Q4 2025 Sabre Corp Earnings Call

February 18, 2026

Speaker #1: Good morning, and welcome to Sabre's full-year and fourth-quarter 2025 earnings conference call. My name is Olivia, and I'll be your operator. As a reminder, please note today's call is being recorded.

Operator: Good morning, and welcome to Sabre's Full Year and Fourth Quarter 2025 Earnings Conference Call. My name is Olivia, and I'll be your operator. As a reminder, please note today's call is being recorded. I will now turn the call over to the Senior Vice President of Finance, Roshan Kancharla. Please go ahead, sir.

Speaker #1: I will now open the call over to the senior vice president in finance, Roushan Zenooz. Please go ahead, sir.

Speaker #2: Good morning and welcome to our full-year and fourth-quarter 2025 earnings call. This morning, we issued an earnings press release, which is available on our website at investors.sabre.com.

Roshan Kancharla: Good morning, and welcome to our Full Year and Fourth Quarter 2025 Earnings Call. This morning, we issued an earnings press release, which is available on our website at investors.sabre.com. A slide presentation, which accompanies today's prepared remarks, is also available during this call on the Sabre Investor Relations webpage. A replay of today's call will be available on our website later this morning. We advise you that our comments contain forward-looking statements that represent our beliefs or expectations about future events, including results of our growth strategies, our AI offerings, and AI-related developments in the industry, transactions and bookings growth, commercial and strategic arrangements, our financial guidance, outlook, and expectations, pro forma financial information, free cash flow, net leverage, and liquidity, among others. All forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from the statements made on today's conference call.

Brian Evans: Good morning, and welcome to our Full Year and Fourth Quarter 2025 Earnings Call. This morning, we issued an earnings press release, which is available on our website at investors.sabre.com. A slide presentation, which accompanies today's prepared remarks, is also available during this call on the Sabre Investor Relations webpage. A replay of today's call will be available on our website later this morning. We advise you that our comments contain forward-looking statements that represent our beliefs or expectations about future events, including results of our growth strategies, our AI offerings, and AI-related developments in the industry, transactions and bookings growth, commercial and strategic arrangements, our financial guidance, outlook, and expectations, pro forma financial information, free cash flow, net leverage, and liquidity, among others. All forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from the statements made on today's conference call.

Speaker #2: A slide presentation, which accompanies today's prepared remarks, is also available during this call on the Sabre Investor Relations webpage. A replay of today's call will be available on our website later this morning.

Speaker #2: We advise you that our comments contain forward-looking statements that represent our beliefs or expectations about future events, including results of our growth strategies, our AI offerings and AI-related developments in the industry, transactions and bookings growth, commercial and strategic arrangements, our financial guidance, outlook and expectations, performance financial information, free cash flow, net leverage, and liquidity, among others.

Speaker #2: All forward-looking statements involve risks and uncertainties that may cause actual results to defer materially from the statements made on today's conference call. More information on these risks and uncertainties is contained in our earnings release issued this morning and our SEC filings, including our Form 10-K for the year ended December 31, 2025.

Roshan Kancharla: More information on these risks and uncertainties is contained in our earnings release issued this morning and our SEC filings, including our Form 10-K for the year ended December 31, 2025. Throughout today's call, we will also be presenting certain non-GAAP financial measures. References during today's call to adjusted EBITDA, adjusted EBITDA margin, normalized adjusted EBITDA, and normalized adjusted EBITDA margin have been adjusted to exclude certain items. The most directly comparable GAAP measures and reconciliations for non-GAAP measures are available in the earnings release and other documents posted on our website at investors.sabre.com. Normalized amounts have been adjusted for estimated costs historically allocated to our Hospitality Solutions business, which was sold on July 3, 2025.

