Ryanair is facing disappointment in its business performance, which is reflected in the sentiments of its investors. The stock of the Irish budget airline has fallen by 17% following the release of a quarterly earnings report that did not meet expectations. The company reported revenue of €3.6 billion ($4 billion), roughly on par with the previous year, but profits plunged nearly 50% to €336 million. CEO Michael O’Leary remarked that while the airline is successfully attracting more passengers—reporting a 10% increase to 55 million—the financial results indicate that this growth is heavily reliant on pricing strategies.
O’Leary noted that the airline is compelled to consistently stimulate fares and bookings, with recent performance indicating disappointing close-in bookings as the summer peak season approaches. Compounding the issue is a rise in labor costs and ongoing challenges with Boeing’s delivery delays, which have been a persistent concern for O’Leary. Despite coping with various challenges, he acknowledged that the airline’s customers seem to be facing increased economic pressures, particularly within the European Union, as inflation and sluggish growth take their toll.
In light of these factors, O’Leary mentioned that Ryanair may operate with reduced capacity heading into summer 2025 compared to initial schedules linked to Boeing deliveries, and there may be two years of essentially stagnant capacity growth. He suggested that if consumer conditions remain tight for the next year to 18 months, this might not be the worst scenario for the airline.