Ryanair has expressed disappointment in its business performance, leading to a 17% decline in its stock following a quarterly earnings report that fell short of expectations. The airline reported revenue of €3.6 billion ($4 billion), nearly unchanged from the previous year, but profits plummeted to €336 million, nearly halving compared to last year. CEO Michael O’Leary noted that while the airline is successfully increasing passenger numbers, it is doing so at a higher cost.
O’Leary mentioned that traffic grew by 10% to 55 million passengers, but emphasized that this growth comes at a price. He highlighted the need to stimulate fares and bookings repeatedly, particularly as close-in fares and booking performance have been disappointing, especially leading into the peak travel months of July, August, and September.
In addition to weaker demand, Ryanair is facing increased labor costs and has cited delays in aircraft deliveries from Boeing as a contributing factor to its challenges. Despite past incidents, including a mid-flight issue with a 737 Max 9, O’Leary has consistently urged Boeing to improve its delivery timelines.
Moreover, O’Leary noted that his airline’s customers are showing signs of increased struggle compared to the early recovery phase following the COVID-19 pandemic. Ongoing inflation and stagnating economic growth in the European Union appear to be affecting consumer spending. As a result, O’Leary stated that Ryanair will operate fewer aircraft than initially planned for summer 2025, suggesting that less capacity could be beneficial if consumer pressure continues over the next year and a half.