Core Insights - Sabre Corporation (SABR) reported Q3 results in early November, indicating ongoing challenges in its turnaround efforts, leading to continuous guidance cuts through 2025 [1] Financial Performance - The third quarter results showed signs of improvement, although the company continues to face roadblocks [1]

Core Insights - Sabre Corporation (SABR) reported Q3 results in early November, indicating ongoing challenges in its turnaround efforts, leading to continuous guidance cuts through 2025 [1] Financial Performance - The third quarter results showed signs of improvement, although the company continues to face roadblocks [1]

Core Insights - Sabre Corporation (SABR) reported mixed results for Q3 2025, with revenues exceeding estimates but adjusted losses falling short [1][10] - The company expects flat revenues for 2025 and has revised down its free cash flow guidance [6][7][10] Financial Performance - Sabre's Q3 revenues reached $715.2 million, surpassing the Zacks Consensus Estimate of $708.8 million, marking a 3.5% year-over-year increase driven by higher air and hotel bookings [2][10] - Distribution revenues increased by 4% to $575 million, while IT Solutions revenues remained flat at $140 million year-over-year [3] - Normalized adjusted EBITDA improved to $150 million, up from $121 million in the previous year, with a margin increase of 350 basis points to 19.7% [4][10] Cash Flow and Balance Sheet - As of the end of Q3, Sabre had cash and equivalents of $447 million, down from $682.8 million in the previous quarter [5] - The company generated operating cash flow of $33.7 million and free cash flow of $13.4 million during Q3 [5] Guidance Updates - For 2025, Sabre now anticipates pro-forma revenues to be flat year-over-year, a revision from earlier expectations of low single-digit growth [6] - Pro-forma adjusted EBITDA is projected at approximately $530 million, and free cash flow is now expected to be around $70 million [7] - For Q4, Sabre expects pro-forma revenue growth in the low single-digit percentage range and adjusted EBITDA of around $110 million [8]

Financial Performance - Revenue for the three months ended September 30, 2025, was $715,183,000, representing a $24 million, or 3%, increase compared to $691,300,000 in the same period of 2024[145]. - Adjusted EBITDA for the nine months ended September 30, 2025, was $389,708,000, compared to $348,894,000 in 2024, reflecting an increase of $40,814,000[145]. - Revenue for the nine months ended September 30, 2025, was $2,099,983, a slight decrease of $4 million or 0.2% compared to $2,104,458 in the same period of 2024[155]. - Cash used in operating activities for the nine months ended September 30, 2025, was $(248,155,000), compared to $(5,463,000) in 2024, indicating a substantial increase in cash outflow[145]. - Free Cash Flow for the nine months ended September 30, 2025, was $(307,574,000), compared to $(70,304,000) in 2024, indicating a significant increase in cash used[145]. Cost Management - Cost of revenue, excluding technology costs, increased by $18 million, or 6%, to $313,074,000 for the three months ended September 30, 2025, compared to $294,656,000 in 2024[148]. - Technology costs decreased by $21 million, or 11%, to $168,009,000 for the three months ended September 30, 2025, down from $189,417,000 in 2024[149]. - Selling, general and administrative expenses decreased by $9 million, or 6%, to $140,475,000 for the three months ended September 30, 2025, compared to $149,386,000 in 2024[150]. - Cost of revenue, excluding technology costs, increased by $34 million or 4% to $914,899 for the nine months ended September 30, 2025, primarily due to a $35 million increase in incentive consideration[155]. - Technology costs decreased by $74 million or 13% to $515,810 for the nine months ended September 30, 2025, due to reductions in labor, professional services, and hosting costs[156]. - Selling, general and administrative expenses decreased by $34 million or 8% to $399,595 for the nine months ended September 30, 2025, primarily due to a decrease in tax litigation reserves and indirect taxes[158]. Debt and Financing - The sale of the Hospitality Solutions business generated cash proceeds of $965 million, primarily used to repay outstanding debt[125]. - As of September 30, 2025, the company's outstanding debt totaled $4.2 billion, net of debt issuance costs and unamortized discounts of $106 million[173]. - Approximately 13% of the company's debt is variable, which may increase future interest expenses due to rising interest rates[128]. - The company recognized a loss on extinguishment of debt of $85 million during the nine months ended September 30, 2025, compared to a loss of $38 million in the same period of 2024[160]. - The company incurred additional indebtedness of $100 million as a result of the June 2025 Refinancing, recognizing a loss on extinguishment of debt of approximately $85 million[180]. - The company entered into a third and fourth amendment to the Amended and Restated Credit Agreement on November 25, 2024, exchanging $775 million of existing senior secured term loans for new loans maturing on November 15, 2029[179]. Operational Insights - Direct billable bookings for Air increased by 2.4% year-over-year to 80,542 in Q3 2025, while total direct billable bookings rose by 2.5% to 95,135[135]. - IT solutions passengers boarded grew by 2.8% year-over-year to 182,212 in Q3 2025, with modest growth expected for the remainder of the year[135]. - Revenue from IT solutions has leveled off relative to prior year amounts, with modest growth expected following the anniversary of prior de-migrations[127]. - The company anticipates that the U.S. government shutdown will negatively impact air distribution volumes in Q4 2025[126]. - The company has established strategic priorities to achieve sustainable long-term growth in response to changing needs in the travel ecosystem[126]. Cash Flow and Investments - Cash provided by discontinued operations was $1,035 million for the nine months ended September 30, 2025[188]. - Cash used in investing activities was $59 million for the nine months ended September 30, 2025, primarily for software development[190]. - Financing activities used $804 million for the nine months ended September 30, 2025, including significant debt repayments totaling $806 million[192]. - The company expects pro forma free cash flow for the full year 2025 to be approximately $70 million, impacted by normal seasonality[168]. Tax and Regulatory Matters - The effective tax rate for the nine months ended September 30, 2025, was influenced by changes in valuation allowances and geographic mix of taxable income, resulting in a provision for income taxes of $21 million[162]. - The company monitors digital services taxes (DST) legislation globally, recording DST in selling, general and administrative costs[172].

