Dive Brief:
- The number of large companies that filed for bankruptcy in the 12 months ending in June of 2026 fell 15% to 100 from 117 in the year-earlier period, according to a report from Cornerstone Research released Thursday.
- Reduced consumer demand, shifts in the regulatory and political landscape, such as cuts to Medicaid, as well as inflation and high interest rates were cited as the primary drivers of mega-bankruptcies, according to the consulting firm’s Trends in Large Corporate Bankruptcy and Financial Distress mid-year update.
- The large bankruptcies filed over the period included freight company STG Logistics, retailers QVC Group and Saks Global, as well as Spirit Airlines, and satellite TV provider DISH.
Dive Insight:
The number of bankruptcy filings over the last year still surpassed the 2005 to 2025 annual average of 82 bankruptcies. That included 28 mega-bankruptcies filed by companies with reported assets over $1 billion — a number that was below the 32 filed in the previous 12 months but still higher than the annual average of 23.
Among the mega filers, 73% attributed their bankruptcies to a decline in demand due to consumer preferences, market competition and other industry factors which added to their financial distress, the report stated.
Collectively, 64% of the large filings over the past year came from companies within the manufacturing, services and finance, insurance, and real estate industries, the report added.
Certain manufacturing subsectors saw more distress than others. This included the plastic manufacturing sector, which saw COVID-19-era product demand ease, said Trevor Haynes, a Cornerstone associate and report co-author.
Pretium Packaging, for example, stated the unprecedented COVID-era demand for its plastics products normalized — leaving its customers with excess inventory and the company with fewer orders, said Haynes.
Companies that filed between July 2025 and June 2026 frequently cited in first-day declarations reduced demand caused by consumer preferences, market competition or industry-specific factors, said Haynes.
Others attributed regulatory and policy shifts as key causes. Medical service providers, for example, were among the mega-bankruptcies filed during the period. Multiple companies within that sector, such as ModivCare Inc., cited cuts to Medicaid’s reimbursement rates and services in their bankruptcy declarations, the report stated. Such cuts were included in the 2025 One Big Beautiful Bill Act that was passed by the Republican congress.
Several big filers cited tariffs as a contributing factor in their first day declarations, said Haynes. Aftermarket car products supplier, First Brands, for example, referenced tariffs on imported goods that reached up to 73% as a contributing factor to its bankruptcy, he said.
Claire’s, the jewelry retailer, in its first day declaration also attributed hefty tariffs on imported goods from China, Thailand, and Vietnam as a factor for its filing, said Haynes.
Industry or firm-specific regulatory, legislative, or trade policy pressures also contributed to bankruptcy filings during the period, said Haynes.
STG Logistics, for example, noted uncertain regulatory oversight in the U.S. such as evolving California Air Resources Board regulations, and federal regulatory revisions that classify drivers as independent contractors, he said.
“These evolving regulations were cited by STG as contributing to increasing operating and compliance costs,” said Haynes in an email.
