Sabre Earnings: Accelerating Air Volumes and AI Strategy Calm Investor Concerns

Key Morningstar Metrics for Sabre

• Fair Value Estimate: $2.82
• Morningstar Rating: ★★★★★
• Morningstar Economic Moat Rating: Narrow
• Morningstar Uncertainty Rating: Very High

What We Thought of Sabre’s Earnings

Sabre’s SABR fourth-quarter sales increased 3.0% as air booking volumes rose 3.7%—an improvement from the 2.4% growth last quarter, despite the US government shutdown. Normalized adjusted EBITDA margins increased to 17.8% from 16.7%. The company guided to 5% air volume growth in 2026.

Why it matters: Sabre provides the foundational layer that artificial intelligence bots will use. Also, we see revenue growth accelerating in 2026 as new product offerings drive share. Investors cheered results, sending shares up around 30% Feb. 18.

• Over decades, Sabre’s proprietary rules and logic infrastructure have processed billions of complex transactions across hundreds of partners with response times in the nanoseconds (versus several seconds for airline supplier websites), while providing servicing that is hard for AI bots to replicate.
• Moreover, new products are winning business. The firm is integrating AI and partnering with players like MindTrip and PayPal to launch an agentic travel app connected to its vast content and service capabilities. We plan to increase our 2026 revenue growth estimate to 4%-5% from 3%.

The bottom line: We don’t expect our planned sales estimate increase for 2026 to change our $2.82 per share fair value estimate materially. Shares are discounting Sabre’s position in AI. We think the company can achieve its targets in 2026, which should provide a catalyst.

• The year is off to a strong start with air volumes around December’s 7% level. With new product innovation and an improving economic landscape, our 5% air volume estimate for 2026 looks realistic.

Between the lines: Sabre’s liquidity profile and fundamentals are improving, increasing our comfort in its ability to meet its debt obligations.

• Sabre exited the year with $910 million in cash, up from $724 million last year. In 2025, the company repaid $1 billion in debt and reduced leverage by 25%. Also, two refinancings have extended more than 90% of its total debt maturities to 2029 and beyond.