

Capital Expenditures

Our future capital commitments consist primarily of new ship orders. As of June 30, 2025, the dates that the ships on order by our Global and Partner Brands are expected to be delivered, and their approximate berths are as follows:

(1) In July 2025, we took delivery of Star of the Seas.

Our future capital commitments consist primarily of new ship orders. As of June 30, 2025, the aggregate expected cost of our ships on order presented in the table above, excluding any ships on order by our Partner Brands, was $12.1 billion, of which we had deposited $1.4 billion. Approximately 50.2% of the aggregate cost was exposed to fluctuations in the Euro exchange rate at June 30, 2025. Refer to Note 8. Commitments and Contingencies and Note 11*. Fair Value Measurements and Derivative Instruments* to our consolidated financial statements under Item 1. Financial Statements for further information.

As of June 30, 2025, we anticipate overall 2025 capital expenditures of approximately $5 billion, primarily related to our existing ships on order, and land-based destination initiatives. This amount does not include any ships on order by our Partner Brands.

Material Cash Requirements

As of June 30, 2025, our material cash requirements were as follows (in millions):

(1)Long-term debt obligations mature at various dates through fiscal year 2037 and bear interest at fixed and variable rates. Interest on variable-rate debt is calculated based on forecasted debt balances, including the impact of interest rate swap agreements, using the applicable rate at June 30, 2025. Debt denominated in other currencies is calculated based on the applicable exchange rate at June 30, 2025.

(2)Amounts primarily represent future commitments with remaining terms in excess of one year to pay for our usage of certain port facilities, marine consumables, services and maintenance contracts.

(3)Amounts are based on contractual installment and delivery dates for our ships on order. Included in these figures are $8.3 billion in final contractual installments, which have committed financing with sovereign guarantees covering approximately 80% of the cost of the ships on order for our Global Brands. Amounts do not include potential obligations which remain subject to cancellation at our sole discretion or any agreements entered for ships on order that remain contingent upon completion of conditions precedent.

Refer to Note 6*. Debt* to our consolidated financial statements under Item 1. Financial Statements for maturities related to debt.

Refer to Note 7*. Leases* to our consolidated financial statements under Item 1. Financial Statements for maturities related to lease liabilities.

Refer to Funding Needs and Sources for discussion on the planned funding of the above material cash requirements.

As a normal part of our business, depending on market conditions, pricing and our overall growth strategy, we continuously consider opportunities to enter into contracts for the building of additional ships. We may also consider the sale of ships or the purchase of existing ships. We continuously consider potential acquisitions and strategic alliances. If any of these were to occur, they would be financed through the incurrence of additional indebtedness, the issuance of additional shares of equity securities or through cash flows from operations.

Off-Balance Sheet Arrangements

Refer to Note 5*. Investments and Other Assets* to our consolidated financial statements under Item 1. Financial Statements for ownership restrictions related to TUI Cruises.

Refer to Note 3*. Revenue* to our consolidated financial statements under Item 1. Financial Statements for credit card processor agreements for export credit agency guarantees.

Refer to Note 8*. Commitments and Contingencies* to our consolidated financial statements under Item 1. Financial Statements for other agreements.

As of June 30, 2025, other than the items described above, we are not party to any other off-balance sheet arrangements, including guarantee contracts, retained or contingent interest, certain derivative instruments and variable interest entities, that either have, or are reasonably likely to have, a current or future material effect on our financial position.

Funding Needs and Sources

We have significant contractual obligations of which our debt service obligations and the capital expenditures associated with our ship purchases represent our largest funding needs. As of June 30, 2025, we had $7.8 billion of committed financing for our ships on order. As of June 30, 2025, our obligations due through June 30, 2026 primarily consisted of $938 million related to debt maturities, $887 million related to interest on debt and $4.6 billion related to progress payments on our ship orders and, based on the expected delivery date, the final installments payable due upon the delivery of Star of the Seas and Celebrity Xcel. We have historically relied on a combination of cash flows provided by operations, draw-downs under our available credit facilities, the incurrence of additional debt and/or the refinancing of our existing debt and the issuance of additional shares of equity securities to fund our obligations.

As of June 30, 2025, we had liquidity of $7.1 billion, including cash and cash equivalents of $0.7 billion, and $6.4 billion of undrawn revolving credit facility capacity.

If any person acquires ownership of more than 50% of our common stock or, subject to certain exceptions, during any 24-month period, a majority of our board of directors is no longer comprised of individuals who were members of our board of directors on the first day of such period, we may be obligated to prepay indebtedness outstanding under our credit facilities, which we may be unable to replace on similar terms. Our public debt securities also contain change of control provisions that would be triggered by a third-party acquisition of greater than 50% of our common stock coupled with a ratings downgrade. If this were to occur, it would have an adverse impact on our liquidity and operations.

Based on our assumptions and estimates and our financial condition, we believe that we have sufficient financial resources to fund our obligations for at least the next twelve months from the issuance of these financial statements. However, there is no assurance that our assumptions and estimates are accurate as there is inherent uncertainty in our ability to predict future liquidity requirements.

