Ryanair has expressed dissatisfaction with its recent business performance, prompting disappointment among its investors as well. The Irish low-cost airline’s stock has declined by 17% following the release of a quarterly earnings report that fell short of expectations. The company’s revenue remained stable at €3.6 billion ($4 billion), similar to last year. However, profits plummeted nearly 50% to €336 million. CEO Michael O’Leary noted an increase in passenger numbers, yet indicated that attracting customers is becoming increasingly challenging.
Despite a strong traffic growth of 10%, bringing the total to 55 million passengers, O’Leary pointed out that this success comes with the need for competitive pricing strategies. He remarked during the earnings call that while there is a demand for flights, the impact of lower bookings and reduced fare performance was unexpected, particularly as the company approached the busy summer months of July, August, and September.
Alongside weaker demand, Ryanair is also facing rising labor costs and has cited issues with Boeing’s delayed aircraft deliveries, which O’Leary has consistently criticized. While he has supported the company following an in-flight incident involving a 737 Max 9, he has urged Boeing to address its delivery challenges.
Moreover, O’Leary indicated that consumers may be feeling the strain of ongoing inflation and slowing economic growth within the European Union. He suggested that reducing the number of aircraft in operation could ultimately benefit the airline.
“We will have less capacity into summer 2025 than we originally scheduled due to Boeing’s delays, and there will be no capacity growth for the next two years,” O’Leary explained. “If consumer pressure continues over the next year or 18 months, this may not be the worst strategy for us.”