Ryanair is expressing dissatisfaction with its recent business performance, which has also resulted in disappointment among investors. The budget airline from Ireland has seen its stock fall by 17% after reporting quarterly earnings that fell short of expectations. Revenue for the quarter was reported at €3.6 billion ($4 billion), remaining stable compared to last year, while profits plummeted to €336 million.
CEO Michael O’Leary indicated that while passenger numbers are increasing—up 10% to 55 million—the airline is facing challenges in maintaining profitable pricing. “Traffic growth is strong, but it’s only strong at a price,” he noted during the earnings call, emphasizing that the airline must consistently incentivize fares and bookings. He pointed out disappointing performance in last-minute bookings as they approach the peak travel months of July, August, and September.
In addition to facing softer demand, Ryanair is contending with rising labor costs and has expressed frustration over Boeing’s delays in aircraft deliveries, an ongoing issue for O’Leary. He has consistently urged the manufacturer to improve its delivery timelines, despite recent incidents involving the 737 Max 9.
O’Leary further remarked that customers appear to be feeling pressure, with economic conditions in the European Union worsening due to years of inflation and stagnating growth. This situation may lead Ryanair to operate fewer aircraft, which could ultimately benefit the airline.
“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 essentially no capacity growth,” he explained. “If consumers are under financial strain for the next year or 18 months, that might not be the worst scenario for us.”