US corporate bankruptcies hit highest first-quarter level since 2010

US corporate bankruptcies through March this year were at their highest level since 2010.

There were 59 bankruptcy filings by certain large public and private companies in March, according to the latest data from S&P Global Market Intelligence. This followed 60 filings in February and 69 filings in January, as adjusted.

Through the end of March, 188 bankruptcies were filed among large companies. This is higher than the 139 filings through March 2024, when full-year filings eventually stacked up to a 14-year high, and the fastest rate of bankruptcies for the first quarter since 254 were filed through March of 2010.

Companies, particularly those with weaker balance sheets, continue to face challenges as debt matures and needs to be refinanced at higher interest rates than at the time of issuance. For nonfinancial non-investment-grade companies with credit ratings below BBB- assigned by S&P Global Ratings, the median debt-to-EBITDA ratio in 2024 moved up to 3.71 in the fourth quarter of 2024 from 3.58 in the preceding third quarter, indicating rising debt pressure, according to Market Intelligence data. The median interest coverage ratio for this group also dipped to 2.89 from 2.94 over the same period, signaling companies were slightly less able to pay interest with cash on hand.

Notable filings

Three companies entered the bankruptcy process in March with over $1 billion in liabilities at the time of their filing. These included DocuData Solutions LC, MLN US Holdco LLC and F21 OpCo LLC, owner of the Forever 21 apparel retail chain.

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DocuData Solutions, which operates a digital document management service, received a bankruptcy court order on March 4 to obtain debtor-in-possession financing through a new money term loan facility in the amount of $75 million from a group of the company's noteholders.

MLN US Holdco's bankruptcy is being jointly administered with its parent company Mitel Networks (International) Ltd. and related subsidiaries. The office workplace-oriented communication services and equipment company said in a statement that it plans to recapitalize its debt and optimize its global operations through the bankruptcy process as it adjusts its long-term business strategy to serve the shift to hybrid workplaces.

F21 OpCo is conducting liquidation sales at its stores while also pursuing a court‑supervised sale and marketing process for some or all of its assets.

Several other companies with notable brands in the US and with liabilities less than $1 billion filed for bankruptcy in March, including genomics company 23andMe Holding Co., restaurant chain Hooters of America LLC and film producer Village Roadshow Entertainment Group USA Inc.

Sector breakdown

There were 32 bankruptcy filings among companies in industrials through the first three months of the year, more than any other sector. The consumer discretionary sector followed with 24 bankruptcies through March.

Together, the industrial and consumer discretionary sectors accounted for nearly 30% of total US bankruptcies through March. The S&P 500 industrials and consumer discretionary sectors were down 0.53% and 13.97%, respectively, during the first quarter.

The utility sector has only one bankruptcy so far this year.

Of the 188 companies that filed for bankruptcy this year through March, 103 had primary sector designations.

This Data Dispatch is updated regularly. The last edition was published March 7.

Bankruptcy figures include public companies or private companies with public debt with a minimum of $2 million in assets or liabilities at the time of filing, in addition to private companies with at least $10 million in assets or liabilities. S&P Global Market Intelligence may remove companies from this list if it discovers that their total assets and liabilities do not meet the threshold requirement for inclusion.