Ryanair Q1 profit falls 34% to €538 million as higher fuel costs and lower fares hit earnings

Ryanair Holdings reported a sharp decline in first-quarter profit, with post-tax profit (PAT) falling 34% year-on-year to €538 million, compared with €820 million in Q1 2025. The Irish low-cost carrier said earnings were impacted by higher unhedged fuel costs and a 6% decline in average fares amid weaker demand linked to geopolitical uncertainty and economic concerns.

Traffic continued to grow, however, with passenger numbers rising 6% to 61.3 million during the quarter, while load factor remained stable at 94%. Revenue increased marginally by 1% to €4.38 billion, as lower ticket prices offset traffic growth and ancillary revenues remained broadly stable.

Operating costs climbed 11% to €3.81 billion, mainly due to a sharp increase in fuel expenses. Ryanair said its 20% unhedged jet fuel exposure saw prices more than double during the quarter to around $150 per barrel. The airline expects its fuel hedging strategy to protect future earnings, with 80% of FY2027 fuel requirements secured at approximately $67 per barrel and 15% of FY2028 consumption hedged at around $85 per barrel.

CEO Michael O’Leary highlighted the airline’s strong financial position, noting that Ryanair became debt-free following the repayment of its final €1.2 billion bond in May. The group ended June with more than €2.8 billion in cash, a fleet of 647 aircraft, and an unencumbered fleet of 620 Boeing 737s.

Ryanair is continuing its expansion strategy, opening three new bases in Rabat (Morocco), Tirana (Albania) and Trapani (Italy), while adding 130 new routes for the summer 2026 season. The airline said it is shifting capacity towards lower-cost markets and reducing exposure to higher-tax or higher-cost regions.

The carrier expects European short-haul capacity to remain constrained until at least 2030 due to aircraft delivery delays, engine maintenance issues and airline consolidation. Ryanair believes its large Boeing 737 MAX order book, low-cost structure and strong balance sheet will support continued growth towards its target of more than 300 million passengers annually by FY2034.

For the full FY2027 year, Ryanair maintains its forecast of 216 million passengers, representing 4% growth. However, the airline warned that profitability remains difficult to predict due to fuel price volatility, geopolitical risks, European air traffic control disruptions and uncertain consumer demand.

The company also highlighted environmental progress, reporting a record 91% customer satisfaction score and continued fleet efficiency improvements. Its fleet now includes 210 Boeing 737-8200 “Gamechanger” aircraft, while the first Boeing 737 MAX 10 deliveries are expected in spring 2027. The MAX 10 fleet is expected to provide around 20% lower fuel consumption and 20% more seats compared with previous-generation aircraft.