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Item 7. Management’s Discussion and Analysis

2026-02-11 compared with 2025-02-14 · 192 added, 227 removed, 408 unchanged (51% of the section changed)

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Certain of our accounting policies are deemed "critical," as they require management's highest degree of judgment, estimates and assumptions.

We have discussed these accounting policies and estimates with the audit committee of our board of directors.

We have discussed these accounting policies and estimates with the audit committee of our Board.

We believe our critical accounting policies and estimates are as follows:

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If the vessel is disposed of before the next drydock, the remaining balance in deferred drydock is written-off to the gain or loss on disposal of vessel in the period in which the sale takes place.

We also use judgment when identifying costs incurred during a drydock which are necessary to maintain the vessel's Class certification as compared to those costs attributable to repairs and maintenance which are expensed as incurred.

We believe we have made reasonable estimates for ship accounting purposes.

However, should certain factors or circumstances cause us to revise our estimates of ship useful lives or projected residual values, depreciation expense could be materially higher or lower.

If circumstances cause us to change our assumptions in making determinations as to whether ship

improvements should be capitalized, the amounts we expense each year as repairs and maintenance costs could increase, partially offset by a decrease in depreciation expense.

If we had reduced our estimated average ship useful life by one year, depreciation expense for 2024 would have increased by approximately $166 million.

If circumstances cause us to change our assumptions in making determinations as to whether ship improvements should be capitalized, the amounts we expense each year as repairs and maintenance costs could increase, partially offset by a decrease in depreciation expense.

If we had reduced our estimated average ship useful life by one year,

depreciation expense for 2025 would have increased by approximately $157 million.

If our ships were estimated to have no residual value, depreciation expense for 2025 would have increased by approximately $470 million.

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Financial Statements and Supplementary Data for further information on goodwill.

The impairment review for indefinite-lived intangible assets can be performed using a qualitative or quantitative impairment assessment.

Similar to the impairment review for goodwill, the impairment review for indefinite-lived intangible assets can be performed using a qualitative and, if necessary, a quantitative impairment assessment.

The quantitative assessment consists of a comparison of the fair value of the asset with its carrying value.

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Royal Caribbean Reporting Unit

During the fourth quarter of 2024, we performed a qualitative analysis as part of our annual impairment review of the Royal Caribbean reporting unit.

Based on our qualitative assessment, we concluded that it was more-likely-than-not that the estimated fair value of the Royal Caribbean reporting unit exceeded its carrying value and thus, we did not proceed to the two-step goodwill impairment test.

During the fourth quarter of 2025 and 2024, we performed a qualitative analysis as part of our annual impairment review of the Royal Caribbean reporting unit.

No indicators of impairment exist primarily because the reporting unit's fair value has consistently exceeded its carrying value by a significant margin and forecasts of operating results expected to be generated by the reporting unit appear sufficient to support its carrying value.

During the fourth quarter of 2023, we performed a quantitative analysis as part of our annual impairment review of the Royal Caribbean reporting unit.

The fair value of the reporting unit was determined using a discounted cash flow model in combination with a market-based valuation approach.

As a result of the quantitative test, we determined that the fair value of the reporting unit exceeded its carrying value by more than 100%, resulting in no impairment to Royal Caribbean's goodwill.

As a result, we determined no impairment to Royal Caribbean's goodwill.

As of December 31, 2025 and 2024, the carrying amount of goodwill attributable to our Royal Caribbean reporting unit was $296 million.

We did not perform interim impairment evaluations of Royal Caribbean's goodwill during 2025 and 2024, as no triggering events were identified.

Silversea Cruises Reporting Unit

During the fourth quarters of 2024 and 2023, we performed a quantitative analysis as part of our annual impairment review of the Silversea Cruises reporting unit.

As of November 30, 2024, and November 30, 2023, the fair value of the Silversea Cruises reporting unit was determined using a probability weighted discounted cash flow model in combination with a market-based valuation approach.

As a result of the tests, we determined the fair value of the Silversea Cruises reporting unit exceeded its carrying value by approximately 63%, as of November 30, 2024 and 2023, respectively, resulting in no impairment to Silversea Cruises' goodwill.

The carrying value of goodwill attributable to our Silversea Cruises reporting unit was $509 million as of December 31, 2024 and 2023.

During the fourth quarters of 2024 and 2023, we performed our annual impairment reviews of the Silversea Cruises trade name.

As a result of the quantitative tests, we determined that the fair value of the Silversea Cruises' trade name exceeded its carrying value by approximately 66% and 62%, as of November 30, 2024 and November 30, 2023, respectively, resulting in no impairment to Silversea Cruises' tr ade name.

As of December 31, 2024 and 2023 , the carrying value of indefinite-life intangible assets was $321 million, which primarily relates to the Silversea Cruises trade name.

We did not perform interim impairment evaluations of Silversea Cruises' goodwill or trade names during 2024 and 2023, as no triggering events were identified.

Silversea Reporting Unit

During the fourth quarters of 2025 and 2024, we performed a quantitative analysis as part of our annual impairment review of the Silversea reporting unit.

As of November 30, 2025 and 2024, the fair value of the Silversea reporting unit was determined using a probability weighted discounted cash flow model in combination with a market-based valuation approach.

As a result of the tests, we determined the fair value of the Silversea reporting unit exceeded its carrying value by approximately 98% and 63%, as of November 30, 2025 and 2024, respectively, resulting in no impairment to Silversea's goodwill.

The carrying value of goodwill attributable to our Silversea reporting unit was $509 million as of December 31, 2025 and 2024.

During the fourth quarters of 2025 and 2024, we performed our annual impairment reviews of the Silversea trade name.

As a result of the quantitative tests, we determined that the fair value of the Silversea's trade name exceeded its carrying value by approximately 90% and 66%, as of November 30, 2025 and 2024, respectively, resulting in no impairment to Silversea's tr ade name.

As of December 31, 2025 and 2024 , the carrying value of indefinite-life intangible assets was $321 million, which primarily relates to the Silversea trade name.

We did not perform interim impairment evaluations of Silversea's goodwill or trade names during 2025 and 2024, as no triggering events were identified.

Derivative Instruments

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We also use non-derivative financial instruments designated as hedges of our net investment in our foreign operations and investments.

Although some of our derivative financial instruments do not qualify for hedge accounting or are not accounted for under hedge accounting, we do not hold or issue derivative financial instruments for trading or other speculative purposes.

Although some of our derivative financial instruments do not qualify for hedge accounting or are not accounted for under hedge accounting, we do not hold or issue derivative financial

instruments for trading or other speculative purposes.

We account for derivative financial instruments in accordance with authoritative guidance.

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We believe it is unlikely that materially different estimates for the fair value of our foreign currency forward contracts, interest rate swaps, fuel swaps and options would be derived from other appropriate valuation models using similar assumptions, inputs or conditions suggested by actual historical experience.

Contingencies—Litigation

On an ongoing basis, we assess the potential liabilities related to any lawsuits or claims brought against us.

While it is typically difficult to determine the timing and ultimate outcome of such actions, we use our best judgment to determine if it is probable that we will incur an expense related to the settlement or final adjudication of such matters and whether a reasonable estimation of such probable loss, if any, can be made.

