Ryanair is facing challenges in its business performance, leading to disappointment among investors. The Irish low-cost airline has seen its stock drop by 17% following a quarterly earnings report that fell short of expectations. The company generated revenue of €3.6 billion ($4 billion), which is largely consistent with last year’s figures. However, profits have plummeted nearly 50% to €336 million. CEO Michael O’Leary noted that while more passengers are flying with Ryanair, attracting them requires significant effort.
O’Leary highlighted that traffic growth increased by 10%, bringing in 55 million passengers, but this growth comes at a cost. He indicated that the airline has had to continuously stimulate fare prices and bookings, with recent close-in bookings performing weaker than anticipated, especially leading into the peak travel months of July, August, and September.
In addition to lower demand, Ryanair is grappling with rising labor costs and has attributed some challenges to delays in aircraft deliveries from Boeing. Although O’Leary has supported the company following incidents such as a mid-flight door plug failure on a 737 Max 9, he has repeatedly urged Boeing to improve its delivery schedule.
O’Leary also mentioned that customers seem to be feeling more financial pressure compared to earlier in the recovery from the COVID-19 pandemic. According to reports, prolonged inflation and stagnant economic growth in the European Union are beginning to impact consumer behavior. As a result, he suggested that operating a smaller fleet could benefit Ryanair moving forward.
“We will have less capacity in summer 2025 than originally planned with our Boeing deliveries, and then, we’re looking at two years with essentially no capacity growth,” O’Leary explained. “If consumers continue to face pressure for the next year or 18 months, that might not be the worst scenario for us.”