Ryanair is expressing disappointment over its recent business performance, which has also led to investor dissatisfaction. The Irish budget airline’s stock has dropped by 17% following a quarterly earnings report that was weaker than anticipated. Revenue remained stable at €3.6 billion ($4 billion), comparable to the previous year, but profits nearly halved to €336 million. CEO Michael O’Leary noted that while more passengers are choosing Ryanair, the airline is having to work significantly harder to make this happen.
During an earnings call, O’Leary reported a 10% increase in passenger traffic to 55 million, but he emphasized that this growth comes at a cost. The airline has been compelled to frequently adjust fares and encourage bookings and has observed disappointing close-in bookings, particularly as they head into the peak months of July, August, and September.
Moreover, Ryanair is facing challenges from rising labor costs and has criticized Boeing for ongoing delivery delays, a recurring issue that has frustrated O’Leary for years. Although he has defended Boeing after a recent mid-flight incident involving a 737 Max 9, he continues to urge the manufacturer to improve its reliability.
O’Leary also mentioned that Ryanair’s customers seem to be feeling more financial pressure compared to the early days of the economic recovery from COVID-19. Reports indicate that prolonged inflation and stagnating economic growth are beginning to impact consumers in the European Union. Consequently, he suggested that operating fewer aircraft may ultimately benefit Ryanair.
“We will have less capacity in summer 2025 than we initially scheduled with our Boeing deliveries, and then we will see two years of essentially no capacity growth,” O’Leary said. “If consumers face pressure in the upcoming 12 to 18 months, this could position us favorably.”