Spirit Airlines Reaches Agreement To Exit Second Bankruptcy

Updated: February 24, 2026, 1:10pm CST

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Table of Contents

Spirit Plans To Emerge From Bankruptcy — Again — This Year
A Timeline of Spirit’s Bankruptcies
Final Thoughts

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It has been a rough few years for the low-cost Spirit Airlines. The airline famously emerged from bankruptcy in 2025, only to file again just a few months later. Now, the airline has reached an agreement to exit its second bankruptcy.

Here’s what we know and what this news means for travelers.

Spirit Plans To Emerge From Bankruptcy — Again — This Year

Spirit Airlines announced on February 24, 2026, that it had inked a deal with its creditors to emerge from its second bankruptcy. The airline says the agreement gives Spirit “the financial support needed to finalize its restructuring” and complete changes needed for its survival.

That’s a mouthful, but here’s what that means for customers.

For starters, customers will still be able to book flights, fly on Spirit, and earn and use Free Spirit points.

The airline says it will also expand its first class and premium economy offerings, reduce off-peak flying, and “enhance” its Free Spirit rewards program. Budget-wise, the airline says its debt and lease obligations will be reduced from pre-bankruptcy levels of $7.4 billion to approximately $2.1 billion post-emergence.

Spirit A320neo docked SJU — Image Credit: Alberto Riva

“This agreement in principle is the result of months of hard work and allows Spirit to move toward completing its transformation,” said Dave Davis, Spirit’s president and CEO. “Spirit will emerge as a strong, leaner competitor that is positioned to profitably deliver the value American consumers expect at a price they want to pay.”

Bottom Line:

According to Spirit, the airline plans to emerge from Chapter 11 in “late spring or early summer,” though an exact date wasn’t mentioned.

A Timeline of Spirit’s Bankruptcies

Unfortunately, Spirit has been down this road before.

Spirit first filed for Chapter 11 bankruptcy in November 2024, shortly after the airline and rival Frontier broke off talks to revive their stalled 2022 merger. At the time, Spirit hadn’t made a profit since 2020 and had debt repayment deadlines it was unlikely to meet.

Four months later, the airline reemerged from financial restructuring, turning nearly $800 million of debt into equity. However, that lifeline didn’t solve its financial problems, as the airline was still operating at negative margins. By the second quarter of 2025, Spirit posted a $246 million loss, and by late summer 2025, it had filed for bankruptcy again.

Around this time, Spirit axed service from nearly a dozen cities, such as Chattanooga (CHA) and Columbia, South Carolina (CAE). In response, several airlines, including Frontier and United, braced for Spirit’s demise by adding numerous routes it served.

But in mid-December, Spirit reached an agreement with its creditors for a $100 million lifeline, gaining immediate access to $50 million of that money.

Final Thoughts

Spirit has reached an agreement with its creditors to exit its second bankruptcy since November 2024. The good news is the airline will keep flying and selling tickets, and customers can earn and redeem their points as usual. Hopefully, this restructuring will be the end of Spirit’s money woes.