Azul Airlines Seeks Financial Restructuring Under Chapter 11

Azul Airlines Files for Chapter 11 Bankruptcy in the US Brazilian airline Azul announced on Wednesday, May 28, 2025, that it has filed for Chapter 11 bankruptcy protection in the United States. This move, similar to a judicial recovery process in Brazil, allows the company to continue normal operations while it works to restructure its finances. Azul cited the COVID-19 pandemic, macroeconomic turbulence, and aviation supply chain issues as contributing factors to its financial difficulties. "The process allows companies to operate and serve their stakeholders normally while working behind the scenes to adjust their financial structure," stated Azul in an official press release. The restructuring plan includes securing $1.6 billion in financing and eliminating over $2 billion in debt. It also anticipates $950 million in new capital investments upon exiting Chapter 11. The news was met with a sharp negative market reaction, with Azul's shares in New York falling as much as 40% before the market opened. This follows a previously reported R$1.82 billion loss in the first quarter of 2025. Azul is now the third major Brazilian airline to resort to such measures, following LATAM and Gol. Despite the challenges, Azul assures customers that its flights and booking services will continue uninterrupted. The company also emphasized that the decision is supported by key stakeholders, including major creditors, lessors, and strategic partners such as United and American Airlines. The successful restructuring could signal a path towards long-term financial stability for the airline.