Royal Caribbean Cruises Ltd. operates in the global vacation industry, which the filing describes as a large and expanding market of over $2 trillion ¹. The company currently holds a small share of this market ². The cruise industry is a well-established vacation sector in North American, European and Australian markets and a developing sector in several emerging markets ³. Industry market penetration rates grew from 3.36% to 3.89% for North America, from 1.25% to 1.41% for Europe, and from 0.08% to 0.20% for Asia/Pacific during the five year period from 2015 through 2019 ⁴. During 2025, industry market penetration rates were 5.96% for North America, 1.73% for Europe, and 0.09% for Asia/Pacific ⁵. The global cruise industry carried approximately 37 million guests in 2025, 35 million guests in 2024, and 32 million guests in 2023 ⁶. The cruise industry was served by a fleet with a weighted average of approximately 725,000 berths during 2025 with approximately 430 ships at the end of 2025 ⁷. As of December 31, 2025, there were approximately 47 ships on order with an estimated 113,000 berths that are expected to be placed in service in the global cruise market through 2029 ⁸.

The company's principal cruise competitors named in the filing are Carnival Corporation & plc, Disney Cruise Line, MSC Cruises, Norwegian Cruise Line Holdings Ltd, Viking, and Virgin Voyages ⁹. The company's competitive edge is grounded in its focus on innovation, best evidenced in the quality and variety of ships in its fleet, its exceptional product offerings and service provided by its dedicated crew, its growing portfolio of private destinations and experiences, the range of itineraries and global destinations tailored to meet diverse guest preferences, and its use and leveraging of technology ¹⁰. Together, the company's Global Brands and Partner Brands have a combined fleet of 69 ships in the cruise vacation industry with an aggregate capacity of approximately 179,720 berths as of December 31, 2025 ¹¹. The company's ships offer a selection of worldwide itineraries that call on more than 1,000 destinations on all seven continents ¹².

The company generates revenue primarily through the sale of cruise vacations, with passenger ticket revenues accounting for approximately 70% of total revenues in 2025, 2024 and 2023 ¹³. Onboard and other revenues accounted for approximately 30% of total revenues in 2025, 2024, and 2023 ¹⁴. The company's payment terms generally require an upfront deposit to confirm a reservation, with the balance due prior to sailing ¹⁵. The company's Global Brands have historically sourced passengers from similar markets around the world and operated in similar economic environments with a significant degree of commercial overlap ¹⁶. The company's loyalty programs collectively have over 28 million enrolled members worldwide ¹⁷.

Royal Caribbean is the world's largest cruise vacation brand and operates 29 ships with an aggregate capacity of approximately 111,000 berths ¹⁸. As of December 31, 2025, Royal Caribbean had four ships on order with an aggregate capacity of approximately 22,500 berths ¹⁹. Celebrity Cruises operates 15 ships with an aggregate capacity of approximately 38,900 berths ²⁰. As of December 31, 2025, Celebrity Cruises had one Edge-class ship on order, Celebrity Xcite, with an aggregate capacity of approximately 3,250 berths, which is expected to be delivered in 2028 ²¹. In 2025, Celebrity Cruises announced the launch of Celebrity River Cruises, offering a premium river cruise vacation with a new fleet including agreements for the commitment of an initial order of 10 ships ²². Subsequently, in January 2026 we entered into additional commitments for 10 new ships that will expand the river cruise fleet to 20 vessels ²³. The first four river cruise ships on order have an aggregate capacity of approximately 680 berths ²⁴. Silversea operates 12 ships, with an aggregate capacity of approximately 5,500 berths ²⁵. TUI Cruises operates eight ships, with an aggregate capacity of approximately 22,700 berths ²⁶. As of December 31, 2025, TUI Cruises had three ships on order with an aggregate capacity of approximately 12,300 berths ²⁷. Hapag-Lloyd Cruises operates two luxury liners and three smaller expedition ships, with an aggregate capacity of approximately 1,620 berths ²⁸.

In 2025, Royal Caribbean introduced Star of the Seas, and Celebrity Cruises introduced Celebrity Xcel ²⁹. In July 2025, the company closed on its acquisition of the Port of Costa Maya and adjacent land in Mahahual, Mexico for a final purchase price of $294 million ³⁰. The first Royal Beach Club, Paradise Island, opened in December 2025 in Nassau, Bahamas ³¹. In December 2025, the company signed agreements with Chantiers de l'Atlantique to build two ships of a new generation for Royal Caribbean, known as Discovery-class ships, which are expected to enter service in 2029 and 2032, respectively ³². During the quarter ended December 31, 2025, the company entered into an agreement with Meyer Turku Oy to build a fifth Icon-class ship for delivery in 2028 ³³. In May 2025, the company amended its two revolving credit facilities, bringing its 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 ³⁴. In October 2025, the company issued $1.5 billion aggregate principal amount of 5.375% senior notes due 2036 ³⁵. In February 2025, the company announced a 12-month common stock repurchase program for up to $1.0 billion that was completed in November 2025 ³⁶. On December 10, 2025, the company announced a common stock repurchase program for up to $2.0 billion ³⁷. During the quarter ended December 31, 2025, the company repurchased 0.6 million of its common stock under this program, for a total of $159 million in open market transactions ³⁸. As of December 31, 2025, the company has $1.8 billion that remains available for future common stock repurchase under the program ³⁹. In 2025, the company returned $2.0 billion in capital to shareholders through dividends and share repurchases ⁴⁰.