In assessing probable losses, we take into consideration estimates of the amount of insurance recoveries, if any, which are recorded as assets when recoverability is probable.

We accrue a liability when we believe a loss is probable and the amount of loss can be reasonably estimated.

Due to the inherent uncertainties related to the eventual outcome of litigation and potential insurance recoveries, it is possible that certain matters may be resolved for amounts materially different from any provisions or disclosures that we have previously made.

Our revenues are seasonal based on demand for cruises.

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• Commissions, transportation and other expenses , which consist of those costs directly associated with passenger ticket revenues, including travel advisor commissions, air and other transportation expenses, port costs that vary with passenger head counts and related credit card fees;

• Onboard and other expenses , which consist of the direct costs associated with onboard and other revenues, including the costs of products sold onboard our ships, vacation protection insurance premiums, costs associated with pre- and post-cruise tours and related credit card fees, as well as the minimal costs associated with concession revenues, as the costs are mostly incurred by third-party concessionaires and costs incurred for the procurement and management related services we perform on behalf of our unconsolidated affiliates;

concession revenues, as the costs are mostly incurred by third-party concessionaires and costs incurred for the procurement and management related services we perform on behalf of our unconsolidated affiliates;

• Payroll and related expenses , which consist of costs for shipboard personnel (costs associated with our shoreside personnel are included in Marketing, selling and administrative expenses );

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The presentation of non-GAAP financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

Adjusted EBITDA is a non-GAAP measure that represents EBITDA (as defined below) excluding certain items that we believe adjusting for is meaningful whe n assessing our profitability on a comparative basis.

For the p eriods presented, these items included (i) Other (income) expense, which includes the 2024 release of the loss contingency recorded in 2022 in connection with the Havana Docks litigation inclusive of related legal fees and costs;

(ii) impa irment and credit losses ;

(iii) equity investment impairment, recovery of losses and other;

(iv) restru cturing charges and other initiatives expense;

and (v) gain on sale of controlling interest .

A reconciliation of Net Income (Loss) attributable to Royal Caribbean Cruises Ltd.

to Adjusted EBITDA is provided below under Results of Operations.

Adjusted Earnings (Loss) per Share ("Adjusted EPS") is a non-GAAP measure that represents Adjusted Net Income (Loss) attributable to Royal Caribbean Cruises Ltd.

Adjusted Earnings per Share ("Adjusted EPS") is a non-GAAP measure that represents Adjusted Net Income attributable to Royal Caribbean Cruises Ltd.

(as defined below) divided by weighted average shares outstanding or by diluted weighted average shares outstanding, as applicable.

We believe that this non-GAAP measure is meaningful when assessing our performance on a comparative basis.

For the periods presented , these items included (i) other (income) expense, (ii) equity investment impairment, (recovery) of losses, and other, (iii) restructuring charges and other initiative expenses, and (iv) impairment and credit losses, and (v) gain on sale of noncontrolling interest.

A reconciliation of Net Income attributable to Royal Caribbean Cruises Ltd.

to Adjusted EBITDA is provided below under Results of Operations.

Adjusted EBITDA Margin is a non-GAAP measure that represents Adjusted EBITDA (as defined above) divided by total revenues.

Adjusted Gross Margin represents Gross Margin, adjusted for payroll and related, food, fuel, other operating, and depreciation and amortization expenses.

Gross Margin is calculated pursuant to GAAP as total revenues less total cruise operating expenses, and depreciation and amortization.

Adjusted Net Income (Loss) attributable to Royal Caribbean Cruises Ltd.

is a non-GAAP measure that represents net income (loss) less net income attributable to noncontrolling interest, excluding certain items that we believe adjusting for is meaningful when assessing our performance on a comparative basis.

For the periods presented, these items included (i) loss on extinguishment of debt;

(ii) litigation loss contingency, which includes the 2024 release of the loss contingency recorded in 2022 in connection with the Havana Docks litigation inclusive of related legal fees and costs;

(iii) impairment and credit losses;

(iv) equity investment impairment, recovery of losses and other;

(v) restructuring charges and other initiatives expense;

(vi) the amortization of the Silversea Cruises intangible assets resulting from the Silversea Cruises acquisition in 2018;

(vii) tax on the sale of PortMiami noncontrolling interest;

(viii) Silver Whisper deferred tax liability release;

and (ix) gain on sale of controlling interest.

A reconciliation of Net Income (Loss) attributable to Royal Caribbean Cruises Ltd.

to Adjusted Net Income (Loss) attributable to Royal Caribbean Cruises Ltd.

Adjusted Net Income attributable to Royal Caribbean Cruises Ltd.

is a non-GAAP measure that represents Net Income attributable Royal Caribbean Cruises Ltd., excluding certain items that we believe adjusting for is meaningful when assessing our performance on a comparative basis.

For the periods presented, these items included (i) loss on extinguishment of debt and inducement expense;

(ii) restructuring charges and other initiatives expenses;

(iii) the amortization of the Silversea intangible assets resulting from the Silversea acquisition;

(iv) gain on sale of noncontrolling interest;

(v) equity investment impairment, (recovery) of losses and other;

(vi) litigation loss contingency, which includes the 2024 release of the loss contingency recorded in 2022 in connection with the Havana Docks litigation;

(vii) impairment and credit losses;

(viii) tax on the sale of PortMiami noncontrolling interest;

(ix) gain on sale of controlling interest;

and (x) Silver Whisper deferred tax liability release.

A reconciliation of Net Income attributable to Royal Caribbean Cruises Ltd.

to Adjusted Net Income attributable to Royal Caribbean Cruises Ltd.

is provided below under Results of Operations.

Adjusted Operating Income (Loss) is a non-GAAP measure that represents operating income (loss) including income (loss) from equity investments and income taxes but excluding (i) impairment and credit losses;

(ii) equity investment impairment, recovery of losses and other;

(iii) restructuring charges and other initiatives expense;

(iv) the amortization of the Silversea Cruises intangible assets resulting from the Silversea Cruises acquisition in 2018;

and (v) tax on the sale of PortMiami noncontrolling interest.

Adjusted Operating Income is a Non-GAAP measure that represents operating income including income from equity investments and provision for income taxes but excluding certain items for which we believe adjusting for is meaningful when

assessing our operating performance on a comparative basis.

We use this non-GAAP measure to calculate ROIC (as defined below).

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Over the longer term, changes in guest sourcing and shifting the amount of purchases between currencies can significantly change the impact of the purely currency-based fluctuations.

EBITDA is a non-GAAP measure that represents Net Income (Loss) attributable to Royal Caribbean Cruises Ltd.

EBITDA is a non-GAAP measure that represents Net Income attributable to Royal Caribbean Cruises Ltd.

excluding (i) interest income;

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(iii) depreciation and amortization expenses;

and (iv) income tax benefit or expense.

and (iv) provision for income taxes.

We believe that this non-GAAP measure is meaningful when assessing our operating performance on a comparative basis.

A reconciliation of Net Income (Loss) attributable to Royal Caribbean Cruises Ltd.

A reconciliation of Net Income attributable to Royal Caribbean Cruises Ltd.

to EBITDA is provided below under Results of Operations.

