Ryanair has expressed disappointment with its business performance, which has led to discontent among investors. The Irish low-cost airline’s stock has dropped 17% following a quarterly earnings report that fell short of expectations. The company’s revenue remained stable at €3.6 billion ($4 billion) compared to last year, but profits nearly halved to €336 million. CEO Michael O’Leary noted that while more passengers are flying with Ryanair, the company is facing challenges in achieving this growth.
O’Leary reported a 10% increase in passenger traffic, reaching 55 million, but emphasized that this growth comes at a cost. During the earnings call, he stated, “We’re having to repeatedly stimulate fares and bookings. The close-in fares and performance have been disappointing and considerably weaker than we anticipated, especially as we approach the peak months of July, August, and September.”
In addition to reduced demand, Ryanair is grappling with rising labor costs and has attributed some of the difficulties to delays in aircraft deliveries from Boeing, an ongoing concern for O’Leary. Despite some operational issues, he remains critical of Boeing’s performance, urging the manufacturer to improve.
O’Leary also mentioned that customers are facing greater financial pressures now than during earlier stages of the COVID-19 recovery. With the effects of inflation and slow economic growth in the European Union becoming evident, he suggested that operating fewer aircraft might actually benefit Ryanair in the long run.
“We will have less capacity in summer 2025 than we initially expected due to Boeing deliveries, and we will experience two years of essentially no capacity growth,” O’Leary stated. “If consumers are going to face pressure over the next year or 18 months, that might not be the worst situation for us.”