Sabre Shares Soar on Narrower-Than-Expected Q4 Loss, Revenues Rise Y/Y

Core Insights - Sabre Corporation (SABR) shares increased by 36% in pre-market trading following better-than-expected Q4 2025 results, reporting an adjusted loss of 1 cent per share, significantly improved from a loss of 8 cents in the same quarter last year and better than the Zacks Consensus Estimate of a loss of 7 cents [1] Financial Performance - Sabre reported Q4 2025 revenues of $667 million, exceeding the Zacks Consensus Estimate of $653.4 million, and reflecting a 3% year-over-year increase driven by higher air bookings and increased rates [2][9] - Distribution revenues rose by 5% to $527 million, primarily due to increased air distribution bookings and a favorable travel supplier mix, surpassing the model estimate of $513.3 million [3] - IT Solutions revenues decreased by 4% to $140 million, slightly below the model estimate of $141.8 million [3] - Normalized adjusted EBITDA for Q4 was $119 million, up from $108 million year-over-year, and exceeded management's guidance of $110 million, with a margin improvement of 110 basis points to 17.8% [4][9] Balance Sheet and Cash Flow - At the end of Q4, Sabre had cash, cash equivalents, and restricted cash totaling $910 million, a significant increase from $447 million in the previous quarter [5] - The company generated operating cash flow of $139 million and free cash flow of $116 million during Q4, while for the full year 2025, cash used in operating activities was $109 million, resulting in negative free cash flow of $192 million [5] Future Guidance - Sabre has initiated guidance for Q1 and FY 2026, expecting pro-forma revenue growth in the mid-single-digit percentage range and pro-forma adjusted EBITDA around $130 million [6] - For 2026, pro-forma revenues are projected to grow in the mid-single-digit percentage range, with pro-forma adjusted EBITDA expected to be approximately $585 million, and a forecasted negative pro-forma free cash flow of about $70 million [7]