Please provide more color on the Q2 bookings outperformance compared to peers, especially regarding corporate mix, and the segment assumptions for your Q3/Q4 guidance.

Sabre's 600 basis point outperformance against peers is due to share gains, growth with low-cost carriers, and NDC adoption. The resilience of corporate travel, which accounts for 45% of Sabre's distribution volumes (compared to 25-30% for the industry), significantly buoyed performance. For the forward guide, Sabre assumes the impact from the Middle East conflict and fuel prices will persist but dissipate through the calendar year, with a modest improvement in the macro environment. “The resilience and the strength in the corporate marketplace has certainly buoyed our performance because we have about 45% of our distribution volumes come from corporate or TMC versus for the industry, about 25% to 30%.”

What are the current NDC volumes and how is NDC impacting unit economics, given the strong revenue per booking growth?

NDC currently represents about 5% of Sabre's distribution volumes and is growing steadily through adoption by existing clients and reintermediation of direct-connected NDC volumes. Outside Europe, NDC has a slightly dilutive impact on both revenue and margin per booking. In Europe, where booking fees are higher, the degradation is more material, but Europe only accounts for about 16% of global point-of-sale bookings, limiting Sabre's exposure. The overall per-unit revenue performance remains strong due to mix performance and growth in non-transaction-based revenue like hotel, media, and payments. “NDC represents about 5% of our distribution volumes. It's growing very steadily. Year-on-year, we see, one, that's a combination of adoption of NDC by existing clientele.”

Amadeus mentioned a 40 million PB Air IT win for 2027. Can you comment on whether this is an existing Cerasonic customer?

Sabre does not comment on the details of individual customer agreements. However, the Airline Technology business is a growth area for Sabre, with strong interest in Sabre Mosaic and offer management capabilities. Sabre has recently won Hawaiian and Louis Airlines, announced a new African carrier win, and expects another significant win soon, indicating strong momentum in its own pipeline. “Otherwise, we don't comment on the details of individual customer agreements.”

SABR

Sabre (SABR) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q2 FY26)· Information Technology· Aug 6, 2026

Source: earnings call transcript

Executive summary

Sabre Corporation Q2 FY26 — Strong EBITDA Growth and Raised Full-Year Outlook

Sabre delivered a strong second quarter, outperforming expectations on revenue and normalized adjusted EBITDA, driven by growth strategies and resilient corporate travel demand. The company raised its full-year adjusted EBITDA and free cash flow guidance, while reaffirming revenue and bookings outlook. Investments in agentic AI and platform modernization are accelerating, positioning Sabre for future growth despite geopolitical and fuel price headwinds.

Highlights

Normalized adjusted EBITDA grew 19% year-on-year to $151 million, exceeding expectations.
Revenue grew 4% year-on-year to $712 million, surpassing expectations of flat to nominal growth.
Payment Suite gross spend exceeded $6 billion in Q2, up more than 30% year-on-year, now over $25 billion annualized.
Hotel related revenue growth accelerated to 11% year-on-year in Q2.
Free cash flow was positive $10 million for the second quarter, improving the full-year outlook.

Concerns

Air Distribution bookings growth was impacted by 300 to 400 basis points due to the Middle East conflict and higher fuel prices.
Airline Technology revenue was $135 million, broadly in line with expectations but reflecting quarter-to-quarter variability due to timing of license fees and deliverables.
Adjusted technology expense is expected to be higher in the second half of the year due to a shift in timing of investments.

Guidance & targets

Category	Target	Timeline	Confidence
Full-year 2026 Pro forma adjusted EBITDA	approximately $600 million high materiality	FY26	High
Full-year 2026 Free cash flow	approximately negative $65 million high materiality	FY26	High
Full-year 2026 Revenue	reaffirmed high materiality	FY26	High
Full-year 2026 Air Distribution bookings growth	reaffirmed high materiality	FY26	High
Q3 Air Distribution bookings growth	flat to low single digits medium materiality	Q3 · FY26	Medium
Q4 Air Distribution bookings growth	low to mid-single-digit rate year-on-year medium materiality	Q4 · FY26	Medium
Q3 Airline Technology revenue	$140 million to $150 million medium materiality	Q3 · FY26	Medium
Q4 Airline Technology revenue	$140 million to $150 million medium materiality	Q4 · FY26	Medium
Full-year 2026 Airline Technology revenue growth	year-on-year revenue growth medium materiality	FY26	Medium
Q3 Gross margin	towards the higher end of our 56% to 57% range medium materiality	Q3 · FY26	Medium
Q4 Gross margin	towards the higher end of our 56% to 57% range medium materiality	Q4 · FY26	Medium
Full-year 2026 Adjusted technology expense	low single-digit increase year-on-year medium materiality	FY26	Medium
Full-year 2026 Adjusted SG&A expense	roughly flat in the second half of the year when compared to the first half of the year low materiality	H2 FY26	Medium
Q3 Normalized adjusted EBITDA	approximately $155 million high materiality	Q3 · FY26	Medium
Q4 Normalized adjusted EBITDA	approximately $125 million high materiality	Q4 · FY26	Medium
H2 Free cash flow	approximately $80 million high materiality	H2 FY26	Medium

Segment performance

Segment	Revenue	YoY	QoQ	Margin
Marketplace Revenue growth driven by increased distribution bookings and higher average booking fee, including growth from payments and media offerings. Distribution bookings increase: 1.5%Average booking fee increase: 4%	$577 million	6%	—	—
Airline Technology Revenue was broadly in line with expectations, reflecting timing of certain items that create quarter-to-quarter variability. Half of revenue driven by PBs, other half by license fees and other performance deliverables.	$135 million	—	—	—

Product announcements

Product	Type	Timeline	Details
Model Context Protocol (MCP) server	launch	Q2 FY26
Sabre Mosaic and CIT capabilities	expansion	by end of 2026

Deals & partnerships

Existing lenders Extension of AR securitization facility through September 2029

Signed an agreement to extend the AR securitization facility, resulting in no maturities until 2029.

