Spirit Airlines can't even tell investors how bad things are

Melvin Backman
·2-min read
A Spirit Airlines plane - Photo: Jay L. Clendenin (Getty Images)
A Spirit Airlines plane - Photo: Jay L. Clendenin (Getty Images)

As reports suggest bankruptcy is on the horizon for Spirit Airlines (SAVE), the company isn’t saying much. In fact, the one thing Spirit Airlines is saying is that it can’t say what’s going on; the company told investors it won’t be able to put together a quarterly earnings filing.

“The Company is unable to file its Quarterly Report on Form 10-Q for the quarter ended September 30, 2024 (the “Q3 2024 Form 10-Q”) by the prescribed due date without unreasonable effort or expense,” the company said in a news release.

Spirit Airlines’ shares are down more than 50% in Wednesday trading after a Wall Street Journal (NWSA) report came out that suggested that a hoped-for resumption of Spirit’s paused Frontier Airlines (ULCC) tie-up talks had fallen apart.

The talks between Spirit and Frontier came after Spirit’s failed attempt at merging with JetBlue (JBLU). And it wasn’t the first time that Frontier and Spirit explored a merger. The airlines had been in on-and-off merger talks since 2016. In February 2022, the companies announced a $2.9 billion definitive merger agreement. That deal fell apart in July of that year.

Since then, Spirit has struggled to find its footing (and JetBlue isn’t faring much better). Speculation has swirled for months that Spirit might be approaching insolvency.

In a recent regulatory filing, the company said it had pushed back its deadline to refinance roughly $1.1 billion in debt until Dec. 23. Spirit also said it had borrowed the entirety of a $300 million revolving credit facility it had set up in March 2020. Borrowings under that facility are scheduled to mature at the end of September 2026. The company also reiterated at the time that it expects to end 2024 with more than $1 billion in liquidity.

Spirit’s revenues are estimated to be at about $1.2 billion, a decrease from the same time last year. The company hasn’t publicly estimated a net income figure, but it did say its operating margin would be about 12 points worse than the third quarter of 2023, which posted a -15% margin.

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