Advertiser Disclosure

Many of the credit card offers that appear on this site are from credit card companies from which we may receive financial compensation when a customer clicks on a link, when an application is approved, or when an account is opened. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). However, the credit card information that we publish has been written and evaluated by experts who know these products inside out. We only recommend products we either use ourselves or endorse. This site does not include all credit card companies or all available credit card offers that are on the market. See our advertising policy here where we list advertisers that we work with, and how we make money. You can also review our credit card rating methodology.

Spirit Airlines Has Filed for Bankruptcy but Will Keep Flying

Alberto Riva's image
Alberto Riva
Edited by: Juan Ruiz
& Ryan Smith
Jump to Section

We may be compensated when you click on a link, when an application is approved, or when an account is opened from one or more of our advertising partners. Terms apply to the offers below. See our Advertising Policy for more about our partners, how we make money, and our rating methodology. Opinions and recommendations are ours alone.

Click for Card Offers (Up to 300k!)

Top Partner Offers

BEST OFFERPlatinum Card® from American Express

Platinum Card® from American Express

Apply Now(at Amex's secure site)
As High As 175,000 Points. Find Out Your Offer.
NEW CHATGPT BENEFITThe Business Platinum Card® from American Express

The Business Platinum Card® from American Express

Apply Now(at Amex's secure site)
Your Offer Could Be As High As 300,000 Points. Find Out Your Offer.
NEW CHATGPT BENEFITAmerican Express® Business Gold Card

American Express® Business Gold Card

Apply Now(at Amex's secure site)
Your Offer Could Be As High As 200,000 Points. Find Out Your Offer.
TOP PICKAmerican Express® Gold Card

American Express® Gold Card

Apply Now(at Amex's secure site)
As High As 100,000 Points. Find Out Your Offer.

The largest ultra-low-cost carrier in the U.S., Spirit Airlines, has declared bankruptcy under Chapter 11, but the airline will continue to operate as it restructures its business.

This comes after last week’s news that Spirit and rival Frontier broke off talks to possibly revive their merger, which had been stalled in 2022.

Like other U.S. airlines before it, Spirit will not stop flying while in bankruptcy.

A Chapter 11 filing for bankruptcy means the airline will negotiate with its creditors to obtain new terms on its debts and restructure its business in the process. It’s likely that Spirit would emerge from bankruptcy as a smaller company.

Here’s what we know about the future of Spirit Airlines.

Advertisement

Spirit Is Going Bankrupt to Survive

The immediate effect of filing for bankruptcy protection is that Spirit will get money from its creditors that will enable it to keep flying. The airline said in a statement after it filed on Monday that its bondholders will pay $300 million in so-called “debtor in possession” financing.

People who have bought tickets for Spirit flights can expect to travel as usual, though.

“Guests can continue to book and fly without interruption and can use all tickets, credits and loyalty points as normal,” the statement said.

Spirit was running out of time to solve a financial crisis that threatened its existence. The airline has not made a profit since 2020 and was facing daunting debt repayment deadlines. Spirit had until the end of the year to refinance $1.1 billion of bonds or risk the ability to process credit card transactions.

Without the protection of Chapter 11, that alone could have forced Spirit to stop flying by year’s end.

Spirit Airlines at Bogota
Spirit tried to merge with Frontier and JetBlue to avoid bankruptcy but failed. Image Credit: Daniel Ross

Spirit said last week it is negotiating to restructure its debt coming due in 2025 and 2026. While bondholders are in talks to get a new repayment schedule, shareholders are going to get essentially wiped out.

Spirit said that the bankruptcy filing will cause its stock to be be delisted from the New York Stock Exchange “in the near term.” Its common stock is expected to be canceled and has already lost nearly all of its value.

No More Merger With Frontier

Spirit also could have survived by merging with Frontier, but that possibility ended last week.

At the end of October, news broke that Spirit was in talks with rival Frontier to merge. The union would have created the fifth largest airline in the U.S. by passengers carried. The 2 had already been discussing a merger, which almost happened in 2022, when Spirit shareholders voted in favor of selling their company to Frontier for $2.9 billion.

That’s when JetBlue came on the scene with a rival bid to buy Spirit for 30% more. Shareholders preferred that offer, but the JetBlue merger collapsed earlier this year when a federal judge ruled it would be anti-competitive.

Advertisement

What Happened to Spirit?

The ultra-low-cost airline sector in the U.S. hasn’t recovered from the pandemic; just like Spirit, its main competitor Frontier has not made money in 4 years.

The introduction of Basic Economy fares from legacy airlines has also hurt discount carriers by offering the same unbundled model: passengers pay for the seat, and everything else is extra.

Spirit had tried to position itself more upscale by eliminating change and cancellation fees, but is still a lot cheaper than the legacy carriers. According to data from aviation analytics firm Cirium, quoted by CNN, Spirit’s average domestic round-trip fare in 2024 was $136, not including taxes and fees. That’s 61% lower than the US average.

Just before the bankruptcy, Spirit’s operating profit margin in the third quarter of 2024 dropped 12 percentage points from the same period a year ago and revenue by $61 million.

The immediate response from Spirit has been to cut routes. However, the airline is also launching new routes in an effort to move its airplanes to where they can turn a profit.

It is also expected to lay off staff in January, CNN said.

Bottom Line:

Airlines have been bankrupt before and emerged, including the biggest in the nation: American Airlines, Delta Air Lines, and United Airlines all filed for Chapter 11 in the 2000s. In all of those cases, bankrupt airlines continued flying while restructuring their business.

Final Thoughts

Spirit Airlines has officially filed for bankruptcy protection. This will bring a restructuring of its business, with Spirit emerging from bankruptcy as a likely smaller — and profitable — airline.

