Spirit Airlines Stock Jumps on Job Cuts, Plane Sales

Spirit Airlines (SAVE) shares are surging 12% in premarket trading Friday after the discount carrier said it plans to cut jobs and sell some planes as it tries to shore up its finances.

The company said that as part of its plans “to return to profitability,” it has identified around $80 million in annualized cost cuts that it plans to start implementing early next year as it cuts flights. 

“These cost reductions are driven primarily by a reduction in workforce commensurate with the company’s expected flight volume,” the airline said in a Securities and Exchange Commission (SEC) filing.

Sprit Strikes $519M Deal To Sell Aircraft

Spirit, which reportedly is considering a bankruptcy filing, also said it had entered into a deal to sell 23 A320ceo/A321ceo aircraft for around $519 million to aircraft-maintenance and component services platform GA Telesis.  The aircraft are set to be delivered from this month through February 2025.

Spirit said that the net proceeds from the sale as well as discharge of the related debt will boost its liquidity by around $225 million through the end of 2025.

Earlier this week, The Wall Street Journal reported that Frontier Airlines parent Frontier Group Holdings (ULCC) is in the early stages of a renewed bid for Spirit. Last Friday, Spirit extended a deadline for debt refinancing with Visa (V) and Mastercard (MA).

Spirit shares had lost 85% of their value this year through Thursday’s close.