Ryanair has expressed disappointment with its recent business performance, leading to a 17% drop in its stock following a quarterly earnings report that fell short of expectations. The Irish low-cost airline reported revenues of €3.6 billion ($4 billion), nearly unchanged from the previous year, but profits plummeted to €336 million, almost half of last year’s figure. CEO Michael O’Leary noted an increase in passenger numbers, which rose by 10% to 55 million, but indicated that this growth is accompanied by a need to aggressively stimulate fares and bookings.
During the earnings call, O’Leary remarked, “Traffic growth is strong, but it comes at a price.” He highlighted that close-in booking performance has been disappointing, particularly as peak travel months of July, August, and September approach.
The airline is grappling with declining demand alongside rising labor costs and has pointed to Boeing’s delivery delays as a contributing factor. O’Leary has expressed frustration with Boeing over the years but has continued to support the company following incidents such as a mid-flight door malfunction on a 737 Max 9.
O’Leary indicated that customers may be feeling the economic strain more acutely now compared to the early stages of recovery from the COVID-19 pandemic. Reports suggest that ongoing inflation and sluggish economic growth are affecting consumer behavior in the European Union. He mentioned that Ryanair would operate with less capacity in summer 2025 than initially planned due to delays in aircraft deliveries, suggesting that reduced capacity could be advantageous in a challenging economic climate. O’Leary said, “If the consumer is going to be under pressure for the next year or 18 months, that might not be the worst place to be.”