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We use this measure to calculate ROIC (as defined below).

Net Cruise Costs and Net C ruise Costs excluding Fuel are non-GAAP measures that represent Gross Cruise Costs excluding commissions, transportation and other expenses, onboard and other expenses and, in the case of Net Cruise Costs excluding Fuel, fuel expenses (each of which is described above under the Description of Certain Line Items heading).

Net Cruise Costs and Net C ruise Costs excluding Fuel are non-GAAP measures that represent Gross Cruise Costs excluding commissions, transportation and other expenses, and onboard and other expenses and, in the case of Net Cruise Costs excluding Fuel, fuel expenses (each of which is described above under the Description of Certain Line Items heading).

In measuring our ability to control costs in a manner that positively impacts net income, we believe changes in Net Cruise Costs and Net Cruise Costs excluding Fuel to be the most relevant indicators of our cost performance.

For the periods presented, Net Cruise Costs and Net Cruise Costs Excluding Fuel excludes (i) impairment and credit losses;

(ii) restructuring charges and other

initiatives expense;

and (iii) the gain on sale of controlling interests.

A reconciliation of Gross Cruise Costs to Net Cruise Costs and Net Cruise Costs excluding Fuel is provided below under Results of Operations.

For the periods presented, Net Cruise Costs and Net Cruise Costs excluding Fuel excludes (i) restructuring charges and other initiatives expenses;

(ii) impairment and credit losses;

and (iii) gain on sale of controlling interest.

Net Yields represent Adjusted Gross Margin per APCD.

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Passenger Cruise Days ("PCD") represent the number of passengers carried for the period multiplied by the number of days of their respective cruises.

Return on Invested Capital ("ROIC") represents Adjusted Operating Income (Loss) divided by Invested Capital.

Return on Invested Capital ("ROIC") represents Adjusted Operating Income divided by Invested Capital.

We believe ROIC is a meaningful measure because it quantifies how efficiently we generated operating income relative to the capital we have invested in the business.

Trifecta refers to the multi-year Adjusted EBITDA per APCD, Adjusted EPS and ROIC goals we publicly announced in November 2022.

We designed these goals to help us better execute and achieve our business goals by clearly articulating longer-term financial objectives.

Under Trifecta, we are targeting Adjusted EBITDA per APCD of at least $100, Adjusted EPS of at least $10, and ROIC of 13% or higher by the end of 2025.

On July 25, 2024, we announced the company achieved all three of its Trifecta goals 18 months ahead of schedule, on a trailing twelve-month basis.

The use of certain significant non-GAAP measures, such as Net Yields, Net Cruise Costs and Net Cruise Costs Excluding Fuel, allows us to perform capacity and rate analysis to separate the impact of known capacity changes from other less predictable changes which affect our business.

The use of certain significant non-GAAP measures, such as Net Yields, Net Cruise Costs and Net Cruise Costs excluding Fuel, allows us to perform capacity and rate analysis to separate the impact of known capacity changes from other less

predictable changes which affect our business.

We believe these non-GAAP measures provide expanded insight to measure revenue and cost performance in addition to the standard GAAP based financial measures.

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Executive Overview

2024 performance was exceptionally strong and significantly exceeded our expectations.

We took delivery of two new ships ( Utopia of the Seas and Silver Ray ), announced the expansion of our private destination portfolio with Royal Beach Club Cozumel and Perfect Day Mexico, and reinstated a dividend to our shareholders.

2025 performance was exceptionally strong.

We took delivery of two ships ( Star of the Seas and Celebrity Xcel ) and continued to expand our vacation ecosystem with the opening of Royal Beach Club Paradise Island, closing on the acquisition of the port of Costa Maya in 2025, and the announcements of Celebrity River Cruises, launching in 2027, and the expansion of our private destination portfolio with Royal Beach Club Santorini.

We achieved strong financial performance, including 8.5% Gross Margin Yield growth as-reported, Net Yields increased 3.8% as-reported (3.7% in Constant-Currency), Net Income of $4.3 billion and Adjusted EBITDA of $7.0 billion, Operating Income of $4.9 billion, and ROIC of 18.0%.

As announced on July 25, 2024, we also achieved our Trifecta goals 18 months ahead of schedule.

In addition, we made significant progress in strengthening our balance sheet, refinancing approximately $6.1 billion of high cost debt, eliminating restrictions on our ability to return capital to shareholders, and eliminating all security and guarantees.

We maintained a strong balance sheet and achieved investment-grade ratings across all three major credit rating agencies.

Our 2025 Net Income attributable to Royal Caribbean Cruises Ltd.

was $2.9 billion, or $10.94 per diluted share, compared to Net Income attributable to Royal Caribbean Cruises Ltd.

of $1.7 billion, or $6.31 per diluted share in 2023.

was $4.3 billion, or $15.61 per diluted share, compared to the 2024 Net Income attributable to Royal Caribbean Cruises Ltd.

of $2.9 billion, or $10.94 per diluted share.

Adjusted Net Income attributable to Royal Caribbean Cruises Ltd.

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of $3.2 billion, or $11.80 per diluted share in 2024.

Total revenues in 2024 were $16.5 billion compared to $13.9 billion in 2023 driven by strong ticket revenue and onboard revenue performance, inclusive of capacity growth.

As a result of this, Gross Margin Yields increased 23.8% as-reported, and Net Yields increased 11.5% as-reported (11.6% in Constant-Currency), both compared to 2023.

The strength in revenue and improved cash flow, combined with our margin expansion efforts allowed us to accelerate debt repayment, improving our debt maturity profile and strengthening our balance sheet.

Cruise operating expenses increased from $7.8 billion in 2023 to $8.7 billion in 2024.

Gross Cruise Costs per APCD increased 4.6% as-reported and 4.6% in Constant Currency, compared to 2023.

Net Cruise Costs, excluding Fuel, per APCD increased 6.8% as-reported and 6.8% in Constant Currency, compared to 2023, primarily driven by a record 22 ships in drydock in 2024, as well as higher incentive based, non-cash compensation expense.

In 2025, we expect our capacity to increase by 5.4% compared to 2024, with the addition of Star of the Seas in late summer and Celebrity Xcel in late 2025, and a full year of operations for Utopia of the Seas and Silver Ray .

In addition, the first Royal Beach Club, at Paradise Island in the Bahamas, is set to open towards the end of the year, and Wonder of the Seas will join Utopia of the Seas focused on short Caribbean itineraries.

We also expect to advance development of the Royal Beach Club Cozumel, Perfect Day Mexico, and Silversea’s new hotel in Puerto Williams, Chile that will provide a further-elevated and seamless guest experience for its Antarctica expeditions.

Our new ships, optimized deployment, continued load factor growth and enhanced onboard offerings are expected to drive growth in Net Yields and Total Revenues.

Total revenues in 2025 increased by $1.5 billion and were $17.9 billion, exceeding the previous record of $16.5 billion in 2024, driven by strong ticket revenue and growth of onboard performance, inclusive of capacity growth.

As a result, Gross Margin Yields increased 8.5% as-reported, and Net Yields increased 3.8% as-reported (3.7% in Constant-Currency), both compared to 2024.