Brian Evans: More information on these risks and uncertainties is contained in our earnings release issued this morning and our SEC filings, including our Form 10-K for the year ended December 31, 2025. Throughout today's call, we will also be presenting certain non-GAAP financial measures. References during today's call to adjusted EBITDA, adjusted EBITDA margin, normalized adjusted EBITDA, and normalized adjusted EBITDA margin have been adjusted to exclude certain items. The most directly comparable GAAP measures and reconciliations for non-GAAP measures are available in the earnings release and other documents posted on our website at investors.sabre.com. Normalized amounts have been adjusted for estimated costs historically allocated to our Hospitality Solutions business, which was sold on July 3, 2025.

Speaker #2: Throughout today's call, we will also be presenting certain non-GAAP financial measures, references during today's call to adjusted EBITDA, adjusted EBITDA margin, normalized adjusted EBITDA, and normalized adjusted EBITDA margin, have been adjusted to exclude certain items.

Speaker #2: The most directly comparable GAAP measures and reconciliations for non-GAAP measures are available in the earnings release and other documents posted on our website at investors.sabre.com.

Speaker #2: Normalized amounts have been adjusted for estimated costs historically allocated to our hospitality solutions business, which was sold on July 3, 2025. We are also presenting certain financial information on a pro forma basis to give effect to the sale of the hospitality solutions business, and we have removed the impact of the $227 million payment in kind interest that was recorded in conjunction with the refinancing activity in the second quarter of 2025 from pro forma free cash flow.

Roshan Kancharla: We are also presenting certain financial information on a pro forma basis to give effect to the sale of the Hospitality Solutions business, and we have removed the impact of the $227 million payment in-kind interest that was recorded in conjunction with the refinancing activity in Q2 2025 from pro forma free cash flow. Unless otherwise noted, results presented are based on continuing operations. Participating with me are Kurt Ekert, President and CEO; Mike Randolfi, CFO; and Garry Wiseman, President, Product and Engineering. With that, I will turn the call over to Kurt.

Brian Evans: We are also presenting certain financial information on a pro forma basis to give effect to the sale of the Hospitality Solutions business, and we have removed the impact of the $227 million payment in-kind interest that was recorded in conjunction with the refinancing activity in Q2 2025 from pro forma free cash flow. Unless otherwise noted, results presented are based on continuing operations. Participating with me are Kurt Ekert, President and CEO; Mike Randolfi, CFO; and Garry Wiseman, President, Product and Engineering. With that, I will turn the call over to Kurt.

Speaker #2: Unless otherwise noted, results presented are based on continuing operations. Participating with me are Kurt Ekert, president and CEO; Mike Randolfi, CFO; and Gary Wiseman, president, product and engineering.

Speaker #2: With that, I will turn the call over to Kurt.

Speaker #3: Thanks, Roushan. Hello everyone and thank you for joining us. 2025 was a challenging and dynamic year in which exogenous events impacted our operational results.

Kurt Ekert: Thanks, Roshan. Hello, everyone, and thank you for joining us. 2025 was a challenging and dynamic year in which exogenous events impacted our operational results. Despite these challenges, we remained focused on execution and met or exceeded our financial guidance in Q4 and ended the year with positive momentum. Moving forward, I believe we are well-positioned for strong, sustained performance. Our growth outlook today is driven by several key catalysts: continued distribution share gains, the expansion of our multi-source content platform, solid growth in both hotel distribution and our payments business, as well as improving performance in our airline technology business. As I've discussed previously, our industry is evolving rapidly, and Sabre is evolving with it. We are in the midst of a fundamental transition, moving Sabre from a GDS-focused company to an AI-native technology leader.

Speaker #3: Despite these challenges, we remained focused on execution and met or exceeded our financial guidance in the fourth quarter, ending the year with positive momentum.

Speaker #3: Moving forward, I believe we are well positioned for strong, sustained performance. Our growth outlook today is driven by several key catalysts. Continued distribution share gains, the expansion of our multi-source content platform, solid growth in both hotel distribution and our payments business, as well as improving performance in our airline technology business.

