The Market's Verdict on Royal Caribbean's Earnings Disconnect#

Understanding Cost-Driven Beats and Revenue Misses#

Royal Caribbean reported what appeared to be a textbook earnings victory on October 28, 2025: adjusted earnings per share of $5.75 exceeded consensus expectations of $5.68, management raised full-year 2025 guidance by 32 percent to $15.58-$15.63, and the company announced a 33 percent dividend increase alongside a successful $1.5 billion debt refinancing that drew credit rating upgrades from both S&P and Fitch. Yet within 48 hours of this announcement, RCL stock had collapsed 13 percent in absolute terms, with social sentiment metrics on Reddit and Twitter plummeting from 42 out of 100 to 32 out of 100—a 24 percent decline in investor enthusiasm. This dramatic reversal raises a critical question: did the market experience a moment of mass irrationality, or did investors correctly identify fundamental deterioration that the headline beat-and-raise narrative obscured? The evidence increasingly suggests the latter.