Spirit Airlines’ stock dropped 59% on Wednesday, closing at $1.31 per share, down from $1.91, as the airline continues restructuring its debt amid bankruptcy reports. The stock has plummeted over 90% this year, with the latest decline following a Wall Street Journal report stating that Spirit might file for bankruptcy protection in the coming weeks.
This comes after failed merger talks with Frontier Airlines and a blocked deal with JetBlue due to antitrust concerns. Spirit also announced it would not report its financial results for the quarter ending Sept. 30, as it works to reach a deal with creditors.
In a filing with the Securities and Exchange Commission, Spirit stated it was engaged in “productive” negotiations to restructure its debt, which is due in 2025 and 2026.
The airline assured that its passengers, employees, and suppliers would not be affected by the restructuring. Spirit’s financial struggles were highlighted by a $360 million operating loss in the first half of 2024, nearly four times its losses from the same period in 2023.
The airline has struggled with profitability, failing to report a profit in five of the last six quarters. To cut costs, Spirit has deferred new aircraft deliveries, furloughed pilots, and plans further reductions in staff and fleet sales. Analysts have lowered their full-year estimates for the airline, noting that customer confidence could further deteriorate, adding pressure to Spirit’s liquidity.
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