Spirit Airlines is facing a critical financial challenge, warning that it may not be able to continue operations without securing additional funds. This announcement comes just five months after the ultra-low-cost carrier emerged from bankruptcy, raising concerns over the company’s ability to recover in a fiercely competitive market.

In its latest quarterly filing, Spirit disclosed a “going concern” warning, signaling significant doubt about its future unless it can raise more cash. While the airline has taken steps to reduce debt, improve cost efficiency, and market more premium offerings such as enhanced seating options, these measures have not been enough to offset mounting financial pressures.

The company has been hit by a combination of unfavorable market conditions, including an oversupply of domestic flights, softer demand for leisure travel, and a pricing environment that has made it harder to maintain profitability. Compounding these issues is an ongoing engine recall, which has grounded several aircraft and disrupted operations.

Last month, Spirit announced plans to furlough 270 pilots this fall in an effort to cut costs further. However, the airline warned that without swift action to boost liquidity through possible asset sales such as aircraft, real estate, or airport gate leases it risks defaulting on agreements with creditors.

Management stated that the uncertainty surrounding the completion of these initiatives leaves the airline’s future in doubt over the next 12 months. The warning underscores the volatility in the airline industry, particularly for budget carriers that operate on thin margins and are more vulnerable to shifts in consumer behavior.

Spirit Airlines, recognized for its distinctive yellow planes and no-frills travel model, was once a pioneer in the U.S. low-cost sector. However, it has struggled in the aftermath of a failed merger attempt with JetBlue Airways and a changing market that increasingly favors more comfortable travel experiences.