Ryanair has expressed disappointment with its recent business performance, reflecting a similar sentiment among investors. The Irish budget airline’s stock has fallen by 17% following the release of a quarterly earnings report that did not meet expectations. The company’s revenue was reported at €3.6 billion ($4 billion), roughly on par with last year’s figures, while profits plummeted by nearly half to €336 million.
CEO Michael O’Leary noted an increase in passenger traffic, which rose 10% to 55 million, but emphasized that this growth comes at a cost. During the company’s earnings call, he mentioned the need to continuously stimulate fares and bookings, particularly as demand for close-in bookings has been disappointing, especially leading into the peak travel months of July, August, and September.
In addition to diminished demand, Ryanair is facing rising labor costs and has attributed some challenges to Boeing’s delivery delays, which have been a long-standing issue for O’Leary. Despite past incidents, including a mid-flight door plug failure on a 737 Max 9, O’Leary has consistently urged Boeing to improve its performance.
Furthermore, he indicated that consumers in the European Union appear to be feeling the weigh of economic pressures as inflation and stagnant growth take their toll. This situation may lead to a strategic shift for Ryanair, as the airline plans to scale down its capacity for summer 2025 compared to previous schedules. O’Leary noted that, with the possibility of continued consumer strain over the next year to 18 months, operating with fewer aircraft might ultimately be advantageous for the company.