The latest push into high-end travel is taking place on the high seas, as cruise lines increasingly rely on luxury offerings.
On Regent’s Seven Seas Splendor, an all-out luxury ship, cabins range in price from $1,800 to $15,000 per night for the highest order, the Regent Suite.
The difference isn’t just about 5,100 square feet. The upper-level suite has a Steinway piano, a private dining room and a wraparound deck with a hot tub and a view comparable to one from the ship’s bridge.
Many passengers want a suite for Splendor’s 151-night global cruise that embarks in January, Regent told CNBC, and it’s almost always occupied.
Regent has set its sights even further, as the cruise line plans to debut the Seven Seas Prestige in December, the first new ship class in a decade. The top suite will cost $25,000 per night.
A bedroom in the Regent Suite on the Seven Seas Splendor.
Ryan Ruggiero CNBC
While megaships with surfing and waterslides can carry more than 7,500 passengers, smaller elite ships – some carrying less than a thousand passengers – generate profits for companies like Norwegian Cruise Line Holdings. The company has luxury lines Regent and Oceania.
Norwegian CEO John Chidsey said he is focused on honing the luxury brand’s position, improving its products and guest experience, and strengthening its commercial performance.
Regent and Oceania, he said, are good for 2027, although Chidsey did not break down the metrics between the companies.
The living room in the Regent Suite on the Seven Seas Splendor.
Ryan Ruggiero CNBC
Cruise rivals are also betting big on luxury offerings, investing in new ships and more specialized experiences.
Regent competes with established luxury cruise lines including Royal Caribbean’s Silversea and Carnival Seabourn, is also a new entrant bringing a hotel name to the market. Four Seasons, Aman and Orient Express are among the brands that bring luxury hospitality to yacht-style ships.
The cruise industry projects that the luxury cruise fleet will grow from 104 ships in 2026 to at least 130 in 2036.
And while global cruise passengers are forecast to increase about 11% between 2025 and 2028, according to the Cruise Lines International Association, or CLIA, industry investment dollars are increasingly going to luxury brands and expeditions, with orders increasing for smaller ships with fewer berths over the next decade.
From 2020 to 2025, the number of luxury ships will increase by 71% and 84%, respectively, according to CLIA. The order represents another 26% jump in the number of ships until the end of 2029 and a 32% increase in capacity.
The deck and hot tub attached to the Regent Suite on the Seven Seas Splendor.
Ryan Ruggiero CNBC
Other hospitality companies are investing and developing uber-upscale offerings as well. Hotels, casinos, airlines, restaurants, spas and other travel and leisure companies see the trend: Wealthy customers are still willing to pay for more space, personal service and distinctive experiences.
United Airlines this year opened the larger Polaris Studio Suite with privacy doors and caviar service. American Airlines increased lie-flat capacity and reported that premium passenger unit revenue rose 18.5% in the third quarter, compared to 14.4% in the main cabin.
Marriott’s The second quarter results show luxury revenue per room available much faster than the hotel business in the US and Canada, up 9.1% year over year, compared to 5% for all Marriott hotels in the region. In June, CEO Anthony Capuano told CNBC there is an “almost insatiable appetite” for luxury travel.
Wynn Resorts, which caters almost exclusively to high-end customers, has chosen to maintain high room rates in Las Vegas even as visits have slowed down over the past year, instead of filling every room with travelers looking for a bargain.
Special dining area in the Regent Suite on the Seven Seas Splendor.
Ryan Ruggiero CNBC
Cracks forming in luxury?
Asked on stage at the Global Gaming Expo in September if Wynn was getting more revenue from fewer customers, CEO Craig Billings said, “We will always focus on the most comfortable experience for customers and where we can drive the highest EBITDA.”
But offering luxury vacations doesn’t guarantee a company’s fortune.
The Ritz-Carlton Yacht Collection, for example, has struggled with occupancy despite major marketing campaigns and has accumulated losses of nearly $700 million since 2017, according to the Financial Times.
More competition in the space can reduce the perception of scarcity. As more companies add luxury products, they must convince travelers that the experience is worth the price.
Las Vegas Sands reported earnings Wednesday that missed expectations for revenue and profit, hurt by the high-end segment in both Macao and Singapore.
“When customers don’t show up, that’s a bit of a problem,” CEO Patrick Dumont said on the company’s earnings call.
Dumont said he couldn’t point to soft reasons, adding, “maybe people don’t feel good about the market,” but he believes this quarter was an anomaly.
CNBC asked Dumont during the NBA China Games in Macau on October 9 whether luxury travel can become overcrowded.
In response, he pointed to long-term wealth creation in Asia and said the challenge is to create an experience that customers want to return to.
“It’s not about, there are enough customers,” he said. “It’s, can we create an interesting enough set of experiences where people can find us very important in their lives.”