U.S. Bankruptcy Filings Surge to Highest Rate Since Pandemic

Bankruptcy filings among U.S. companies have reached a 14-year high, with over 500 cases recorded this year, excluding the pandemic's impact.

The current total stands at 512, just six short of matching the levels seen during the COVID-19 crisis in 2020.

From January to September, bankruptcies in the U.S. surged, marking the highest annual figure since 2009. Notably, August and September saw 59 and 63 filings, respectively, breaking a four-year record. Significant companies, including Big Lots Inc., Tupperware Brands Corp., and Wheel Pros LLC, declared bankruptcy in September, each with over $1 billion in liabilities.

BREAKING: 512 large US companies have declared bankruptcy year-to-date, only 6 less than during the 2020 pandemic.

Outside of the pandemic, this is the largest number of bankruptcies in 14 years.

In September and August alone, 59 and 63 firms filed for bankruptcy, the most in… pic.twitter.com/htDXUtcXRk

— The Kobeissi Letter (@KobeissiLetter) October 15, 2024

California accounted for over 20% of all bankruptcy filings in April, with notable figures from New York, Texas, and Florida contributing as well. A report from S&P Global Market Intelligence highlighted June as the peak month for bankruptcies, with 72 filings, followed by April’s 68 and May’s 60.

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The consumer discretionary sector has been hit hardest, recording 81 bankruptcies. It was followed by industrials with 60 and healthcare with 48, reflecting a downturn in U.S. consumer spending amid recession concerns. The year-to-date total of bankruptcies is up by eight compared to 2023, with predictions suggesting that the annual figure could surpass 600 by year-end.

This trend marks a significant rise in insolvency cases since the 2008 financial crisis, with a notable 40% year-over-year increase in Q2, bringing the total to 6,276 cases. Chapter 11 filings reached 2,462, the highest in 13 years.

It’s important to note that the bankruptcy rate might be even higher than reported, as the S&P Global Market Intelligence survey focuses on large publicly traded companies or private firms with significant liabilities. Statistica data highlights Lehman Brothers as the largest U.S. bankruptcy, with $691 billion in assets at the time of its collapse in 2008.

Kosta Gushterov