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When Spirit Airlines, the pioneering ultra-low-cost carrier that reshaped U.S. air travel for 32 years, ceased all operations on May 2, it left behind more than thousands of rebooked passengers and empty route slots: industry analysts and economists broadly agree that its exit will add significant new upward pressure on already climbing U.S. airfares.

Founded in 1992, Spirit built its legacy on the so-called “Spirit Effect”, a market phenomenon that turned affordable air travel from a luxury into an accessible option for millions of consumers who had previously been priced out of flying. Its stripped-down business model — which eliminated free checked bags, complimentary in-flight meals, and other non-essential extras to keep base fares as low as possible — earned it a reputation as the industry’s most disruptive competitive force. This impact was so significant that the U.S. Department of Justice (DOJ) highlighted it in 2023, when regulators moved to block Spirit’s proposed merger with JetBlue, arguing that losing Spirit’s independent presence would harm consumer competition.

Official DOJ data underscores just how much Spirit shaped market pricing: when the carrier entered a new route, average fares across all competing airlines on that route dropped by an immediate 17%, and when it exits a market, fares jump by an average of 30%. That historical trend has left experts bracing for broad fare increases as the aviation industry absorbs Spirit’s exit.

The timing of Spirit’s collapse could not be worse for consumers, who are already facing rising ticket costs driven by skyrocketing jet fuel prices tied to ongoing conflict in the Middle East. New data from the U.S. Department of Transportation released this week confirms that U.S. airline jet fuel costs surged 56% in March compared to February, and are up 30% from the same period one year ago.

While many carriers have moved quickly to fill the gap left by Spirit, with low-cost peers including Frontier, Breeze and Avelo adding capacity and new routes to capture Spirit’s former customer base, all of these existing competitors already price their tickets slightly higher than Spirit did. Frontier, the largest of Spirit’s ultra-low-cost rivals, has announced plans to add nine new routes this summer and 15 extra daily departures across 18 former Spirit routes, a move the airline projects will boost its key revenue metric by 3 to 5% and grow its total capacity by 6 to 8%.

Even as existing carriers maintain the basic economy fare tiers that major airlines originally launched specifically to compete with Spirit and other budget carriers, experts say those low-cost options will likely become less attractive for consumers. Jan Brueckner, emeritus economics professor at the University of California, Irvine, noted that while basic economy tickets are not expected to disappear entirely, airlines will almost certainly raise their prices. “They might be less attractive” to budget-focused travelers, Brueckner explained.

Aviation analysts broadly echo this assessment. “There’s no question in some markets fares will probably increase,” said Richard Aboulafia, an aviation expert at consultancy AeroDynamic. Richard Masler, head of analysis for the Centre for Aviation, pointed out that for more than a decade, Spirit’s disruptive presence forced legacy major airlines to cut their own fares and adopt more granular pricing models to stay competitive.

Bradley Akubuiro, a partner at advisory firm Bully Pulpit International, noted that Spirit’s exit will not make air travel entirely unavailable to consumers, but it will eliminate the industry’s most powerful check on excessive pricing. “The likely consequence for passengers is not that air travel suddenly becomes unavailable,” he said. “It’s that the cheapest version of air travel becomes immediately harder to find in some markets.” Over time, he added, fares will continue to creep upward because “a meaningful check on the system is now gone.”

In a major update on the Japanese gaming industry’s financial health released Friday, gaming giant Nintendo has announced it will raise prices for its newly launched Switch 2 console, as skyrocketing memory chip costs driven by the global AI boom create unprecedented margin pressure. The company also warned that its full-year net profit will drop sharply by 27% in the current fiscal year ending March 2026. Rival Sony, by contrast, has delivered a far more optimistic forecast, projecting a 13% rise in gaming division income even as sales of its mature PlayStation 5 console continue to decline.

Nintendo’s price adjustments will roll out in phases across key global markets. Starting May 25, Japanese consumers will see a 20% jump in Switch 2 retail prices. From September 1, the console will cost $499.99 in the United States, an 11% increase, and 499.99 euros in the European Union, representing a 6% price hike.

For the 12-month period ending next March, Nintendo projects net profit will fall to 310 billion Japanese yen, equal to roughly $1.98 billion, on total annual sales of 2.05 trillion yen. That marks an 11.4% drop in revenue from the prior fiscal year. Operating profit is forecast to hit 370 billion yen, a figure that falls well below the average analyst consensus estimate of 480 billion yen, according to data compiled by Bloomberg News.