Speaker #3: As I've discussed previously, our industry is evolving rapidly. And Sabre is evolving with it. We are in the midst of a fundamental transition, moving Sabre from a GDS-focused company to an AI-native technology leader.

Speaker #3: Before reviewing 2025 performance, I have some thoughts on recent market sentiment around AI disintermediation risk. The concern that AI bots could bypass our marketplace and connect directly to suppliers.

Kurt Ekert: Before reviewing 2025 performance, I have some thoughts on recent market sentiment around AI disintermediation risk. The concern that AI bots could bypass our marketplace and connect directly to suppliers. We strongly disagree. AI needs what Sabre has already built: vast, constantly evolving data, integrated content, and complex logic, purpose-built to solve travel's uniquely challenging workflows. We provide the foundational transaction layer AI uses to shop, price, book, and service travel. We expect this shift makes us more essential, not less. We believe agentic AI will reshape the technology landscape, and we are positioning Sabre to lead in this next phase. As AI-native companies enter the travel ecosystem, they need Sabre's strong foundation, which provides breadth of content, modern cloud-native platform, and AI-native APIs, which we believe positions us as the platform of choice.

Speaker #3: We strongly disagree. AI needs with Sabre has already built. Vast, constantly evolving data, integrated content, and complex logic, purpose-built, to solve travel's uniquely challenging workflows.

Speaker #3: We provide the foundational transaction layer AI uses to shop, price, book, and service travel. We expect this shift makes us more essential, not less.

Speaker #3: We believe agentic AI will reshape the technology landscape and we are positioning Sabre to lead in this next phase. As AI-native companies enter the travel ecosystem, they need Sabre's strong foundation.

Speaker #3: Which provides breadth of content, modern cloud-native platform, and AI-native APIs. Which we believe positions us as the platform of choice. While we are in the early stages of sizing the AI opportunity, and have not included any of the potential significant upside in our forward outlook, we are taking deliberate actions to align our talent and investments with the strategy and position Sabre for long-term growth and value creation.

Kurt Ekert: While we are in the early stages of sizing the AI opportunity and have not included any of the potential significant upside in our forward outlook, we are taking deliberate actions to align our talent and investments with this strategy and position Sabre for long-term growth and value creation. As part of these actions, today we announced a series of executive leadership changes effective tomorrow. Garry Wiseman is promoted to President, Product and Engineering, with his remit expanded to include leadership of innovation and agentic AI. Sean Williams is appointed Chief Operating Officer and will lead Sabre's revenue and commercial operations functions. Andy Finkelstein steps into the role of Chief Commercial Officer, Travel Marketplace, and Dave Medrano is promoted to Chief People Officer. Separately, Roshan Mendis, who has been a superb leader during his many years with Sabre, most recently as Chief Commercial Officer, has decided to pursue another opportunity.

Speaker #3: As part of these actions, today we announced a series of executive leadership changes. Effective tomorrow. Gary Wiseman is promoted to president, product and engineering, with his remit expanded to include leadership of innovation, and agentic AI.

Speaker #3: Sean Williams is appointed chief operating officer and will lead Sabre's revenue and commercial operations functions. Andy Finkelstein steps into the role of chief commercial officer, travel marketplace, and Dave Medrano is promoted to chief people officer.

Speaker #3: Separately, Roushan Mendez, who has been a superb leader during his many years with Sabre, most recently as chief commercial officer, has decided to pursue another opportunity.

Speaker #3: Roushan will transition to senior advisor before departing the company in May. We deeply appreciate his contributions, and wish him continued success. On today's call, I've invited Gary to share our progress on delivering agentic AI solutions to drive long-term growth, and why that makes us a critical part of the evolving AI ecosystem.

