What changed in this filing

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Item 1. Business

2025-02-14 compared with 2024-02-21 · 199 added, 182 removed, 518 unchanged (42% of the section changed)

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We own and operate three global cruise brands:

Royal Caribbean International, Celebrity Cruises and Silversea Cruises (collectively, our "Global Brands").

Royal Caribbean, Celebrity Cruises and Silversea Cruises (collectively, our "Global Brands").

We also own a 50% joint venture interest in TUI Cruises GmbH ("TUIC"), which operates the German brands TUI Cruises and Hapag-Lloyd Cruises (collectively, our "Partner Brands").

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Our ships offer a selection of worldwide itineraries that call on more than 1,000 destinations on all seven continents.

We compete principally by operating valued brands that offer exceptional service provided by our crew and on the basis of innovation and quality of ships, variety of itineraries, choice of destinations and price.

We believe that our commitment to build state-of-the-art ships and to invest in the maintenance and upgrade of our fleet to, among other things, incorporate many of our latest signature innovations, allows us to continue to attract new and loyal repeat guests.

We compete principally by operating our portfolio of valued brands that deliver vacation experiences known for exceptional product offerings and service provided by our dedicated crew.

Our competitive edge is grounded in our focus on innovation, best evidenced in the quality and variety of ships in our fleet, our growing portfolio of private destinations and experiences, and a range of itineraries and global destinations tailored to meet diverse guest preferences.

By continually reimagining vacation possibilities and investing in the maintenance and enhancement of our fleet, we inspire both new travelers and loyal repeat guests to embark on unforgettable journeys with us.

Royal Caribbean was founded in 1968 as a partnership.

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Our Global Brands

Our Global Brands include Royal Caribbean International, Celebrity Cruises, and Silversea Cruises.

Our Global Brands include Royal Caribbean, Celebrity Cruises, and Silversea Cruises.

We believe our Global Brands possess the versatility to enter multiple market segments within the vacation industry.

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As a result, we strategically manage our Global Brands as a single business with the ultimate objective of maximizing long-term shareholder value.

Royal Caribbean International

Royal Caribbean International is the world's largest cruise brand.

The brand competes in both the contemporary family market and premium segments of the cruise vacation industry appealing to both families with children of all ages and older and younger couples.

Royal Caribbean International offers cruises and land destinations that generally feature a casual ambiance, as well as a variety of activities and entertainment venues.

We believe that the quality of the Royal Caribbean International brand allows it to achieve market coverage that is among the broadest of any of the major cruise brands in the cruise vacation industry.

Royal Caribbean International’s strategy is to attract an array of vacationing guests by offering a wide variety of itineraries to destinations worldwide, including Alaska, Asia, Australia, the Bahamas, Bermuda, Canada, the Caribbean, Europe, the Panama Canal and New Zealand, with cruise lengths generally ranging from two to 18 nights.

Royal Caribbean International offers multiple innovative options for onboard dining, entertainment and other onboard activities.

Because of the brand’s ability to deliver extensive and innovative product offerings at an excellent value to consumers, we believe Royal Caribbean International is well positioned to attract new consumers to cruising and to continue to bring loyal repeat guests back for their next vacation.

Royal Caribbean International operates 26 ships with an aggregate capacity of approximately 94,100 berths.

Additionally, as of December 31, 2023, Royal Caribbean International had three ships on order with an aggregate capacity of approximately 16,900 berths.

The ships on order include two Icon-class ships, Star of the Seas and the third Icon-class ship, which are expected to be delivered in 2025 and 2026, respectively, and our sixth Oasis-class ship, Utopia of the Seas, which is expected to be delivered in 2024.

Royal Caribbean

Royal Caribbean is the world's largest cruise vacation brand.

The brand competes in both the contemporary family market and premium segments of the vacation industry appealing to both families with children of all ages and older and younger couples.

Royal Caribbean offers vacation experiences that generally feature a casual ambiance, as well as a variety of activities and entertainment venues.

We believe that the quality of the Royal Caribbean brand allows it to achieve market coverage that is among the broadest of any of the major cruise brands in the cruise vacation industry.

Royal Caribbean's strategy is to attract an array of vacationing guests by offering a wide variety of itineraries to destinations worldwide, including Alaska, Asia, Australia, the Bahamas, Bermuda, Canada, the Caribbean, Europe, the Panama Canal and New Zealand, with cruise lengths generally ranging from three to 14 nights.

Royal Caribbean offers multiple innovative options for onboard dining, entertainment and other onboard activities.

Because of the brand’s ability to deliver extensive and innovative product offerings at an excellent value to consumers, we believe Royal Caribbean is well positioned to attract new consumers to cruising and to continue to bring loyal repeat guests back for their next vacation.

Royal Caribbean operates 28 ships with an aggregate capacity of approximately 105,400 berths.

Additionally, as of December 31, 2024, Royal Caribbean had three ships on order with an aggregate capacity of approximately 16,900 berths.

The ships on order include the second Icon-class ship, Star of the Seas, the third Icon-class ship, and the seventh Oasis-class ship, which are expected to be delivered in 2025, 2026, and 2028, respectively.

In addition, during 2024, we entered into an agreement with Meyer Turku Oy to build a fourth Icon-class ship for delivery in 2027.

The agreement is contingent upon completion of certain conditions precedent including financing.

Celebrity Cruises

Celebrity Cruises is positioned within the premium segment of the cruise vacation industry.

Celebrity Cruises is positioned within the premium segment of the vacation industry.

Celebrity Cruises’ strategy is to target consumers by delivering a destination-rich experience on upscale ships that offer, among other things, excellent food and drink, elevated hospitality, world-class spaces and accommodations, and live entertainment.

Celebrity Cruises offers a range of itineraries to destinations, including Alaska, Asia, Australia, Bermuda, Canada, the Caribbean, Europe, the Galapagos Islands, Hawaii, New Zealand, the Panama Canal and South America, with cruise lengths ranging from three to 18 nights.

Celebrity Cruises operates 14 ships with an aggregate capacity of approximately 35,650 berths.

Additionally, as of December 31, 2023, Celebrity Cruises had one Edge-class ship on order, Celebrity Xcel, with an aggregate capacity of approximately 3,250 berths, which is expected to be delivered in 2025.

As of December 31, 2024, Celebrity Cruises had one Edge-class ship on order, Celebrity Xcel, with an aggregate capacity of approximately 3,250 berths, which is expected to be delivered in 2025.

In addition, during 2024, we entered into an agreement with Chantiers de l' Atlantique to build a sixth Edge-class ship for delivery in 2028.

The agreement is contingent upon completion of certain conditions precedent including financing.

Silversea Cruises

Silversea Cruises is an ultra-luxury and expedition cruise line with smaller ships, high standards of accommodations, fine dining, personalized service and exotic itineraries.

Silversea Cruises delivers distinctive destination experiences by visiting unique and remote destinations, including the Galapagos Islands, Antarctica and the Arctic with cruise itineraries generally ranging from five to 24 nights.

Silversea Cruises operates 12 ships, with an aggregate capacity of approximately 5,500 berths.

As of December 31, 2023, Silversea Cruises had on order one Evolution-class ship, Silver Ray , with an aggregate capacity of approximately 730 berths, which is expected to be delivered in 2024.

Our Partner Brands

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All onboard activities, services, shore excursions and menu offerings are designed to suit the preferences of this target market.

