Ryanair’s recent business performance has led to disappointment among both the airline and its investors. The Irish budget airline’s stock has fallen by 17% following the release of a quarterly earnings report that fell short of expectations. The company’s revenue for the quarter was €3.6 billion ($4 billion), which is on par with last year’s figures. However, profits plummeted nearly 50% to €336 million. CEO Michael O’Leary noted that while more passengers are flying with Ryanair, the airline is having to work significantly harder to achieve this.
O’Leary reported a strong traffic growth of 10%, translating to 55 million passengers, but emphasized that this increase comes at a cost. He expressed concerns about disappointing performance in close-in bookings and fares, particularly as the company heads into the peak months of July, August, and September.
Additionally, Ryanair is facing challenges such as rising labor costs and ongoing delays in aircraft deliveries from Boeing, a persistent issue that O’Leary has criticized over the years. Despite these challenges, he assured investors that his airline’s customer base seems to be experiencing more difficulties compared to the initial recovery phase after the COVID-19 pandemic. According to reports, ongoing inflation and sluggish economic growth are beginning to affect consumers in the European Union.
Looking ahead, O’Leary indicated that Ryanair would have less flight capacity for the summer of 2025 than initially scheduled due to Boeing delivery issues. He stated that after this period, the airline would enter two years with essentially no growth in capacity. O’Leary posited that operating with reduced capacity could be advantageous if consumer spending remains under strain for the next year to 18 months.