Royal Caribbean Cruises Ltd. (NYSE:RCL) Q4 2022 Earnings Call Transcript

We are — we work very hard to create global brands that attract guests from all over the world, and of course, to build the revenue management systems to effectively harvest that quality demand. And we think that apparatus more than supports our expected supply growth over the coming years.

Michael Bayley: Vince, it’s Michael. I just have to add one little comment here talking about new ships coming online. Obviously, we opened up to sail Icon of the Seas a few months ago, and that ship literally has been the best-selling product in the history of our business and has been absolutely outstanding in terms of the demand and the pricing that we’re generating for the product. And in fact, it’s really driving a great ’24. I mean we don’t — we never talk about ’24 at the beginning of ’23, obviously, but ’24 is looking very healthy. And a big driver of that is Icon. We’ve had some remarkable stats coming out of Icon. Just one little nugget that gets me very excited is it’s only one category of room, but the ultimate family townhouse that we sell on Icon, which is a 3-story experience in our new Surfside venue for younger families is already 55% sold for 2024 at an average price of $75,000 a week.

So you can just get a feel of the kind of demand that’s being generated by these new products. And obviously, we’re very excited with what we’re seeing with Icon. And that new class, which Jason mentioned is the first time Royal Caribbean International has had a new class of ship in nine years, and we are delighted with the performance so far.

Jason Liberty: We’ll save you a cabin, Vince, don’t worry.

Vince Ciepiel: Going to start saving for that. Appreciate the color.

Operator: Your next question comes from the line of Brandt Montour with Barclays.

Brandt Montour: First off, congratulations on this really important milestone. So my first question is on WAVE season. By all accounts — in your account this morning, WAVE season is going really well. Volumes seem to be pretty consistent week-over-week, month-over-month. Jason, or anyone, if you could just expand a little bit more on the behavior you’re seeing within the bookings? Any differentiation between brands or any pricing sensitivity sort of forming at either at the lower end, which are lower — with your older fleet ships or at the higher-end suites and things that were pricing much better last going into this year?

Jason Liberty: Thanks, Brandt. First, I mean — and it’s — I don’t say this lightly, so it’s wonderful to say, but we’re really seeing these very strong WAVE trends across all of our brands. And you see an elevated amount of demand coming from North America. And we have been very happy to see over the past two or three weeks, that elevated demand now move into Europe as well. We have been very happily surprised by how strong we’re seeing the consumer plan their vacation travel and to see that our booking window is now within a couple of weeks of what it has normally been. And that includes a lot of acceleration for short close-in products, especially as we’ve increased more of our 3, 4 and 5 night products is really encouraging overall.

So I wish I could say it’s different — well, actually, I don’t wish I could say, I should say that it’s different from the family to ultra-luxury or to expedition. But we’re really seeing this across all of our brands really strong. And we’ve seen markets like, for example, like Northern Europe now begin to move into a much stronger place. I also just add is demand, as you probably have seen in other travel products for North Americans to go to Europe has been exceptionally strong. And so, we’re now seeing that take over here in the cruise space.