Ryanair is expressing disappointment with its business performance, which has also led to investor dissatisfaction. The stock of the Irish budget airline has plummeted by 17% following the release of a quarterly earnings report that fell short of expectations. The company reported revenue of €3.6 billion ($4 billion), a figure comparable to last year, but profits nearly halved to €336 million. CEO Michael O’Leary noted that while more people are flying with Ryanair, attracting these passengers has become increasingly challenging.
“Traffic growth is strong, with a 10% increase to 55 million passengers, but it comes at a price,” O’Leary stated during the earnings call. He emphasized that the company has had to continuously lower fares and improve bookings, indicating that recent close-in fare performance has been disappointing, particularly as the summer months of July, August, and September approach.
In addition to lower demand, Ryanair faces rising labor costs and has pointed to delays in aircraft deliveries from Boeing as another concern, a persistent issue for O’Leary. While he has defended Boeing in light of an incident involving a 737 Max 9 earlier this year, he has called for the company to improve its performance for several years.
O’Leary also indicated that passengers seem to be feeling more financial pressure than they did earlier in the COVID-19 recovery phase, with reports suggesting that years of inflation and stagnating economic growth are beginning to impact consumers in the European Union. This scenario may lead to a reduction in Ryanair’s flight capacity in summer 2025, as O’Leary mentioned that they will have less capacity than initially scheduled due to Boeing delivery delays. He suggested that operating fewer aircraft might ultimately benefit Ryanair if consumer pressure continues over the next year to 18 months.