Shares of Spirit Airlines tumble 24% after cost warning
MIRAMAR, Fla. (AP) — Shares of Spirit Airlines have fallen 24% after the discount carrier warned of sharply rising costs.
Spirit says the cost of flying each seat one mile will rise 7% to 8% in the third quarter, up from its earlier forecast of a 1% to 2% increase.
It says it reduced on-call pilots and flew planes more hours a day to increase efficiency, but those things hurt its ability to recover from bad weather. When storms hit, the airline got stuck paying to accommodate stranded passengers.
The airline says third-quarter revenue per seat will be about flat.
Miramar, Florida-based Spirit offered the outlook while reporting second-quarter earnings of $114.5 million, up from $11.3 million a year earlier, after the market closed Wednesday.
In Thursday trading, its shares fell $13.04 to close at $42.01.