TUI Cruises operates six ships, with an aggregate capacity of approximately 15,800 berths.

Additionally, as of December 31, 2023, TUI Cruises had three ships on order with an aggregate capacity of approximately 11,100 berths, two of these ships are expected to be delivered in 2024, the third ship is expected to be delivered in 2026.

TUI Cruises operates seven ships, with an aggregate capacity of approximately 18,700 berths.

Additionally, as of December 31, 2024, TUI Cruises had two ships on order with an aggregate capacity of approximately 8,200 berths, which are expected to be delivered in 2025 and 2026, respectively.

Hapag-Lloyd Cruises operates two luxury liners and three smaller expedition ships, with an aggregate capacity of approximately 1,590 berths.

Hapag-Lloyd Cruises did not have any ships on order as of December 31, 2023.

Refer to Note 7.

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Financial Statements and Supplementary Data for further details.

The cruising industry has been considered a well-established vacation sector in the North American, European and Australian markets and a developing sector in several other emerging markets.

We believe that cruising will continue to be a popular vacation choice due to its inherent value, extensive itineraries and variety of shipboard and shoreside activities.

The Company and other industry participants voluntarily suspended operations in March of 2020 and gradually resumed full operations starting in the second half of 2021 through the first half of 2022.

As a result, comparative information regarding market penetration is not meaningful for 2020, 2021, and 2022.

For the five year period prior to 2020, industry data indicated that market penetration rates were still low and that a significant portion of cruise guests carried in those years were first-time cruisers.

We believe this presents an opportunity for long-term growth and a potential for increased profitability.

The cruising industry is a well-established vacation sector in the North American, European and Australian markets and a developing sector in several other emerging markets.

We believe that cruising will continue to be a popular vacation choice due to its inherent value, extensive itineraries, private destinations, and variety of shipboard and shoreside activities.

Industry data indicates that market penetration rates are increasing but still low and that a significant portion of cruise guests carried are first-time cruisers.

Despite the increase in market penetration rates during 2024, we believe there is an opportunity for long-term growth and a potential for increased profitability.

Industry market penetration rates (computed based on the number of annual cruise guests as a percentage of the total population) 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.

During 2024, industry market penetration rates were 6.01% for North America, 1.72% for Europe, and 0.09% for Asia/Pacific.

The penetration rates in 2023 show the recovery and growth potential in the markets most served by the industry.

The penetration rates in 2024 show the growth potential in the markets most served by the industry.

The cruise industry was served by a fleet with a weighted average of approximately 706,000 berths during 2024 with approximately 432 ships at the end of 2024.

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The global cruise industry carried approximately 36 million guests in 2024, 32 million cruise guests in 2023 and approximately 20 million in 2022.

The following table details the growth in global weighted average berths and the percentage of North American, European and Asia/Pacific cruise guests for 2023, 2022 and for each of the five years from 2015 through 2019 (in thousands, except berth data):

The following table details the growth in global weighted average berths and the percentage of North American, European and Asia/Pacific cruise guests for 2024, 2023, 2022 and for each of the two years prior to the 2020 suspension of global cruise operations (in millions, except berth data):

Supply of Berths

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2023 650,000 157,575 21,200 63% 27% 6% 4%

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(1) Historically, we have reported annual information for comparability across periods.

The 2020 suspension of global cruise operations as a result of COVID-19 and the gradual resumption of full operations starting in the second half of 2021 through the first half of 2022 do not allow for a meaningful comparison to prior years' information and, as such, 2020 and 2021 data has been excluded from this table.

The 2020 suspension of global cruise operations and the gradual resumption of full operations starting in the second half of 2021 through the first half of 2022 do not allow for a meaningful comparison to prior years' information and, as such, 2020 and 2021 data has been excluded from this table.

(2) The estimates of the number of global cruise guests and the weighted-average supply of berths marketed globally are based on a combination of data that we obtain from various publicly available cruise industry trade information sources.

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Wild to estimate cruise guest information.

For 2023, cruise guest information includes data through the third quarter of 2023.

For 2024, we estimate the total number of global cruise guests for the full year with actual data only available through the third quarter.

In addition, our estimates incorporate our own analysis utilizing the same publicly available cruise industry data as a base.

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(6) Our estimates include Southeast Asia (most notably:

Singapore, Thailand and the Philippines), East Asia (most notably:

Singapore and Malaysia), East Asia (most notably:

China and Japan), South Asia (most notably:

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Australia and New Zealand) regions.

The decrease in Asia/Pacific cruise guests from 2019 to 2023 is partly driven by China remaining closed given its COVID-19 restrictions through the first half 2023.

The decrease in Asia/Pacific cruise guests from 2019 to 2024 is partly driven by lack of cruise supply and itineraries in China through the first half 2023.

We compete with a number of cruise lines as well as land-based vacation alternatives for consumers’ leisure time.

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Norwegian Cruise Line Holdings Ltd, which owns Norwegian Cruise Line, Oceania Cruises, and Regent Seven Seas Cruises;

and Virgin Voyages.

Viking, and Virgin Voyages.

Operating Strategies

Our mission is to deliver the best vacation experiences responsibly.

We continue to prioritize operating strategies that support this mission in a socially and environmentally responsible manner, working with our various business and community partners as we build toward a more sustainable cruise industry.

We continue to prioritize operating strategies that support this mission, working with our various business and community partners as we build toward a more sustainable cruise industry.

Our Company's operating strategies are as follows:

• deliver the best vacation experiences responsibly;

• deliver a lifetime of vacations to our customers;

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• deepen our customer relationships in order to increase frequency and repeat booking rates;

• focus on cost efficiency, adequate cash and liquidity, and strong balance sheet, with the overall goals of maximizing our return on invested capital and shareholder value;

• protect the environment and communities in which our vessels and organization operate, with a focus on decarbonization;

• invest in our workforce in order to better serve our global guest base and grow our business, and promote gender equality, diversity and inclusion;

• invest in our workforce in order to better serve our global guest base and grow our business, and nurture a culture that values the contribution of individual talents;

• increase the awareness and market penetration of our brands globally;

• focus on cost efficiency, capital allocation and liquidity, with the overall goals of maximizing our return on invested capital and long-term shareholder value;

• strategically invest in our fleet through the upgrade and maintenance of existing ships and the transfer of key innovations, while prudently expanding our fleet with new state-of-the-art cruise ships;

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We target customers at important consumer decision points throughout their vacation journey and identify underlying needs for which guests value and are willing to pay a premium.

We rely upon and continue to invest in various programs and technologies during the cruise-planning, cruising and after-cruise periods aimed at increasing revenues and occupancy.

We continue to invest in various programs and technologies to provide greater value to our customers throughout the vacation planning process - before, during, and after their vacations - and these investments are aimed at increasing revenues and occupancy.

We have and expect to strategically invest in experiences on our ships that we believe drive marketability, profitability and improve the guest experience.

In addition, we are focused on enhancing our vacation ecosystem by investing in a new travel platform, our loyalty programs and e-commerce capabilities.

Focus on cost efficiency, capital allocation, adequate cash and liquidity and improving our balance sheet

We are focused on maintaining a strong liquidity position and a balanced debt maturity profile, while making progress towards achieving lower leverage, lower interest expense, and an unsecured balance sheet.

For example, during 2023, we amended our revolving credit facility with our key relationship banks to ensure adequate liquidity on a going-forward basis and additionally, we repaid approximately $4.0 billion of debt.

