Ryanair has expressed dissatisfaction with its recent business performance, leading to disillusionment among investors. The Irish budget airline’s shares have dropped by 17% following an earnings report that fell short of expectations. While the company’s revenue remained stable at €3.6 billion ($4 billion), profits plummeted nearly 50% to €336 million. CEO Michael O’Leary noted that the airline is successfully attracting more passengers but is finding it increasingly challenging to do so.
During the earnings call, O’Leary shared that traffic grew by 10%, reaching 55 million passengers, but emphasized that this growth comes at a cost. He mentioned the need to continually stimulate fares and bookings, which have proven disappointing, especially as the peak months of July, August, and September approach.
In addition to weaker demand, Ryanair is grappling with rising labor expenses and has partially blamed delivery delays from Boeing, a recurring issue for O’Leary. Despite supporting the planemaker after an in-flight incident involving a 737 Max 9, he has consistently urged Boeing to improve its operations.
O’Leary also informed investors that customers appear to be facing greater financial pressures now compared to the initial recovery period post-COVID-19. With ongoing inflation and sluggish economic growth impacting consumers in the European Union, he suggested that operating fewer aircraft might ultimately benefit Ryanair.
He stated, “We will have less capacity into summer 2025 than originally scheduled with our Boeing deliveries, leading to two years of essentially no capacity growth. If consumers are under pressure for the next year or 18 months, that might not be the worst position for us.”