Sabre (0A21) AI Stock Analysis

Company Guidance

Management raised full‑year pro forma adjusted EBITDA to approximately $600 million and improved full‑year free cash flow to about negative $65 million (from negative $70 million) while reaffirming revenue and air distribution bookings guidance; Q3 air distribution bookings are expected flat to low‑single digits and Q4 low to mid‑single digits. Quarterly guidance calls for normalized adjusted EBITDA of roughly $155 million in Q3 and $125 million in Q4, with gross margin toward the high end of the 56%–57% range (Q2 gross margin was 57.1%); Airline Technology revenue is expected to be $140–$150 million per quarter in Q3/Q4, adjusted technology expense is expected to be up low single digits year‑over‑year, and CapEx was increased by $10 million. Q2 results that underpinned the raise included revenue of $712 million (up 4%), normalized adjusted EBITDA of $151 million (up 19%) with a 21.2% adjusted EBITDA margin (up 272 bps), positive free cash flow of $10 million, a cash balance of $697 million, Payment Suite gross spend >$6 billion in the quarter (annualized >$25 billion), hotel revenue growth of 11% with ~35% hotel attach rate, NDC at ~5% of volumes, and the company expects ~ $80 million of free cash flow in H2 (primarily Q4) despite ~$60 million of restructuring costs driving this year's negative FCF; the AR securitization was extended to September 2029 leaving no maturities until 2029.