We believe these strategies together with our continued focus on increasing operating income and margin, as well as disciplined capital allocation, enhance our ability to achieve our overall goal of maximizing our return on invested capital and long-term shareholder value.

Protect the environment and communities in which we operate

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Destination Net Zero is our decarbonization strategy that focuses on achieving net zero emissions by 2050 and delivering a net zero capable ship by 2035.

This strategy also includes reducing our carbon intensity by double digits by 2025, compared to 2019.

This strategy also includes reducing our carbon intensity by double digits by 2025, compared to 2019, which we achieved one year early in 2024.

Destination Net Zero’s four-pronged approach includes:

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Collaboration is imperative to reaching our decarbonization goals.

as such, we are partnering with governments, fuel suppliers, shipyards, and technology stakeholders to build and test a safe and reliable supply of alternative energy sources.

As such, we are partnering with governments, fuel suppliers, shipyards, ship operators, ports, and technology stakeholders to build and test a safe and reliable supply of alternative energy sources.

Another example of our commitment to sustaining our planet with key partners is our decades-long Save the Waves program, which focuses on waste management techniques and technologies, along with reuse and recycling programs, to reduce the amount of waste produced on our ships and divert the remaining waste from landfills.

We also have a long-term partnership with the World Wildlife Fund to evaluate ship operations, sustainable sourcing of food supplies, waste management, sustainable destinations and guest education on ocean conservation.

We also believe in transparent reporting on our environmental and sustainability stewardship, as well as our social and governance efforts.

Our SEA the Future commitment and annual sustainability report, both of which are accessible on our corporate website, highlight our commitment and progress made with regards to those environmental, social and governance aspects of our business that we believe are most significant to our organization and stakeholders.

In addition to providing an overview on our sustainability efforts, the report references the guidelines of the Global Reporting Initiative and is aligned with the Sustainable Accounting Standards Boards Industry Standards for Cruise Lines.

We also believe in transparent reporting around our corporate responsibility efforts.

Our SEA the Future commitment and annual sustainability report, both of which are accessible on our corporate website, highlight our commitment and progress made with regards to those corporate responsibility aspects of our business that we believe are most significant to our organization and stakeholders.

In addition to providing an overview on our sustainability efforts, the report references the guidelines of the Global Reporting Initiative and is aligned with the Sustainability Accounting Standards Boards Industry Standards for Cruise Lines.

We continue to advance our reporting following the recommendations of the Task Force on Climate Related Financial Disclosures (TCFD).

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Refer to the Regulation - Environmental Regulations section below for further information.

Investing in our workforce and promoting equality, diversity and inclusion

Investing in our workforce

We believe that our employees, both shipboard and shoreside, are a critical success factor for our business.

We strive to identify, hire, develop, motivate and retain the best employees, who provide our guests with extraordinary vacations.

Our ability to attract, engage, and retain key employees has been and will remain critical to our success.

Our Talent and Compensation Committee of our Board of Directors oversees the Company's human capital management strategies, including initiatives for talent diversity, equity and inclusion, talent management, and corporate culture.

Our Talent and Compensation Committee of our Board of Directors oversees the Company's human capital management strategies, including initiatives for talent management, and a thriving corporate culture.

We focus on providing our employees with a competitive compensation structure, development opportunities, and other personal and professional growth opportunities in order to strengthen and support our human capital.

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We strive to maintain a work environment that reinforces collaboration, motivation and innovation, and believe that maintaining a strong employee-focused culture is beneficial to the growth and expansion of our business.

We foster diversity and inclusion among our broad employee base.

We foster belonging and trust and respect for all among our broad employee base.

Refer to the Human Capital section below for further information.

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Our brands also engage past and potential guests by collaborating with travel partners and through call centers, international offices and international representatives.

In addition, our Global Brands target repeat guests with exclusive benefits offered through their respective loyalty programs.

In addition, our Global Brands target repeat guests with exclusive benefits offered through their respective loyalty programs, which effective June 2024, includes loyalty status match across our brand portfolio.

We sell and market our Global Brands to guests outside of the United States and Canada through the combined efforts of internationally focused internal resources and a network of independent international representatives located throughout the world.

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In addition, we explore opportunities that may arise to acquire or develop brands tailored to specific markets.

Focus on cost efficiency, capital allocation, and liquidity

We are 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.

During 2024, we achieved investment grade metrics and proactively eliminated all secured and guaranteed debt.

Delivery of state-of-the-art cruise ships, and fleet upgrade and maintenance

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Our newer vessels traditionally generate higher revenue yield premiums and are more efficient and environmentally friendly to operate than older vessels.

In 2023, we introduced three new vessels to our fleet, including Royal Caribbean International’s new flagship – Icon of the Seas , Celebrity Cruises – Celebrity Ascent , and Silversea Cruises – Silver Nova .

Each of these vessels represent the latest hardware for their respective brands and both Icon of the Seas and Silver Nova are the first vessels of a new class.

For Royal Caribbean International, new features on Icon of the Seas include a dedicated family neighborhood called “Surfside”, a pool deck featuring the largest swimming pool and waterpark at sea, and the “Aquadome” showcasing the tallest waterfall at sea in an 82-foot-tall dome.

In 2023, we introduced three new vessels to our fleet, including Royal Caribbean’s new flagship – Icon of the Seas , Celebrity Cruises – Celebrity Ascent , and Silversea Cruises's – Silver Nova .

Both Icon of the Seas and Silver Nova are the first vessels of a new class.

For Royal Caribbean, new features on Icon of the Seas include a dedicated family neighborhood called “Surfside”, a pool deck featuring the largest swimming pool and waterpark at sea, and the “Aquadome” showcasing the tallest waterfall at sea in an 82-foot-tall dome.

For Celebrity Cruises, Celebrity Ascent represents an evolution of Celebrity Beyond and builds on the innovation that the Edge series of ships have brought to market.

For Silversea, Silver Nova is amongst our most environmentally friendly and energy efficient ships to date.

As of December 31, 2023, our Global Brands and Partner Brands have 8 ships on order.

In 2024, Royal Caribbean introduced Utopia of the Seas, and Silversea Cruises introduced Silver Ray.

Each of these ships represent the evolution of their class and the latest ships for each brand.

As of December 31, 2024, our Global Brands and Partner Brands have six ships on order.

Refer to the Operations section below for further information on our ships on order.

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In order to provide unique destination experiences to our guests, we have and continue to invest in our private land destinations.

Our Perfect Day Island Collection represents our initiative to develop a series of private island destinations in

Our Perfect Day Collection represents our initiative to develop a series of private destinations in key markets.

The first island in the collection, Perfect Day at CocoCay, includes a wide range of attractions, such as a full water park, zip line course, freshwater pools, helium balloon ride, splash pads and a beach club.

In January 2024, we completed the expansion of Perfect Day at CocoCay with the delivery of Hideaway Beach, an adults-only experience.

Additionally, our Royal Beach Club will offer an exclusive and branded experience at high volume ports.

In January 2024, we completed an expansion of Perfect Day at CocoCay with the delivery of Hideaway Beach, an adults-only experience.

In October 2024, we announced the second destination in our Perfect Day Collection, Perfect Day Mexico, a Mexican inspired Royal Caribbean destination experience expected to open in 2027, and will serve our Western Caribbean itineraries from

homeports in Texas and Florida.

Additionally, our Royal Beach Club collection will offer an exclusive and branded experience at high volume ports.