In 2025 we generated $6.5 billion in operating cash flow, maintained an unsecured balance sheet, managed debt maturities, and returned $2.0 billion in capital to shareholders through dividends and share repurchases.

Cruise operating expenses increased by $0.4 billion from $8.7 billion in 2024 to $9.1 billion in 2025.

The increase was primarily due to an increase in capacity in 2025, compared to the same period in 2024.

Gross Cruise Costs per APCD decreased 0.6% as-reported and 0.8% in Constant Currency, compared to 2024.

Net Cruise Costs excluding Fuel, per APCD decreased 0.1% as-reported and 0.1% in Constant Currency, compared to 2024, primarily driven by efficiencies on newer hardware and group scale driving efficiencies.

In 2026, we expect our capacity to increase by 6.7% compared to 2025, with a full year of Star of the Seas and Celebrity Xcel, and delivery of Legend of the Seas in the summer.

In addition, our portfolio of exclusive land-based destinations is expected to reach 8 by 2028, with additions of Silversea’s Cormorant at 55 South, Royal Beach Club Santorini, and Royal Beach Club Cozumel on the horizon.

In addition, we will continue development of Perfect Day Mexico and Royal Beach Club Lelepa.

Our new ships, deployment, enhanced product offerings are expected to drive growth in Net Yields, total revenues, and earnings.

Results of Operations

In addition to the items discussed above under "Executive Overview," significant items for 2025 include:

• Net Income attributable to Royal Caribbean Cruises Ltd.

and Adjusted Net Income attributable to Royal Caribbean Cruises Ltd.

for the year ended December 31, 2024 was $2.9 billion and $3.2 billion, or $10.94 and $11.80 per share on a diluted basis, respectively, compared to Net Income attributable to Royal Caribbean Cruises Ltd.

and Adjusted Net Income attributable to Royal Caribbean Cruises Ltd.

of $1.7 billion and $1.8 billion, or $6.31 and $6.77 per share on a diluted basis, respectively, for the year ended December 31, 2023.

• Total revenues increased by $2.6 billion for the year ended December 31, 2024 as compared to the same period in 2023.

The increase was primarily due to an increase in capacity, ticket prices and onboard spending in 2024 , compared to the same period in 2023.

• Total cruise operating expenses increased by $0.9 billion for the year ended December 31, 2024 compared to the same period in 2023.

The increase was primarily due to an increase in capacity in 2024, compared to the same period in 2023.

• In March 2024, we issued $1.25 billion aggregate principal amount of 6.25% senior notes due 2032.

Upon closing, we redeemed all of the outstanding $1.25 billion aggregate principal amount of 11.63% Senior Notes Due 2027.

• During the second quarter of 2024, we repaid $839 million of outstanding deferred amounts under our export credit facilities.

• In May 2024, we took delivery of Silver Ray .

Refer to Note 8 .

Debt to our consolidated financial statements under Item 8.

Financial Statements and Supplementary Data for further information on the financing of the ship.

• In June 2024, we took delivery of Utopia of the Seas .

• In February 2025, TUI Cruises, our 50% joint venture, took delivery of the Mein Schiff Relax.

• In March 2025, we completed a privately negotiated exchange with certain holders of 6.00% Convertible Senior Notes due 2025.

The holders exchanged approximately $213 million in aggregate principal amount for approximately 3 million shares of common stock and $214 million in cash, including accrued interest.

• In May 2025, we amended our two revolving credit facilities, bringing our aggregate revolving credit capacity to $6.4 billion, and extended the termination date of one of the revolving credit facilities from October 2026 to October 2030.

• In July 2025, we took delivery of Star of the Seas.

Refer to Note 8 .

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Financial Statements and Supplementary Data for further information on the financing of the ship.

• In June 2024, TUI Cruises, our 50% joint venture, took delivery of Mein Schiff 7 .

• In August 2024, we issued $2.0 billion aggregate principal amount of 6.00% senior notes due 2033.

Upon closing, we redeemed all of the outstanding $1.0 billion aggregate principal amount of 9.250% Senior Notes Due 2029, and all of the outstanding $1.0 billion aggregate principal amount of 8.250% Senior Secured Notes Due 2029.

• In August 2024, we completed privately negotiated exchange with certain holders of 6.00% Convertible Senior Notes due 2025 to exchange approximately $827 million in aggregate principal amount for approximately 11.4 million shares of common stock and $827 million in cash.

• In September 2024, we issued $1.5 billion aggregate principal amount of 5.63% senior unsecured notes due 2031.

Upon closing, we redeemed the outstanding $700 million aggregate principal amount of 7.25% Senior Notes Due 2030.

• In September 2024, we entered into agreements to acquire the Port of Costa Maya and adjacent land in Mahahual, Mexico for approximately $292 million.

The transaction is expected to close in the first half of 2025, subject to regulatory approval and customary closing conditions.

• In July 2025, we closed on our acquisition of the Port of Costa Maya and adjacent land in Mahahual, Mexico.

The final purchase price was $294 million.

Refer to Note 6 .

Commitments and Contingencies to our consolidated financial statements under Item 8.

Property and Equipment to our consolidated financial statements under Item 8.

Financial Statements and Supplementary Data for further information.

• In December 2024, we executed the bargain purchase option on the S ilver Dawn finance lease for approximately $227 million.

• During the quarter ended December 31, 2024, we repaid the remaining $138 million outstanding balance on the Silver Moon .

• During the year ended December 31, 2024, we released approximately $124 million of the loss contingency inclusive of related legal fees and costs in connection with the Havana Docks litigation.

• In August 2025, the remaining $106 million of our 6.0% Convertible Senior Notes matured.

The notes and accrued interest were settled using a combination of $109 million in cash, and the issuance of approximately 1.8 million shares of common stock..

• In October 2025, we took delivery of Celebrity Xcel.

Refer to Note 8 .

Commitments and Contingencies to our consolidated financial statements under Item 8.

Financial Statements and Supplementary Data for further information.

• In February 2025, TUI Cruises, our 50% joint venture, took delivery of Mein Schiff Relax .

For further information regarding the debt and lease transactions discussed above, refer to Note 8 .

Debt, and Note 9 .

Leases to our consolidated financial statements under Item 8.

Debt to our consolidated financial statements under Item 8.

Financial Statements and Supplementary Data for further information on the financing of the ship.

• In October 2025, we issued $1.5 billion aggregate principal amount of 5.375% senior notes due 2036.

The Company used the net proceeds from the offering to primarily finance the delivery of Celebrity Xcel at a lower cost compared to utilizing its existing committed export credit agency facility.

For further information regarding the debt transactions discussed above, refer to Note 8 .

Debt, to our consolidated financial statements under Item 8.

Financial Statements and Supplementary Data for further information.

We reported Net Income (Loss) attributable to Royal Caribbean Cruises Ltd., Adjusted Net Income (Loss) attributable to Royal Caribbean Cruises Ltd., Earnings (Loss) per Share and Adjusted Earnings (Loss) per Share as shown in the following table (in millions, except per share data.