Notable African carrier Selection of Sabre as new technology platform provider

The airline will modernize its operations with Sabre's platform, with implementation expected by year-end.

Voca Bridge and Deep Learning AI Hosted a Hackathon in Silicon Valley

More than 400 developers participated and submitted over 100 projects built on Sabre's agentic KPIs and MCP server, demonstrating platform power and flexibility.

Risks & headwinds

Impact of Middle East conflict and higher fuel prices on Air Distribution bookings Q2 FY26, expected to persist but dissipate through H2 FY26

300 to 400 basis points reduction in bookings growth

Mitigation:Resilience of corporate volumes partially offsetting softness in leisure demand; expectation of modest macro improvement.

Amadeus anti-competitive behavior in the OOSD market Ongoing

Discussed not quantified

Mitigation:Sabre's approach is centered on openness and modularity, enabling airlines to modernize without being locked into a single vertically integrated stack.

Uncertain timing for agentic AI adoption by large tech players Near-term

Discussed not quantified

Mitigation:Sabre is investing aggressively in AI, positioning itself as critical infrastructure for AI agents, and has significant engagement with developers and partners.

What to watch in Q3 FY26

Q3 Air Distribution bookings growth

Q3 FY26

Current 1% YoY (Q2 FY26)

Target flat to low single digits

Why it matters

This will indicate whether the recovery seen in June and July is sustained and if the impact from geopolitical events and fuel prices is dissipating as expected.

We expect third quarter air distribution bookings growth of flat to low single digits.

Find out whether SABR delivers this. Inve re-checks your case every morning.

Q&A highlights

Can you elaborate on the Q2 airline tech revenue variability and whether Amadeus' anti-competitive actions are impacting it? Also, what are your thoughts on leading AI labs pursuing agentic travel strategies?

Q2 airline tech revenue was in line with expectations, with variability due to timing of license fees and deliverables. Concerns about Amadeus' anti-competitive behavior, specifically regarding data access, API limitations, integration costs, and delays, persist. Sabre believes agentic AI will be a material distribution channel, and while large tech players are currently focused on enterprise, travel will follow e-commerce. Sabre is uniquely positioned as critical infrastructure for AI agents due to its open, multisource platform and active developer engagement.

“With respect to Amadeus' behavior in the market, the concerns that we raised previously still exist. Specifically, we believe that Amadeus is leveraging a dominant position in passenger service system, or PSS, to exclude alternative providers in the separate emerging market for offer order settlement and delivery or OOSD.”

asked by John Halpert · answered by Kurt Ekert

2 min read 5 chapters

Detailed narrative

Q2 Performance Exceeds Expectations

Sabre reported Q2 FY26 revenue of $712 million, a 4% year-on-year increase, surpassing expectations of flat to nominal growth. Normalized adjusted EBITDA reached $151 million, up 19% year-on-year, significantly exceeding the guidance of approximately $130 million. This outperformance was primarily driven by higher gross income from a better average booking fee and increased air distribution bookings, with the remainder attributed to the timing of technology investments.

Air Distribution Bookings and Market Outperformance

Air Distribution bookings grew 1% year-on-year in Q2, ahead of outlook, driven by a modest recovery in June that continued into July. Sabre has consistently outperformed the broader industry in bookings growth by approximately 600 basis points since late 2025.

Corporate volumes, representing nearly 45% of marketplace bookings, showed steady performance and resilience, offsetting softness in leisure demand. The Middle East conflict and higher fuel prices impacted bookings by 300-400 basis points, particularly in EMEA and Asia Pacific.

Strategic Investments in AI and Platform Modernization

Sabre is increasing investment in AI initiatives, positioning itself as a leader in the emerging agentic AI travel channel. The company deployed its Model Context Protocol (MCP) server with a global enterprise loyalty and travel service company and doubled its active pilot and production partners from 30 to 60 in Q2.

A Hackathon with Voca Bridge and Deep Learning AI attracted over 400 developers, showcasing the platform's capabilities for AI-powered travel solutions.

Airline Technology Business Momentum

The Airline Technology segment is emerging as a growth business, with revenue expected to be in the $140 million to $150 million range per quarter in Q3 and Q4, and year-on-year growth anticipated for FY26. Sabre announced a new win with a notable African carrier, which will migrate its core passenger services to the Sabre platform and adopt Sabre Mosaic and CIT capabilities, with implementation expected by year-end.

This follows recent wins with Hawaiian and Louis Airlines, and another significant win is expected soon.

Financial Position and Capital Structure

Sabre ended Q2 with a cash balance of $697 million. The company signed an agreement to extend its AR securitization facility through September 2029, ensuring no maturities until 2029. The full-year free cash flow outlook improved to approximately negative $65 million, with approximately $60 million of this attributed to restructuring costs.

The company expects to generate approximately $80 million of free cash flow in the second half of the year, primarily in Q4.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.