The first Royal Beach Club is expected to open in 2025 in Nassau, Bahamas;

and the second Royal Beach Club expected to open in 2026, in Cozumel, Mexico.

In October 2024, we also announced Silversea's plans to develop a hotel in Puerto Williams, Chile to provide a further-elevated and seamless guest experience for its Antarctica expeditions.

We continue to evaluate opportunities to develop additional destinations across the globe.

In an effort to secure desirable berthing facilities for our ships, and to provide new or enhanced cruise destinations for our guests, we have actively assisted or invested in the development or enhancement of certain port facilities and infrastructure, including mixed-use commercial properties, located in strategic ports of call, and reduction of our environmental impacts.

For instance, in March 2023 we closed a partnership agreement with iCON Infrastructure Partners VI, L.P.

This partnership will own, develop, and manage cruise terminal facilities and infrastructure in key ports of call, initially including several development projects in Italy and Spain.

Generally, we collaborate with local, private or governmental entities by providing management and/or financial assistance and often enter into long-term port usage arrangements.

Our participation in these efforts is most often accomplished via investments with the relevant government authority and/or various other strategic partnerships established to develop and/or operate the port facilities, by providing direct development and management expertise or in certain limited circumstances, by providing direct or indirect financial support.

For instance, through our partnership agreement with iCON Infrastructure Partners VI, L.P.

("iCON"), we own, develop, and manage cruise terminal facilities and infrastructure in key ports of call, initially including several development projects in Italy and Spain.

Generally, we partner with local, private or governmental entities by collaborating on strategic investments and destination management.

In exchange for our involvement, we generally secure preferential berthing rights for our ships.

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For example, we recently enabled booking a cruise in our mobile applications, built a loyalty hub to provide easy to view status, benefits and ways to earn rewards and a video library to showcase our family of brands.

We have continued to integrate digital capabilities into our operations and have increased our focus in bringing data analytics and artificial intelligence into our processes to provide better insights for revenue management as well as in how to model our maintenance or operational actions.

We have also partnered with SpaceX to launch Starlink, the next generation in shipboard connectivity, unlocking an improved guest experience.

In concert with our destination focus, our island technology solutions are now enabling our guests to remain connected with WiFi access, charge food and beverages as well as take advantage of all the island based activities with the same ease as onboard our ships.

Investments in our core platforms, as well as the trade and direct distribution channels, are delivering the benefit of more modernized solutions with scalability and faster self-service response times while also deploying new features such as flight packages and additional promotional offer capabilities.

We have continued to expand digital capabilities into our operations and have increased our focus in bringing data analytics and artificial intelligence into our processes to provide better insights for revenue management as well as in how to model our maintenance or operational actions.

Our entire fleet is equipped with Starlink through our partnership with SpaceX, bringing the next generation in shipboard connectivity and unlocking an improved guest experience.

In concert with our destination focus, our island technology solutions are now enabling our guests to remain connected with WiFi access, charge food and beverages, and take advantage of all the island based activities with the same ease as onboard our ships.

Cyber security and data privacy are an ongoing focus, and we have made and will continue to make investments to protect our customer data, intellectual property and global operations.

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Risk Factors - “ We are exposed to cyber security attacks and data breaches and the risks and costs associated with protecting our systems and maintaining data integrity and security” for a discussion of the risks associated with cyber security.

Travel advisor support, consumer outreach, and e-commerce

Travel advisor relationships, consumer outreach, and e-commerce

Travel advisors continue to be a significant sourcing channel of revenues for our ships.

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Additionally, we continue to advance our e-commerce capabilities and the vacation shopping experience for our guests.

In addition to offering a simplified booking experience, we leverage the

mobile application for onboard experiences such as WiFi, beverages, shore excursions, and specialty dining – enabling guests to book their vacation end-to-end.

In addition to offering a simplified booking experience, we leverage the mobile application for onboard experiences such as WiFi, beverages, shore excursions, and specialty dining – enabling guests to book their vacation end-to-end.

Guest Services

We handle virtually all travel aspects related to guest reservations and transportation, including facilitating guest pre- and post-hotel stay arrangements and air transportation.

Royal Caribbean International, Celebrity Cruises and Silversea Cruises offer recognition and status upgrades to their guests through their loyalty programs, Crown & Anchor Society, Captain’s Club, and Venetian Society, respectively, to encourage repeat business.

Crown & Anchor Society has approximately 19.2 million members worldwide.

Captain’s Club and Venetian Society have approximately 6.1 million members combined worldwide.

Members are awarded points or credits in proportion to the number of cruise days and stateroom category.

Royal Caribbean, Celebrity Cruises and Silversea Cruises offer recognition and cruise benefits to their guests through their loyalty programs, Crown & Anchor Society, Captain’s Club, and Venetian Society, respectively, to encourage repeat business.

These loyalty programs collectively have over 26 million enrolled members worldwide.

Members are awarded points or credits in proportion to their number of cruise days and stateroom category.

The loyalty programs provide tiers of membership benefits which entitle guests to upgraded experiences and recognition relative to the status achieved once guests have accumulated the number of cruise points or credits specified for each tier.

In addition, upon achieving a certain level of cruise points or credits, the Crown & Anchor Society and Captain’s Club members benefit from reciprocal membership benefits between the loyalty programs.

Examples of the benefits available under our loyalty programs include, but are not limited to, priority waitlist for shore excursions, complimentary laundry service, complimentary internet, digital discount vouchers, upgraded bathroom amenities, reserved seating on the pool deck, ship tours and, in the case of our most loyal guests who have achieved the highest levels of cruise points or credits, complimentary cruises.

In addition, the Crown & Anchor Society, Captain’s Club and Venetian Society members all benefit from our loyalty status match program, effective June 2024, where membership in one program qualifies for the equivalent tier in each of the sister brands.

Examples of the benefits available under our loyalty programs include, but are not limited to, priority waitlist for shore excursions, complimentary laundry service, complimentary internet, digital discount vouchers, upgraded bathroom amenities, reserved seating in entertainment venues, ship tours and, in the case of our most loyal guests who have achieved the highest levels of cruise points or credits, complimentary cruises.

We regularly work to enhance each of our loyalty programs by adding new features and amenities in order to reward our repeat guests.

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Built Year ship entered service / will enter service Approximate

Royal Caribbean International

Royal Caribbean

Star of the Seas 2025 2025 5,600

Utopia of the Seas 2024 2024 5,700

Icon of the Seas 2023 2024 5,600

2023 2024 5,600

Wonder of the Seas 2022 2022 5,700

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Navigator of the Seas 2002 2002 3,400

Brilliance of the Seas 2002 2002 2,150

Ship Year Ship

Built Year ship entered service / will enter service Approximate

Brilliance of the Seas 2002 2002 2,150

Adventure of the Seas 2001 2001 3,350

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Celebrity Cruises

Celebrity Xcel 2025 2025 3,250

Celebrity Ascent 2023 2023 3,250

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Celebrity Solstice 2008 2008 2,850

Celebrity Xploration 2007 2016 15

Celebrity Constellation 2002 2002 2,200

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Celebrity Infinity 2001 2001 2,150

Celebrity Xpedition 2001 2004 50

Celebrity Millennium 2000 2000 2,200

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Mein Schiff 1 2018 2018 2,900

Ship Year Ship

Built Year ship entered service / will enter service Approximate

Mein Schiff 6 2017 2017 2,500

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Mein Schiff 4 2015 2015 2,500

Ship Year Ship

Built Year ship entered service / will enter service Approximate

Mein Schiff 3 2014 2014 2,500

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(1) Icon of the Seas was delivered in 2023 and commenced cruise revenue operations in January 2024.