Certain amounts may not add due to use of rounded numbers):

Adjusted Net Income attributable to Royal Caribbean Cruises Ltd., and Adjusted Earnings per Share are calculated as follows (in millions, except per share data.

Certain amounts may not add or calculate due to the use of rounded numbers):

Year Ended December 31,

2025 2024 2023

Net Income (Loss) attributable to Royal Caribbean Cruises Ltd.

Net Income attributable to Royal Caribbean Cruises Ltd.

$ 4,268 $ 2,877 $ 1,697

Loss on extinguishment of debt (1) 463 121 94

Loss on extinguishment of debt and inducement expense (1) 16 463 121

Restructuring charges and other initiatives expenses (2) 8 10 5

Amortization of Silversea intangible assets resulting from the Silversea acquisition (3) 6 6 6

Gain on sale of noncontrolling interest (4) (11) — —

Equity investment impairment, (recovery) of losses and other (1) (1) 12

Litigation loss contingency (5) — (124) —

Impairment and credit losses (6) — 9 8

Equity investment impairment, recovery of losses and other (1) 12 —

Restructuring charges and other initiatives expense 10 5 12

Amortization of Silversea Cruises intangible assets resulting from the Silversea Cruises acquisition (4) 6 6 6

PortMiami tax on sale of noncontrolling interest (7) — (3) 7

Silver Whisper deferred tax liability release (6) — (26) —

Gain on sale of controlling interest (8) — — (3)

Adjusted Net Income (Loss) attributable to Royal Caribbean Cruises Ltd.

Silver Whisper deferred tax liability release (9) — — (26)

Adjusted Net Income attributable to Royal Caribbean Cruises Ltd.

$ 4,286 $ 3,237 $ 1,827

Earnings (Loss) per Share $ 11.00 $ 6.63 $ (8.45)

Adjusted Earnings (Loss) per Share $ 12.38 $ 7.14 $ (7.50)

Earnings (Loss) per Share (8) $ 10.94 $ 6.31 $ (8.45)

Adjusted Earnings (Loss) per Share (9) $ 11.80 $ 6.77 $ (7.50)

Earnings per Share $ 15.75 $ 11.00 $ 6.63

Adjusted Earnings per Share $ 15.81 $ 12.38 $ 7.14

Earnings per Share (10) $ 15.61 $ 10.94 $ 6.31

Adjusted Earnings per Share (11) $ 15.64 $ 11.80 $ 6.77

Weighted-Average Shares Outstanding:

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Diluted 274 279 283

(1) For 2024, includes $119 million of inducement expense related to the partial settlement of our 6.00% convertible notes due 2025.

(1) For 2025 and 2024, includes $10 million and $119 million, respectively, of inducement expense related to the settlements of our 6.00% convertible notes due 2025.

These amounts are included in Interest expense, net of interest capitalized within our consolidated statements of comprehensive income (loss).

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Financial Statements and Supplementary Data for further information.

(2) These amounts are included in Marketing, selling and administrative expenses within our consolidated statements of comprehensive income (loss).

(3) Represents the amortization of the Silversea intangible assets resulting from the 2018 Silversea acquisition.

(4) For 2025, represents gain on sale of noncontrolling interest of Floating Docks and Grand Bahama Shipyard.

These amounts are included in Other income within our consolidated statements of comprehensive income (loss).

Refer to Note 7.

Investments and Other Assets to our consolidated financial statements under Item 8.

Financial Statements and Supplementary Data for further information.

(5) For 2024, represents the release of the loss contingency recorded in 2022, in connection with the Havana Docks litigation inclusive of related legal fees and costs.

These amounts are included in Other income (expense) within our consolidated statements of comprehensive income (loss).

These amounts are included in Other income within our consolidated statements of comprehensive income (loss).

Refer to Note 17.

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Financial Statements and Supplementary Data for further information.

(3) For 2024, primarily represents property and equipment impairment charges related to certain construction in progress assets, which we determined would no longer be completed.

(6) For 2024, represents property and equipment impairment charges related to certain construction in progress assets.

For 2023, represents asset impairments and credit losses recoveries for notes receivables for which credit losses were previously recorded.

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This amount is included in Marketing, selling and administrative expenses within our consolidated statements of comprehensive income (loss).

(4) Represents the amortization of the Silversea Cruises intangible assets resulting from the 2018 Silversea Cruises acquisition.

(7) For 2024, represents adjustments to tax impacts on the 2023 PortMiami sale of noncontrolling interest.

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These amounts are included in Other income (expense) in our consolidated statements of comprehensive income (loss).

(6) Represents the release of the deferred tax liability subsequent to the execution of the bargain purchase option for the Silver Whisper.

These amounts are included in Other (expense) income within our consolidated statements of comprehensive income (loss).

(7) Represents gain on sale of controlling interest in cruise terminal facilities in Italy.

(8) For 2023, represents gain on sale of controlling interest in cruise terminal facilities in Italy.

These amounts are included in Other operating within our consolidated statements of comprehensive income (loss).

(8) Diluted EPS includes the add-back of $175 million and $88 million of dilutive inducement and interest expense related to our convertible notes for the years ended December 31, 2024, and 2023, respectively.

(9) Adjusted Diluted EPS includes the add-back of dilutive interest expense related to our convertible notes of $56 million and $88 million for the years ended December 31, 2024, and 2023, respectively.

(9) Represents the release of the deferred tax liability subsequent to the execution of the bargain purchase option for the Silver Whisper.

These amounts are included in Other income (expense) within our consolidated statements of comprehensive income (loss).

(10) Diluted EPS includes the add-back of $16 million, $175 million and $88 million of dilutive inducement and interest expense related to our convertible notes for the years ended December 31, 2025, 2024, and 2023, respectively.

Refer to Note 12 .

Earnings Per Share to our consolidated financial statements under Item 8.

Financial Statements and Supplementary Data for further information.

(11) Adjusted Diluted EPS includes the add-back of dilutive interest expense related to our convertible notes of $6 million, $56 million and $88 million for the years ended December 31, 2025, 2024, and 2023, respectively.

The following table presents operating results as a percentage of total revenues for the last three years:

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Depreciation and amortization expenses 9.6 % 9.7 % 10.5 %

Operating Income (Loss) 24.9 % 20.7 % (8.7) %

Operating Income 27.4 % 24.9 % 20.7 %

Other income (expense):

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Other income (expense) 0.1 % 0.9 % — %

(7.3) % (8.4) % (15.7) %

Net Income (Loss) 17.6 % 12.3 % (24.4) %

Income before income taxes 24.4 % 17.8 % 12.3 %

Provision for income taxes (0.5) % (0.3) % — %

Net Income 23.9 % 17.6 % 12.3 %

Net Income attributable to noncontrolling interest 0.1 % 0.1 % 0.1 %

Net Income (Loss) attributable to Royal Caribbean Cruises Ltd.

Net Income attributable to Royal Caribbean Cruises Ltd.

23.8 % 17.5 % 12.2 %

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Occupancy 109.7 % 108.5 % 105.6 %

EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin were calculated as follows (in millions, except APCD and per APCD data.

Certain amounts may not add due to use of rounded numbers;

reported EBITDA, Adjusted EBITDA, and per APCD and Margin amounts are calculated from the underlying dollar amounts):

EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin are calculated as follows (in millions, except APCD and per APCD data.

