Ryanair has expressed disappointment over its business performance, leading to investor dissatisfaction and a significant 17% drop in its stock following a weaker-than-expected quarterly earnings report. The Irish budget airline reported revenue of €3.6 billion ($4 billion), roughly the same as the previous year, but profits plummeted nearly 50% to €336 million. CEO Michael O’Leary noted that while more passengers are flying with the airline, achieving this growth has required considerable effort.
During the company’s earnings call, O’Leary mentioned that passenger traffic was robust, with a 10% rise to 55 million travelers; however, this growth has come at a cost. He highlighted the challenges in stimulating fares and bookings, particularly noting disappointing performance in close-in bookings as the peak travel months of July, August, and September approach.
In addition to the decline in demand, Ryanair is also grappling with rising labor costs and has pointed fingers at Boeing for its ongoing delivery delays. Despite O’Leary’s previous support for Boeing following a mid-flight incident with a 737 Max 9, he has been vocal about needing improvements from the aerospace manufacturer.
O’Leary also mentioned that consumers may be feeling more financial strain now than they did during the initial stages of the COVID-19 recovery, with inflation and slowing economic growth impacting spending in the European Union. He suggested that operating fewer aircraft might prove beneficial for Ryanair in light of these challenges.
“We will have less capacity into summer 2025 than we originally planned due to Boeing’s delivery schedule, which will lead to two years of no capacity growth,” O’Leary shared. “If consumers are under financial pressure in the coming year or so, this situation may not be entirely negative for us.”