US bankruptcy filings cooled slightly in July after surging in June to the highest level since the early days of the COVID-19 pandemic, but remain on track for one of the worst years for bankruptcies since 2020.

There were 50 bankruptcy filings in July of public and certain private companies, down from a revised 72 in June and the lowest monthly number since February, according to the latest S&P Global Market Intelligence. With 392 bankruptcy filings through the first seven months of this year, bankruptcy filings are the highest since 2020, when there were 407 filings through July.

US corporate reorganizations have risen in response to higher interest rates, which have remained at roughly 20-year highs for the past year, rising geopolitical uncertainty and an overall economic cooling.

Notable filings

Home goods retailer Conn's Inc. filed one of the largest bankruptcy petitions during the month, with more than $1 billion in debts detailed in its July 23 filing.

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Conn's president and CEO Normal Miller said in a court filing that changing consumer spending, inflation and high interest rates caused a slowdown in business.

Another large filing came from online education company 2U Inc., which sought bankruptcy protection on July 25 to restructure its business. Once it emerges from bankruptcy, 2U will no longer be a publicly traded company, instead being owned by existing lenders.

There have been 18 bankruptcy filings with more than $1 billion in liabilities in 2024 through the end of July. That is more than double the comparable amount during the first seven months of 2023.

Sector, region breakdown

There have been 60 bankruptcy filings in the consumer discretionary sector, as relatively high inflation and rising borrowing costs continue to impact demand, the most of any sector.

Bankruptcy filings in the consumer discretionary, industrials, and healthcare sectors accounted for about 38% of all filings through the first seven months of 2024.

Since 2010, there have been 1,293 bankruptcy filings in California, the most of any state. Texas has seen the second-highest number of bankruptcies over that time with 1,054 followed by New York with 716.

This Data Dispatch is updated regularly. The last edition was published July 8.

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.