Spirit Airlines warns it may not have the option to survive a yr

Spirit Airlines has warned it may not have the option to survive a yr as a going concern if it doesn’t raise additional cash, five months after the budget travel icon emerged from bankruptcy.

After cutting its debt by converting $795 million to equity during restructuring, Spirit has tried to draw bookings by marketing more upscale products and on the lookout for recent ways to lower costs. Late last month, the airline announced plans to furlough 270 more pilots this fall.

“Nevertheless, the Company has continued to be affected by antagonistic market conditions, including elevated domestic capability and continued weak demand for domestic leisure travel within the second quarter of 2025, leading to a difficult pricing environment,” the corporate said in its quarterly report late Monday.

Bookings this yr for domestic flights have are available lower than what airlines had hoped in the beginning of 2025.

As its financial results aren’t improving at the identical pace creditors agreements require, Spirit will need extra money. Failing to achieve this could end in defaults. The carrier is taking a look at selling some aircraft, real estate or access to airport gates, it said.

“Due to uncertainty of successfully completing the initiatives to comply with the minimum liquidity covenants and of the consequence of discussions with Company stakeholders, management has concluded there may be substantial doubt as to the Company’s ability to proceed as a going concern inside 12 months from the date these financial statements are issued,” it said within the filing.

The carrier said its bank card processor is looking for more collateral to renew its processing agreement, which expires on Dec. 31.

CEO Dave Davis on Tuesday expressed confidence to the airline’s staff about Spirit’s changes, like rethinking unprofitable flying and growing in stronger markets.

In a memo to employees, which was seen bc CNBC, Davis said the going-concern warning “is a phrase required by our outside auditors to convey that there may be risk if we don’t make changes. But, we’re.”

Spirit’s bankruptcy last November was the primary for a serious U.S. airline since 2011.

Known for its vivid yellow planes, Spirit was a budget airline pioneer within the U.S., but struggled within the wake of a failed acquisition by JetBlue Airways last yr, shifting consumer tastes to more upmarket products and an engine recall that grounded lots of its airplanes. Post-pandemic travel trends, including a surge in international trips and more upscale seats, have been particularly punishing for budget airlines which are largely focused on U.S. travel.