JetBlue Creditors Hire PJT as 2031 Bonds Fall to 42 Cents on the Dollar
Key Facts
A group of JetBlue’s major creditors is working with financial adviser PJT Partners and law firm Akin, the Wall Street Journal reported, as the airline faces cash burn and high oil prices. The creditors’ move puts the company’s financing under scrutiny as its bonds lose value and it posts quarterly losses. Bonds worth $2 billion due in 2031 fell to 42 cents on the dollar on Thursday, before rebounding to the mid-40s on Friday. The bonds had traded near 80 cents on the dollar earlier in October. The moves point to a sharp deterioration in the market’s valuation of the debt, while the company continues to say it has liquidity to cover its cash needs in the coming months.
The creditor group includes holders of the 2031 bonds and a $742 million first-lien secured loan, according to Bloomberg. Company data show total debt and finance lease obligations of $8.537 billion on June 30, 2026. After deducting $59 million in debt issuance costs and $477 million in current maturities, the long-term balance stood at $8.001 billion. Net scheduled maturities are $236 million for the rest of 2026, $478 million in 2027 and $582 million in 2028, before rising to $1.835 billion in 2029. The maturity schedule means a large portion of scheduled obligations falls in the coming years, as available cash declines.
Cash and cash equivalents totaled $1.656 billion at the end of June, down from $1.946 billion on December 31, 2025. The company used $35 million in cash for operating activities in the first half of 2026, compared with $1 million in the same period a year earlier. In its quarterly report, JetBlue said it believes available liquidity "will be sufficient to meet our cash needs for at least the next twelve months." That assessment puts management’s assertion of short-term solvency against a shrinking cash balance and operating outflows. The disclosure did not report any change to the published maturity schedule or link the company’s liquidity view to the creditors’ move.
JetBlue reported a net loss of $282 million in the second quarter of 2026, compared with $260 million in the same period of 2025, while diluted loss per share widened to $0.82 from $0.78. Operationally, revenue per available seat mile rose 10.9% year over year, supported by strong demand across most products and geographies, according to the company’s results. But operating cost per available seat mile rose 17.0%, outpacing revenue growth on the same measure. System capacity increased 3.2% year over year, within revised guidance of 2.0% to 4.0%. Chief Executive Joanna Geraghty said, "Strong demand and our decisive actions enabled us to recover higher fuel costs faster than we expected."
The company said it recovered nearly half of its higher fuel costs in the second quarter, exceeding its expectations, but high oil prices remained one of the main pressures it faces. In results released in July, JetBlue forecast third-quarter capacity growth of 3.0% to 6.0%, revenue per available seat mile growth of 12.5% to 16.5%, and a fuel price of $3.49 per gallon. In its market-risk assessment, the company said a hypothetical 10% increase in the cost per gallon would raise fuel expense by about $309 million, based on consumption over the next twelve months. JetBlue had no fuel hedging contracts in place on June 30, 2026. Its JetForward transformation initiative targets an additional annual operating profit benefit of $850 million to $950 million by the end of 2027, after recording a cumulative $470 million through June 2026.
JetBlue shares fell 42% from the start of the year through October 23, according to Reuters, while market data showed the stock closing at $2.65 on October 22 and $2.63 on October 23. PJT Partners shares closed at $142.85 and then $140.94 on the same two days. The company also disclosed a long-term target of earnings per share of at least $1 in 2028, assuming demand remains strong and an average fuel price of $3 per gallon that year. JetBlue is scheduled to hold its third-quarter earnings call on Tuesday, October 27, 2026, at 10:00 a.m. Eastern time. Management is expected to present the period’s results and updates on operations, liquidity and costs.