As of December 31, 2023, our Global Brands and our Partner Brands have eight ships on order.

The table below sets forth, as of December 31, 2023, the dates that the ships on order are expected to be delivered, and their approximate berths.

As of December 31, 2024, our Global Brands and our Partner Brands have the following ships on order.

The expected delivery dates for all of our ships on order are subject to change due to events such as shipyard construction delays or agreed upon scope changes which impact the delivery timelines.

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Ship Shipyard Expected Delivery Approximate

Royal Caribbean International —

Utopia of the Seas Chantiers de l’Atlantique 2nd Quarter 2024 5,700

Star of the Seas Meyer Turku Oy 2nd Quarter 2025 5,600

Royal Caribbean —

Unnamed Chantiers de l’Atlantique 2nd Quarter 2028 5,700

Star of the Seas Meyer Turku Oy 3rd Quarter 2025 5,600

Unnamed Meyer Turku Oy 2nd Quarter 2026 5,600

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Celebrity Xcel Chantiers de l’Atlantique 4th Quarter 2025 3,250

Silversea Cruises —

Evolution-class:

Silver Ray Meyer Werft 2nd Quarter 2024 730

TUI Cruises (50% joint venture) —

Mein Schiff 7 Meyer Turku Oy 2nd Quarter 2024 2,900

Mein Schiff Relax Fincantieri 4th Quarter 2024 4,100

Unnamed Fincantieri 2nd Quarter 2026 4,100

Mein Schiff Relax Fincantieri 1st Quarter 2025 4,100

Mein Schiff Flow Fincantieri 2nd Quarter 2026 4,100

Total Berths 28,350

__________________________________________________________________

In addition, in February 2024, we entered into an agreement with Chantiers de l’Atlantique to build an additional Oasis class ship for delivery in 2028, which is contingent upon completion of certain conditions precedent including financing.

During the quarter ended December 31, 2024, we received commitments for the unsecured financing of the seventh Oasis-class ship for up to 80% of the ship’s contract price and our building contract with Chantiers de l’Atlantique became effective.

Bpifrance Assurance Export, the official French export credit agency, has agreed to guarantee to the lenders 100% of the financing.

In addition, during 2024, we entered into an agreement with Meyer Turku Oy and Chantiers de l' Atlantique to build a fourth Icon-class ship for delivery in 2027 and a sixth Edge-class ship for delivery in 2028.

The agreements are contingent upon completion of certain conditions precedent including financing.

In January 2025, we announced the launch of Celebrity River Cruises, a premium river cruise vacation.

We entered into agreements for the commitment to an initial order of 10 ships with plans to sail in 2027.

Our revenues have historically been seasonal based on the demand for cruises.

Demand is typically strongest for cruises during the Northern Hemisphere’s summer months and holidays.

In order to mitigate the impact of the winter weather in the Northern Hemisphere and to capitalize on the summer season in the Southern Hemisphere, our brands have focused on deployment in the Caribbean, Asia and Australia during that period.

In order to mitigate the impact of the winter weather in the Northern Hemisphere and to capitalize on the summer season in the Southern Hemisphere, our brands have

focused on deployment in the Caribbean, Asia and Australia during that period.

Passengers and Capacity

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Management’s Discussion and Analysis of Financial Condition and Results of Operations , for definitions).

Passengers Carried, Passenger Cruise Days, Available Passenger Cruise Days and Occupancy reflect the impact of our suspension of operations during parts of 2020 and 2021 due to the COVID-19 pandemic and the gradual resumption of full operations starting the second half of 2021 through the first half of 2022:

Passengers Carried, Passenger Cruise Days, Available Passenger Cruise Days and Occupancy reflect the impact of our suspension of operations during parts of 2020 and 2021 and the gradual resumption of full operations starting the second half of 2021 through the first half of 2022:

Year Ended December 31,

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(1) Due to the elimination of the Silversea Cruises three-month reporting lag in October of 2021, we include Silversea Cruises' metrics from October 1, 2020 through June 30, 2021 and October 1 through December 31, 2021 in the year ended December 31, 2021.

The year ended December 31, 2021 does not include July, August, and September 2021 statistics as Silversea Cruises' results of operations for those months are included within Other (expense) income in our consolidated statements of comprehensive loss for the year ended December 31, 2021.Refer to Note 1 .

General to our consolidated financial statements under Item 8.

Financial Statements and Supplementary Data for more information on the three-month reporting lag.

(2) Due to the three-month reporting lag effective through September 30, 2021, we include Silversea Cruises' metrics from October 1, 2019 through September 30, 2020 in the year ended December 31, 2020, and from October 1, 2018 through September 30, 2019 in the year ended December 31, 2019.

The year ended December 31, 2021 does not include July, August, and September 2021 statistics as Silversea Cruises' results of operations for those months are included within Other (expense) income in our consolidated statements of comprehensive income (loss) for the year ended December 31, 2021.

(3) For the year ended December, 31, 2021, we include Azamara Cruises' metrics through March 19, 2021, the effective sale date of the brand.

Refer to Note 1 .

General to our consolidated financial statements under Item 8.

Financial Statements and Supplementary Data for more information on the sale of the Azamara Cruises brand.

For the years ended December 31, 2020, and 2019, we include the full year of operations for Azamara Cruises.

For the year ended December 31, 2020, we include the full year of operations for Azamara Cruises.

Cruise Pricing

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Many of these services are available for pre-booking prior to embarkation.

These activities are offered either directly by us or by independent concessionaires from which we receive a percentage of their revenues.

These onboard activities are offered either directly by us or by independent concessionaires from which we receive a percentage of their revenues.

The all-inclusive pricing programs that we offer currently add some of these onboard activity and other services to the base price of the cruise.

In conjunction with our cruise vacations, we offer pre- and post-cruise hotel packages to our Royal Caribbean International, Celebrity Cruises and Silversea Cruises guests.

In conjunction with our cruise vacations, we offer pre- and post-cruise hotel and tour packages to our Royal Caribbean, Celebrity Cruises and Silversea Cruises guests.

We also offer cruise vacation protection coverage to guests in a number of markets, which provides guests with coverage for trip cancellation, medical protection and baggage protection.

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As a result, our brands have been aggregated as a single reportable segment based on the similarity of their economic characteristics, types of consumers, regulatory environment, maintenance requirements, supporting systems and processes as well as products and services provided.

Our President and Chief Executive Officer has been identified as the chief operating decision-maker and all significant operating decisions including the allocation of resources are based upon the analyses of the Company as one segment.

( For financial information, see Item 8.

Financial Statements and Supplementary Data .)

Our President and Chief Executive Officer has been identified as the chief operating decision-maker ("CODM"), and is responsible for carrying out the functions of allocating resources and assessing performance.

The CODM uses Operating Income (loss) to assess performance and allocate resources.

This financial metric is used by the CODM to review operating trends, and to monitor budget-to-actual variances in order to make key operating decisions.

( Refer to Item 8.

Financial Statements and Supplementary Data, for financial information.)

