Ryanair has expressed disappointment regarding its latest business performance, leading to a 17% drop in its stock price following the release of a quarterly earnings report that fell short of expectations. The Irish low-cost airline reported revenue of €3.6 billion ($4 billion), which remained on par with last year, but profits plummeted by nearly half to €336 million. CEO Michael O’Leary acknowledged that while traffic growth was encouraging, with an increase of 10% to 55 million passengers, attracting customers has required significant effort and financial incentives.
O’Leary mentioned during the earnings call that although traffic is growing, the company has had to lower fares to stimulate bookings, which have been disappointing as the peak months of July, August, and September approach. Coupled with softening demand, Ryanair is also facing rising labor costs and has pointed to Boeing’s ongoing delivery delays as a contributing factor to its struggles.
Despite recent challenges, O’Leary noted that customers might be feeling the economic impact of ongoing inflation and stunted growth in the European Union, which could potentially shift in Ryanair’s favor by reducing competition among airlines. He indicated that the airline would have a lower capacity for summer 2025 than initially planned, suggesting that this situation might buffer against the anticipated consumer pressures expected in the upcoming year and a half.