Ryanair has significantly upgraded its full-year projections for both passenger numbers and airfare increases, citing robust demand and accelerated aircraft deliveries from Boeing. The budget carrier now anticipates carrying almost 208 million passengers in the 2025-26 financial year, a revision upwards from its previous guidance of 207 million.
Strong Quarterly Performance and Revised Guidance
The Irish airline reported transporting 47.5 million passengers during its third quarter, which concluded at the end of December. This figure represents a solid 6% increase compared to the same period last year. The company attributes this growth to sustained strong market demand and the earlier-than-expected arrival of new Boeing aircraft, which have bolstered its operational capacity.
Fare Increases Exceeding Expectations
Average fares rose by 4% during the third quarter. More notably, Ryanair has revised its full-year fare growth forecast upwards. The airline now expects fares to increase by up to approximately 9%, surpassing its previous projection of a 7% rise. This adjustment indicates stronger pricing power and favourable market conditions than initially anticipated.
Profit Outlook Amidst Challenges
Despite the positive revisions, Ryanair's third-quarter financial results were impacted by a significant one-off provision. The airline set aside funds to cover a substantial 256 million euro fine imposed by Italy's competition authority in December. This penalty was levied over allegations that Ryanair employed an "abusive strategy" to obstruct third-party travel agencies from purchasing tickets on its website between April 2023 and at least April 2025.
As a result of this provision, pre-tax profits for the quarter plummeted by 83% to 24.4 million euros. Excluding this exceptional item, underlying net profits still declined by 22% to 115.4 million euros. Ryanair has expressed strong confidence that this "baseless" fine will be successfully overturned through the appeals process.
Confident Full-Year Projections
Looking ahead, Ryanair is providing a "cautious" guidance for its full-year underlying profits after tax, projecting a range of 2.13 billion to 2.23 billion euros. This represents a substantial increase from the 1.61 billion euros reported in the previous financial year.
Chief Executive Michael O'Leary commented on the outlook, stating, "While the fourth quarter doesn't benefit from Easter, fares are trending ahead of prior year and we now believe full-year fares will exceed the 7% growth previously guided by 1% or 2%."
Risks and Long-Term Strategy
O'Leary also highlighted several potential risks that could affect the final profit outcome, including:
- Escalation of conflicts in Ukraine and the Middle East
- Macro-economic shocks
- Further disruptions from European air traffic control strikes and operational mismanagement
Despite these uncertainties, the CEO outlined a positive long-term vision for the company. He emphasised that industry-wide capacity constraints, combined with Ryanair's cost advantages, strong financial position, low-cost aircraft order book, and operational resilience, position the airline for controlled, profitable expansion. The carrier aims to reach 300 million passengers annually by the 2033-34 financial year.
