Ryanair is expressing dissatisfaction with its recent business performance, leading to a significant decline in investor confidence. The budget airline’s stock has dropped 17% following the release of a quarterly earnings report that fell short of expectations. Revenue remained stagnant at €3.6 billion ($4 billion), comparable to the previous year, while profits plummeted by nearly half to €336 million. CEO Michael O’Leary noted that while more passengers are flying, attracting them has come with increased effort.
“Traffic growth is robust, rising 10% to 55 million passengers, but this comes at a cost,” he stated during the earnings call. “We are having to promote fares and bookings repeatedly. The demand for close-in fare bookings has been surprisingly weak, especially entering the peak months of July, August, and September.”
Additionally, Ryanair is facing challenges from rising labor costs and has cited Boeing’s ongoing delivery delays as a contributing factor, which has been a long-standing issue for O’Leary. Despite supporting the aircraft manufacturer after a mid-flight incident involving a 737 Max 9, he has frequently urged Boeing to improve its operations.
O’Leary also indicated that the airline’s customers are showing signs of financial strain, with years of inflation and stagnant economic growth starting to affect spending behavior in the European Union. Given these circumstances, he suggested that reducing fleet capacity might actually benefit Ryanair.
“We will have lower capacity for summer 2025 than originally expected due to Boeing deliveries, leading to essentially no capacity growth for the next two years,” O’Leary explained. “If consumers face financial pressures over the next year or 18 months, this might not be a disadvantage for us.”