Ryanair has expressed disappointment in its recent business performance, leading to a 17% decline in its stock following weaker-than-expected quarterly earnings. The Irish budget airline reported revenues of €3.6 billion ($4 billion), which remained consistent with the previous year, but profits nearly halved to €336 million. CEO Michael O’Leary acknowledged that while the airline is successfully attracting more passengers, it is facing challenges in maintaining profitability.
O’Leary noted that passenger traffic grew by 10% to 55 million this year, but emphasized that this growth comes at a cost as the company is compelled to frequently lower fares to stimulate bookings. He highlighted that bookings for the peak months of July, August, and September have been particularly disappointing.
Additionally, Ryanair is grappling with increased labor costs and has pointed fingers at Boeing for ongoing delivery delays, which have been a source of frustration for O’Leary. Despite previous issues, he remains supportive of Boeing but insists on the need for improved efficiency from the manufacturer.
O’Leary also indicated that customers appear to be struggling more now compared to earlier in the COVID-19 economic recovery, as inflation and slowing growth begin to impact consumers in the European Union. He suggested that the airline might benefit from operating fewer aircraft, stating that Ryanair would have reduced capacity through summer 2025 due to Boeing delivery schedules, which aligns with expectations of consumer pressures over the next year to 18 months.