Spirit Airlines has issued a stark warning about its financial future, telling regulators there is “substantial doubt” it can continue operating over the next 12 months without a significant cash infusion.
In a recent filing with the Securities and Exchange Commission, the ultra-low-cost carrier cited weak demand for domestic leisure travel, fierce competition, and an oversupply of U.S. flights as key factors straining its revenue. The disclosure comes just months after the airline emerged from Chapter 11 bankruptcy in March 2025.
To stave off another collapse, Spirit is taking aggressive measures, including selling aircraft, real estate, and airport gate rights, furloughing about 270 pilots, demoting some captains to first officer roles, and introducing new premium fare options such as “Go Comfy” to increase per-passenger revenue. The airline is also in tense negotiations with its credit card processor, which is demanding additional collateral that could further erode its cash reserves.
The market reaction was swift and severe, with Spirit’s shares plunging more than 45 percent to around $2. Rival airlines including JetBlue, Frontier, and Sun Country saw stock gains as investors anticipated reduced competition or potential consolidation.
Spirit has not announced any renewed merger talks, though past bids by JetBlue and Frontier were blocked or abandoned. For now, the carrier says day-to-day operations and near-term flights remain unaffected, but its survival beyond the next year depends on securing new capital.
If Spirit ultimately collapses, it could reshape the ultra-low-cost segment of U.S. air travel, leaving millions of budget-conscious passengers with fewer options and potentially higher fares.