Ryanair has expressed dissatisfaction with its recent business performance, which has led to disappointment among investors as well. The budget airline from Ireland has seen its stock price fall by 17% following a quarterly earnings report that fell short of expectations. The company’s revenue remained steady at €3.6 billion ($4 billion), the same as the previous year, but profits dropped nearly 50% to €336 million. CEO Michael O’Leary noted that although more passengers are flying with Ryanair, it requires significant effort to maintain this level of traffic.
O’Leary reported a 10% increase in passenger traffic, reaching 55 million, but emphasized that this growth comes at a cost. He indicated that the airline has had to implement strategies to stimulate fares and bookings. He stated that the recent bookings, especially leading into the high travel months of July, August, and September, have been disappointing and weaker than anticipated.
In addition to decreased demand, Ryanair is facing rising labor costs and has attributed some challenges to delays in aircraft deliveries from Boeing, an ongoing issue for O’Leary. While he has defended the company following a safety incident involving a 737 Max 9 earlier this year, he has consistently urged Boeing to improve its operations.
O’Leary also mentioned that consumers seem to be facing greater financial challenges compared to the early stages of the COVID-19 recovery. Reports indicate that prolonged inflation and stagnant economic growth are beginning to impact individuals within the European Union. Consequently, having a reduced number of aircraft might actually benefit Ryanair in the coming months.
He noted, “We will have less capacity into summer 2025 than we originally scheduled with our Boeing deliveries, and then we’re looking at two years of essentially no capacity growth at all. If consumers are going to be under pressure for the next year to 18 months, that might not be the worst scenario for us.”