Royal Caribbean Cruises (NYSE: RCL) has outperformed the market in 2025. The cruise line saw substantial growth in revenue and net income during the 2010s. However, the pandemic hit hard in 2020, causing sales to plummet by over 80%. In the following years, Royal Caribbean lost over $13 billion, but rebounded with record revenue and profits in 2024.

Unlike competitors Carnival (NYSE: CCL) and Norwegian Cruise Line Holdings (NYSE: NCLH), Royal Caribbean managed to navigate the early pandemic period by raising over $12 billion in debt without significant stock dilution. The company saw strong demand post-pandemic, setting new revenue records and returning to profitability, with earnings surpassing $4 billion in the past 12 months.

Royal Caribbean’s financial recovery has allowed it to pay down obligations, with positive free cash flow and debt reductions of $3.75 billion in 2023 and 2024. The company has also reinstated its dividend and initiated share buybacks. With a strong third-quarter performance in 2025 and improved guidance, Royal Caribbean’s stock is trading at an attractive valuation.

Looking ahead, investors are keen to see if Royal Caribbean can sustain its momentum. Despite missing the Motley Fool’s top 10 stocks to buy now, the company’s financial turnaround has been impressive. With strong demand, positive cash flow, and debt reduction efforts, Royal Caribbean’s future prospects are promising.

Read more at Yahoo Finance: How Royal Caribbean’s Financial Domination Could Continue in 2026