Certain amounts may not add or calculate due to the use of rounded numbers):

Year Ended December 31,

2025 2024 2023

Net Income (Loss) attributable to Royal Caribbean Cruises Ltd.

Net Income attributable to Royal Caribbean Cruises Ltd.

$ 4,268 $ 2,877 $ 1,697

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Depreciation and amortization expenses 1,718 1,600 1,455

Income tax expense (1) 46 6 4

Provision for income taxes 82 46 6

EBITDA 7,036 6,097 4,524

Other (income) expense (17) (149) 2

Impairment and credit losses (3) 9 8 1

Equity investment impairment, (recovery) of losses and other (1) 4 8

Restructuring charges and other initiatives expense 10 5 12

Restructuring charges and other initiative expenses (1) 8 10 5

Impairment and credit losses (2) — 9 8

Gain on sale of controlling interest (3) — — (3)

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APCD 53,325,212 50,552,731 46,916,259

Net Income (Loss) per APCD $ 56.92 $ 36.17 $ (52.33)

Net Income attributable to Royal Caribbean Cruises Ltd.

per APCD $ 80.04 $ 56.92 $ 36.17

Adjusted EBITDA per APCD $ 131.75 $ 118.13 $ 96.85

Adjusted EBITDA Margin 39.2 % 36.2 % 32.7 %

(1) These amounts are included in Other income (expense) within our consolidated statements of comprehensive income (loss).

(2) Represents net non-operating (income) expense.

For 2024, primarily represents the release of the loss contingency recorded in 2022 in connection with the Havana Docks litigation inclusive of related legal fees and costs.

The amount excludes income tax expense, included in the EBITDA calculation above.

(3) For 2024, primarily represents property and equipment impairment charges related to certain construction in progress assets, which we determined would no longer be completed.

(1) These amounts are included in Marketing, selling and administrative expenses within our consolidated statements of comprehensive income (loss).

(2) For 2024, represents property and equipment impairment charges related to certain construction in progress assets.

For 2023, represents asset impairments and credit losses recoveries for notes receivables for which credit losses were previously recorded.

These amounts are included in Other operating within our consolidated statements of comprehensive income (loss).

Additionally, for 2023, includes an $11 million impairment related to ceasing the use of certain real

estate assets in our shoreside operations.

Additionally, for 2023, includes an $11 million impairment related to ceasing the use of certain real estate assets in our shoreside operations.

This amount is included in Marketing, selling and administrative expenses within our consolidated statements of comprehensive income (loss).

(4) Represents gain on sale of controlling interest in cruise terminal facilities in Italy.

(3) For 2023, represents gain on sale of controlling interest in cruise terminal facilities in Italy.

These amounts are included in Other operating within our consolidated statements of comprehensive income (loss).

Gross Margin Yields, Net Yields and Adjusted Gross Margin per PCD were calculated by dividing Gross Margin and Adjusted Gross Margin by APCD, and Adjusted Gross Margin by PCD as follows (in millions, except APCD, PCD, Yields, and Adjusted Gross Margin per PCD.

Certain amounts may not add due to use of rounded numbers;

reported Yields and per PCD amounts are calculated from the underlying dollar amounts):

Gross Margin Yields and Net Yields are calculated as follows (in millions, except APCD and Yields.

Certain amounts may not add or calculate due to the use of rounded numbers):

Year Ended December 31,

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APCD 53,325,212 53,325,212 50,552,731 46,916,259

Passenger Cruise Days 54,844,780 54,844,780 49,549,127 35,051,935

Gross Margin Yields $ 133.77 $ 133.89 $ 123.27 $ 99.54

Net Yields $ 273.51 $ 273.35 $ 263.59 $ 236.38

Adjusted Gross Margin per PCD $ 242.96 $ 243.11 $ 223.81 $ 196.45

Gross Cruise Costs, Net Cruise Costs and Net Cruise Costs excluding Fuel were calculated as follows (in millions, except APCD and costs per APCD.

Certain amounts may not add due to use of rounded numbers;

reported Gross Cruise Costs, Net Cruise Costs, Net Cruise Costs excluding Fuel, and per APCD amounts are calculated from the underlying dollar amounts):

Gross Cruise Costs, Net Cruise Costs and Net Cruise Costs excluding Fuel are calculated as follows (in millions, except APCD and costs per APCD.

Certain amounts may not add or calculate due to the use of rounded numbers):

Year Ended December 31,

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Net Cruise Costs including other costs 7,957 7,938 7,619 6,757

Restructuring charges and other initiatives expenses (1) 8 8 10 5

Impairment and credit losses (2) — — 9 8

Restructuring charges and other initiatives expense (2) 10 10 5 12

Gain on sale of controlling interests (3) — — — (3)

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Net Cruise Costs excluding Fuel per APCD $ 127.57 $ 127.23 $ 127.40 $ 119.30

(1) For 2024, primarily represents property and equipment impairment charges related to certain construction in progress assets, which we determined would no longer be completed.

(1) These amounts are included in Marketing, selling and administrative expenses within our consolidated statements of comprehensive income (loss).

(2) For 2024, represents property and equipment impairment charges related to certain construction in progress assets.

For 2023, represents asset impairments and credit losses recoveries for notes receivables for which credit losses were previously recorded.

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This amount is included in Marketing, selling and administrative expenses within our consolidated statements of comprehensive income (loss).

(2) These amounts are included in Marketing, selling and administrative expenses within our consolidated statements of comprehensive income (loss).

(3) Represents gain on sale of controlling interest in cruise terminal facilities in Italy.

(3) For 2023, represents gain on sale of controlling interest in cruise terminal facilities in Italy.

These amounts are included in Other operating within our consolidated statements of comprehensive income (loss).

Adjusted Operating Income and ROIC, were calculated as follows:

Adjusted Operating Income and ROIC, are calculated as follows:

(in millions, except ROIC.

Certain amounts may not add due to use of rounded numbers;

Adjusted operating income, Invested Capital, and ROIC amounts are calculated from the underlying dollar amounts):

Certain amounts may not add or calculate due to the use of rounded numbers):

For the Twelve Months Ended

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Equity investment income 414

Income tax expense (46)

Impairment and credit losses (1) 9

Provision for income taxes (82)

Restructuring charges and other initiatives expenses (1) 8

Amortization of Silversea intangible assets related to Silversea acquisition (2) 6

Equity investment impairment, (recovery) of losses and other (1)

Restructuring charges and other initiatives expense 10

Amortization of Silversea Cruises intangible assets related to Silversea Cruises acquisition (2) 6

PortMiami tax on sale of noncontrolling interest (3) (3)

Adjusted Operating Income $ 5,254

Invested Capital $ 29,174

(1) For 2024, primarily represents property and equipment impairment charges related to certain construction in progress assets, which we determined would no longer be completed.

This amount is included in Other operating within our consolidated statements of comprehensive income (loss).

(2) Represents the amortization of the Silversea Cruises intangible assets resulting from the 2018 Silversea Cruises acquisition.

(3) Represents adjustments to tax impacts on the 2023 PortMiami sale of noncontrolling interest.

