Spirit Airlines Faces Potential Bankruptcy Amid Debt Restructuring Talks

The budget carrier's stock plummets as it negotiates with creditors to restructure over $1 billion in debt, risking shareholder equity.

Spirit Airlines has delayed its Q3 financial results as it negotiates a debt restructuring deal with bondholders, which could lead to a Chapter 11 bankruptcy filing.
The airline's stock dropped over 59%, closing at $1.31, amid news that existing shareholder equity may be canceled under the proposed restructuring.
Spirit has been struggling financially, with increased operating costs and decreased revenue, partly due to competitive pricing pressures from larger airlines.
Merger talks with Frontier Airlines have stalled, but analysts believe a merger could still occur after Spirit addresses its financial challenges.
Spirit continues to operate flights, but has cut several routes and plans further cost reductions, including workforce furloughs, to manage its financial situation.