Ryanair has expressed disappointment in its recent business performance, leading to investor dissatisfaction as well. The Irish budget airline’s stock has plummeted by 17% following a weaker-than-anticipated quarterly earnings report. The company’s revenue remained stable at €3.6 billion ($4 billion), similar to the previous year, but profits nearly halved to €336 million. CEO Michael O’Leary noted an increase in passenger numbers, yet highlighted the challenges in attracting customers.
O’Leary mentioned that while traffic growth reached 10%, bringing in 55 million passengers, the benefits come at a cost, requiring the airline to continually lower fares and stimulate bookings. He noted that close-in bookings have shown disappointing performance, especially leading into the peak summer months of July, August, and September.
In addition to lower demand, Ryanair is confronting higher labor costs and has criticized Boeing for its ongoing delivery delays. O’Leary has previously defended the airline despite a mid-flight incident involving a 737 Max 9 but has been urging Boeing to resolve its production issues for years.
Moreover, O’Leary indicated that consumers appear to be facing more challenges compared to the initial stages of the COVID-19 economic recovery. According to reports, the effects of inflation and stagnating economic growth are beginning to impact individuals in the European Union. He speculated that having fewer aircraft in operation could ultimately benefit Ryanair.
“We will have less capacity into summer 2025 than we originally scheduled with our Boeing deliveries, and then we will enter a period of essentially no capacity growth for two years,” O’Leary stated. “If consumers face pressure over the next year or 18 months, that might not necessarily be a bad position for us.”