Ryanair is expressing disappointment in its recent business performance, which has also led to investor discontent. The budget airline from Ireland has seen its stock drop by 17% following the release of a quarterly earnings report that fell short of expectations. The company reported revenues of €3.6 billion ($4 billion), roughly comparable to last year’s figures. However, profits nearly halved to €336 million. CEO Michael O’Leary noted that while passenger numbers increased by 10% to 55 million, achieving this growth required significant effort.
O’Leary mentioned during the earnings call that the strong traffic numbers come at a cost, as the airline has been compelled to frequently stimulate fares and bookings. He also expressed concerns about weaker than anticipated close-in bookings heading into the peak travel months of July, August, and September.
In addition to subdued demand, the airline is facing increased labor costs and has attributed some of its challenges to delays in aircraft deliveries from Boeing, a recurring issue for O’Leary. Despite a recent incident involving a 737 Max 9, he remains critical of Boeing’s operations.
Furthermore, O’Leary pointed out that Ryanair’s customers seem to be feeling the effects of prolonged inflation and sluggish economic growth in the European Union, which may mean that the airline might benefit from operating fewer aircraft in response to potential market pressures.
He stated, “We will have less capacity into summer 2025 than we are originally scheduled to have with our Boeing delivery, and then, we’re into two years of essentially no capacity growth at all. And 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.”