Ryanair has expressed disappointment in its recent business performance, which has resulted in a 17% drop in the airline’s stock following a weaker-than-expected quarterly earnings report. The Irish budget airline’s revenue remained steady at €3.6 billion ($4 billion), the same as the previous year, but profits saw a nearly 50% decline, falling to €336 million. According to CEO Michael O’Leary, although more passengers are flying with the airline, attracting them has required significant effort.
During the earnings call, O’Leary noted a strong traffic growth of 10%, amounting to 55 million passengers, but emphasized that this growth comes at a cost. “We’re having to repeatedly stimulate fares and bookings, and the close-in fares and performance have been disappointing, particularly as we approach the peak months of July, August, and September,” he stated.
The airline also faces challenges from rising labor costs and ongoing issues with Boeing’s delivery delays, which O’Leary has criticized for years. Despite having expressed support for the company after a mid-flight incident involving a 737 Max 9, he has urged Boeing to improve its operations.
Moreover, O’Leary remarked that customers seem to be feeling more economic pressure compared to the early stages of recovery from the COVID-19 pandemic. With inflation and stagnant economic growth impacting consumers in the European Union, he speculated that reducing their fleet capacity might ultimately benefit Ryanair. He indicated that the airline would operate fewer aircraft than initially planned for the summer of 2025, with no growth expected over the following two years. “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.