Ryanair Holdings PLC Earnings - Q3 2025 Analysis & Highlights

Key Takeaways

Ryanair's Q2 2026 earnings call, held on November 3, 2025, highlighted a 2% traffic increase, a 7% fare increase, and a 20% profit increase to €1.72 billion. The call covered Boeing delivery improvements, fuel hedging for FY 2027, balance sheet strength, and concerns over European competitiveness.
  • Key financial results:
  • Q2 profits increased by 20% to €1.72 billion.
  • Q2 traffic is up 2% due to Boeing delivery delays.
  • Fares in Q2 were up 7%, recovering from the previous year's decline.
  • Unit costs were up only 1% in Q2.
  • Average fares are expected to recover the full 7% decline from last year, potentially reaching an 8% increase if Christmas bookings are strong.
  • Capital allocation:
  • An interim dividend of €0.193 was announced, similar to the previous year.
  • The company is progressing with its buyback program, with over 35% completed, expected to run until the back end of 2026.
  • The €850 million bond was repaid in September, with the final €1.2 billion bond to be paid in May, leading to a debt-free status.
  • The first 50 of 150 firm MAX-10 aircraft orders are hedged at $1.24, resulting in a 15% euro saving on CapEx.
  • Industry trends and dynamics:
  • European capacity remains constrained due to manufacturer delivery delays and grounded Airbus fleets.
  • Europe is failing on competitiveness, with calls to move ETS tax rates in line with CORSIA and reform broken ATC services.
  • Several governments are abolishing environmental taxes and incentivizing traffic growth.
  • Competitive landscape:
  • Ryanair is switching capacity away from high-tax economies like Germany, France, and the UK to countries abolishing environmental taxes.
  • Competitors are struggling to contain unit costs, putting pressure on them to increase fares.
  • Ryanair has a significant unit cost advantage over competitors.
  • Macroeconomic environment:
  • Europe's competitiveness is a concern, with calls for reform on environmental taxes and air traffic control.
  • The Irish government is criticized for inaction on the Dublin Airport cap.
  • Environmental taxation is seeing a sea change at the national level.
  • Growth opportunities and strategies:
  • Ryanair aims to grow traffic to 215 million, 216 million passengers in FY 2027 and to 225 million passengers by FY 2028.
  • The airline plans to grow from 207 million passengers this year to approximately 300 million passengers by 2034.
  • The company is taking advantage of recent fuel weakness by hedging for FY 2027 at just under $67 a barrel.
  • Approximately 75% of growth will be in Italy, Poland, Albania, and the UK.
  • The company is investing €25 million annually to accelerate cadet and first officer recruitment for the next three years.
  • Ryanair is close to selecting its first MRO shop and will open two shops, each capable of handling 200 engines.
  • Financial Guidance and Outlook:
  • The airline is confident in achieving approximately €10 to €12 or €14 profit per passenger over the next 10 years.
  • Modest unit cost inflation is guided for the full year, remaining between 1% and 3%.
  • The company expects modest fare increases as capacity is added next year.
  • Fuel cost savings of about €600 million next year will enable incentivized growth and fund increased emissions taxes.
  • The company anticipates strong and profitable growth for the next four years, up to 2030.
  • Additional Topics:
  • Boeing is delivering aircraft at an improved rate, with 23 of 29 aircraft delivered in the last three months.
  • The company expects to have all 210 Gamechangers in the fleet by the end of March next year, ahead of summer 2026.
  • The airline has extended OpEx hedging into next year at $1.15 compared to $1.11 on the euro/dollars.
  • Europe's airlines are advocating for moving ETS environmental tax rates in line with CORSIA and reforming Europe's broken ATC services.
  • The company is rewarding countries incentivizing growth by abolishing environmental taxes and penalizing those with tax increases.
  • The new MAX-10s will carry 20% more passengers and burn 20% less fuel per flight, resulting in a 40% reduction in fuel and emissions per seat.
  • The company is in advanced discussions with GE and CFM on spares packages.
  • Attrition rates are at their lowest, slowing down cadet recruitment to approximately 500 this year.
  • Most labor contracts are up for renewal in April 2027.
  • The company is seeing very strong loads in regional Italy.
  • The airline is not a believer in SAF (sustainable aviation fuel) mandates.
  • The company needs to move these mandates to the right.
  • There is very little prospect of those SAF mandate to be met in 2030.
  • The company does need a much more - either Europe and European governments should use some of the environmental taxation, this astonishing, there's (01:20:46) ETS taxation to incentivize the production of SAF are moved the SAF mandate to the right or further out into 2030s.
  • The only call out that I would have is some of UK leisure in November and it's a very small part of our business and the rest of the UK is as robust as the rest of the network Europe was.
  • The company is not focusing lobbying efforts on sustainable aviation fuel mandates.
  • The company would like to see any changes there to rules in the UK or EU.