Ryanair is expressing dissatisfaction with its recent business results, a sentiment echoed by its investors. The Irish low-cost airline has seen its stock price drop by 17% following the release of a quarterly earnings report that fell short of expectations. The company reported revenue of €3.6 billion ($4 billion), which remains unchanged from the previous year, while profits plummeted to €336 million.
CEO Michael O’Leary noted that while passenger traffic has increased significantly, it has come at a high cost. During an earnings call, he stated that the airline is experiencing a 10% increase in passenger numbers, reaching 55 million, but this growth requires significant fare stimulation and booking incentives. He acknowledged that recent close-in bookings have underperformed expectations, especially as the peak summer months of July, August, and September approach.
In addition to facing lower demand, Ryanair is also grappling with rising labor costs and has pointed fingers at Boeing for ongoing delivery delays. Despite defending the company after a mid-flight incident involving a 737 Max 9, O’Leary has criticized Boeing for its consistent failures to deliver aircraft on time.
O’Leary highlighted that consumers appear to be feeling the effects of prolonged inflation and sluggish economic growth within the European Union, which may affect travel habits. He indicated that operating with fewer aircraft could potentially benefit Ryanair in this context.
Looking ahead, O’Leary mentioned that the airline would have reduced capacity for the summer of 2025 compared to original forecasts due to issues with Boeing deliveries. He expressed the view that a lack of capacity growth over the next two years could be advantageous if consumer demand remains under pressure over the coming year to eighteen months.