U.S. Corporate Bankruptcies Surge to Highest Levels Since 2010
Recent data from S&P Global Market Intelligence indicates a sharp increase in corporate bankruptcy filings among U.S. companies, reaching a peak not seen since 2010. In the first quarter of 2025, there were 188 bankruptcy filings from large firms, a notable rise from 139 filings during the same period the year prior.
Historical Context of Bankruptcies
The volume of bankruptcies recorded in the opening months of 2025 marks the highest first-quarter figure since 2010 when the economy was still recovering from the ramifications of the financial crisis that began in 2008. That year saw 254 bankruptcies in the first quarter.
Financial Challenges Intensify
According to S&P Global, many companies, particularly those with weaker financial positions, continue to struggle as their debts mature and require refinancing under increased interest rates compared to earlier borrowing terms.
Sector-Specific Insights
The most affected sectors during this period were:
- Industrials: 32 bankruptcies
- Consumer Discretionary: 24 bankruptcies
Together, these sectors accounted for nearly 30% of all bankruptcy filings in the first quarter. The S&P 500 saw a decline in these segments, with industrials down by 0.53% and consumer discretionary by 13.97% during the same timeframe.
Notable Bankruptcy Filings
Several prominent companies declared bankruptcy in the first quarter, including:
- F21 OpCo LLC, which operates the Forever 21 apparel chain.
- Nikola, an electric vehicle manufacturer that recently sought Chapter 11 protection.
- Joann Fabrics, the crafts retailer, which has also faced significant financial pressures.
- Noteworthy mentions include the restaurant chain Hooters and 23andMe, a genetic testing company.
Conclusion and Future Outlook
While the uptick in bankruptcy filings may suggest growing difficulties for some sectors, it remains essential to note that these levels remain significantly below those recorded during the 2008 financial crisis, which peaked at 1,836 bankruptcies in 2009. Since 2020, the highest monthly figure was recorded in July of that year, with 74 bankruptcy filings.
As companies continue navigating the economic landscape marked by rising interest rates and fluctuating consumer demand, it remains to be seen how these conditions will affect future bankruptcy rates.
