Royal Caribbean Cruises adjusted its financial guidance on Tuesday, citing geopolitical tensions in the Middle East as a factor influencing cruise demand. The company reduced its revenue growth expectation to 9% annually, representing a decline from the 10% forecast issued in the preceding quarter.
The cruise operator also moderated its outlook for net yields, which measure daily revenue generated per passenger. The company now projects net yields will increase between 2.35% and 2.85% in 2026, narrowing the range from the previous estimate of 2.3% to 3.3% provided three months earlier.
Despite the downward adjustments, Royal Caribbean’s earnings per share guidance moved in a positive direction. The company expects earnings between $17.73 and $17.87 per share for the full year, an increase from April’s projected range of $17.10 to $17.50 per share.
Royal Caribbean characterized the effect of Middle Eastern conflict on bookings as modest and near-term in nature, suggesting the company views the impact as temporary rather than structural. The guidance revision reflects broader headwinds facing the cruise industry, as cruise operators have begun underperforming the broader travel market for the first time since the COVID-19 pandemic recovery period. The company’s acknowledgment of geopolitical factors affecting bookings underscores how international conflicts can influence consumer travel decisions and discretionary spending on leisure experiences.
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