Ryanair has expressed disappointment in its recent business results, which has led to investor dissatisfaction as well. The Irish low-cost airline’s stock has fallen by 17% following the release of a weaker-than-anticipated quarterly earnings report. Revenue reached €3.6 billion ($4 billion), nearly unchanged from the previous year, while profits plummeted to €336 million, nearly halved from the prior period. CEO Michael O’Leary noted that while more passengers are flying with Ryanair, attracting them has become increasingly challenging.
O’Leary stated on the earnings call that passenger numbers rose by 10%, totaling 55 million, but this growth is dependent on pricing strategies. He indicated that the company has had to frequently adjust fares and bookings, especially as close-in bookings have not met expectations heading into the busy summer months of July, August, and September.
In addition to weaker demand, Ryanair is facing rising labor costs and has pointed to delays in aircraft deliveries from Boeing as a contributing factor to its struggles. Despite previously defending Boeing after a mid-flight incident involving a 737 Max 9, O’Leary has called for improvements from the manufacturer.
He conveyed to investors that customers are feeling the impact of rising inflation and slowing economic growth within the European Union, which could potentially benefit Ryanair in the long run by encouraging a reduction in flight capacity. O’Leary mentioned, “We will have less capacity into summer 2025 than we were originally scheduled to have with our Boeing delivery, and then we’re into two years of essentially no capacity growth at all. If the consumer is going to be under pressure for the next year or 18 months, that might not be the worst place to be.”