Royal Caribbean Suggests 'Royal Amplification' Is Coming Back

During the cruise industry's roughly 15-month covid-enforced shutdown, Royal Caribbean went into survival mode. 

Little revenue was coming in, as few people were booking cruises that weren't likely to happen. 

And while cruises weren't happening, Royal Caribbean (RCL) - Get Free Report still had expenses: Cruise ships had to be kept operating with skeleton crews, and tens of thousands of crew members had to be repatriated, with every country having different rules for exactly how that worked.

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Royal Caribbean also had to maintain office staff, and it needed to make loan payments as it borrowed more money at unfavorable rates to keep the lights on. 

During this period the company cut every expense it could, including canceling the Royal Amplified program for Oasis-, Freedom- and Voyager-class ships.

Under this program, ships in those classes were scheduled for major improvements -- well beyond a traditional drydock. In most cases, that meant adding the Playmakers sports-bar concept to ships that did not have it, as well as adding more restaurants, revamping bars and the pool deck, as well as sprucing up the entire ship.

Amped ships were greatly improved, bringing them a lot closer to the newest ships in the fleet. The program was popular among passengers, who got everything from access to the newest dining concepts in the fleet to more USB ports in their staterooms.

Now, more than two years since the cruise line returned to sailing, the Royal Amplified program still has not returned. Company executives hinted however, that that could change in 2024. They spoke during the company's second-quarter-earnings call.

Royal Caribbean Hints at Program's Return

While they never used the words "Royal Amplified," both Chief Executive Jason Liberty and Chief Financial Officer Naftali Holtz suggested that the program -- or at least something like it -- would return in 2024.

"[We] are now in the planning process obviously for 2024, and we're considering all the tasks that we need to do next year, and that could be more elevated than this year, which obviously will impact some of the cost a little bit on the yield," Holtz said.

Holtz's comment leaves room for interpretation, but Liberty's comments immediately afterward made the CFO's reference clear.

"Yes. And the elevation on the drydock is just a reflection of ships that came out of Covid that had missed those windows. And so, it will be a little bit more elevated in 2024," he added.

Some Royal Caribbean Ships Have Been Improved 

While the cruise line has not, well, amplified, any ships since the pandemic, it has made some additions during scheduled drydocks. Explorer of the Seas, for example, a ship that missed its planned amplification, added a water-slide package during its recent drydock.

In addition, all the cruise line's Oasis-class ships have seen their Jazz on 4 music venues turned into smoke-free casinos. That mirrors Royal Caribbean's newest ship, Wonder of the Seas, which was built for operation in China where the secondary casino was meant for high rollers. 

The cruise line has also been updating the slot machines in the casinos on many ships. 

These changes, however, fall short of a full amplification, which puts a ship in drydock and and out of service for at least a few weeks. Royal Caribbean has made its casino changes while maintaining all scheduled sailings for those ships.   

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