Ryanair is expressing disappointment with its recent business performance, which has led investors to share similar sentiments. The Irish low-cost airline’s stock has plummeted by 17% following the release of a quarterly earnings report that fell short of expectations. The company’s revenue stood at €3.6 billion ($4 billion), showing no significant change from the previous year. However, profits nearly halved to €336 million. CEO Michael O’Leary noted that while more passengers are flying, the airline is required to work much harder to achieve this.
“Traffic growth is strong, up 10% to 55 million passengers, but it comes at a price,” O’Leary commented during the earnings call. He mentioned that the airline is repeatedly having to stimulate fares and bookings, particularly noting disappointing performance in close-in bookings as the peak travel months of July, August, and September approach.
In addition to weaker demand, Ryanair faces rising labor costs and cited delays in aircraft deliveries from Boeing, an ongoing frustration for O’Leary. Despite incidents earlier this year, he has maintained pressure on Boeing to improve its operations.
O’Leary also indicated that Ryanair’s customers appear to be feeling the financial strain more acutely than earlier in the pandemic recovery, as inflation and sluggish economic growth impact consumers in the European Union. This situation might lead to Ryanair operating with fewer jets.
“We will have less capacity heading into summer 2025 than originally planned due to Boeing’s delivery issues, resulting in two years of minimal capacity growth,” O’Leary stated. He suggested that if consumer pressures persist for the next year to 18 months, this might not be a detrimental position for the airline.