Ryanair has expressed disappointment in its recent business performance, which has also left investors dissatisfied. The Irish low-cost airline’s stock has dropped 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 the same as the previous year, but profits plummeted nearly 50% to €336 million. CEO Michael O’Leary noted that while more people are flying with Ryanair—up 10% to 55 million passengers—the airline is facing challenges in maintaining pricing and stimulating demand.
During the earnings call, O’Leary stated, “Traffic growth is strong, but it’s only strong at a price.” He highlighted that recent fare and booking performance had been weaker than anticipated, particularly as the airline approaches the peak travel months of July, August, and September.
The airline is also confronting higher labor costs and has partially attributed its challenges to delays in aircraft deliveries from Boeing, a longstanding issue for O’Leary. Despite past incidents, including a mid-flight emergency involving a 737 Max 9, he has been critical of Boeing’s performance for years.
Moreover, O’Leary indicated that customers seem to be experiencing greater strain as inflation and sluggish economic growth impact the European Union. He suggested that a reduction in jetliner capacity could ultimately benefit Ryanair.
“We will have less capacity into summer 2025 than we originally scheduled with our Boeing deliveries, and then we’re looking at two years of essentially no capacity growth,” O’Leary said. He concluded that given the pressures facing consumers over the next 12 to 18 months, this situation might not be entirely unfavorable for the airline.