The prior fiscal year delivered strong results for Nintendo, however. The company reported that net profit surged 52% year-over-year to 424 billion yen, while annual revenue climbed to 2.31 trillion yen, nearly double the prior year’s total. The Switch 2, launched last June, got off to a strong commercial start, with global sales growing steadily after its release. By the end of March, Nintendo had sold 19.86 million units of the new console, boosted by popular first-party titles including *Pokemon Pokopia*, *Mario Kart World*, and *Donkey Kong Bananza*.

The core headwind facing console manufacturers right now is the rapid rise in memory chip prices. The global AI boom has spurred massive demand for high-capacity memory chips from data centers and AI developers, pushing up costs for consumer electronics makers including game console and smartphone producers. Supply chain disruptions linked to ongoing conflict in Iran have further tightened available supplies, worsening the cost pressure for manufacturers.

For Sony, the past fiscal year saw PlayStation 5 sales fall to 16 million units, down from 18.5 million units in the prior 12-month period. Since the PS5 launched in 2020, Sony has sold 92 million units of the console overall, putting the company in a strong position to capitalize on the upcoming November launch of the highly anticipated blockbuster title *Grand Theft Auto VI*. Industry analysts note the franchise is expected to drive a massive wave of new console sales in the coming year.

“If there is any game that can move millions of additional PlayStation units, it is this one,” Serkan Toto, a leading gaming industry consultant, told AFP.
Sony projects that even with lower console sales, its gaming division will see higher profits in the fiscal year ending March 2027. Industry analysts explain that Sony’s more mature position in the PS5 product cycle leaves it better insulated from rising memory chip costs than Nintendo’s newly launched Switch 2.

“Sony’s more mature PS5 console cycle leaves it better placed to weather higher memory costs,” said Amir Anvarzadeh, a strategist at Asymmetric Advisors. “Having already moved past the heavy hardware penetration costs typical of earlier product cycle years, Sony’s bottom line stands to benefit significantly from the high-margin software sales and ecosystem engagement that the *Grand Theft Auto VI* launch should trigger.”

Nintendo, however, faces a more challenging operating environment, Toto noted. Switch 2 consumers are especially price sensitive, he said, and the console’s first-year game lineup is far weaker than that of the original Switch at launch. Even so, Toto added that Nintendo has room to improve its performance by ramping up software releases in the coming months: “But now it’s time for them to really step on the gas on the software side.”

Trump Media & Technology Group (TMTG), the parent firm behind former U.S. President Donald Trump’s social media platform Truth Social, has disclosed a staggering net loss exceeding $400 million for the first three months of 2025, with the overwhelming majority of the deficit tied to plummeting valuations in the cryptocurrency sector, per a regulatory filing released Friday.

The company, which became publicly traded and counts Trump as its largest single shareholder, reported total revenue of just $900,000 across the first quarter. That figure marks a remarkably low top line for an enterprise that currently holds a public market valuation of $2.47 billion.

Trump, who relies heavily on Truth Social as his primary platform for public announcements and political messaging, controls roughly 41% of TMTG’s outstanding shares. Those holdings are held in a blind trust established to manage his financial interests during his second presidential term.

Beyond its core social media operations, TMTG has expanded into digital asset investing. Twelve months prior to this quarterly report, the firm secured $2.5 billion in dedicated funding specifically for cryptocurrency investments – a pivot aligned with Trump’s well-documented personal interest in the digital asset space in recent years.

The broad downturn in crypto markets during the first quarter hit TMTG’s investment portfolio particularly hard. Bitcoin, the world’s largest cryptocurrency by market capitalization, saw its price drop from a peak above $126,000 in early October 2024 to less than $70,000 by the end of March 2025. While Bitcoin has since recovered partially to trade above $80,000, the markdown required for quarterly reporting still generated massive unrealized losses.

Under U.S. accounting regulations, publicly traded companies must mark their investment holdings to current market value each quarter, even if they have not sold the assets. This requirement forced TMTG to record a total net loss of $406 million for the first quarter. The company confirmed in its filing that “the vast bulk” of this loss stems directly from its digital asset holdings.

TMTG signaled it remains committed to its long-term growth strategy, stating in the filing that it will “continue to focus on expanding its infrastructure and audience to prepare for future monetised features.”

In addition to its social media and crypto investment operations, TMTG announced a planned merger with TAE Technologies, a U.S.-based firm developing commercial nuclear fusion technology, back in December 2024. The merger is currently on track to close in the middle of 2026, according to the company’s latest update.