Sabre(US:SABR)2025-11-05 18:01Financial 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].