Spirit Airlines baggage tags are seen near a check-in counter on the Austin-Bergstrom International Airport on April 10, 2024 in Austin, Texas.
Brandon Bell | Getty Images
Spirit Airlines shares surged after the struggling budget carrier said it could cut jobs and sell aircraft.
The carrier late Thursday laid out a plan to reduce costs and lift money by selling 23 older Airbus aircraft. That sale will herald $519 million, Spirit said in a securities filing.
It also said it’s going to reduce costs by about $80 million, mostly through job cuts.
Last week the airline again delayed a deadline to refinance greater than $1 billion in debt until late December, giving it respiration room with its credit-card processor.
Spirit has struggled to return to profitability within the wake of the pandemic, facing a shift in travel demand and the grounding of dozens of Pratt & Whitney powered aircraft.
Even with Friday’s jump, Spirit’s shares have tumbled greater than 80% this 12 months after a judge blocked its planned acquisition by JetBlue Airways.
Spirit didn’t immediately comment on what number of employees it’s going to cut but said its 2025 capability might be down within the mid-teen percentage-point range compared with this 12 months. It began furloughing about 200 pilots in September. Flight attendants “are well-positioned” because so many crew members took voluntary leaves of absence, in line with the corporate.
Earlier this week, the Wall Street Journal reported that Spirit and Frontier Airlines have revived merger discussions, sending shares higher. The airlines didn’t immediately comment. The 2 budget airlines had a merger agreement that was derailed by JetBlue‘s April 2022 offer to buy Spirit outright.
Late Thursday, Spirit forecast a third-quarter negative operating margin of 24.5%, higher than a previous estimate for as much as a negative 29% margin for the three-month period.
