Back to top

Image: Shutterstock

Sabre's (SABR) Q2 Loss Narrower Than Expected, Sales Up Y/Y

Read MoreHide Full Article

Sabre Corporation (SABR - Free Report) reported a narrower-than-expected loss for second-quarter 2021. The company’s adjusted loss per share of 52 cents came in much narrower than the Zacks Consensus Estimate of a loss of 62 cents. Quarterly adjusted loss was also way narrower than the year-ago quarter’s loss of $1.29 per share.

The company recorded revenues $420 million for the quarter, which is significantly higher than the revenues of $83 million posted in the year-ago quarter, when the COVID-19 pandemic caused disruptions in the global travel industry. This year-over-year surge in the top line reflects continued gradual recovery in global air, hotel and other bookings. Moreover, the top-line figure topped the Zacks Consensus Estimate of $403 million.

Revenue Details

The Travel Solutions segment’s revenues increased to $373 million from the year-ago quarter’s $56 million, mainly on gradual recovery in global air and other bookings.

Sabre Corporation Price, Consensus and EPS Surprise

Sabre Corporation Price, Consensus and EPS Surprise

Sabre Corporation price-consensus-eps-surprise-chart | Sabre Corporation Quote

Distribution (sub-division of Travel Solutions) revenues improved to $218 million from the $48 million seen in second-quarter 2020, chiefly driven by favorable comparison of the prior-year quarter’s significant cancellation activities and gradual recovery in bookings.

IT Solutions (sub-division of Travel Solutions) revenues came in at $155 million, up from the year-ago quarter’s tally of $104 million. This increase was primarily driven by gradual recovery in passengers boarded. Number of boarded airline passengers, a key revenue metric for IT Solutions division, increased to 103.65 million from 19.8 million.

The Hospitality Solutions segment’s revenues totaled $51 million compared with the year-ago quarter’s $29 million. This upside was mainly fueled by the continued gradual recovery in central reservation system transactions and higher Digital Experience revenues.

The company reported an adjusted operating loss of $121.8 million, significantly narrower than the operating loss of $306.8 million posted in the year-earlier period.

Balance Sheet and Cash Flow

Sabre ended the first quarter with cash and cash equivalents of $1.12 billion compared with the previous quarter’s $1.28 billion.

During the quarter, the company used $141 million of cash for operational activities and generated negative free cash flow of $152 million. In the first-half of 2021, it used $338 million of cash for operational activities and generated negative free cash flow of $356 million.

Zacks Rank & Stocks to Consider

Sabre currently carries a Zacks Rank #5 (Strong Sell).

Better-ranked stocks in the broader technology sector include Microsoft (MSFT - Free Report) , Cadence Design Systems (CDNS - Free Report) and Texas Instruments (TXN - Free Report) . While Microsoft sports a Zacks Rank #1 (Strong Buy), Cadence Design and Texas Instruments carries a Zacks Rank of 2 (Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The long-term earnings growth rate for Microsoft, Cadence Design and Texas Instruments is currently pegged at 11.5%, 11.7% and 9.3%, respectively.

Published in