Jason Liberty
President, Chief Executive Officer and Director at Royal Caribbean Cruises
Thank you. Thank you, Blake, and good morning, everyone. I am thrilled to discuss our exceptional 4th-quarter and full-year results, our outlook for 2025 and the many exciting things happening at the Royal Caribbean Group. 2024 was an incredible year for us and the 4th-quarter was no exception.
We delivered a record 8.6 million memorable vacations at very-high customer satisfaction scores, achieved an 11.6% net yield growth, generated more than $5 billion of operating cash-flow and returned the balance sheet to investment-grade metrics. We achieved our trifecta financial goals 18 months ahead of schedule and at the same time, we expanded capital allocation, all while continuing to invest in the business to support our growth ambitions.
We also met our double-digit carbon intensity reduction target a full-year ahead of schedule. These strong financial results set the foundation for a very bright future, which is truly just beginning for us. With our industry-leading global brands, the most innovative fleet and private destinations and the best people, we remain focused on winning a greater share of the $2 trillion vacation market. Our plan to capitalize on this opportunity continues to be grounded in our proven formula for success, moderate capacity growth, moderate yield growth and strong cost-control.
I want to thank the entire World Caribbean Group team for their passion, dedication and commitment that enables us to deliver the best vacation experiences responsibly and to drive exceptional financial results. Before getting into the details, I would like to take a moment to discuss an exciting new chapter in our mission to deliver the best vacation experiences. Celebrity River Cruises, which we announced this morning, will unlock exciting new opportunities for our guests, our business and our shareholders.
Beginning in 2027, Celebrity River Cruises will provide yet another opportunity for guests to explore even more destinations with our leading brands. We placed an initial order for 10 transformative ships, which will serve as the foundation for this new edge class inspired product. Our ambitions, however, go far beyond that.
We see River cruising as an exciting growth opportunity that aligns with our strategy of turning the vacation of a lifetime into a lifetime of vacations, expanding our ecosystem of vacation offerings and broadening our reach into adjacent lines of businesses. River cruising is a sizable and attractive market that has experienced double-digit growth over the last decade, driven by increasing demand from both seasoned cruisers as well as new customers.
It is a very fragmented market that presents an exciting opportunity for us to win substantial market-share. It delivers attractive APDs that we can capture while deepening customer loyalty within our family of brands. River cruising is a complementary high-margin, high ROIC business that fits nicely within our portfolio.
The smaller-scale of river ships and shorter build timelines allow us for faster deployment and return profiles. Celebrity River Cruises is a natural extension of celebrities premium Ocean offering and appeals to a similar demographic of discerning travelers who value immersive destination-focused experiences. River cruises spend a disproportionate amount of their time and money on travel including more spend on all types of cruises. We have a remarkable opportunity.
Approximately half of our guests have either already experienced or intend to take a river cruise vacation and a majority of guests who would add an additional vacation to take a river cruise. Furthermore, celebrity's existing reputation for exceptional hospitality and unparalleled experiences will attract new demand from travelers who are curious about river cruising, but who haven't yet taken that leap. Just as we've set the standard of excellence in ocean cruising, we will continue to innovate and elevate in the river space.
The quality and sophistication of our Edge class ocean ships will bring cutting-edge design, sustainable technologies and reimagined onboard and shore experiences that raises the bar for river cruising. This is an exciting time for the Celebrity brand as this news follows our recent agreement to order a sixth edge class ship set to be delivered to Celebrity Cruises in 2028. Edge 6, also known as XL2 will be the sister ship to Celebrity XL, which is gearing up for its inaugural sailing later this year. So now let's talk about 2024 results and 2025 outlook.
I am proud of what we have accomplished in 2024. We delivered double-digit yield growth and generated $0.5 billion more in revenue than we originally expected. Our strong performance was propelled by the flawless execution of our incredible team, which drove elevated demand across our brands. We also continued our focus on driving durable margin expansion, resulting in 74% year-over-year adjusted EPS growth.
We continue to invest in our future while strengthening the balance sheet, achieving our target of investment-grade metrics and reaching mid-teen ROIC. The year ended on a great note with revenue yields up 7.3% in the 4th-quarter, earnings that were $0.20 better than our guidance and a strong book position for 2025 from both a pricing and volume standpoint. 2024 was another year of remarkable innovation as we ushered in a new era of vacations with the launch of Icon of the Seas, Utopia of the Seas and Silver Ray.
While announcing and advancing several key private destinations that will further differentiate our leading portfolio of brands, including Perfect Day, Mexico, Royal Beach Clubs in Paradise Island and. We received exceptionally high guest satisfaction scores and attracted a record number of both new and loyal guests.
We continue to invest in our commercial and vacation experiences flywheel. In 2024, we expanded our capabilities across distribution channels to create a digital experience that connects the dots across all aspects of the consumer journey. Guests have been seamlessly planning and booking their dream vacations, reducing the amount of time to book a cruise by half.
We launched over 300 new digital capabilities across channels in 2024, improving the overall experience and reducing friction points while increasing spend. We also infused AI into the guest journey to provide a better, more efficient experience and more personalized service. For example, our new in-app chat saw a 35% increase in guest adoption that led to a 20% reduction in the customer service line on-board.