Core Insights - Sabre reported revenue of $715.18 million for Q3 2025, a year-over-year decline of 6.5%, with an EPS of -$0.01 compared to -$0.04 a year ago, indicating a slight improvement in earnings despite the revenue drop [1] - The revenue exceeded the Zacks Consensus Estimate of $708.84 million by 0.9%, while the EPS fell short of the consensus estimate of $0.04 by 125% [1] Financial Performance - Travel Solutions - Air Bookings were 80.54 million, below the average estimate of 81.48 million [4] - Total Bookings in Travel Solutions reached 95.14 million, slightly below the average estimate of 95.85 million [4] - Passengers Boarded in Travel Solutions totaled 182.21 million, exceeding the average estimate of 177.6 million [4] - Lodging, Ground and Sea Bookings in Travel Solutions were 14.59 million, surpassing the average estimate of 14.38 million [4] - IT Solutions Revenue in Travel Solutions was $139.88 million, slightly above the average estimate of $139.04 million, reflecting a year-over-year change of -0.3% [4] - Distribution Revenue in Travel Solutions was $575.31 million, exceeding the average estimate of $569.69 million, with a year-over-year increase of 4.4% [4] Market Performance - Over the past month, Sabre's shares have returned +10.5%, outperforming the Zacks S&P 500 composite's +1% change [3] - The stock currently holds a Zacks Rank 4 (Sell), suggesting potential underperformance relative to the broader market in the near term [3]

