Ryanair is expressing disappointment over its recent business performance, prompting discontent among investors as well. The Irish low-cost airline saw its stock price drop by 17% following a quarterly earnings report that fell short of expectations. The company’s revenue remained stable at €3.6 billion ($4 billion), which is on par with last year, but profits nearly halved to €336 million. CEO Michael O’Leary noted an increase in passenger numbers but indicated that attracting customers requires significant effort.
During an earnings call, O’Leary stated, “Traffic growth is strong, up 10% to 55 million passengers, but it’s only strong at a price.” He highlighted the need for constant fare promotions and bookings, with disappointing performance in close-in bookings as they approach the peak months of July, August, and September.
Additionally, Ryanair is facing challenges such as rising labor costs and ongoing delays in Boeing aircraft deliveries, a point of contention for O’Leary. While he defended the airline after a mid-flight incident with a 737 Max 9 earlier this year, he continues to push the manufacturer to improve its operations.
O’Leary also observed that Ryanair’s customers seem to be experiencing more economic strain compared to the earlier stages of the COVID-19 recovery. According to reports, lingering inflation and sluggish economic growth in the European Union are starting to affect consumers. This situation might lead to reduced capacity for Ryanair in the summer of 2025 compared to initial plans, as O’Leary noted a forecast of no capacity growth for the following two years. He suggested that this might actually be advantageous if consumers remain under financial pressure over the next year to 18 months.