Ryanair (NASDAQ:RYAAY) on Monday struck a cautious tone about travel demand for the rest of the year and cut its passenger growth forecast due to Boeing delivery delays after its quarterly profit flew past pre-pandemic levels.
Ryanair, which flew a record number of monthly passengers both in May and June, said demand looked robust for the rest of the summer with fares expected to keep growing but at a slower low double-digit percentage rate from July to September.
Fares for passengers booking close to their date of departure softened in late June and early July and CEO Michael O’Leary said the low-cost carrier would likely have to stimulate demand through lower prices this winter when it will have 25% more seats to fill than in 2019.
Ryanair shares, up 26% so far this year on the back of a post-pandemic travel boom, were 4.3% lower at 15.74 euros in early trade. They had lost $7.77, or 7.2%, to $99.75 U.S. soon after the open on Wall Street.
“We’re concerned about the impact of these macroeconomic trends. Consumer price inflation, higher interest rates, higher mortgage rates might affect consumer spending in the second half of the year,” O’Leary said in an analyst presentation.
He added that this would ultimately be good for Ryanair’s growth because customers will keep flying but become more price sensitive.
The Irish airline, Europe’s largest by passenger numbers, posted a 663 million euro ($737.26 million U.S.) after-tax profit for the three months ending in June after traffic rose by 11% year-on-year and average fares jumped by 42%.
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