(1) These amounts are included in Marketing, selling and administrative expenses within our consolidated statements of comprehensive income (loss).

(2) Represents the amortization of the Silversea intangible assets resulting from the 2018 Silversea acquisition.

Year Ended December 31, 2025 Compared to Year Ended December 31, 2024

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Total revenues increased $1.5 billion, or 8.8%, to $17.9 billion in 2025 from $16.5 billion in 2024.

Capacity was up 7.8% in 2024, driven by the additions of our newest ships Utopia of the Seas, Icon of the Seas, Silver Ray, as well as a full year of operations from Celebrity Ascent and Silver Nova.

Passenger ticket revenues comprised 69.8% of our 2025 total revenues.

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The increase was primarily due to:

• a 7.8% increase in capacity due to the new ships noted above, an increase in ticket prices on a per passenger basis, and a 2.9% increase in occupancy.

• a $1.2 billion increase driven by higher ticket prices and occupancy in 2024, and a $0.7 billion increase driven by capacity.

• $631 million driven by 5.5% capacity growth as a result of the addition of our newest ships Star of the Seas and Celebrity Xcel, as well as a full year of operations from Utopia of the Seas and Silver Ray compared to 2024;

• $386 million driven by yield growth as result of higher load factors and higher ticket pricing on both existing ships and new ships in 2025 , compared to 2024.

The remaining 30.2% of 2025 total revenues was comprised of Onboard and other revenues , which increased $0.4 billion, or 8.7% to $5.4 billion in 2025 from $5.0 billion in 2024.

The increase was due to:

• a $336 million increase driven by a 7.8% increase in capacity due to the additions of new ships noted above in 2024 compared to the same period in 2023.

• a $318 million increase driven by improved pricing and an increase in occupancy of 2.9% in 2024 compared to the same period in 2023.

The increase was primarily due to:

• $273 million increase driven by 5.5% capacity growth as a result of the addition of our newest ships and a full year of operations of ships noted above in 2025 compared to 2024;

• $160 million driven by yield growth as result of higher load factors and improved pricing on both existing ships and new ships in 2025 compared to 2024.

Cruise operating expenses

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The increase was primarily due to:

• the 7.8% increase in capacity noted above which increased cruise operating expenses by $603 million;

• an increase of $300 million driven by various factors including an increase in higher drydock and maintenance related expenses;

and commissions due to the increases in ticket prices noted above in 2024 compared to the same period in 2023.

• a 5.5% increase in capacity noted above which increased cruise operating expenses by $475 million, partially offset by a decrease in drydocks and maintenance related expenses in 2025 compared to 2024.

Marketing, selling and administrative expenses

Marketing, selling and administrative expenses increased $98 million, or 4.6% to $2.2 billion in 2025 from $2.1 billion in 2024.

The increase was primarily due to an increase in payroll and benefits expense driven by an increase in headcount and higher stock price related to our performance share awards in 2024 compared to the same period in 2023, and higher spending on advertisement and media promotions.

Other income (expense)

Interest expense, net of interest capitalized for 2024 increased $188 million, to $(1.6) billion from $(1.4) billion in 2023.

The increase was due to loss on extinguishment of debt of $344 million primarily associated with the full redemption of our 11.625%, 9.250%, 8.250%, and 7.25% Senior Notes, and $119 million inducement expense on the partial settlement of our 2025 Convertible notes in 2024 compared to loss on extinguishment of debt of $121 million during the same period in 2023.

The increase was partially offset by a decrease of $146 million lower interest expense in 2024 compared to the same period in 2023, resulting from the 2024 refinancings.

The increase was primarily due to the additions of Star of the Seas and Celebrity Xcel.

Depreciation and amortization expenses

Depreciation and amortization expenses for 2025 increased $118 million, or 7.4%, to $1.7 billion from $1.6 billion in 2024.

The increase was primarily due to the additions of Icon of the Seas, Utopia of the Seas, and Silver Ray compared to the addition of Celebrity Ascent and Silver Nova during the second half of 2023.

Equity investment income for 2024 was $260 million compared to $200 million in 2023.

The increase in income was primarily due to income from TUI Cruises, one of our equity method investments, in 2024 compared to 2023.

Other income (expense) increased $111 million, to other income in 2024, from other expense of $(8) million in 2023.

The increase was primarily due to the release of the loss contingency of $124 million recorded in 2022 in connection with the Havana Docks litigation.

The increase was primarily due to the additions of Star of the Seas , Celebrity Xcel, and a full year of operations of Utopia of the Seas and Silver Ray in 2025 compared to the same period in 2024.

Other income (expense)

Interest expense, net of interest capitalized for 2025 decreased $0.6 billion, to $(1.0) billion from $(1.6) billion in 2024.

The decrease was primarily due to loss on extinguishment of debt of $344 million associated with the full redemption of several Senior Notes, and $119 million inducement expense on the partial settlement of our 2025 Convertible Notes in 2024 compared to an immaterial loss on extinguishment during the same period in 2025.

The remaining decrease was due to the effect of refinancings of certain indebtedness at lower rates compared to 2024.

Equity investment income for 2025 increased $154 million to $414 million from $260 million in 2024.

The increase in income was primarily due to the increase in income from TUI Cruises, one of our equity investments, in 2025 compared to 2024.

Other income (expense) for 2025 decreased $132 million, to other income of $17 million from $149 million in 2024.

The decrease was primarily due to the release of the loss contingency of $124 million, in connection with the Havana Docks litigation, during 2024, which did not recur in 2025.

Other comprehensive income (loss)

Other comprehensive income was $198 million in 2025 compared to Other comprehensive loss of $(128) million for the same period in 2024.

The increase of $326 million in income was primarily due to a gain on cash flow derivative hedges of $228 million in 2025 compared to a loss on cash flow derivative hedges of $(157) million in 2024, mostly as a result of a significant increase in the fair value of our FX forward swaps in 2025 compared to 2024.

Future Application of Accounting Standards

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Sources and Uses of Cash

Net cash provided by operating activities increased by $0.8 billion to $5.3 billion for the year ended December 31, 2024, compared to cash provided of $4.5 billion for the same period in 2023.

The increase was primarily driven by higher operating income in 2024 compared to the same period in 2023.

Net cash used in investing activities decreased by $0.5 billion to $3.4 billion for the year ended December 31, 2024, compared to cash used of $3.9 billion for the same period in 2023.

The decrease of $0.5 billion was primarily attributable to increased capital expenditures associated with taking delivery of Icon of the Seas, Celebrity Ascent, and Silver Nova in 2023 compared to Utopia of the Seas and Silver Ray in 2024.

Net cash (used in) provided by financing activities was $(1.9) billion for the year ended December 31, 2024, compared to cash used of $(2.0) billion for the same period in 2023.

The change of $0.1 billion was primarily attributable to an increase in debt repayments of $2.1 billion, an increase in premiums on repayments of debt of $0.2 billion, an increase of $0.1 billion related to our return to payment of dividends in 2024, and proceeds of $0.2 billion for the sale of noncontrolling interest of PortMiami, which did not recur in 2024.