Debt Covenants

Our export credit facilities and our non-export credit facilities, and certain of our credit card processing agreements contain covenants that require us, among other things, to maintain a fixed charge coverage ratio, and limit our net debt-to-capital ratio. As of June 30, 2025, we were in compliance with our financial covenants and we estimate that we will be in compliance for at least the next twelve months.

Dividends

The declaration of dividends shall at all times be subject to the final determination of our Board of Directors that a dividend is prudent at that time in consideration of the needs of the business. During the quarter ended June 30, 2025, our Board of Directors declared a cash dividend on our common stock of $0.75 per share, which was paid in July 2025.

For a discussion of our market risks, refer to Part II, Item 7A. Quantitative and Qualitative Disclosures About Market Risk in our Annual Report on Form 10-K for the year ended December 31, 2024. There have been no material changes to our exposure to market risks since the date of our 2024 Annual Report.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our President and Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of our disclosure controls and procedures, as such term is defined in Exchange Act Rule 13a-15(e), as of the end of the period covered by this Quarterly Report on Form 10-Q. Based upon such evaluation, our President and Chief Executive Officer and Chief Financial Officer concluded that those controls and procedures are effective to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to management, including our President and Chief Executive Officer and our Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure and are effective to provide reasonable assurance that such information is recorded, processed, summarized and reported within the time periods specified by the rules and forms of the Securities and Exchange Commission (the "SEC").

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting identified in connection with the evaluation required by Exchange Act Rule 13a-15(d) during the quarter ended June 30, 2025, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations on Effectiveness of Controls

It should be noted that any system of controls, however well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives of the system will be met. In addition, the design of any control system is based in part upon certain assumptions about the likelihood of future events. Because of these and other inherent limitations of control systems, there is only reasonable assurance that our controls will succeed in achieving their goals under all potential future conditions.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

As previously reported, a lawsuit was filed against us in August 2019 in the U.S. District Court for the Southern District of Florida (the "Court") under Title III of the Cuban Liberty and Democratic Solidarity Act, also known as the Helms-Burton Act. The complaint filed by Havana Docks Corporation ("Havana Docks Action") alleges it holds an interest in the Havana Cruise Port Terminal, which was expropriated by the Cuban government. The complaint further alleges that we trafficked in the terminal by embarking and disembarking passengers at these facilities. The plaintiffs seek all available statutory remedies, including the value of the expropriated property, plus interest, treble damages, attorneys’ fees and costs.

The Court entered final judgment in December 2022 in favor of the plaintiff and awarded damages and attorneys' fees to the plaintiff in the aggregate amount of approximately $112 million. We then appealed the judgment to the United States Court of Appeals for the 11th Circuit. On October 22, 2024, the 11th Circuit issued an opinion reversing the lower court’s judgment. The plaintiff's petition for a rehearing by the full 11th Circuit was subsequently denied. The plaintiff has petitioned the United States Supreme Court for a writ of certiorari. During the fourth quarter of 2022, we recorded a charge of approximately $130 million to Other income (expense) within our consolidated statements of comprehensive income (loss) related to the Havana Docks Action, including post-judgment interest and related legal defense costs and bonding fees. Following the 11th Circuit's denial of the rehearing petition, we released approximately $124 million of the previously recorded loss contingency for the year ended December 31, 2024, recognized within Other income (expense) within our consolidated statements of comprehensive income (loss).

In addition, we are routinely involved in claims typical within the cruise vacation industry. The majority of these claims are covered by insurance. We believe the outcome of such claims, net of expected insurance recoveries, will not have a material adverse impact on our financial condition or results of operations and cash flows.

There have been no material changes from risk factors previously disclosed in the Company’s most recent Annual Report on Form 10-K. See the discussions of the Company’s risk factors under Part I, Item 1A in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Share Repurchases

During the quarter ended June 30, 2025, there were no common stock repurchases.

As of June 30, 2025, we have approximately $759 million that remains available for future stock repurchase transactions under a 12-month common stock repurchase program for up to $1.0 billion authorized by our board of directors on February 12, 2025. Refer to Note 9*. Shareholders' Equity* to our consolidated financial statements under Item 1. Financial Statements for further information.

Rule 10b5-1 Plan Elections

During the quarter ended June 30, 2025, none of our directors or officers (as defined in Rule 16a-1 under the Exchange Act) adopted or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement" (as those terms are defined in Item 408 of Regulation S-K).

Interactive Data File

101 The following financial statements of Royal Caribbean Cruises Ltd. for the period ended June 30, 2025, formatted in iXBRL (Inline extensible Reporting Language) are filed herewith:

(i) the Consolidated Statements of Comprehensive Income (Loss) for quarter and six months ended June 30, 2025 and 2024;

(ii) the Consolidated Balance Sheets at June 30, 2025 and December 31, 2024;

(iii) the Consolidated Statements of Cash Flows for the six months ended June 30, 2025 and 2024; and

(iv) the Notes to the Consolidated Financial Statements, tagged in summary and detail.

104 Cover page interactive data file (the cover page XBRL tags are embedded within the Inline XBRL document).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.