Ryanair Expresses Disappointment Over Business Performance
Ryanair is facing challenges in its business performance, leading to dissatisfaction among investors. The Irish low-cost airline has seen its stock decline 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 is comparable to the previous year, but profits plummeted nearly 50% to €336 million. CEO Michael O’Leary noted an increase in passenger numbers but emphasized that attracting more travelers requires significant effort.
Passenger traffic has increased by 10%, reaching 55 million, but O’Leary remarked that such growth comes at a cost. He mentioned that the company has had to frequently stimulate fares and bookings, and the recent close-in bookings have been disappointing, especially as peak months of July, August, and September approach.
The airline is grappling with softening demand alongside rising labor costs, and O’Leary has laid some blame on Boeing for delays in aircraft deliveries, a recurring issue for him. Despite issues earlier this year with a 737 Max 9, O’Leary has continued to hold Boeing accountable for their delivery timelines.
Furthermore, O’Leary pointed out that Ryanair customers seem to be feeling more economic pressure than they did during the initial recovery from the COVID-19 pandemic. Recent reports indicate that years of inflation and slowing economic growth are beginning to impact consumers in the European Union. As a result, O’Leary suggested that operating fewer aircraft might benefit the airline.
He stated, “We will have less capacity into summer 2025 than we are originally scheduled to have with our Boeing delivery, and then we’re into two years of essentially no capacity growth at all. If the consumer is going to be under pressure for the next year or 18 months, that might not be the worst place to be.”