The short version
Ryanair (RYAAY) reported first-half results on Monday. Profit after tax of €2.15 billion, down 15% from €2.54 billion.
The business did not shrink. It grew. Traffic rose 6% to 125.8 million passengers, a record, with load factors at 95%.
The problem was fuel, and the detail is remarkable. Ryanair hedges most of its jet fuel in advance. The portion it had not hedged roughly doubled to about $130 a barrel, against a hedged price of about $67.
Same fuel. Nearly double the price. The only difference was whether it had been bought in advance.
And fares fell. Average fares dropped 4% to €55.70, including the peak summer period. Revenue still rose 3% to €10.08 billion, but operating costs rose 10%.
If this sounds like the other side of a story we have been telling, it is. Shell, Exxon and Reliance have all just reported record refining results. Ryanair buys what they sell.
People are searching:
- "Ryanair results"
- "RYAAY stock"
- "Ryanair profit"
- "jet fuel prices"
- "what is fuel hedging"
- "airline stocks 2026"
- "Ryanair fares 2027"
- "will flights get more expensive"
Explore global stocks and ETFs from $1 on Nemo.money — zero commission, and uninvested cash earns 6% AER interest, paid daily in USD.
What Ryanair reported
- 💰 Profit after tax: €2.15 billion, down 15% from €2.54 billion.
- ✈️ Traffic: 125.8 million passengers, up 6%, a record, at a 95% load factor.
- 🎫 Average fare: €55.70, down 4%.
- 💵 Total revenue: €10.08 billion, up 3%. Scheduled revenue rose just 1% to €7.0 billion.
- 🧳 Ancillary revenue: €3.08 billion, up 6%, about €24.50 per passenger.
- 📈 Operating costs: €7.69 billion, up 10%, well ahead of revenue growth.
- 📉 Operating profit: down 16% to about €2.40 billion.
Ryanair also cut its full-year traffic target from 216 million passengers to 214 million, and said winter traffic from November to March will be broadly flat year on year.
And it declined to give full-year profit guidance at all, citing what management called zero visibility on the final quarter, along with sensitivity to unhedged fuel prices and potential air traffic control disruption. That is unusually candid.
What hedging actually does
Hedging means agreeing a price for something now, to be delivered later. Airlines do it with jet fuel because fuel is their largest controllable cost and the price moves violently.
Ryanair's half-year shows exactly what it buys you:
- 🛡️ The hedged portion cost about $67 a barrel, locked in earlier.
- 💥 The unhedged portion cost about $130 a barrel, roughly double.
Most of its fuel was protected. The part that was not caused a 15% fall in profit.
Two things follow from that, and both matter:
- ⏳ Hedging delays, it does not prevent. A hedge runs out. When it does, you pay whatever the market charges.
- 🔄 It works in both directions. We wrote this week about Mondelez, where cocoa prices fell but hedges meant the benefit arrived late. Ryanair is the same mechanism with the sign reversed.
The practical lesson: when a company's costs are hedged, its reported results lag the real market. Good news and bad news both arrive late, which is why the share price often moves before the numbers do.
One barrel of oil, six companies, six outcomes
Over the past fortnight we have followed a single commodity through six stories. Here is the whole chain.
The people who sell it had an exceptional quarter:
- 🇬🇧 Shell: record refining margins, $10.8 billion of adjusted earnings.
- 🇺🇸 Exxon: refining earnings roughly doubled, even as its oil production business earned 20% less.
- 🇮🇳 Reliance: refining profits up 67.9%, driving an 8% share move.
The people who buy it did not:
- ✈️ Ryanair: profit down 15%, with unhedged fuel at roughly double the hedged price.
- 🇺🇸 Four US airlines: 2026 profit forecasts cut, with American reporting record revenue and still posting a loss.
- 🚗 Drivers in the UAE: petrol roughly 70% above February.
That is the single most useful thing in any of these posts. The same number in a commodity market creates record profits on one side of a transaction and forecast cuts on the other, simultaneously. When you read that something is good or bad for the economy, the question is always: good for whom?
The choice Ryanair made
Traffic up 6%. Fares down 4%.
That is not an accident. Faced with higher costs, Ryanair chose to fill planes rather than protect fares. More passengers, each paying slightly less, at a 95% load factor.
It is a version of a question we have asked all month: did a company grow by selling more or by charging more? At Coca-Cola, as at several others, the answer was volume volumes rose 5% worldwide while price contributed just one point of its organic growth.
Ryanair is the same answer arrived at under duress. A nearly empty seat earns nothing, so filling it at a lower fare beats flying with it empty. The economics of a low-cost airline make that the rational move, and it is why the profit fall came through costs rather than demand.
Whether it can keep doing that is the open question, and management has already said what it would take.
The warning about next year
Management put a number on it, and it is the most striking thing in the results.
If oil prices stay elevated, Ryanair says FY28 could bring a €2 billion increase in fuel costs against FY27. Fully offsetting that would require fares roughly 20% higher, or about €10 more per passenger.
Read that as a conditional, not a forecast. It depends on where oil goes, and the company was explicit that it is too early to guide on next year's profit.
But it tells you what the maths looks like, and it is the clearest answer yet to the question your next flight raises. If jet fuel stays where it is, someone pays. The options are the airline's margin, the passenger's fare, or fewer flights.
