Ryanair reported a 34% drop in first-quarter profits to €538 million, down from €820 million a year earlier, as rising jet fuel costs and lower fares impacted earnings. The budget airline attributed the decline to the Iran war, which pushed unhedged fuel prices above $150 a barrel and prompted travelers to delay bookings, forcing fare reductions.
Operating costs rose 11% to €3.81 billion, while passenger fares fell 6% year-on-year. Despite a 6% increase in traffic to 61.3 million passengers, total revenue grew just 1% to €4.38 billion. The results fell short of analyst expectations of €579 million.
CEO Michael O'Leary noted that the conflict created consumer hesitancy and concerns about jet fuel shortages in Europe, leading to weaker pricing trends. Ryanair extended its hedging program, locking in 15% of its 2028 fuel needs at $85 a barrel, on top of 80% of 2027 requirements already hedged at $67 a barrel. The airline declined to provide full-year guidance, citing uncertainty over Middle East developments, fuel prices, and macroeconomic shocks.
Chief financial officer Neil Sorahan warned that weaker airlines face a 'difficult winter,' while aviation analyst John Strickland noted that travelers' anxiety over the war forced fare cuts, impacting revenue despite increased traffic. Ryanair shares fell 6% following the announcement.