The change was offset by an increase of $2.7 billion related to debt proceeds in 2024 compared to the same period in 2023.

Cash flow generated from operations provides us with a significant source of liquidity.

Net cash provided by operating activities increased by $1.2 billion to $6.5 billion for the year ended December 31, 2025, compared to $5.3 billion in 2024.

The change was primarily driven by higher operating income in 2025 compared to 2024.

Net cash used in investing activities increased by $1.6 billion to $5.0 billion for the year ended December 31, 2025, compared to $3.4 billion in 2024.

The change of $1.6 billion was primarily attributable to increased capital expenditures associated with taking delivery of Star of the Seas and Celebrity Xcel and the acquisition of the Port of Costa Maya in 2025 compared to the delivery of Utopia of the Seas and Silver Ray in 2024.

Net cash used in financing activities decreased by $0.9 billion to $1.0 billion for the year ended December 31, 2025, compared to $1.9 billion in 2024.

The change of $0.9 billion was primarily attributable to a net decrease in debt repayments of $2.5 billion, a decrease of $290 million of premiums on repayments of debt, partially offset by $1.2 billion in repurchases of common stock and $824 million in dividend payments in 2025 compared to $107 million in 2024.

Future Capital Commitments

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Our future capital commitments consist primarily of new ship orders.

As of December 31, 2024, we have two Icon-class ships and one Oasis-class ship on order for our Royal Caribbean brand with an aggregate capacity of approximately 16,900 berths.

In addition, as of December 31, 2024, we have one Edge-class ship on order for our Celebrity Cruises brand, with a capacity of approximately 3,250 berths.

As of December 31, 2025, we have three Icon-class ships and one Oasis-class ship on order for our Royal Caribbean brand with an aggregate capacity of approximately 22,500 berths.

In addition, as of December 31, 2025, we have one Edge-class ship and four river cruise ships on order for our Celebrity Cruises brand, with a capacity of approximately 3,930 berths.

Refer to Item 1.

Business-Operations for further information on our ships on order.

We have committed financing arrangements in place covering approximately 80% of the cost of the ship for the four ships on order for our Global Brands, all of which include sovereign financing guarantees.

As of December 31, 2024, the aggregate cost of our ships on order, excluding any ships on order by our Partner Brands, was approximately $7.8 billion, of which we had deposited $815 million.

Approximately 43.4% of the aggregate cost was exposed to fluctuations in the Euro exchange rate at December 31, 2024.

Bu s iness-Operations for further information on our ships on order.

We have committed financing arrangements in place covering approximately 80% of the cost of the ship for the five ships on order for our Global Brands, all of which include sovereign financing guarantees, excluding ships on order for Celebrity River Cruises.

As of December 31, 2025, the aggregate cost of our ships on order, excluding any ships on order by our Partner Brands, was approximately $11.3 billion, of which we had deposited $1.0 billion.

Approximately 64.1% of the aggregate cost is exposed to fluctuations in the Euro exchange rate at December 31, 2025.

Refer to Note 16.

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(3) Amounts are based on contractual installment and delivery dates for our ships on order.

Included in these figures are $4.9 billion in final contractual installments, which have committed financing covering approximately 80% of the cost of the ships on order for our Global Brands, all of which include sovereign financing guarantees.

Included in these figures are $7.8 billion in final contractual installments, which have committed financing covering approximately 80% of the cost of the ships on order for our Global Brands, all of which include sovereign financing guarantees, excluding ships on order for Celebrity River Cruises.

Amounts do not include potential obligations which remain subject to cancellation at our sole discretion or any agreements entered for ships on order that remain contingent upon completion of conditions precedent.

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We have significant contractual obligations of which our debt service obligations and the capital expenditures associated with our ship purchases represent our largest funding needs.

As of December 31, 2024, we had approximately $5.9 billion of committed financing for our ships on order.

As of December 31, 2024, our obligations due through December 31, 2025 primarily consisted of $1.6 billion related to debt maturities, $1.0 billion related to interest on debt and $2.4 billion related to progress payments on our ship orders and, based on expected delivery date, the final installments payable due upon the delivery of Star of the Seas and Celebrity Xcel .

As of December 31, 2025, we had approximately $10.4 billion of committed financing for our ships on order, which excludes ships on order for Celebrity River Cruises.

As of December 31, 2025, our obligations due through December 31, 2026 primarily consisted of $3.2 billion related to debt maturities, $1.0 billion related to interest on debt and $2.4 billion related to progress payments on our ship orders, including the final installments payable due upon the delivery of Legend of the Sea given the expected delivery date in 2026.

We have historically relied on a combination of cash flows provided by operations, draw-downs under our available credit facilities, the incurrence of additional debt and/or the refinancing of our existing debt and the issuance of additional shares of equity securities to fund our obligations.

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Financial Statements and Supplementary Data for further information.

If any person acquires ownership of more than 50% of our common stock or, subject to certain exceptions, during any 24-month period, a majority of our board of directors is no longer comprised of individuals who were members of our board of directors on the first day of such period, we may be obligated to prepay indebtedness outstanding under our credit facilities, which we may be unable to replace on similar terms.

We may be obligated to prepay indebtedness outstanding under our credit facilities if any person acquires ownership of more than 50% of our common stock or, subject to certain exceptions, if during any 24-month period, a majority of our Board is made up of persons who were not (i) members of the Board on the first day of such period, (ii) nominated by persons who were members of the Board on the first day of such period, or (iii) nominated by directors who themselves were nominated under clauses (i) or (ii) above.

If prepayment is triggered, we may be unable to replace our credit facilities on similar terms.

Our public debt securities also contain change of control provisions that would be triggered by a third-party acquisition of greater than 50% of our common stock coupled with a ratings downgrade.

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Debt Covenants

Our export credit facilities and our non-export credit facilities, and certain of our credit card processing agreements contain covenants that require us, among other things, to maintain a fixed charge coverage ratio, limit our net debt-to-capital ratio, and to maintain a minimum liquidity.

In July 2024, we amended all of our export credit facilities to eliminate the contractual requirement for us to maintain a minimum level of stockholders' equity.

As of December 31, 2025, we were in compliance with our financial covenants and we estimate that we will be in compliance for at least the next twelve months.

The declaration of dividends shall at all times be subject to the final determination of our Board of Directors that a dividend is prudent at that time in consideration of the needs of the business.

In December 2024, our Board of Directors declared a cash dividend on our common stock of $0.55 per share, which was paid in January 2025.

During the third quarter of 2024, our Board of Directors declared a cash dividend on our common stock of $0.40 per share, which was paid in the fourth quarter of 2024.

In February 2025, our Board of Directors declared a dividend of $0.75 per share, payable in April 2025.

The declaration of dividends shall at all times be subject to the final determination of our Board that a dividend is prudent at that time in consideration of the needs of the business.

During the fourth and third quarters of 2025, our Board declared dividends of $1.00 per share, which were paid in January 2026 and October 2025, respectively.

During the second and first quarters of 2025 the Board declared dividends of $0.75 per share which were paid in July 2025 and April 2025, respectively.

In February 2026, our Board declared a dividend of $1.50 per share, payable in April 2026.

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 7. Management’s Discussion and Analysis