Spirits Airlines filed late earnings — and they show how bad things got before bankruptcy

Spirit Airlines has just given the world a peek into how bad things got at the end before it filed for bankruptcy.

After formally declaring that it would not be able to file its third-quarter earnings report on time, the company finally filed the document Monday. There are no surprises in it. As had been the case for every quarter for the last three years, Spirit presented a loss: $308 million against $1.2 billion in revenue.

“The Company has been impacted by an increasingly challenging pricing environment,” Spirit said, a reference to the tail end of the industry-wide seat oversupply crisis that made life especially difficult for the lower-end players.

Spirit had been trying to turn things around after its merger with JetBlue Airlines (JBLU-3.59%) failed earlier this year (and as its attempted rekindling with Frontier Airlines also failed). It made moves to become more like its larger “legacy” competitors by shedding some elements of its full-of-fees flying experience and introducing something like a first-class seat.

“Moreover, the expected short-term impact of certain policy changes, such as the removal of change and cancel fees, have negatively affected revenue performance,” the company said (since more than half of its revenue comes from fees). “In addition, challenging market conditions, including increasing costs, have impacted the Company’s performance. The Company expects these trends to continue for at least the remainder of 2024, which creates uncertainty in operating results.”

Also coming as no surprise, Spirit elected not to have an earnings call to discuss its results, which it said were unaudited. Still, investors were ecstatic at this cascade of bad news: Spirit shares were up about 130% in Tuesday trading. But since Spirit has been delisted by the New York Stock Exchange and trades among the pink sheets, the thinner market is vulnerable to more volatility. The shares are trading at about 50 cents apiece.