Ryanair has expressed dissatisfaction with its recent business performance, leading to a 17% drop in its stock following a disappointing quarterly earnings report. The Irish budget airline reported revenue of €3.6 billion ($4 billion), remaining stable compared to the previous year, but profits nearly halved to €336 million. CEO Michael O’Leary noted that while more passengers are using their services, the airline has had to exert significant effort to attract them.
O’Leary highlighted a 10% increase in traffic, totaling 55 million passengers, but he emphasized that achieving this growth has required stimulating fares and bookings. He pointed out that close-in bookings for the peak summer months have been particularly weak, against the company’s expectations.
Additionally, Ryanair is grappling with rising labor costs and has cited Boeing’s delivery delays as a contributing factor to its challenges. O’Leary, who has been critical of Boeing in the past, reiterated the need for improvements from the manufacturer.
The CEO indicated that customers of Ryanair are feeling more financial pressure than earlier during the economic recovery from the COVID-19 pandemic, exacerbated by years of inflation and slow economic growth in the European Union. He speculated that operating with a reduced number of aircraft could be advantageous for the airline, given the current economic conditions.
Looking ahead, O’Leary mentioned that Ryanair will operate with less capacity during the summer of 2025 than initially planned due to delays in Boeing deliveries. He forecasted two years of minimal capacity growth, suggesting that this might be beneficial if consumer spending remains constrained over the next 12 to 18 months.