Oct 27, 2026 earnings call — Investment in Sandals and Beaches Resorts
Announced approximately $3 billion investment for a 50% stake in Sandals and Beaches Resorts, expected to be immediately accretive to earnings.
Revenue $5.6B (est $5.6B) · EPS $6.57 (est $6.38)
Key quotes
"Financially, our approximately $3 billion investment for a 50% stake at 10 times forward EBITDA is expected to be immediately accretive to our earnings while keeping us within our leverage targets."
"Since the last earnings call, booking volumes have increased in the mid-teens year-over-year, and bookings for 2027 sailings up in the high teens, demonstrating strong demand as we continue to build a strong base of business for 2027."
"Based on current fuel prices, currency exchange rates, and interest expense, we expect full-year adjusted earnings per share to be $17.85 to $17.95."
Analyst Q&A 10
long-term demand and market share
Q (Matthew Boss · JPMorgan): Analyst asked if management expects any moderation in multi-year cruise prospects and if confidence in gaining more market share in the $2 trillion vacation market has changed.
A: Management said no moderation is expected. They described strong, high-quality demand across their brands, high guest trust and NPS in the low to mid-70s, and said adding River and all-inclusive resorts deepens customer relationships and raises lifetime value.
"I will start off with the short answer, which is no, I do not." — Jason Liberty (CEO·CHAIR)
Sandals timing and land development
Q (Steve Wieczynski · Stifel): Analyst asked whether the $20-plus 2027 outlook excludes Sandals, buybacks, and refis, and asked about development plans for Sandals' 1,000 acres of land.
A: Management said the Sandals closing timing is uncertain but expected end of this year or early next, and the Sandals impact was not included in next year's statement because it is expected to be immaterial for next year. Naf described the 1,000 acres as beachfront, often adjacent to existing properties, suitable for room expansions and some greenfield development, with 18 resorts now and 3 being built, and emphasized focus on guest satisfaction and accretive financial results.
"But regardless, we expect the impact for next year to be immaterial to our business." — Jason Liberty (CEO·CHAIR)
what 'high teens' booking means
Q (Trey Bowers · Wells Fargo): Analyst asked whether the 'up high teens' commentary for 2027 refers to year-over-year or quarter-over-quarter and whether pricing will be up again next year.
A: Management said the phrase measures elevated demand for future periods and that their book position is at a higher place and at higher rates. They added that customers are willing to pay more now and in the future, and that repeat business and high NPS support this pricing power.
"But I would take the commentary as customers are willing to pay us more in the future and today than they did yesterday." — Jason Liberty (CEO·CHAIR)
cross-selling between cruise and resorts
Q (Ben Chaiken · Mizuho): Analyst asked how much overlap exists today between Royal guests taking all-inclusive vacations and Sandals guests who cruise on Royal.
A: Management said there is already a good portion of overlap but still room to grow, and noted Sandals guests often cruise on competitors. They emphasized focusing on loyalty, growing repeat rates, and that the all-inclusive occasion tends to be incremental rather than substitution, which encourages them.
"It's a good portion, but there's definitely room to grow." — Naftali Holtz (CFO)
opportunities outside the Caribbean
Q (Meredith Jensen · HSBC): Analyst asked about opportunities in Europe, Asia, Australia and Japan, and what returns or demand they see in those regions.
A: Management said 46% of business is outside the Caribbean and they see opportunities across Asia Pacific and Europe, calling Europe a vacation playground and noting growth across markets and products. They said they have over 100 destination projects and are building experiences, and added that Royal Beach Club Lelepa is attractive in Australia with more capacity moving into Asia Pacific and four ships operating out of Australia in 2028.
"We've got four ships operating out of Australia in 2028, three in 2027." — Michael Bayley (CEO)
Sandals synergies and global growth
Q (Robin Farley · UBS): Analyst asked if Royal would consider land-based expansions outside the Caribbean, whether synergies are mainly revenue or cost, and about any rights to increase ownership of Sandals.
A: Management said they are focused on the partnership with the Stewart family and would not discuss future ownership. They said yes, Sandals and Beaches have potential beyond the Caribbean but they are focused on growing the Caribbean footprint now. They described synergies coming over time across revenue (yield, loyalty, data) and cost (purchasing), while balancing community and local benefits.
"As it relates to the timing, synergies come in over time." — Jason Liberty (CEO·CHAIR)
closer-in bookings and consumer behavior
Q (Brandt Montour · Barclays): Analyst asked if the trend of consumers booking closer-in is concentrated in lower-price itineraries or contemporary brands and whether this is temporary or structural.
A: Management said close-in demand has surprised to the upside repeatedly and is driven partly by product shifts to more weekend getaways and shorter itineraries, which naturally book closer in. They also noted that about half their guests are millennial and younger who take more trips, and that onboard spend has been much stronger than they expected, supporting resilience.
"I think the other thing just to give you another, I think, important data point is onboard spend has been much stronger than we thought it was going to be." — Jason Liberty (CEO·CHAIR)
yield sensitivity to land-based travel
Q (Conor Cunningham · Melius): Analyst asked how land-based price moves and small deployment shifts could affect net yields next year.
A: Management said cruise yields typically lag land-based increases, so rising land prices are a positive sign and tend to give tailwinds to cruise because of the value differential. They noted their yields have grown over past years but still lag land-based, and that they focus on competing with land-based vacation experiences rather than other cruise lines.
"Well, I think first, we tend to, I think, lag a little bit to land-based." — Jason Liberty (CEO·CHAIR)
Icon reception in Galveston
Q (Vince Ciepiel · Cleveland): Analyst asked how Icon is being received in Galveston and thoughts on the Western Caribbean and itinerary planning given Mexico developments.
A: Management said Icon should be received exceptionally well and called it the best product entering Texas in cruise history, with strong travel partner response. They said Icon sets the table for future itineraries, noted ships are generating NPS in the 80s, and pointed to high load factors as evidence guests are enjoying and paying for the experience.
"I think Icon is going to be received exceptionally well." — Michael Bayley (CEO)
Sandals timing and synergies timing
Q (David Katz · Jefferies): Analyst sought to confirm that the comment Sandals impact is immaterial refers to current timing and that meaningful synergy discussion awaits closing.
A: Management said it depends on timing and that they expect the deal to close early in 2027, while noting they are working hard to keep that date. They added synergies will come over time, not everything at day one, and said they are excited about benefits to customers and financial results.
"We expect this to be closing early in 2027." — Naftali Holtz (CFO)