Total revenues in 2025 increased by $1.5 billion and were $17.9 billion, exceeding the previous record of $16.5 billion in 2024 ⁴¹. Net Income attributable to Royal Caribbean Cruises Ltd. was $4.3 billion, or $15.61 per diluted share, compared to the 2024 Net Income attributable to Royal Caribbean Cruises Ltd. of $2.9 billion, or $10.94 per diluted share ⁴². Adjusted EBITDA was $7.0 billion ⁴³. Operating Income was $4.9 billion ⁴⁴. ROIC was 18.0% ⁴⁵. Gross Margin Yields increased 8.5% as-reported, and Net Yields increased 3.8% as-reported (3.7% in Constant-Currency), both compared to 2024 ⁴⁶. In 2025 the company generated $6.5 billion in operating cash flow ⁴⁷.

The filing states that in 2026, the company expects its capacity to increase by 6.7% compared to 2025, with a full year of Star of the Seas and Celebrity Xcel, and delivery of Legend of the Seas in the summer ⁴⁸. The company's portfolio of exclusive land-based destinations is expected to reach 8 by 2028, with additions of Silversea's Cormorant at 55 South, Royal Beach Club Santorini, and Royal Beach Club Cozumel on the horizon ⁴⁹. The company will continue development of Perfect Day Mexico and Royal Beach Club Lelepa ⁵⁰. The company's new ships, deployment, and enhanced product offerings are expected to drive growth in Net Yields, total revenues, and earnings ⁵¹.

The company's Destination Net Zero strategy focuses on achieving net zero emissions by 2050 and delivering a net zero capable ship by 2035 ⁵². This strategy also includes reducing the company's carbon intensity by 15% or greater as compared to 2024 by 2027 ⁵³. The company's Destination Net Zero's four-pronged approach includes modernizing the fleet with new energy-efficient and alternatively fueled vessels, continued investment in energy efficiency programs, development of alternative fuel and alternative power solutions, and optimized deployment and integration of strategic shore-based supply chains ⁵⁴.

The filing states that the company is focused on maintaining a strong liquidity position and a balanced debt maturity profile, while ensuring appropriate leverage, opportunistically reducing interest expense, and maintaining an unsecured balance sheet ⁵⁵. The company believes these strategies together with its continued focus on increasing operating income and margin, as well as disciplined capital allocation, enhance its ability to achieve its overall goal of maximizing return on invested capital and long-term shareholder value ⁵⁶.

As of December 31, 2025, the company anticipates overall full year capital expenditures, based on its existing ships on order, will be approximately $5 billion for 2026 ⁵⁷. This amount does not include any ships on order by the company's Partner Brands ⁵⁸. As of December 31, 2025, the aggregate cost of the company's ships on order, excluding any ships on order by its Partner Brands, was approximately $11.3 billion, of which the company had deposited $1.0 billion ⁵⁹. Approximately 64.1% of the aggregate cost is exposed to fluctuations in the Euro exchange rate at December 31, 2025 ⁶⁰. The company has committed financing arrangements in place covering approximately 80% of the cost of the ship for the five ships on order for its Global Brands, all of which include sovereign financing guarantees, excluding ships on order for Celebrity River Cruises ⁶¹. As of December 31, 2025, the company had approximately $10.4 billion of committed financing for its ships on order, which excludes ships on order for Celebrity River Cruises ⁶². As of December 31, 2025, the company had liquidity of $7.2 billion, including cash and cash equivalents of $0.8 billion and $6.4 billion of undrawn revolving credit facility capacity ⁶³.

In February 2026, the company's Board declared a dividend of $1.50 per share, payable in April 2026 ⁶⁴. During the fourth and third quarters of 2025, the company's Board declared dividends of $1.00 per share, which were paid in January 2026 and October 2025, respectively ⁶⁵. During the second and first quarters of 2025 the Board declared dividends of $0.75 per share which were paid in July 2025 and April 2025, respectively ⁶⁶.

The filing identifies several headwinds and constraints. Weak or uncertain economic conditions may impact consumer confidence and pose a risk as vacationers postpone or reduce discretionary spending ⁶⁷. The company's operating costs, including fuel, food, payroll and benefits, airfare, taxes, insurance, and security costs, can be and have been subject to increases due to market forces and economic or geopolitical conditions or other factors beyond the company's control, including global inflationary pressures ⁶⁸. Terrorist attacks, war, conflicts, civil unrest and other hostilities could have a material adverse impact on the company's business and results of operations ⁶⁹. Disease outbreaks and increased concern related to illness when traveling to, from, and on the company's ships, could cause a decrease in demand for cruises, guest cancellations, travel restrictions, an unavailability of ports and/or destinations, cruise cancellations, ship redeployments and an inability to source crew, provisions or supplies from certain places ⁷⁰. The company's reliance on shipyards, their subcontractors and suppliers to implement its newbuild and ship upgrade programs and to repair and maintain its ships exposes it to risks which could adversely impact its business ⁷¹. An increase in capacity worldwide or excess capacity in a particular market could adversely impact the company's cruise sales and/or pricing ⁷². As of December 31, 2025, a total of 47 new ships with approximately 113,000 berths were on order for delivery through 2029 in the cruise industry, including twelve ships currently scheduled to be delivered to the company's Global and Partner Brands ⁷³.

