Ryanair fares are set for a sharp rise as the airline attempts to rebound from a double-digit hit to profits in a year where Ryanair shipped a record number of passengers.

Europe’s largest airline transported a record 200 million passengers in 2024, though fares were 7% lower than in the year prior. Ryanair’s CEO, Michael O’Leary, said high inflation and interest rates, an off-cycle Easter, and a fall in travel agency bookings forced the company into “repeated price stimulation” last year, in other words, price cuts.

Net profit fell 16% in Ryanair’s financial year as it cut ticket prices to boost passenger numbers.

The airline is now hoping to recoup that average fare reduction this year, and in turn return to profit growth, as European consumers look better positioned than last year to spend through the Summer.

As part of that plan, the airline expects fares to rise by “a mid-high teen percent ahead of Q1 FY25,” compared with the same period last year. Much of that is attributable to the timing of Easter, which fell in April this year and fed into higher average flight prices.

The airline said tariffs, geopolitical conflicts, and as yet unrealized problems with air traffic control created potential barriers to its recovery.

Profit after tax slid to €1.61 billion ($1.8 billion) in the 12 months to the end of March for the airline that flies mostly across Europe, Ryanair said in an earnings statement. Revenue increased four percent to €13.95 billion. A seven percent drop in fares saw passenger numbers rise to just over 200 million, up from almost 184 million passengers the previous year.

“We cautiously expect to recover most, but not all, of last year’s seven percent fare decline, which should lead to reasonable net profit growth” in its latest financial year, the company said.

O’Leary signalled optimism for the peak summer season ahead.

“We are seeing robust summer 2025 demand across the network. Our forward bookings are strong,” he said in an online presentation on Monday.

Shares in Ryanair jumped around 3.5% in morning deals in Dublin after the results slightly beat analyst expectations.

It also launched a €750 million share buyback programme over the next six to 12 months.

Ryanair’s staff costs increased by 17% to €1.75 billion last year ($1.97 billion), owing to a larger plane fleet.

Despite the profit drop, Ryanair is “more bullish for this year, highlighting that demand is robust across Europe”, said Susannah Streeter, head of money and markets at Hargreaves Lansdown.

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“Travellers are brushing off economic uncertainty and appear determined to ring-fence available budgets to spend on trips abroad,” she added.

‘Improving’ Boeing delays

The airline warned that it expects just three percent growth in passenger numbers by March 2026 due to delayed Boeing deliveries.

Ryanair has lowered its growth forecasts several times as manufacturing issues at the US aircraft maker continue to affect Europe’s biggest airline by passenger numbers. In its earnings, Ryanair reminded investors it had achieved record passenger numbers last year “despite” delays to Boeing deliveries.

But O’Leary noted on Monday that these delays are “improving”.

Boeing had a bruising 2024 that included a labour strike of more than seven weeks, major safety issues on commercial planes, and defence contract cost overruns.

O’Leary cautioned last month that Ryanair may defer deliveries of new Boeing jets should the fallout from US President Donald Trump’s tariffs make them more expensive.

Trump’s tariffs, including on key aircraft materials aluminium and steel, together with retaliatory levies risk hitting global supply chains, in turn hiking costs across sectors.

This story was originally featured on Fortune.com

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