With nine out of 10 guests indicating their intent to repeat, our new loyalty status match program allows our guests to earn loyalty status across all three brands, fostering long-term relationships and rewarding loyal customers across our portfolio. Thank you. Turning to this year, momentum continues in 2025 with bookings accelerating since the last earnings call, resulting in the best five booking weeks in the company's history.
Bookings have continued to outpace last year across all key products. Our book position is in-line with prior years at higher APDs, allowing us to further optimize pricing and yield growth as we continue to build the book of business for 2025. As our bookings for 2025 have ramped-up since the last earnings call, our APD premium to last year has widened, underlining our continued focus on optimizing yield growth., our commercial apparatus is firing on all cylinders and all channels are delivering quality demand above 2024 levels. Our direct-to-consumer channels are performing extremely well.
We added hundreds of new capabilities across our digital platforms last year as consumers' preference for digital engagement continues to grow. Our travel partners are also delivering meaningfully more bookings than last year at higher rates. We continue to see particularly healthy demand from North-America where about 80% of our guests will be sourced this year.
Our brand's global appeal and nimble sourcing model allows us to attract the highest-yielding guests by positioning our ships in multiple markets around the world. Our brands lead-in their respective segments and are very successful at capturing quality demand across sectors and sourcing from new consumer bases. As we think about consumer demand for 2025 and beyond, we look to both macro trends and data points from millions of daily interactions with our customers. We continue to see very positive sentiment from our customers bolstered by strong labor markets, high wages, surplus savings and elevated wealth levels.
At the same time, they continue to prioritize travel experiences. American households are wealthier than ever with continued wage growth and low unemployment driving strong consumer spending. We see positive sentiment from our customers in a macro-environment that favors experiences over things as leisure and travel spend continued to grow.
Consumers plan to spend more on vacations and take more trips in the coming year and our guests over-index in their intent to spend more on leisure travel. Consumers place significant value on visiting multiple destinations and this is even more important to millennial and Gen Z consumers, something that Cruising is uniquely positioned to deliver on. Cruise consideration is high with the biggest gains among millennials and younger travelers.
Cruise remains an attractive value proposition and also leads in guest satisfaction compared to other vacation alternatives. We are very well-positioned to benefit from these trends with our exceptional and leading portfolio of brands, innovative and differentiated chips, exciting and exclusive destination experiences and leading commercial and AI-driven capabilities. 2025 is shaping up to be another great year with 23% expected earnings growth and accelerated path towards robust cash-flow generation.
In 2025, we expect to grow capacity by 5% through the introduction of star of the Seas and Celebrity Excel as well as the full-year benefit of Utopia of the Seas and Silver Ray. New ships not only elevate our vacation experience and draw new customers to our brand, but also provide yield tailwinds and enhance overall profitability. We expect yields to grow 2.5% to 4.5%, driven by the performance of our entire fleet, new and existing ships combined with our leading private destinations and strengthening commercial apparatus.
Strong rates and load factors together with continued focus on margins and strategic capital allocation are expected to drive adjusted earnings per share of $14.35 to $14.65, which includes $0.65 of FX and fuel rate headwinds compared to our last earnings call. Our proven formula for success is working.
Moderate capacity growth, moderate yield growth and strong cost-control leads to enhanced margins, profitability and superior financial performance. For decades, the Royal Caribbean Group has been redefining what a vacation experience can be. It's clear that our success has been built on a foundation of differentiation, setting ourselves apart through innovation and excellence. We have led the way in delivering best-in-class chips that redefine possible.
As we look-ahead, we continue to redefine vacations through the ambition expansion of our private destination portfolio, the exciting entry into new lines of businesses like Celebrity River Cruises and the development of industry-leading digital and AI capabilities. We relentlessly pursue an acute understanding of how today's families, couples and individuals want to spend their valuable vacation time, so that we can continue to develop an expanding ecosystem of vacation experiences that wildly exceed their expectations.
Our goal is to create seamless and personalized journeys across a portfolio of experiences from ship to private island to river cruises and beyond that inspire loyalty, deepen relationships and position us as a preferred choice for every kind of vacation. This is not just a strategy, it's a promise to redefine what travel means for our guests. It's about meeting them where they are, dreaming alongside them and turning the vacation of a lifetime into a lifetime of vacations.
With this vision, we are poised to lead not just the cruise industry, but the broader world of travel into an exciting new era. Through it all, we remain committed to our seed of future vision, sustaining the planet, energizing communities and accelerating innovation. 2024 was an exceptional year for our company marked by many milestones that set the stage for an even brighter future.
We are continuously elevating what it means to deliver the best vacation experiences, ships, an unparalleled private destination portfolio and globally trusted brands, all propelled by the best people. Royal Caribbean Group is redefining what people have come to expect from a vacation. As we embark on 2025, we remain focused on winning an even greater share of the broader vacation market and we are just getting started.
And with that, I will turn it over to Nav Tolly. Nav?
