Ryanair is expressing disappointment with its business results, leading to discontent among investors. The Irish low-cost airline saw its stock plummet 17% following a quarterly earnings report that fell short of expectations. Revenues remained steady at €3.6 billion ($4 billion), remaining nearly unchanged from the previous year, but profits nearly halved to €336 million. CEO Michael O’Leary noted that while more passengers are choosing to fly with Ryanair, the airline is facing challenges to attract them.
During the company’s earnings call, O’Leary mentioned that traffic growth was strong, increasing 10% to 55 million passengers, but emphasized that this growth comes at a cost. He pointed out that fares and bookings require considerable stimulation and that the last-minute bookings have been disappointing as the airline enters its peak months of July, August, and September.
Additionally, Ryanair is grappling with rising labor costs and has criticized Boeing for ongoing delivery delays, which have been a persistent issue for O’Leary. Despite a recent incident involving a mid-flight door malfunction on a 737 Max 9, O’Leary continues to hold Boeing accountable for its performance.
O’Leary also indicated that customers seem to be facing more financial pressure compared to the earlier stages of the COVID-19 recovery. Reports suggest that years of inflation and slowing economic growth are starting to impact consumer behavior in the European Union. He mentioned that operating with reduced aircraft capacity could potentially benefit Ryanair in this context.
He added that for the summer of 2025, Ryanair will have less aircraft capacity than initially planned due to Boeing’s delays, leading to two years of stagnant capacity growth. O’Leary suggested that if consumers are under financial strain in the coming year to 18 months, this could ultimately be advantageous for the airline.