Ryanair has expressed dissatisfaction with its business performance, and investors share this disappointment, as the airline’s stock has fallen by 17% following a quarterly earnings report that fell short of expectations. The company reported revenue of €3.6 billion ($4 billion), a figure that remained stable compared to last year. However, profits saw a significant decline, nearly halving to €336 million. CEO Michael O’Leary noted that while more passengers are flying with Ryanair, attracting them has required substantial effort.
O’Leary indicated that passenger traffic experienced a 10% increase, reaching 55 million, but this growth came at a cost. He mentioned during the earnings call, “Traffic growth is strong, up 10% to 55 million [passengers], but it’s only strong at a price.” He acknowledged the need to consistently lower fares and boost bookings, expressing concerns regarding disappointing close-in bookings, especially as the company approaches its peak travel months of July, August, and September.
In addition to weaker demand, Ryanair is grappling with rising labor costs and has redirected some blame towards Boeing’s ongoing delivery delays, a long-standing issue for O’Leary. Despite standing by Boeing after a mid-flight incident with a 737 Max 9 earlier this year, he has been critical of the manufacturer for years.
O’Leary also pointed out that Ryanair’s customers are showing signs of economic strain, a trend that’s particularly pronounced in the European Union due to years of inflation and sluggish growth. He suggested that a reduction in flight capacity might ultimately benefit Ryanair if consumer spending continues to decline.
“We will have less capacity into summer 2025 than we originally scheduled with our Boeing deliveries, and then we’re looking at two years of no capacity growth,” O’Leary remarked. “If consumers are under pressure for the next 12 to 18 months, that might not be the worst scenario for us.”