The Ranks of Corporate Zombies Are Growing: Credit Weekly
Update: 2025-11-01
Description
Zombie Companies on the Rise: As of November 1st, nearly 100 more U.S. businesses have joined the ranks of zombie companies, those unable to cover debt interest with profits. This surge is linked to companies that borrowed heavily during the pandemic and now face rising borrowing costs and tariffs. The Federal Reserve's potential pause on rate cuts and solidified tariffs further complicate matters. Companies like Lionsgate Studios and Tronox Holdings struggle to fix their balance sheets, risking default. Experts warn that carrying debt is now more challenging, and securing financing is tougher due to lowered earnings expectations in various industries. As the number of zombie companies grows, concerns rise about potential market distress.
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