Ryanair has expressed disappointment in its recent business performance, which has resulted in a 17% drop in its stock value following the release of a weaker-than-expected quarterly earnings report. The Irish budget airline reported revenue of €3.6 billion ($4 billion), showing no significant growth compared to the previous year, while profits decreased nearly by half to €336 million. CEO Michael O’Leary acknowledged that although more people are flying with Ryanair, the airline is faced with increased competition and financial pressure.
O’Leary noted a strong traffic growth of 10%, bringing passenger numbers to 55 million, but remarked that this growth comes at a cost. He indicated that the company has had to stimulate pricing and bookings extensively, and that recent close-in bookings showed a disappointing performance ahead of the busy summer months.
Additionally, Ryanair is grappling with heightened labor costs and has pointed to Boeing’s ongoing delivery delays as a contributing factor to its challenges. O’Leary, who has vocally criticized Boeing in the past, emphasized the need for improvement from the aircraft manufacturer.
In light of inflation and slowing economic growth impacting consumers in the European Union, O’Leary suggested that operating fewer aircraft might ultimately benefit Ryanair. He projected that the airline would have less capacity than initially planned for the summer of 2025 due to delays in Boeing deliveries and warned of a period with no growth in capacity over the next two years. He concluded that adapting to a potential decline in consumer spending over the coming year and a half could prove advantageous for the airline.