Ryanair has expressed dissatisfaction with its recent business performance, leading to similar disappointment among investors. The Irish budget airline’s stock has fallen by 17% following the release of a quarterly earnings report that was weaker than anticipated. Revenue for the period reached €3.6 billion ($4 billion), nearly unchanged from the previous year. However, profits have significantly declined, dropping to €336 million.
CEO Michael O’Leary noted that while more passengers are flying with Ryanair, the company is working harder to achieve these numbers. He emphasized that traffic growth has been strong, with passenger numbers increasing by 10% to 55 million. However, he acknowledged that this growth comes at a price, stating, “We’re having to repeatedly stimulate fares and bookings.” He further mentioned that close-in fare performance and bookings have been disappointing, particularly as the peak months of July, August, and September approach.
Additionally, Ryanair is facing challenges from rising labor costs and has pointed fingers at Boeing’s ongoing delivery delays, a longstanding issue for O’Leary. Despite past confidence in the company’s planes, he has urged Boeing repeatedly to resolve these issues.
O’Leary also highlighted that customers are feeling the effects of inflation and slow economic growth in the European Union, suggesting that it may be beneficial for Ryanair to operate fewer aircraft during this time. He indicated that the airline will have reduced capacity for the summer of 2025 compared to initial estimates due to Boeing’s delivery setbacks, leading to two years of minimal capacity growth. “If the consumer is going to be under pressure for the next year or 18 months, that might not be the worst place to be,” he concluded.