Spirit Airlines faces potential bankruptcy due to debt restructuring challenges, but bankruptcy isn't the base case scenario. Read more about SAVE stock here.

Key Takeaways Shares of discount airlines Frontier Group Holdings and JetBlue soared on a report that rival Spirit Airlines is holding discussions about a possible bankruptcy.The Wall Street Journal said Spirit is holding talks with bondholders and other creditors about a Chapter 11 filing.

Shares of Spirit Airlines fell by over 30% on Friday, pacing the company’s worst loss since a merger with JetBlue Airways was blocked earlier this year, after reports indicated the low-cost airline was exploring bankruptcy. Spirit’s shares dropped to just over $1.50 as of around 9:50 a.m. Friday, following an earlier plunge in premarket trading.