Financial Data and Key Metrics Changes - For Q3 2025, the company reported revenue of $715 million, reflecting a 3% year-on-year increase, consistent with guidance for low to mid-single-digit growth [16][17] - Normalized adjusted EBITDA for the quarter was $150 million, up 23% year-on-year, with the normalized adjusted EBITDA margin expanding by 340 basis points to 21% [18][9] - Pro forma free cash flow was $13 million, with an expectation of approximately $70 million for the full year 2025 [18][19] Business Line Data and Key Metrics Changes - Total distribution bookings grew by 3% year-on-year, with air distribution bookings increasing by more than 2% [7][8] - Hotel distribution bookings grew by 6% in the quarter, and the attachment rate to air bookings increased over 100 basis points year-on-year [8] - IT solutions revenue remained flat at $140 million year-on-year, as growth from passengers boarded was offset by a decrease in license fee revenue [17] Market Data and Key Metrics Changes - The company experienced softness in July air bookings, but saw improvement in September, which finished strong with a 7% year-on-year increase [7][8] - The GDS industry air distribution bookings declined approximately 1 percentage point year-on-year, impacting the company's air booking mix [8] - The company noted that U.S. military and government travel represented about 4% of global air distribution volumes, which is a minor component of current trading volumes [29] Company Strategy and Development Direction - The company aims to reduce net leverage by approximately 50% by year-end 2025 compared to year-end 2023, focusing on generating free cash flow and deleveraging the balance sheet [6][20] - Innovation is central to the company's strategy, with recent announcements including agentic APIs for travel and a continuous revenue optimizer within the Sabre Mosaic platform [6][10] - The company is transforming its platform into a modern, open travel marketplace, with 41 live NDC integrations enhancing its competitive position [9][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to drive air distribution bookings growth, despite challenges from the government shutdown impacting October bookings by approximately 3 percentage points [15][21] - The outlook for Q4 anticipates air distribution bookings growth of between 6% and 8%, with a full-year expectation of near the low end of the previously provided range of 0.5%-3.5% [21][22] - Management highlighted that leisure demand is positive year-on-year, while corporate demand remains mixed, with expectations for low single-digit passenger growth globally [38][39] Other Important Information - The company has made significant progress in its capital structure, paying off over $1 billion of debt this year, including approximately $825 million from the sale of the Hospitality Solutions business [19][20] - The payments business is scaling rapidly, processing over $20 billion in annual transactions, with quarterly gross spend growing over 40% year-on-year [11][10] Q&A Session Summary Question: Can you run through the updated FY25 guidance and explain the changes in EBITDA and free cash flow? - Management noted that the $20 million reduction in EBITDA is primarily due to a $10-$12 million impact from the government shutdown, along with lower margin from FX and product sales [23][24] Question: What is the impact of the government shutdown on travel? - The impact is mainly on travel by government employees and U.S. military, with a high concentration of this business affecting overall volumes [28][29] Question: What is the current NDC mix? - The NDC mix remains in the low single digits, between 2% and 3% of air distribution volumes, but is expected to grow rapidly [30] Question: How does the company expect to recover from the government shutdown? - Management anticipates a phased recovery back to normalcy, likely in the first quarter following the resolution of the shutdown [32] Question: Can you elaborate on the payments business strategy? - The payments business is scaling at a 40% top line rate, with significant growth opportunities identified, although specific revenue and margin details have not been disclosed yet [32]

Financial Performance - Q3 2025 revenue reached $715 million, a 3% year-over-year increase[17] - Normalized Adjusted EBITDA for Q3 2025 was $150 million, up 23% year-over-year[17] - The Normalized Adjusted EBITDA margin increased by 340 basis points year-over-year to 21%[36] - Pro Forma Free Cash Flow was $13 million for Q3 2025[16, 34] - The company expects to generate approximately $70 million in Pro Forma Free Cash Flow for the full year 2025[16] Operational Highlights - Total distribution bookings increased by 3% year-over-year to 95 million[17] - Air distribution bookings increased by 2% year-over-year to 81 million[17] - Hotel distribution bookings increased by 6% year-over-year to 11 million[17] - Digital Payments gross spend increased by approximately 40% year-over-year in Q3 2025[16] Debt and Leverage - Approximately $825 million of debt was repaid using proceeds from the Hospitality Solutions sale[16] - The company anticipates reducing year-end 2025 pro forma net leverage by approximately 50% from year-end 2023[16] Future Outlook - The company expects air distribution volumes to grow 6% to 8% year-over-year in Q4 2025[27, 44] - The company expects approximately 9% Pro Forma Adjusted EBITDA growth for full-year 2025[16, 44]

Core Insights - Sabre Corporation announced its financial results for the third quarter of 2025, with the earnings release and presentation available on its Investor Relations webpage [1] - A live webcast of the earnings conference call is scheduled for today at 9:00 a.m. ET, where management will discuss financial results and future outlook [2] - Sabre is a leading technology company in the travel industry, providing solutions for airlines, hoteliers, and travel agencies globally [3] Financial Results - The financial results for the quarter ended September 30, 2025, have been posted on Sabre's Investor Relations webpage [1] - The earnings conference call will provide insights into the financial performance and future expectations of the company [2] Company Overview - Sabre Corporation is headquartered in Southlake, Texas, and serves customers in over 160 countries [3] - The company focuses on leveraging technology to address complex challenges in the travel sector [3] Communication Channels - Important investor information is routinely posted on Sabre's Investor Relations section, LinkedIn account, and X account [3] - The company emphasizes the use of these platforms for disclosing material, non-public information [3]