Spirit’s yellow airplanes will continue to fly while the company is in bankruptcy, but it’s likely that some routes will be cut, so keep that in mind when booking Spirit flights in the future.

The airline, however, has offered refunds or reaccommodation on different Spirit flights in recent cases of route cancellations.

Alberto Riva's image

About Alberto Riva

Alberto’s passion for points and miles began when he moved to the U.S. from Italy in 2000. After a career in news journalism, that passion led him to become the first managing editor of The Points Guy in 2017. He also worked at Vice News, Bloomberg and CNN, among other places.

Originally from Milan, Alberto has lived in Rome and Atlanta and now resides in Brooklyn, New York. He speaks Italian, French, and Spanish, has traveled to every continent except Antarctica, and enjoys skiing, mountaineering, and flying —often with his wife, Regan, and always in a window seat.

INSIDERS ONLY: UP PULSE™

Deluxe Travel Provided by UP Pulse

Get the latest travel tips, crucial news, flight & hotel deal alerts...

Plus — expert strategies to maximize your points & miles by joining our (free) newsletter.

We respect your privacy. This site is protected by reCAPTCHA. Google's privacy policy  and terms of service  apply.

Deluxe Travel Provided by UP Pulse

We Recommend

Platinum Card® from American Express

  • You may be eligible for as high as 175,000 Membership Rewards® points after you spend $12,000 in eligible purchases on your new Card in your first 6 months of Card Membership. Welcome offers vary and you may not be eligible for an offer. Apply to know if you’re approved and find out your exact welcome offer amount – all with no credit score impact. If you’re approved and choose to accept the Card, your score may be impacted.
  • Get more for your travels with 5X Membership Rewards® points on all flights and prepaid hotel bookings through American Express Travel®, including Fine Hotels + Resorts® and The Hotel Collection bookings. You earn 5X points on flights purchased directly from airlines or through American Express Travel® on up to $500,000 on these purchases per calendar year.
Show more
  • $600 Hotel Credit: Get up to $300 in statement credits semi-annually on prepaid Fine Hotels + Resorts® or The Hotel Collection* bookings through American Express Travel® using the Platinum Card®. *The Hotel Collection requires a minimum two-night stay. Effective January 1, 2027, Fine Hotels + Resorts® bookings will require a minimum two-night stay to be eligible for the $600 Hotel Credit.
  • With over 1,550 airport lounges - more than any other credit card company on the market* - enjoy the benefits of the Global Lounge Collection, over $850 of annual value, with access to Centurion Lounges, 10 Delta Sky Club visits when flying on an eligible Delta flight, Priority Pass membership (enrollment required), and other select partner lounges. *As of 08/2026.
  • $200 Uber Cash + $120 Uber One Credit: With the Platinum Card® you can receive $15 in Uber Cash each month plus a bonus $20 in December when you add your Platinum Card® to your Uber account to use on rides and orders in the U.S. when you select an Amex Card for your transaction. Plus, when you use the Platinum Card® to pay for an auto-renewing Uber One membership, you can get up to $120 in statement credits each calendar year. Terms apply.
  • $300 Digital Entertainment Credit: Experience the latest shows, news and recipes. Get up to $25 in statement credits each month when you use your Platinum Card® for eligible purchases on Disney+, a Disney+ bundle, ESPN streaming services, Hulu, The New York Times, Paramount+, Peacock, The Wall Street Journal, YouTube Premium, and YouTube TV when you purchase directly from one or more of the providers. Enrollment required.
  • $400 Resy Credit + Platinum Nights™ by Resy: Get up to $100 in statement credits each quarter when you use the Platinum Card® to pay for eligible purchases with Resy, including dining purchases at over 10,000 qualifying U.S. Resy restaurants. Enrollment required. As a Platinum Card® Member you have special access to reservations on select nights at participating sought after Resy restaurants through Platinum Nights™ by Resy. Simply add your Platinum Card® to your Resy profile to book your reservation.
  • $219 CLEAR+ Credit: CLEAR+ helps get you to your gate faster by using your face to verify you are you at 60+ airports nationwide. You can cover the cost of a CLEAR+ Membership* with up to $219 in statement credits per calendar year after you pay for CLEAR+ with your Platinum Card®. *Excluding any applicable taxes and fees. Subject to auto-renewal.
  • $200 Airline Fee Credit: Select one qualifying airline and then receive up to $200 in statement credits per calendar year when incidental fees, such as checked bags and in-flight refreshments, are charged by the airline to The Platinum Card® Account. American Express relies on airlines to submit the correct information on airline transactions to identify incidental fee purchases. If you do not see a credit for a qualifying incidental purchase on your eligible Card after 8 weeks, simply call the number on the back of your Card. Qualifying airlines are subject to change. See terms & conditions for more details.
  • Whatever the occasion, choose from our two signature collections of premium hotels, curated to inspire and excite you when you book through Amex Travel™: Fine Hotels + Resorts® is a collection of over 1,900 luxury hotels that are destinations unto themselves and the Hotel Collection includes over 1,400 upscale hotels in desirable destinations.
  • $300 lululemon Credit: Enjoy up to $75 in statement credits each quarter when you use the Platinum Card® for eligible purchases at U.S. lululemon retail stores (excluding outlets) and lululemon.com. That’s up to $300 in statement credits each calendar year. Enrollment required.
  • $155 Walmart+ Credit: Get up to a $12.95* statement credit back each month after you pay for a monthly Walmart+ membership (subject to auto-renewal) with your Platinum Card®. *Up to $12.95 plus applicable taxes on one membership fee.
  • $895 annual fee.
  • Terms Apply.
DMCA.com Protection Status