Ryanair has expressed disappointment with its recent business performance, leading to a significant decline in investor confidence. The Irish low-cost airline’s stock has dropped 17% following a quarterly earnings report that fell short of expectations. The company’s revenue remained stable at €3.6 billion ($4 billion), comparable to the previous year, but profits plummeted nearly 50% to €336 million. CEO Michael O’Leary noted that while the number of passengers flying with Ryanair increased by 10% to 55 million, it has come at a cost.
During the earnings call, O’Leary pointed out that the airline has had to continuously lower fares to stimulate demand. He expressed concerns over weaker close-in bookings, especially as the peak travel months of July, August, and September approach.
Additionally, Ryanair is facing challenges from rising labor costs and ongoing delays in aircraft deliveries from Boeing, which O’Leary has long criticized. He acknowledged that customers are feeling the impact of prolonged inflation and sluggish economic growth within the European Union, hinting that operating fewer aircraft might be beneficial for Ryanair in this climate.
O’Leary indicated that the airline would have a reduced capacity in summer 2025 compared to initial schedules due to delays from Boeing, which means there will be no growth in capacity for the next two years. He mentioned that given the current pressure on consumers, this slower growth might not be detrimental.