Management's message emphasizes that 2025 performance was exceptionally strong ⁸². The company took delivery of two ships (Star of the Seas and Celebrity Xcel) and continued to expand its vacation ecosystem with the opening of Royal Beach Club Paradise Island, closing on the acquisition of the port of Costa Maya in 2025, and the announcements of Celebrity River Cruises, launching in 2027, and the expansion of its private destination portfolio with Royal Beach Club Santorini ⁸³. The company achieved strong financial performance, including 8.5% Gross Margin Yield growth as-reported, Net Yields increased 3.8% as-reported (3.7% in Constant-Currency), Net Income of $4.3 billion and Adjusted EBITDA of $7.0 billion, Operating Income of $4.9 billion, and ROIC of 18.0% ⁸⁴. The company maintained a strong balance sheet and achieved investment-grade ratings across all three major credit rating agencies ⁸⁵. In 2025 the company generated $6.5 billion in operating cash flow, maintained an unsecured balance sheet, managed debt maturities, and returned $2.0 billion in capital to shareholders through dividends and share repurchases ⁸⁶. In 2026, the company expects its capacity to increase by 6.7% compared to 2025, with a full year of Star of the Seas and Celebrity Xcel, and delivery of Legend of the Seas in the summer ⁸⁷. The company's portfolio of exclusive land-based destinations is expected to reach 8 by 2028, with additions of Silversea's Cormorant at 55 South, Royal Beach Club Santorini, and Royal Beach Club Cozumel on the horizon ⁸⁸. The company's new ships, deployment, and enhanced product offerings are expected to drive growth in Net Yields, total revenues, and earnings ⁸⁹.

For the year ended December 31, 2025, total revenues were $17.935 billion ⁹⁰, compared to $16.484 billion ⁹¹ in 2024. Net Income attributable to Royal Caribbean Cruises Ltd. was $4.268 billion ⁹² in 2025, compared to $2.877 billion ⁹³ in 2024. Diluted earnings per share were $15.61 ⁹⁴ in 2025, compared to $10.94 ⁹⁵ in 2024. Operating Income was $4.910 billion ⁹⁶ in 2025, compared to $4.106 billion ⁹⁷ in 2024. Adjusted EBITDA was $7.025 billion ⁹⁸ in 2025, compared to $5.971 billion ⁹⁹ in 2024. Net cash provided by operating activities was $6.465 billion ¹⁰⁰ in 2025, compared to $5.265 billion ¹⁰¹ in 2024. As of December 31, 2025, the company had cash and cash equivalents of $825 million ¹⁰² and total long-term debt of $18.165 billion ¹⁰³. The company's ROIC was 18.0% ¹⁰⁴ for the twelve months ended December 31, 2025. Significant one-time items in 2025 included a loss on extinguishment of debt and inducement expense of $16 million ¹⁰⁵, restructuring charges and other initiatives expenses of $8 million ¹⁰⁶, and a gain on sale of noncontrolling interest of $11 million ¹⁰⁷. In 2024, the company recorded a release of the loss contingency of $124 million in connection with the Havana Docks litigation ¹⁰⁸. Equity investment income for 2025 increased $154 million to $414 million from $260 million in 2024 ¹⁰⁹.

Adverse economic or other conditions could reduce the demand for cruises and passenger spending, adversely impacting the company's operating results, cash flows and financial condition including impairing the value of its goodwill, ships, trademarks and other assets ⁷⁴. The company's operating costs, including fuel, food, payroll and benefits, airfare, taxes, insurance, and security costs, can be and have been subject to increases due to market forces and economic or geopolitical conditions or other factors beyond the company's control, including global inflationary pressures ⁷⁵. Terrorist attacks, war, and other similar events could have a material adverse impact on the company's business and results of operations ⁷⁶. Disease outbreaks or an increase in concern about the risk of illness could adversely impact the company's business and results of operations, and may cause significant disruptions, create new risks, and exacerbate existing risks ⁷⁷. The company's reliance on shipyards, their subcontractors and suppliers to implement its newbuild and ship upgrade programs and to repair and maintain its ships exposes it to risks which could adversely impact its business ⁷⁸. An increase in capacity worldwide or excess capacity in a particular market could adversely impact the company's cruise sales and/or pricing ⁷⁹. As of December 31, 2025, a total of 47 new ships with approximately 113,000 berths were on order for delivery through 2029 in the cruise industry, including twelve ships currently scheduled to be delivered to the company's Global and Partner Brands ⁸⁰. The company's sustainability activities, including initiatives to sustain the planet, energize communities and accelerate innovation, could result in reputational risks, increased costs and other risks ⁸¹.