Booking vs. Royal Caribbean – Two Travel Giants, Two Different Journeys
Booking vs. Royal Caribbean: Two Travel Giants, Two Different Journeys
Two of the biggest names in global travel just reported results. While Booking Holdings (Nasdaq:BKNG) continues to climb on the strength of digital travel demand, Royal Caribbean (Nasdaq:RCL) finds itself navigating choppier waters, pressured by higher costs and softer pricing. Here’s how both players are positioned going into the final stretch of 2025 — and into 2026.
Booking Holdings: Flying Smoothly Above Expectations
Booking Holdings once again delivered a strong quarter, reinforcing the idea that travel demand remains resilient. The company beat expectations across key metrics and showed that global consumers are still prioritizing travel spending, even in an uncertain macro environment.
Headline results (Q3 2025):
- Adjusted EPS: $99.50 (above FactSet estimate of $95.85)
- Net profit: $2.75 billion, +9% vs. Q3 2024
- Revenue: $9.01 billion, +13% YoY (estimate: $8.73 billion)
- Gross bookings: $49.7 billion, +14% YoY (estimate: $48 billion)
- Nights booked: 323 million, +8% YoY (vs. ~6% expected)
Q4 2025 outlook:
- +4–6% growth in nights booked
- +11–13% growth in total gross bookings
- +10–12% revenue growth (slightly below analyst forecasts)
“Despite ongoing macroeconomic and geopolitical uncertainty, we’re pleased to see positive momentum, with steady travel demand so far in the fourth quarter,” the company said.
- +4.8% after-hours reaction
- +2.6% YTD (still trailing the S&P 500)
- Market cap: $165.96B
- Forward P/E: 23.5× (vs. sector median ~17.7×)
What the analysts see: Booking continues to post impressive top-line expansion, with ~17.6% annualized revenue growth over the last three years. That said, the forward view is more measured: consensus expects revenue growth of just ~8.3% in the next 12 months. Translation: investors are paying a premium multiple for a company that is still growing — but not at “hypergrowth” levels anymore.
Royal Caribbean: Sailing Through Choppy Waters
For Royal Caribbean, the story is more complicated. Demand is strong, bookings are healthy, and 2026 looks promising. But short-term pressure from costs and pricing is starting to worry investors.
Headline results (Q3 2025):
- Adjusted EPS: $5.75 (slightly above estimates)
- Revenue: $5.14B (below $5.17B expected)
- Ticket revenue: $3.64B (+3.4% vs. 2024)
- Onboard & other revenue: $1.5B (+6% YoY; in line with expectations)
- Advance onboard bookings: ~50%, with ~90% of those bookings done digitally
Cost pressures:
- Net cruise cost per available day (ex-fuel): +4.8%
- Higher fuel and maintenance costs
- Normalizing ticket prices after a post-pandemic boom
- Investor concerns about cash flow and future capex plans
Forward guidance:
- Q4 2025 EPS forecast: $2.74–$2.79
- Full-year 2025 guidance: $15.58–$15.63 per share
- 2026 outlook: “We expect EPS starting with a 17,” said the CEO
Royal Caribbean is also leaning heavily on product pipeline and differentiated experiences:
- Record expected occupancy in 2026
- New flagship demand from Star of the Seas and Celebrity Xcel
- Strong interest in Royal Beach Club Paradise Island
- Celebrity River itineraries nearly sold out immediately after launch
- -12% in pre-market trading after the report
- Selloff driven mainly by margin fears, not demand fears
The message from the market is clear: demand alone isn’t enough anymore. Investors now want proof that cruise operators can protect margins, manage fuel and maintenance costs, and generate cash while still investing in new ships and destinations.
Two Travel Stories, One Sector in Motion
Looking at Booking and Royal Caribbean side by side gives us a snapshot of the wider travel industry in late 2025:
- Booking Holdings: an asset-light, digital marketplace that scales globally with relatively low incremental cost per booking.
- Royal Caribbean: a capital-intensive operator with physical assets, higher fixed costs, and direct exposure to fuel, labor, and maintenance inflation.
Both benefit from the same macro driver: consumers still prioritize experiences, travel, and leisure time. But the way that demand turns into profit is very different.
Booking is being rewarded for efficient growth, strong margins, and visibility into future bookings.
Royal Caribbean is being punished not for lack of demand — demand looks excellent — but for rising costs and worries about how sustainable current pricing really is.
Quick Takeaway
- Booking Holdings: still in control, still highly profitable, still scaling. The market is paying a premium multiple for that clarity.
- Royal Caribbean: healthy booking pipeline and record occupancy in sight, but investors are asking: at what cost to margins and cash flow?
