DANIA BEACH, FL – Spirit Airlines issued a stark warning about its financial stability on Monday, stating in a quarterly filing that there is “substantial doubt as to the company’s ability to continue as a going concern within 12 months.”
The Florida-based budget carrier revealed that its financial results are not improving quickly enough to meet the critical liquidity requirements set by its creditors. In response, Spirit is exploring drastic measures to raise cash, including the potential sale of aircraft, airport gates, and other assets. The airline confirmed it is in active discussions with creditors to renegotiate its financial obligations.
This development places Spirit at risk of a second bankruptcy filing or, in a worst-case scenario, a complete liquidation.
The announcement may feel familiar to industry observers. Following a collapsed merger with JetBlue Airways, Spirit faced immense financial pressure that culminated in a Chapter 11 bankruptcy filing in November 2024. The airline emerged from bankruptcy in March of this year smaller and with reduced debt, but it has failed to return to profitability. Spirit reported a significant operating loss of $184 million for the three months ending in June.
Despite the dire warning, the airline has been actively trying to improve its financial footing. It has attempted to attract higher-paying customers by rebranding its “Big Front Seat” to “Spirit First” and introducing premium economy options. The carrier has also expanded its network with new destinations and forged a partnership with regional carrier Contour Airlines.
However, these efforts are being challenged by a broader slowdown in U.S. domestic leisure travel, a trend that may not reverse fast enough to save the airline. “The company continues to experience challenges and uncertainties in its business operations and expects these trends to continue for at least the remainder of 2025,” Spirit stated in the filing.
Should Travelers Be Concerned?
For customers with immediate travel plans, the warning is unlikely to cause disruption. The “going concern” notice reflects the company’s outlook over the next year, not its immediate operational capability.
A key date highlighted in the filing is December 31, 2025, when Spirit must renegotiate a critical agreement with its credit card processor. The airline warned this could require “additional collateral,” further straining its available cash.
Travelers considering booking flights with Spirit for later dates may want to purchase travel insurance, ensuring the policy specifically covers airline failure.
Opportunities for Competitors
One airline’s struggle often creates openings for others. Rival budget carrier Frontier Airlines stands to gain the most from a potential Spirit collapse. “We are going to be last man standing in the low-cost space when you get to next year,” Frontier CEO Barry Biffle said on August 5, in what now appears to be a prophetic statement.
Other airlines are also watching closely. Analysts note that carriers like Sun Country Airlines could expand in markets like Detroit (DTW), while Spirit’s valuable gates at its Fort Lauderdale (FLL) hub could be attractive targets for JetBlue and United Airlines.
