Ryanair has expressed disappointment over its recent business performance, a sentiment also echoed by its investors. The budget airline’s stock has plummeted by 17% following the release of a quarterly earnings report that fell short of expectations. The revenue stood at €3.6 billion ($4 billion), remaining stagnant compared to the previous year, while profits nearly halved to €336 million. CEO Michael O’Leary remarked that while passenger numbers are increasing, attracting these customers requires considerable effort.
During the earnings call, O’Leary highlighted a 10% rise in traffic, bringing the total to 55 million passengers, but noted that growth is contingent on pricing strategies. He pointed out challenges regarding close-in fares and bookings, which have been weaker than anticipated, especially as the airline approaches the peak travel months of July, August, and September.
In addition to softening demand, Ryanair is grappling with escalating labor costs and has also attributed some of its struggles to Boeing’s delayed aircraft deliveries, a persistent issue for O’Leary. Despite recent incidents with Boeing aircraft, he has maintained a steadfast relationship with the manufacturer while urging them to improve their operations.
O’Leary further indicated that consumers might be feeling financial strain as years of inflation and slowing economic growth start to take a toll in the European Union. As a result, Ryanair may end up with reduced operational capacity in summer 2025 compared to what was initially planned due to ongoing delays with Boeing deliveries. He concluded that if consumer pressure continues over the next 12 to 18 months, this might not be detrimental for the airline in the long run.