Ryanair has expressed disappointment regarding its recent business performance, leading to investor dissatisfaction as well. The stock of the Irish budget airline has fallen by 17% following the release of a quarterly earnings report that did not meet expectations. Revenue remained flat at €3.6 billion ($4 billion), similar to last year, while profits nearly halved to €336 million.
CEO Michael O’Leary indicated that although more passengers are flying with Ryanair, reaching this goal has required increased effort. He noted during the earnings call that traffic grew by 10%, reaching 55 million passengers, but emphasized that this growth comes at a cost. The airline has been compelled to continually adjust fares and bookings, and in the lead-up to the peak summer months of July, August, and September, close-in bookings have underperformed relative to expectations.
In addition to weak demand, Ryanair faces challenges from rising labor costs and delivery delays from Boeing, a situation that O’Leary has criticized for years. Despite a past incident involving a mid-flight emergency on a 737 Max 9, he has remained supportive of the company while urging Boeing to improve its performance.
O’Leary also noted that consumers seem to be feeling the strain as the effects of inflation and slow economic growth within the European Union begin to take their toll. He suggested that operating a reduced number of aircraft in the coming years may actually benefit Ryanair, given the potential difficulties facing consumers.
“We will have less capacity in summer 2025 than originally planned with our Boeing deliveries, and we anticipate two years of essentially no capacity growth,” O’Leary said. “If consumers face pressure over the next year to 18 months, this might not be the worst position for us.”