Human Capital

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Some key elements of these strategies include:

assessing current and future talent needs;

a diverse and inclusive workforce;

current and future talent needs assessments;

a thriving culture that values the contribution of individual talents, skills and ideas;

robust opportunities for employee growth and development;

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and an active listening strategy to make sure voices are heard and continuous improvement occurs.

We review our human capital metrics and our diversity equity and inclusion (DEI) program with the Talent and Compensation Committee of our Board of Directors on a regular basis.

We review our human capital strategy with the Talent and Compensation Committee of our Board of Directors on a regular basis.

As of December 31, 2024, our three global cruise brands employed approximately 106,000 employees spanning across our shipboard fleet and shoreside locations.

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As a global operation, we take great pride in the broad diversity of our workforce and the value it brings to our company.

Our shoreside workforce is gender diverse with 54% female representation.

Females represent 56% of our global shoreside workforce.

Our shipboard workforce is comprised of employees from approximately 145 countries.

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Shipboard 79% 21%

shoreside workforce is ethnically diverse with approximately 57% comprised of non-White ethnic groups.

shoreside workforce is ethnically diverse as shown in the following table:

Shoreside Representation by Ethnicity

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In 2024, our shoreside employee engagement scores remained high and above most global industry benchmarks.

We own a number of registered trademarks related to the Royal Caribbean International, Celebrity Cruises and Silversea Cruises cruise brands.

The registered trademarks include the name “Royal Caribbean International” and its crown and anchor logo, the name “Celebrity Cruises” and its “X” logo, the name “Silversea Cruises” and its logo, and the names of various cruise ships, ship venues and other marketing programs.

We own a number of registered trademarks related to the Royal Caribbean, Celebrity Cruises and Silversea Cruises cruise brands.

The registered trademarks include the name “Royal Caribbean” and its crown and anchor logo, the name “Celebrity Cruises” and its “X” logo, the name “Silversea Cruises” and its logo, and the names of various cruise ships, ship venues, private destinations, and other marketing programs.

We believe our largest brands' trademarks are widely recognized throughout the world and have considerable value.

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No assurance can be given that affordable and secure insurance markets will be available to us in the future, particularly for war risk insurance.

Refer to Item 1A.

Risk Factors - “ The potential unavailability of insurance coverage, an inability to obtain insurance coverage at commercially reasonable rates or our failure to have coverage in sufficient amounts to cover our incurred losses may adversely affect our financial condition or results of operations” for a discussion of the risks associated with insurance coverage.

Our ships are regulated by various international, national, state and local laws, regulations and treaties in force in the jurisdictions in which they operate.

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This convention sets the training and competency standards for all our crew who are responsible for operating the vessels or who have designated roles in ensuring the safety of our guests and crew during an emergency.

Regulatory bodies routinely check that our crews’ training credentials are up-to-date and assess competency by observing safety and emergency drills.

Regulatory bodies routinely check that our crews’ training credentials are up-to-date and

assess competency by observing safety and emergency drills.

As amendments are made to STCW, we ensure that our crew training is updated accordingly.

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The cruise industry supported this legislation and we believe that our internal standards are generally as strict or stricter than the law requires.

Some provisions of the act call for regulations which have not been finalized.

We do not expect the pending regulations to have a material impact to our operations.

Environmental Regulations

We are subject to various international and national laws and regulations relating to environmental protection.

Under such laws and regulations, we are generally prohibited from discharging materials other than food waste and treated effluents into the waterways.

We are subject to various international, regional, and national laws and regulations relating to environmental protection governing air emissions, water and waste management among others.

Under such laws and regulations, we are generally prohibited from discharging materials other than food waste and treated effluents into the waterways, while also reducing our emissions.

We have made, and will continue to make, capital and other expenditures to comply with environmental laws and regulations.

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We have obtained the relevant international compliance certificates relating to oil, sewage, air pollution prevention and ballast water for all of our ships.

International Regulations:

Sulfur Emissions

The MARPOL Regulations imposed reduced global limitations on the sulfur content of emissions emitted by ships operating worldwide to 0.5% as of January 1, 2020.

Compliance with this limitation has not and is not expected to have a material impact to our results of operations, largely due to a number of mitigating steps we have taken over the last several years.

The MARPOL Regulations also establish special Emission Control Areas ("ECAs") with additional stringent limitations on sulfur emissions in certain geographical areas.

There are four established ECAs, one additional ECA being established beginning in May of 2025 and two more in March 2026 that restrict sulfur emissions:

the Baltic Sea, the North Sea/English Channel, certain waters surrounding the North American coast, and the waters surrounding Puerto Rico and the U.S.

Virgin Islands (the "US Caribbean ECA"), the Mediterranean Sea ECA coming into force in May 2025 and the Norwegian Sea and Canadian Arctic ECA coming into force as early as March 2026.

Ships operating in these sulfur ECAs are required to reduce their emissions sulfur content to 0.1%.

Compliance with the MARPOL sulfur regulations has not and is not expected to have a material impact to our results of operations, largely due to a number of mitigating steps we have taken over the last several years.

This includes equipping all of our new ships delivered since 2014 with Advanced Emissions Purification ("AEP") systems covering all engines and actively developing and installing AEP systems on the majority of our remaining fleet;

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These efforts will provide us with additional operational and deployment flexibility.

The MARPOL Regulations also establish special Emission Control Areas ("ECAs") with additional stringent limitations on sulfur emissions in certain geographical areas.

There are four established ECAs and one additional ECA being established beginning in May of 2025 that restrict sulfur emissions:

the Baltic Sea, the North Sea/English Channel, certain waters surrounding the North American coast, and the waters surrounding Puerto Rico and the U.S.

Virgin Islands (the "US Caribbean ECA") and the Mediterranean Sea ECA coming into force in May 2025.

Ships operating in these sulfur ECAs are required to reduce their emissions sulfur content to 0.1%.

Additionally, all new ships operating within the North American and U.S.

Nitrogen Oxides Emissions

The MARPOL Regulations also impose limitations on Nitrogen Oxides.

All new ships operating within the North American and U.S.

Caribbean Sea ECA that began construction on or after January 1, 2016 and ships operating in the North and Baltic Sea ECA constructed on or after January 1, 2021 are required to meet more stringent nitrogen oxide emission limits.

In order to ensure deployment flexibility, all of our ships under construction are being built to comply with these nitrogen oxide emission rules.

In order to ensure deployment flexibility, all of our ships under construction are being built to comply with

these nitrogen oxide emission rules.

Compliance with these MARPOL requirements has not had and is not expected to have, a material impact on our results of operations due to the mitigating steps described above.

The European Union (EU) and IMO implemented legislations that require ships to monitor and report their carbon emissions.

These legislations contemplated the enactment of further obligations and restrictions focused on reducing carbon emissions from ships.

In 2022, the EU proposed a series of carbon reforms under its Fit for 55 package designed to meet its 2030 emission goals of reducing its GHG emissions by 55% from 1990 levels.

As part of this package, during 2023, the EU adopted and published the Emission Trading System (ETS) and the FuelEU Maritime regulation.

The ETS program will impose requirements to purchase carbon emission allowances beginning in 2024 for 40% of our emissions

within Europe, growing to 70% in 2025, and to 100% in 2026.

The impact of the EU ETS regulation is not expected to have a material impact on our 2024 results of operations.

The impact of the regulation on future periods is uncertain as the costs of ETS allowances will depend on future markets as well as future deployments.

Based on current deployment plans and current prices of ETS allowances, we do not expect the regulation to have a material impact on our 2025 and 2026 results of operations.

