Ryanair has expressed disappointment with its recent business performance, leading to similar feelings among investors as the airline’s stock plummeted by 17% following a quarterly earnings report that fell short of expectations. The Irish low-cost carrier reported revenue of €3.6 billion (approximately $4 billion), which remained flat compared to the previous year. However, profits saw a significant decline, dropping nearly 50% to €336 million. CEO Michael O’Leary noted that while more passengers are flying with Ryanair, the airline is facing challenges in maintaining profitability.
O’Leary highlighted that passenger traffic is robust, increasing by 10% to 55 million travelers, but this growth comes at a cost, as the company is compelled to offer financial incentives to boost fare and booking numbers. He remarked that the demand for last-minute bookings has not met expectations, particularly leading into the busy months of July, August, and September.
Compounding these issues, Ryanair is also grappling with rising labor costs and has attributed part of its struggles to Boeing’s ongoing delivery delays, a longstanding frustration for O’Leary. Despite a recent incident involving a 737 Max 9, O’Leary has continued to urge Boeing to improve its performance.
Moreover, there are indications that Ryanair’s customers are feeling the effects of prolonged inflation and slowing economic growth within the European Union. O’Leary suggested that a reduction in fleet capacity might be beneficial for the airline in the near future.
“We anticipate having less capacity for the summer of 2025 than originally planned due to Boeing’s delays, followed by two years with no capacity growth at all,” O’Leary explained. “If consumer spending remains under pressure for the next year or 18 months, this situation might prove advantageous for us.”