Financial Performance - Q3 2025 revenue totaled $715 million, up 3% from $691 million in Q3 2024[4] - Adjusted EBITDA for Q3 2025 was $141 million, a 25% increase from $112 million in Q3 2024[2] - Net income attributable to common stockholders was $849 million, compared to a loss of $63 million in Q3 2024[8] - Operating income for Q3 2025 was $94 million, up 62% from $58 million in Q3 2024[5] - Revenue for Q3 2025 was $715,183,000, a 3.0% increase from $691,300,000 in Q3 2024[28] - Operating income for Q3 2025 was $93,625,000, compared to $57,841,000 in Q3 2024, reflecting a significant improvement[28] - Net income for Q3 2025 was $848,478,000, a substantial increase from a net loss of $63,133,000 in Q3 2024[28] - Adjusted EBITDA for Q3 2025 increased to $140,633, up from $112,275 in Q3 2024, reflecting a margin of 19.7%[44] - Free Cash Flow for Q3 2025 was $13,417, compared to $5,102 in Q3 2024, indicating a positive cash generation trend[45] - Cash provided by operating activities for Q3 2025 was $33,686, an increase from $24,393 in Q3 2024[45] - The company reported a net income margin of 118.7% for Q3 2025, compared to a negative margin of (9.1)% in Q3 2024[44] Cash and Debt Management - Cash balance at the end of Q3 2025 was $683 million[2] - The company repaid approximately $825 million of debt during the quarter[2] - Cash and cash equivalents as of September 30, 2025, were $661,722,000, down from $724,479,000 at the end of 2024[30] - Total cash, cash equivalents, and restricted cash at the end of the period was $682,747, down from $689,801 at the beginning of the period[32] - The company made payments on borrowings from lenders totaling $2,048,415, while proceeds from borrowings were $1,325,000[32] - The company incurred $111,312 in interest expense for Q3 2025, slightly down from $113,126 in Q3 2024[44] Operational Highlights - Distribution revenue increased by $24 million, or 4%, to $575 million, driven by a $16 million increase in transaction-based revenue[7] - Total bookings reached 95 million, a 3% increase from Q3 2024 levels[7] - The company completed the sale of its Hospitality Solutions business, impacting financial results and operations[23] - The company anticipates continued growth in the travel industry, with a focus on enhancing technology solutions and operational efficiency[24] Forward-Looking Statements - Fourth quarter Pro Forma Adjusted EBITDA guidance is approximately $110 million, with expected low single-digit revenue growth[15] - Full-year Pro Forma Free Cash Flow guidance is expected to be approximately $70 million[14] - Forward-looking statements indicate potential risks including dependency on global travel transaction volumes and competition in the travel distribution industry[25] Adjusted Financial Metrics - Adjusted Net Loss is defined as net income attributable to common stockholders adjusted for various costs, including discontinued operations and stock-based compensation[34] - Adjusted EBITDA is calculated by adjusting income from continuing operations for depreciation, amortization, and other specified costs[35] - The company emphasizes the importance of non-GAAP financial measures for monitoring core operations and evaluating financial performance[40] - Pro Forma Free Cash Flow is adjusted to reflect the impact of the Hospitality Solutions Sale and related refinancing activities[39] - Adjusted Net Loss from continuing operations for Q3 2025 was $(4,880), an improvement from $(18,868) in Q3 2024[44] - Normalized Adjusted EBITDA for the nine months ended September 30, 2025, was $416,864, compared to $377,034 for the same period in 2024[44] Discontinued Operations - The company experienced a loss from discontinued operations amounting to $783,725 in 2025, compared to a gain of $4,484 in 2024[32] - Free Cash Flow from Discontinued Operations for Q3 2025 was $(1,179), compared to $2,449 in Q3 2024, indicating challenges in this segment[46] - Cash provided by investing activities was $1,054,898 for discontinued operations, contrasting with cash used of $3,211 in the previous year[32] - Cash used in investing activities for Q3 2025 was $(20,269), a decrease from $35,543 in Q3 2024[45]

Core Insights - Sabre Corporation has entered a multi-year agreement with Volaris, Mexico's leading ultra-low-cost airline, to make Volaris's flight content available through the SabreMosaic Travel Marketplace, marking a strategic expansion for Volaris into the global distribution system [1] - The partnership enhances the SabreMosaic Travel Marketplace's position as a key source of low-cost carrier content for travel agencies globally, with Volaris being one of the fastest-growing low-cost carriers in the Americas [2] - Sabre has also launched the SabreMosaic Continuous Revenue Optimizer, an AI-driven solution aimed at providing continuous pricing recommendations for airlines, moving beyond traditional fare classes [3] Company Overview - Sabre Corporation operates as a software and technology company for the travel industry, with two segments: Travel Solutions and Hospitality Solutions [4]