Spirit Airlines Reports $1.23 Billion Net Loss for Fiscal Year 2024, Initiates Chapter 11 Bankruptcy

Spirit Airlines, Inc. reported a net loss of $1.23 billion for the fiscal year 2024, compared to a net loss of $447.5 million in 2023. The increased loss resulted from higher operating expenses, including a rise in salaries, wages, benefits, aircraft rent, and other operating expenses, partially offset by a decrease in aircraft fuel expense due to lower fuel prices. Operating revenues decreased by 8.4% to $4.91 billion, primarily due to lower average yields and traffic. The company's total revenue per passenger flight segment also decreased by 8.5% to $111.21.

Significant developments during 2024 included the termination of the merger agreement with JetBlue Airways Corporation, resulting in a $69 million payment to Spirit. The company also experienced operational disruptions due to issues with Pratt & Whitney GTF engines, leading to a reduction in capacity and the receipt of $150.6 million in credits from International Aero Engines, LLC. Furthermore, Spirit initiated voluntary Chapter 11 bankruptcy proceedings on November 18, 2024, and subsequently filed a plan of reorganization, which was confirmed by the Bankruptcy Court on February 20, 2025. This plan involves equitization of existing debt, a new money equity raise, and the issuance of new senior secured notes.

As part of a transformation plan announced in July 2024, Spirit introduced four new travel options (Go Big, Go Comfy, Go Savvy, and Go) designed to enhance the customer experience and offer a broader range of price points. Other initiatives included eliminating change and cancellation fees for bundled options, increasing checked bag weight allowances, and extending the expiration of travel vouchers. The company also implemented a new boarding process and debuted a priority check-in experience at several major airports. The company's employee headcount decreased from 13,167 at the end of 2023 to 11,331 at the end of 2024, reflecting furloughs and position eliminations.

The company's average daily aircraft utilization decreased by 10.8% to 9.9 hours in 2024, primarily due to the GTF engine issues. The number of departures decreased by 3.3% to 288,180, while the number of passenger flight segments increased slightly by 0.2% to 44,180,000. The load factor increased by 1.1 percentage points to 82.4%. Spirit's adjusted CASM ex-fuel increased by 12.9% to 7.97 cents, primarily due to higher salaries, wages, benefits, aircraft rent, and other operating expenses. The company's common stock was delisted from the New York Stock Exchange and began trading on the OTC Pink Market on November 19, 2024.

Spirit's outlook is uncertain due to the ongoing Chapter 11 proceedings. The company's ability to continue as a going concern is dependent on the successful implementation of its reorganization plan. The company expects to emerge from bankruptcy with a significantly altered capital structure and a reconstituted board of directors. The company also anticipates continued volatility in its financial performance due to various factors, including economic conditions, competition, and fuel prices.