Sabre Shares Drop On Q3 Consensus Miss; Expects To Be FCF Positive Next Year & Annually Thereafter

  • Sabre Corp (NASDAQ: SABR) reported third-quarter FY22 revenue growth of 50% year-on-year to $663.4 million, missing the consensus of $702 million.
  • Revenue growth was driven by higher global air, hotel, and other travel bookings reflecting continued recovery from the pandemic.
  • Travel Solutions' revenue rose 55% Y/Y to $603.6 million and saw a positive operating income of $69.1 million. Distribution revenue grew 76% Y/Y to $430.8 million, and IT Solutions revenue increased 19% Y/Y to $172.8 million. 
  • Hospitality Solutions' revenue increased by 22% Y/Y to $67.5 million, while the operating loss widened to $(11.3) million.
  • The adjusted EBITDA margin improved from (12.5)% to 5.2%.
  • Adjusted loss per share of $(0.25) missed the consensus loss of $(0.23).
  • Free Cash Flow was negative $(123) million and held $803.8 million in cash and equivalents.
  • Outlook: Sabre reiterated its FY22 revenue outlook of $2.3 billion - $2.6 billion at 50% bookings recovery (% of 2019), $2.7 billion - $3.0 billion at 60% bookings recovery, and $3.0 billion - $3.3 billion at 70% bookings recovery.
  • Sabre will be free cash flow positive in Q4 of 2022 and expects to be free cash flow positive in 2023 and annually after that. 
  • Price Action: SABR shares traded lower by 5.71% at $5.61 on the last check Wednesday.
  • Photo Via Company

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