Equities Update: Ryanair,Diageo…

Ryanair profit slumps, but optimistic about fare recovery

Adam Vettese, market analyst for eToro says: “Ryanair has reported a 16% drop in profit, albeit in line with expectations due to softer fares. Cost of living increases in this higher interest rate environment has had consumers feeling the pinch, prompting Ryanair to cut prices in order to get seats filled. However, it’s not necessarily all doom and gloom given the company flew a record 200 million passengers and expects to surpass that figure next year, whilst also making up for the lions share of the shortfall in fares at the same time.

“There are also lingering worries about tariffs, which could come into play and affect cost and delivery of Ryanair’s Boeing fleet, although the airline expects existing orders would still be honoured at agreed prices.

“Shares have been climbing since the low point seen in July last year and opened positively this morning, despite the fall in profit. It would seem investors are confident that Ryanair will come good despite the challenges of the last 12 months.”

Diageo’s Q3 beat masks underlying volatility

Lale Akoner, global market analyst at eToro says: “Diageo’s Q3 beat, driven by a 5.9% jump in organic net sales, offers temporary relief, but the real story is what’s brewing beneath. The spike was artificially inflated by North American wholesalers front-running expected tariffs. That’s not sustainable demand; it’s strategic stockpiling. With a weaker Q4 expected, Diageo’s reaffirmed guidance feels more like damage control than confidence.

“The company now faces an estimated $150 million annual impact from tariffs, of which it expects to mitigate around half. Diageo’s $500 million cost-cutting plan is a smart defensive pivot, but the lack of detail raises questions about where and how those cuts will land. Investors cheered the headline, but operational efficiency isn’t the same as growth. While brands like Don Julio continue to perform well but softness in Asia Pacific and Africa paints a broader picture of uneven momentum. Diageo scrapping its medium-term sales targets earlier this year still looms large.

Q3 results may reassure investors in the short term, however they do little to dispel the broader concerns around structural demand shifts and geopolitical headwinds. Diageo’s disciplined response to macro headwinds is encouraging but investors should brace for volatility as tariff pressures and patchy regional demand persist.”