Bankruptcies are on the rise. What it means, in 3 charts.

• Corporate bankruptcies are rising in 2025, nearing a 15-year high, S&P reports.
• This year, we've seen numerous notable bankruptcies, including Spirit Airlines and Claire's.
• How bad is it? We break down the trends in 3 charts.

If you watch the news, you have undoubtedly seen the stories of well-known companies closing stores or raising doubts about their ability to continue operating.

Earlier this month, S&P's data tracking company seemed to confirm our worst fears, reporting that 2025 bankruptcies were nearing levels not seen since in 15 years, or since 2010, when the economy was still recovering from the Great Recession.

Scary, right?

Not so fast. While the trend is definitely pointed upward, it's not all doom and gloom. Here is what's happening in 3 charts:

2025 bankruptcies are rising

S&P Global Market Intelligence reported some 68 bankruptcies in October, bringing the 2025 total to 655 for the first 10 months of the year. Assuming the trend continues through November and December, 2025 will end the year with 792 bankruptcies. That's more companies having filed for bankruptcy protection than any year since 2010, when S&P tracked 828 corporate bankruptcies.

S&P, which only tracks companies of a certain size, said it's seeing the most bankruptcies in the industrials sector (think manufacturing), followed by consumer discretionary (think fashion).

This year's high-profile bankruptcy filings have included electric truck maker Nikola, Spirit Airlines, and fashion accessory retailer Claire's.

We're still well below Great Recession levels

While 2025 bankruptcies are now on track to reach their highest levels since 2010, they are still expected to be significantly lower than the levels reached at the height of the Great Depression.

In 2008, the year Lehman Brothers failed, leading to massive bank bailouts, S&P tracked 5,335 bankruptcies. The next year, it tracked 5,026.

By contrast, bankruptcies were relatively low leading up to the Fed's recent spate of rate hikes — hitting a nadir of just 372 in 2022, according to S&P's data.

Bankruptcies have been rising since 2023, as the cost of borrowing has increased. (The Federal Reserve began slowly raising interest rates in 2022 in an effort to tamp down inflation.) Even so, 2025's bankruptcies could still come in below 2010.

More companies are looking to emerge from bankruptcy

There are two common types of bankruptcy filings: Chapter 7 liquidation and Chapter 11 reorganization.

The first usually signals that the filing company plans to shutter its doors and go out of business.

A company that turns to Chapter 11 bankruptcy, by contrast, does so to hammer out plans to repay its creditors under court supervision. Under this scenario, a company may look to cut costs, including by closing doors; however, the goal is to emerge from bankruptcy as a healthier and stronger company.

There have been periods when liquidations have been on par with or even exceeded reorganizations, including between 2021 to 2023, when S&P tracked 744 liquidations to 667 reorganizations.

That trend appears to have reversed in the last two years, however. This year, the S&P has tallied 412 reorganizations versus 269 liquidations, suggesting more companies are turning to bankruptcy court as a way to reduce debt rather than close their doors.