Ryanair Profit Declines Amid Boeing Delivery Delays

Ryanair Profit Declines Amid Boeing Delivery Delays and Lower Fares

Ryanair, Europe’s largest airline, has reported a 16 per cent decline in post-tax profit, falling to €1.61 billion (£1.4 billion) for the fiscal year ending 31 March. This decrease occurred despite the airline carrying a record 200.2 million passengers, marking a nine per cent increase year-on-year. The company attributed the profit drop primarily to a seven per cent reduction in average air fares, a consequence partly linked to capacity constraints caused by delayed deliveries of Boeing aircraft.

Impact of Boeing Delivery Delays and Market Conditions

The surge in passenger numbers was driven by lower ticket prices, which attracted more European travellers. However, the increased traffic volume was insufficient to counterbalance the financial strain imposed by reduced fares and ongoing supply chain disruptions. Boeing’s production challenges, including a widely reported incident involving a door panel on an Alaska Airlines flight, have significantly hindered Ryanair’s planned capacity expansion. The airline currently holds an order for 330 Boeing aircraft valued at approximately €27 billion, but persistent delivery delays have compelled Ryanair to revise its growth forecasts.

These supply chain difficulties are not isolated to Boeing; rival manufacturer Airbus has also faced setbacks. The broader industry challenges have been intensified by post-pandemic labour shortages and a rapid resurgence in travel demand, complicating efforts to restore normal operations.

Rising Costs and Uncertain Outlook

Operating costs for Ryanair increased by nine per cent to €12.4 billion, reflecting the wider pressures confronting the aviation sector. The airline is also grappling with uncertainty over the financial implications of increased tariffs following former US President Donald Trump’s ‘Liberation Day’ announcement in April, which adds further complexity to its financial outlook.

Chief Executive Michael O’Leary expressed cautious optimism, stating that while the airline expects to recover most—but not all—of the previous year’s fare decline, leading to reasonable net profit growth in the full year 2026, it remains premature to offer definitive guidance. O’Leary highlighted the sensitivity of the company’s prospects to external risks, including potential tariff disputes, macroeconomic shocks, escalating conflicts in Ukraine and the Middle East, and ongoing staffing challenges within European air traffic control.

Corporate Developments and Market Reaction

In a notable corporate development, Ryanair announced the departure of non-executive director Howard Millar, who served as the airline’s chief financial officer from 1992 to 2014. Despite the profit decline, Ryanair’s shares rose by more than three per cent in early trading, buoyed by the announcement of a €750 million share buyback programme. The airline’s current challenges underscore the volatility that continues to affect the aviation industry amid shifting market dynamics and geopolitical uncertainties.