Ryanair has expressed disappointment in its recent business performance, which has led to discontent among investors. The Irish budget airline’s stock has plummeted by 17% following a quarterly earnings report that fell short of expectations. The revenue remained stable at €3.6 billion ($4 billion), similar to the previous year, while profits saw a significant decline, nearly halving to €336 million.
CEO Michael O’Leary noted that while more passengers are flying with Ryanair, the airline is facing challenges in increasing fare prices. During the earnings call, he revealed a 10% rise in passenger numbers, reaching 55 million, but emphasized that this growth came at a cost. He mentioned the need to continually stimulate fares and bookings, which have shown disappointing performance, particularly as the peak travel months of July, August, and September approach.
In addition to dwindling demand, Ryanair is contending with rising labor costs and has pointed fingers at Boeing over ongoing delivery delays. O’Leary has been vocal about his frustrations with Boeing while still supporting the company despite safety incidents involving the 737 Max 9.
Furthermore, he indicated that consumers in the European Union appear to be facing more challenges as the effects of years of inflation and slowing economic growth begin to take their toll. This situation could potentially lead to a reduced capacity for Ryanair in the coming years. O’Leary stated, “We will have less capacity into summer 2025 than we are originally scheduled to have with our Boeing delivery, and then, we’re into two years of essentially no capacity growth at all.” He added that if consumer pressure continues over the next year to 18 months, this might position Ryanair favorably in a challenging market.