Ryanair has expressed disappointment in its recent business performance, which has also impacted investor sentiment, leading to a 17% drop in the airline’s stock following a quarterly earnings report that fell short of expectations. The Irish budget airline reported revenue of €3.6 billion ($4 billion), roughly the same as the previous year, but profits plummeted nearly 50% to €336 million. CEO Michael O’Leary noted that while passenger traffic grew by 10%, reaching 55 million, the growth has come at a cost, as the airline has been compelled to stimulate bookings and adjust fares frequently.
O’Leary pointed out that the company is facing softer demand, higher labor costs, and ongoing challenges, including delays in aircraft deliveries from Boeing. He has consistently urged the manufacturer to improve its performance. Additionally, he highlighted potential economic pressures on customers in the European Union, as inflation and slower economic growth seem to be affecting traveler behavior more significantly than in the earlier stages of the COVID-19 recovery.
Looking ahead, O’Leary indicated that Ryanair would be operating with less capacity through the summer of 2025 than initially planned, with no growth in capacity anticipated over the next two years. He suggested that this reduced capacity might position the airline favorably if consumers continue to feel financial strain in the coming months.