The FuelEU Maritime regulation will require ships to reduce GHG intensity in the fuels they consume by 2% as of 2025, and periodically reducing the intensity to 80% by 2050, compared to the 2020 average.

All passenger ships will additionally be obligated to connect to shore power when at berth in a Trans-European Transport Network ("TEN-T") port by 2030 and all EU ports by 2035.

When fully implemented, the FuelEU Maritime and the remaining Fit for 55 proposals could individually and collectively have a material adverse effect on our business and results of operations due to increased costs associated with compliance and modified itineraries in the affected regions.

Greenhouse Gas ("GHG") Emissions

In 2019, the IMO implemented regulations that require ships to monitor and report their carbon emissions called IMO's Data Collection System ("DCS").

The DCS contemplated the enactment of further obligations and restrictions focused on reducing carbon emissions from ships.

In January 2023, the IMO amendments to the MARPOL convention went into effect combining a technical and an operational measure (Energy Efficiency Existing Ship Index ("EEXI") and Carbon Intensity Indicator ("CII")).

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Furthermore, the IMO in 2023 revised its initial GHG Strategy to include check points in 2030 and 2040 to seek reductions in absolute GHG emissions from international shipping by at least 20% and 70%, respectively, compared to 2008.

The revised IMO strategy also considers various other measures, including a possible fuel standard and a global market-based measure, such as a fuel levy or carbon taxes, with the intent to reduce greenhouse gas emissions even further.

The revised IMO strategy also considers various other measures, obligations and restrictions to further reduce carbon emissions from ships.

These include a possible fuel standard and a global market-based measure, such as a fuel levy or carbon taxes, with the intent to reduce greenhouse gas emissions.

While the exact impact is uncertain at this time as the proposals have yet to be finalized, the global nature of the CII regulation and various other potential measures within the IMO's revised strategy could have a material impact on our results of operations due to increased compliance costs.

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The IMO Ballast Water Management Convention, which came into effect in 2017, requires ships that carry and discharge ballast water to meet specific discharge standards by installing Ballast Water Treatment Systems.

Compliance with this regulation has not had a material effect on our results of operations and we do not expect the continuing compliance with this regulation to have a material effect on our results of operations.

The convention also sets requirements for record keeping and maintaining an approved Ballast Water Management Plan.

Compliance with this regulation has not had and is not expected to have a material effect on our results of operations,

European Union Regulations:

The European Union (EU) continues to propose and adopt environmental regulations aimed at improving or maintaining environmental standards in the union.

One major focus of these regulations is around greenhouse gases.

In 2018, the EU adopted the Monitoring, Reporting and Verification regulations which mandated the reporting of emissions data from all ships over 5,000 gross tons.

In 2022, the EU proposed a series of carbon reforms under its Fit for 55 package designed to meet its 2030 emission goals of reducing its GHG emissions by 55% from 1990 levels.

As part of this package, during 2023, the EU adopted and published the Emission Trading System (ETS) and the FuelEU Maritime regulation.

The ETS program imposes requirements to purchase carbon emission allowances beginning in 2024 for 40% of our emissions within Europe, growing to 70% of emissions in 2025, and to 100% of emissions in 2026 and annually thereafter.

The EU ETS regulation did not have a material impact on our 2024 results of operations.

The impact of the regulation on future periods is uncertain as the costs of ETS allowances will depend on future markets and future deployments.

Based on current deployment plans and current prices of ETS allowances, we do not expect the regulation to have a material impact on our 2025 and 2026 results of operations.

The FuelEU Maritime regulation will require ships to reduce GHG intensity in the fuels they consume by 2% as of 2025, and gradually reduce the intensity to 80% by 2050, compared to the 2020 average.

All passenger ships will additionally be obligated to connect to shore power when at berth in a Trans-European Transport Network ("TEN-T") port by 2030 and all EU ports by 2035.

Federal and State Regulations:

The Clean Water Act (“CWA”) provides the U.S.

Environmental Protection Agency (“EPA”) with the authority to regulate incidental discharges from commercial vessels.

Through the establishment of the Vessel General Permit ("VGP") in 2013, the EPA mandated standards for many of these discharges such as ballast water, bilge water, gray water, anti-fouling and more.

The Vessel Incidental Discharge Act (VIDA), which will eventually replace the VGP, was signed into law in 2018 to help clarify and streamline discharge requirements for all states for the incidental discharges covered by the VGP and certain U.S.

Coast Guard (“USCG”) regulations for ballast water.

The VIDA requires the EPA to develop new

national standards of performance for incidental discharge and the USCG will then have two years to develop and implement enforcement regulations.

On September 2024, the EPA finalized the national standards of performance for incidental discharges.

The exact impacts of these standards on our vessels are uncertain as the USCG has yet to develop the corresponding implementing regulations to enforce compliance.

However, the new standards could expand applicability of vessel discharges from 3 to 12 nautical miles which could have impacts on our environmental operations and increase reporting requirements.

In the interim, we continue to be subject to the VGP’s requirements for discharges incidental to the normal operations of our vessels.

Refer to Item 1A.

Risk Factors - "Factors associated with climate change, including an increasing global regulatory focus, could adversely affect our business", and "Labor, health and safety, financial responsibility and other maritime regulations and measures could affect operations and increase operating costs" for further discussion of the risks associated with the regulations discussed above .

Risk Factors - "Factors associated with climate change, including an increasing global regulatory focus, could adversely affect our business", and "Labor, health and safety, financial responsibility, maritime and other regulations and measures could affect operations and increase operating costs" for further discussion of the risks associated with the regulations discussed above .

Consumer Financial Responsibility Regulations

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The following is a summary of our principal taxes, exemptions and special regimes.

In addition to or instead of income taxation, virtually all jurisdictions where our ships call impose some tax or fee, or both, based on guest headcount,

tonnage or some other measure.

In addition to or instead of income taxation, virtually all jurisdictions where our ships call impose some tax or fee, or both, based on guest headcount, tonnage or some other measure.

We also collect and remit value added tax (VAT) or sales tax in many jurisdictions where we operate.

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and Silversea Cruises Ltd.

are engaged in a trade or business in the United States, and many of our ship-owning subsidiaries, depending upon the itineraries of their ships, receive income from sources within the United States.

Silversea Cruises Ltd.

and our United Ki ngdom tonnage tax companies are classified as disregarded entities, or divisions for U.S.

are engaged in a trade or business in the United States, and many of our ship-owning subsidiaries, depending upon the itineraries of their ships, generate income from sources within the United States.

Certain of our subsidiaries, including our United Ki ngdom tonnage tax company are classified as disregarded entities, or divisions for U.S.

federal income tax purposes that may earn U.S.

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(1) the foreign country in which the foreign corporation is organized grants an equivalent exemption to corporations organized in the United States;

and (2) the stock of the corporation (or the direct or indirect corporate parent thereof) is “primarily and regularly traded on an established securities market” in the United States.

and (2) the stock of the corporation (or the direct or indirect corporate parent thereof) is “primarily and regularly traded on an

established securities market” in the United States.

