Spirit Airlines Inc (0L8U.L) Q2 2025 Earnings Report

Spirit Airlines’ QQ2 2025 results show a mixed bag: revenue declined year-over-year, but gross profit benefited from a sharper improvement in gross margins even as the bottom line deteriorated due to a very large non-operating charge. For the quarter ended June 30, 2025, Spirit reported revenue of $1.0198 billion and gross profit of $361.6 million, yielding a gross margin of 35.45%. Yet the company posted an operating loss of $184.1 million and a net loss of $245.8 million, translating to an EPS of -$2.24. EBITDA was negative at $124.8 million with an EBITDAR ratio of -0.122, underscoring that the operating unwind is being overwhelmed by other expenses that remain structurally material.

From a cash and liquidity perspective, Spirit generated negative operating cash flow of $133.0 million and free cash flow of about -$63.0 million for the quarter. The balance sheet shows cash and cash equivalents of $407.5 million and total debt of $2.603 billion, with net debt of $2.196 billion. The liquidity profile remains tight: current ratio around 1.02 and a cash ratio near 0.28, while leverage metrics remain elevated (debt-to-equity around 5.43x; long-term debt to capital ~0.824, total debt to capitalization ~0.844).

Profitability is being driven by a dramatic deterioration in non-operating costs, which appear to be masking improving unit economics on the revenue line. While gross margin improvement signals some progress on cost of revenue discipline, the company’s earnings trajectory continues to depend on reducing or reclassifying other expenses and achieving positive free cash flow. With no forward guidance disclosed in the provided data, investors should focus on whether Spirit can stabilize or reduce the “other expenses” line, sustain higher load factors, and meaningfully delever its balance sheet over the next several quarters.