Ryanair is expressing disappointment over its recent business performance, a sentiment echoed by its investors. The Irish budget airline has seen its stock price drop by 17% following the release of a quarterly earnings report that fell below expectations. The company’s revenue stood at €3.6 billion ($4 billion), which is comparable to last year’s figures, but profits nearly halved to €336 million. CEO Michael O’Leary noted that while more people are flying with Ryanair, attracting these customers requires significant effort.
During the company’s earnings call, O’Leary reported a strong traffic growth of 10%, resulting in 55 million passengers. However, he emphasized that this growth comes at a price, as the airline has been forced to frequently stimulate fares and bookings. He also expressed concern over disappointing close-in fares and bookings as the company approaches the busiest travel months of July, August, and September.
In addition to lower demand, Ryanair has been facing increased labor costs and has pointed fingers at Boeing’s delivery delays. O’Leary, who has previously criticized Boeing for its inefficiencies, reiterated his frustrations although he has continued to support the company following issues with its 737 Max 9 model.
O’Leary remarked that Ryanair’s customers appear to be experiencing more financial strain than during the initial recovery from the COVID-19 pandemic. As inflation and slow economic growth take their toll on consumers in the European Union, he indicated that operating fewer aircraft might be beneficial for Ryanair in the long run.
He stated, “We will have less capacity into summer 2025 than we are originally scheduled to have with our Boeing delivery, and then, we’re into two years of essentially no capacity growth at all. 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.”