In the opinion of our U.S.

tax counsel, Faegre Drinker Biddle & Reath LLP, based on the representations and assumptions set forth in that opinion, Royal Caribbean Cruises Ltd., including Silversea Cruises Ltd., Celebrity Cruises Inc., and relevant ship-owning subsidiaries with U.S.

tax counsel, Faegre Drinker Biddle & Reath LLP, based upon and subject to the representations, assumptions, legal authorities and limitations set forth in that opinion, Royal Caribbean Cruises Ltd., Celebrity Cruises Inc., Silversea Cruises Ltd., and relevant ship-owning subsidiaries with U.S.

source shipping income qualify for the benefits of Section 883 because Royal Caribbean Cruises Ltd.

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Taxation in the Absence of an Exemption Under Section 883

If Royal Caribbean Cruises Ltd., the operator of our vessels, Celebrity Cruises Inc., or our ship-owning subsidiaries were to fail to meet the requirements of Section 883 of the Internal Revenue Code, or if the provision was repealed, then, as explained below, such companies would be subject to U.S.

If Royal Caribbean Cruises Ltd., the operator of our vessels, Celebrity Cruises Inc., Silversea Cruises Ltd., or our ship-owning subsidiaries were to fail to meet the requirements of Section 883 of the Internal Revenue Code, or if the provision was repealed, then, as explained below, such companies would be subject to U.S.

income taxation on a portion of their income derived from or incidental to the international operation of our ships.

Because Royal Caribbean Cruises Ltd.

and Celebrity Cruises Inc.

conduct a trade or business in the United States, Royal Caribbean Cruises Ltd., including Silversea Cruises Ltd., and Celebrity Cruises Inc.

would be taxable at regular corporate rates on our separate company taxable income (i.e., without regard to the income of our ship-owning subsidiaries) on income which is effectively connected with our U.S.

Celebrity Cruises Inc., and Silversea Cruises Ltd., conduct a trade or business in the United States, Royal Caribbean Cruises Ltd., Celebrity Cruises Inc., and Silversea Cruises Ltd., would be taxable at regular corporate rates on our separate company taxable income (i.e., without regard to the income of our ship-owning subsidiaries) on income which is effectively connected with our U.S.

trade or business (generally only income from U.S.

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trade or business, those withdrawn amounts would be subject to a “branch profits” tax at the rate of 30%.

Royal Caribbean Cruises Ltd., which includes Silversea Cruises Ltd.

for tax purposes, and Celebrity Cruises Inc.

would also be potentially subject to tax on portions of certain interest paid by us at rates of up to 30%.

Royal Caribbean Cruises Ltd., Celebrity Cruises Inc., and Silversea Cruises Ltd., would also be potentially subject to tax on portions of certain interest paid by us at rates of up to 30%.

If Section 883 were not available to our ship-owning subsidiaries, each such subsidiary would be subject to a special 4% tax on its U.S.

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Other United States Taxation

Royal Caribbean Cruises Ltd., which includes Silversea Cruises Ltd., and Celebrity Cruises Inc.

Royal Caribbean Cruises Ltd., Celebrity Cruises Inc., and Silversea Cruises Ltd., earn U.S.

source income from activities not considered incidental to international shipping.

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State Taxation

Royal Caribbean Cruises Ltd., Celebrity Cruises Inc., and certain of our subsidiaries are subject to various U.S.

Royal Caribbean Cruises Ltd., Celebrity Cruises Inc., Silversea Cruises Ltd., and certain of our subsidiaries are subject to various U.S.

state income taxes which are generally imposed on each state’s portion of the U.S.

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corporate income tax.

We and certain of our subsidiaries are subject to value-added and other indirect taxes most of which are reclaimable, zero-rated or exempt.

The Organization for Economic Co-operation and Development (OECD) has issued Pillar Two model rules introducing a new global minimum tax of 15% with certain aspects of Pillar 2 effective January 1, 2024 and other aspects effective January 1, 2025 .

The UK and EU member countries have agreed to adopt these provisions and many countries have implemented these rules for 2024.

Global Minimum Tax

The Organization for Economic Co-operation and Development (OECD) issued Pillar Two model rules ("Global Minimum Tax") introducing a new global minimum tax of 15% with certain aspects of Pillar Two effective January 1, 2024 and other aspects effective January 1, 2025 .

The UK and EU member countries have agreed to adopt these provisions and many countries implemented these rules for 2024.

Our parent company is incorporated in Liberia.

Liberia has not announced plans to revise its local corporate income tax laws as part of the Pillar 2 proposal.

Liberia has not announced plans to revise its local corporate income tax laws as part of the Pillar Two proposal.

The OECD model rules provide an exclusion for “International Shipping Income,” and certain ancillary income, for which certain of our earnings may be eligible.

The Pillar Two rules will become effective for a portion of our earnings in 2024 and 2025, but we believe the impact will be immaterial.

The Pillar Two rules became effective for a portion of our earnings in 2024 and will also be effective for a portion of our earnings in 2025.

These changes did not have a material impact on our 2024 results of operations, and we believe the impact for 2025 will be immaterial.

These rules will apply to a majority of our earnings starting in 2026.

We are continuing to evaluate the impact of these proposed and enacted legislative changes, which continue to evolve.

We are evaluating mitigation strategies that we believe we can execute to minimize the impact of these provisions to an immaterial amount.

Refer to Item 1A.

We have developed mitigation strategies that we believe we can execute to minimize the impact of these provisions to an immaterial amount.

However, we continue to evaluate our mitigation options given the evolving nature of the proposed and enacted legislative changes Refer to Item 1A.

Risk Factors - "A change in our tax status under the U.S.

Internal Revenue Code, or other jurisdictions, may have adverse effects on our results of operations."

We and certain of our subsidiaries are subject to value-added and other indirect taxes most of which are reclaimable, zero-rated or exempt.

Website Access to Reports

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Naftali Holtz 47 Chief Financial Officer

Bayley 65 President and Chief Executive Officer, Royal Caribbean International

Bayley 66 President and Chief Executive Officer, Royal Caribbean

Laura Hodges Bethge

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In his role as Chief Financial Officer, Mr.

Holtz is responsible for overseeing the Company’s financial planning and analysis, supply chain, risk management, corporate strategy, treasury, corporate tax matters, investor relations, investments, internal audit, accounting and financial reporting.

Holtz is responsible for overseeing the Company’s financial planning and analysis, supply chain, risk management,

corporate strategy and development, treasury, corporate tax matters, investor relations, investments, internal audit, accounting and financial reporting.

Prior to his role as Chief Financial Officer, Mr.

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Holtz is also a veteran of the Israeli Air Force.

Bayley has served as President and Chief Executive Officer of Royal Caribbean International since December 2014.

Bayley has served as President and Chief Executive Officer of Royal Caribbean since December 2014.

Prior to this, he served as President and Chief Executive Officer of Celebrity Cruises since August 2012.

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Senior Vice President, International from December 2007 to May 2010;

Senior Vice President, Hotel Operations for Royal Caribbean International;

Senior Vice President, Hotel Operations for Royal Caribbean;

and Chairman and Managing Director of Island Cruises.

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Prior to that role, she served as Senior Vice President of Shared Services Operations from December 2020 to February 2022;

Senior Vice President of Product Development for Royal Caribbean International from February 2020 to December 2020;

Senior Vice President of Product Development for Royal Caribbean from February 2020 to December 2020;

and Vice President of Customer Experience from April 2017 to February 2020.

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Prior to World Fuel Services, Mr.

Lake served as Assistant General Counsel at America Online Latin America, Inc.

and practiced as a corporate lawyer in leading law firms in New York and Miami.

Lake practiced as a corporate lawyer in leading law firms in New York and Miami.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business