Ryanair Profit Tops Estimates as Fuel Costs Threaten Fares

Ryanair said its fiscal second-quarter net income was $1.85 billion, or $3.54 per share, with revenue of $6.56 billion. Both figures exceeded the average forecasts from three analysts surveyed by Zacks Investment Research: $3.49 per share and $6.47 billion in revenue.

For the six months through September 30, the airline reported post-tax profit of 2.15 billion euros, about $2.4 billion, down 15% from the year-earlier period. Ryanair said elevated fuel prices are weighing on earnings and could mean higher ticket prices and temporary pay freezes as it examines costs.

The company has locked in prices for more than 80% of its fuel needs at about $67 a barrel through next March. It said the remaining portion has risen to roughly $130 a barrel and anticipates fuel expenses will climb by 2 billion euros, or $2.2 billion, next financial year.

Chief Executive Michael O’Leary said fares would need to rise about 20%, or 10 euros per passenger, to cover the added costs. He expects a substantial increase but said it may fall short. Ryanair also raised the possibility of fewer crew members relative to passengers and greater use of AI in operations and support roles.

The airline lowered its passenger target from 216 million to 214 million, implying no year-over-year growth this winter. It aims for 3% growth next year, with 16 Boeing 737 Max 10 aircraft planned for its fleet. Ryanair also announced an 800 million euro share buyback. Ryanair stock gained roughly 2% on European markets and 2.75% in Nasdaq premarket dealings.