Ryanair is facing challenges in its business performance, leading to disappointment among investors. The Irish budget airline’s stock has fallen by 17% following the release of a quarterly earnings report that was weaker than anticipated. The company’s revenue remained stable at €3.6 billion ($4 billion) compared to last year, but profits nearly halved to €336 million. CEO Michael O’Leary noted that while more passengers are flying with Ryanair—up by 10% to 55 million—the company is struggling to boost fares and bookings as desired.
During the earnings call, O’Leary highlighted the challenges in achieving close-in fare performance, particularly as the company approaches peak travel months in July, August, and September. He attributed some of the difficulties to declining demand and rising labor costs, and he also pointed fingers at Boeing for ongoing delivery delays, a persistent issue for the airline. Despite these setbacks, O’Leary has consistently defended Boeing, even after a safety incident earlier this year involving a 737 Max 9.
O’Leary remarked that consumers seem to be experiencing more financial strain than earlier in the recovery from COVID-19, with inflation and slow economic growth impacting spending in the European Union. He indicated that this might result in Ryanair operating fewer aircraft, which he suggested could have benefits for the airline in the long run. “We will have less capacity into summer 2025 than we were originally scheduled to have with our Boeing delivery, and then we’re looking at two years of essentially no capacity growth at all,” O’Leary explained. He added that if consumer pressure persists over the next year to 18 months, this situation might not be detrimental for the airline.