Spirit Burns Cash as Fuel Spike Threatens Plan

Spirit Airlines, which has been rumored to be nearing the end of its road amid rising jet fuel costs, posted another loss-making month, with the low-cost carrier continuing to bleed cash so far in 2026.

On April 16, 2026, Spirit Airlines filed its February monthly report, indicating that the airline ended the month with an operating loss of $28.2 million and a net loss of $133.2 million, with the difference between operating and net results stemming from $93.7 million in reorganization-related items.

During the month, the carrier’s revenues were $222.6 million, while operating expenses were $250.8 million. In January, Spirit Airlines’ revenue and operating expenses were $250.3 million and $292.3 million, respectively, and it ended the first month of 2026 with an operating loss of $42 million and a net loss of $125.1 million.

Once again, reorganization items were the culprit of the stark contrast between the operating and net results.

Cirium’s Diio Mi showed that in January, Spirit Airlines had 2,842 weekly departures, rising to 3,036 in February. Year-on-year (YoY), weekly departures in January and February are down 29.1% and 31.5%, respectively.

The airline’s filing showed that at the end of January, it had $821.6 million in cash and restricted cash, and at the end of February, it had $780.7 million in adjusted cash and restricted cash reserves. It began the year with $867.2 million in cash and restricted cash, indicating it has burned through almost $100 million in liquidity during the first two months of 2026.

Spirit Airlines’ latest monthly operating report was published a day after Bloomberg, citing people familiar with the matter, reported that the airline could potentially be liquidated this week. That could still change as the carrier continues talking with its creditors, the report added.

However, Reuters, citing a person familiar with the matter, reported that the airline should continue operating beyond this week.

Before the United States and Israel attacked Iran on February 28, resulting in a huge spike in jet fuel-related costs, Spirit Airlines planned to emerge from its second Chapter 11 bankruptcy case, which it filed for in August 2025, “in late spring or early summer,” it said on February 24.

In its post-bankruptcy plan, which was presented to its creditors on February 2, Spirit Airlines outlined a future fleet of 76 aircraft by mid-August 2026, down from 214 pre-bankruptcy, targeting unit revenue maximization and a focus on profitable flying days and seasons.

As a result of the planned cost reductions and network and fleet changes, the low-cost carrier had planned to begin generating cash – in terms of unlevered free cash flow (UFCF) – in October 2026, and a return to full-year profit at the end of 2027.

However, the assumptions included specific fuel-related expenses, which were much lower as of February 2. Since the breakout of the conflict in Iran, which spilled into the wider Middle East, the Platts Jet Fuel Index for North America is up 68.9% on April 16 compared to February 27.

In a filing related to Spirit Airlines’ Chapter 11 bankruptcy case, Citi, which filed an objection to the airline’s plan to ‘reinstate’ a $275 million revolving credit facility (RCF), cited the carrier itself as saying that the recent jet fuel price and availability fluctuations “could negatively impact” its financial results.

Thus, periods “of high volatility in jet fuel costs, increased jet fuel prices, and significant disruptions in the supply of jet fuel could have a material adverse impact on the Company’s business, financial condition, and operating results.”

However, Citi warned that Spirit Airlines did not account for risks related to elevated jet fuel prices, and assumed “that prices ‘return to normal’ by mid-May 2026 without basis.”

“[Spirit Airlines] fail to provide any projections reflecting the possibility that fuel prices do not normalize from their elevated levels. [Spirit Airlines] provide no sensitivity analysis and no modeling of the impact of sustained fuel price increases on [its post-bankruptcy] cash flow, liquidity, or ability to comply with post-emergence debt covenants.”

The aforementioned February 2 plan, published on March 16, included an update on rising jet fuel prices.

Spirit Airlines said that while it is “certaintly exposed to this rapid rise,” there are a “number of potentially mitigating factors,” including its short booking window, which helps its exposure to fuel fluctuations with the ability to quickly respond via pricing actions, and its flexibility amid its court-protected restructuring, as it would have “an advantaged position to reduce capacity and fixed costs.”

“Illustratively, for the month of April, a $20 fare increase across all bookings would offset jet fuel price increases of up to 70% from forecasted levels.”

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