Spirit Airlines suffered another blow to its creditworthiness this week as Moody’s downgraded its rating two notches deeper into junk territory, citing unexpectedly high cash burn and weak liquidity .
Despite emerging from bankruptcy in March 2025, Spirit is forecasted to burn over $500 million in cash this year due to soft domestic leisure demand, excessive capacity, and intense pricing pressure . Analysts noted that at the end of Q2, the airline held just $408 million in unrestricted cash and had tapped its $275 million revolving credit facility, which matures in March 2028 .
This downgrade comes on the heels of a similar one from Fitch Ratings, which cited a high near-term default risk . Both agencies’ actions follow Spirit’s own “going concern” warning in its recent earnings report, underscoring the airline’s continuing financial distress .
