Ryanair has expressed disappointment in its recent business results, which has led to investor dissatisfaction as well. The Irish budget airline’s stock has dropped 17% following a quarterly earnings report that was weaker than anticipated. Revenue remained steady at €3.6 billion ($4 billion) compared to last year, but profits plummeted by nearly half to €336 million. CEO Michael O’Leary noted that while more passengers are flying with the airline, attracting them has become increasingly challenging.
O’Leary stated during the earnings call that traffic has risen by 10% to 55 million passengers, but this growth comes at a cost. He mentioned that the company has had to continuously lower fares to stimulate demand, which has notably underperformed expectations, particularly as the peak travel months of July, August, and September approach.
In addition to softening demand, Ryanair is facing rising labor costs and has criticized Boeing for ongoing delivery delays. Despite previously standing by the aircraft manufacturer after an incident involving a 737 Max 9, O’Leary has reiterated his frustration with Boeing’s performance over the years.
He also highlighted that Ryanair’s customers seem to be feeling the impact of prolonged inflation and slow economic growth in the European Union, which could lead to a strategic advantage for the airline in operating fewer aircraft.
O’Leary conveyed to investors that Ryanair will have reduced capacity for the summer of 2025 compared to earlier projections due to Boeing’s delivery issues. He indicated that if economic pressures on consumers persist for the next year or so, this situation may ultimately work in Ryanair’s favor.