The cruise industry has largely completed its post-pandemic recovery. Occupancy rates have returned to historical levels, pricing remains healthy, and consumers continue spending on travel despite broader economic uncertainty.
With Carnival (NYSE: CCL), Royal Caribbean (NYSE: RCL), and Norwegian Cruise Line (NYSE: NCLH) all reporting earnings over the next two weeks, we'll soon get another update on booking trends and profitability. But if I had to choose just one stock today, it would be Royal Caribbean. Here's why.
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Among the three largest cruise operators, Royal Caribbean has consistently produced the strongest financial results. During the first quarter of 2026, Royal Caribbean generated approximately $4.54 billion in revenue, while adjusted earnings per share increased to $3.60.
The company continues to outperform on profitability, as well. Higher ticket prices, increased onboard spending, and disciplined cost management helped Royal Caribbean generate some of the strongest margins in the leisure travel industry. Management noted that onboard purchases and pre-cruise spending remained above prior-year levels, while customer demand continued to be supported by travelers prioritizing experiences over other discretionary spending.
But perhaps most encouraging is what the company sees in future demand. Royal Caribbean says booking volumes accelerated since its last earnings report, and travelers continue reserving cruises at higher prices.
Carnival's latest earnings report showed that the company's turnaround continues to gain momentum. During the second quarter, Carnival reported record operating income and record adjusted net income, while customer deposits climbed to an all-time high of $9 billion. Management also said booking volumes remain strong, with reservations for 2027 and beyond ahead of last year's pace despite a more uncertain economic backdrop.
The company also made meaningful progress in strengthening its balance sheet. Since the beginning of 2024, management repaid more than $7 billion of debt, reducing interest expenses and improving financial flexibility. Still, Carnival ended the quarter with approximately $23.4 billion of long-term debt, considerably more than Royal Caribbean.
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