On the other side of the ledger: Ryanair expects 16 MAX-10 aircraft in its summer 2027 fleet, taking traffic above 220 million passengers. Newer aircraft carry more seats and burn less fuel, which is the structural response to a fuel problem.
Which airlines you can actually explore from the UAE
Most large airlines are listed somewhere, but what matters is whether they are listed in the US, since that is what is available through Nemo.money.
The US-listed options fall into three groups:
- 🇪🇺 European, via a depositary receipt. Ryanair trades as RYAAY. A depositary receipt is a US-listed certificate representing shares in a foreign company, which is how you access a Dublin-listed business from a US exchange.
- 🇺🇸 The US majors: Delta (DAL), United (UAL) and American (AAL). These are full-service carriers with international networks, and all three featured in our post on four US airlines cutting their forecasts.
- 🎒 The low-cost carriers: Southwest (LUV) in the US, alongside Ryanair. Different economics entirely: higher load factors, lower fares, tighter cost control.
The distinction worth understanding is the one between a low-cost carrier and a full-service airline. Ryanair's model depends on filling almost every seat, which is why its response to higher fuel was to cut fares and fly more people. A full-service carrier with business cabins and long-haul routes has different levers and different exposures.
What they share is the fuel bill, and this quarter demonstrated that all of them are on the same side of it.
Two things to be clear about. Middle Eastern carriers including Emirates and Etihad are not publicly listed, so there is no share to buy. And airlines generally are a cyclical, capital-intensive sector where profits swing hard with fuel, demand and currency.
All companies named here are examples to research, not recommendations.
What could go wrong
- ⛽ Hedges expire. The protection that limited this half's damage is temporary, and the €2 billion figure above is what the other side of it could look like.
- 📉 Fares are falling while costs rise. Average fares down 4% against operating costs up 10% is not a gap that can widen indefinitely.
- 🎯 Guidance was withdrawn, not just lowered. Declining to give full-year profit guidance because of zero fourth-quarter visibility is honest, and it also removes a reference point investors rely on.
- ✂️ Traffic targets were cut, from 216 million to 214 million, with winter capacity flat.
- 🛫 Delivery schedules slip. The FY28 growth plan depends on 16 aircraft arriving in spring 2027, and aircraft delivery delays have been an industry feature for years.
- 🌍 And the whole thing turns on a price nobody controls.
RYAAY is an example to research, not a recommendation. Airlines are a cyclical, capital-intensive sector.
What should investors take from this?
Find out which side of a commodity a company sits on, then find out how long its protection lasts.
Ryanair's results were not a demand problem. Traffic hit a record and planes flew 95% full. The profit fall came entirely from the cost side, and specifically from the fifth of its fuel that was not hedged.
Three habits:
- 🔍 Check the hedging disclosure. Most companies with big commodity exposure publish what proportion is hedged and at what price. It tells you how much of next year is already decided.
- ⚖️ Separate a demand problem from a cost problem. They look identical in a profit figure and they are completely different to fix.
- 🧺 And remember both sides are investable. Energy producers and airlines sit in most broad index funds, which is one reason a fund holding hundreds of companies behaves differently from holding one.
Research airline and energy stocks on Nemo.money
- From $1. Fractional investing, in research-sized amounts.
- Zero commission on US stocks and ETFs.
- Nemes: curated themed collections to start from.
- 6% AER interest on uninvested cash, paid daily in USD.
FAQs
What did Ryanair report? First-half FY27 profit after tax of €2.15 billion, down 15% from €2.54 billion. Traffic rose 6% to a record 125.8 million passengers at a 95% load factor, average fares fell 4% to €55.70, total revenue rose 3% to €10.08 billion and operating costs rose 10% to €7.69 billion.
Why did Ryanair's profit fall if more people flew? Because of fuel. The portion of jet fuel Ryanair had not hedged roughly doubled to about $130 a barrel, against a hedged price of about $67, while average fares fell 4%.
What is fuel hedging? Agreeing a price now for fuel delivered later. It protects against price rises while the hedge lasts, and it also delays the benefit when prices fall. It postpones the effect rather than removing it.
Will Ryanair fares rise? The company has said that if oil prices stay elevated, FY28 could bring a €2 billion increase in fuel costs, which would require roughly 20% higher fares, about €10 per passenger, to fully offset. That is a conditional statement about what the arithmetic would require, not a pricing announcement.
Can I invest in Ryanair from the UAE? Ryanair trades in the US as an American Depositary Receipt under the ticker RYAAY, alongside its Dublin and London listings. On Nemo.money you can research and invest in eligible US-listed stocks and ETFs from $1 with zero commission, with uninvested cash earning 6% AER interest, paid daily in USD. RYAAY is an example to research, not a recommendation. Your capital is at risk.
Nemo = Never Miss Out.
Stay informed. Stay ahead.
#Ryanair #Airlines #JetFuel #Earnings #StockMarket #Investing #NemoMoney
Terms and conditions apply. This is not investment advice. Past performance is not indicative of future results. Your capital is at risk. See website for Risk Disclosure. Exinity ME Ltd (https://nemo.money) is regulated by ADGM's Financial Services Regulatory Authority.