Kurt Ekert: Roshan will transition to senior advisor before departing the company in May. We deeply appreciate his contributions and wish him continued success. On today's call, I've invited Garry to share our progress on delivering agentic AI solutions to drive long-term growth and why that makes us a critical part of the evolving AI ecosystem. Now, turning to slide four. For the year, we recorded double-digit year-on-year growth in normalized Adjusted EBITDA and generated positive pro forma free cash flow. A key focus for us is further strengthening our balance sheet, and we made significant progress this year by paying off over $1 billion in debt, which, when combined with growth in pro forma Adjusted EBITDA, reduced our pro forma net leverage by approximately 25% compared to year-end 2024. We continue to be proactive in managing our long-term capital structure.

Speaker #3: Now, turning to slide four, for the year we recorded, double-digit year-on-year growth in normalized adjusted EBITDA. And generated positive pro forma free cash flow.

Speaker #3: A key focus for us is further strengthening our balance sheet. And we made significant progress this year by paying off over $1 billion in debt.

Speaker #3: This, when combined with growth in pro forma adjusted EBITDA, reduced our pro forma net leverage by approximately 25% compared to year-end 2024. We continue to be proactive in managing our long-term capital structure.

Speaker #3: Through two successful refinancings in 2025, we have no large maturities until 2029, and over 90% of our debt now matures in 2029 or later.

Kurt Ekert: Through two successful refinancings in 2025, we have no large maturities until 2029, and over 90% of our debt now matures in 2029 or later. We also ended the year with a strong cash balance of $910 million, which includes $98 million of restricted cash for debt repayments in Q1 2026. While we have more work to do to reach our long-term leverage goals, these actions provide us with significant room to continue to invest and further grow our business. On the right side of the slide, our technology investments are driving positive, measurable results. AI has been a core systemic part of the Sabre technology stack for years, and we continue to lean into that advantage.

Speaker #3: We also ended the year with a strong cash balance of $910 million. Which includes $98 million of restricted cash for debt repayments in the first quarter of 2026.

Speaker #3: While we have more work to do to reach our long-term leverage goals, these actions provide us with significant room to continue to invest and further grow our business.

Speaker #3: On the right side of the slide, our technology investments are driving positive, measurable results. AI has been a core, systemic part of the Sabre technology stack for years.

Speaker #3: And we continue to lean into that advantage. In 2025, we see as the first mover position in our industry with our introduction of agentic APIs and a proprietary MCP server designed for the travel industry.

Kurt Ekert: In 2025, we seized the first-mover position in our industry with our introduction of agentic APIs and a proprietary MCP server designed for the travel industry. These agentic solutions help AI agents better understand and operate within the complexity of travel content and workflows. We also launched several industry-first AI solutions and partnerships, which Garry will touch on shortly. Sabre Payments was one of our fastest-growing businesses in 2025, with gross spend on the platform increasing more than 35% year-over-year and producing strong revenue growth. Our travel marketplace continues to deliver multi-source travel content on an unprecedented scale and drove agency wins and expansions during the year. In Q4, air distribution bookings grew 4%, which included the direct and indirect impacts from the US government shutdown, and we ended the year with air bookings growth of 7% in December.

Speaker #3: These agentic solutions help AI agents better understand and operate within the complexity of travel content and workflows. We also launched several industry-first AI solutions and partnerships.

Speaker #3: Which Gary will touch on shortly. Sabre Payments was one of our fastest-growing businesses in 2025. With gross spend on the platform increasing more than 35% year-on-year, and producing strong revenue growth.

Speaker #3: Our travel marketplace continues to deliver multi-source travel content on an unprecedented scale, and drove agency wins and expansions during the year. In the fourth quarter, air distribution bookings grew 4%.

Speaker #3: Which included the direct and indirect impacts from the US government shutdown. And we ended the year with air bookings growth of 7% in December.

Speaker #3: Finally, we extended our leadership position in NDC by adding 15 live integrations during the year. Bringing our total to 42, and we are seeing adoption ramp.

Kurt Ekert: Finally, we extended our leadership position in NDC by adding 15 live integrations during the year, bringing our total to 42, and we are seeing adoption ramp. We exited 2025 with NDC representing approximately 4% of total air distribution bookings, and we expect our rate of NDC bookings to accelerate throughout 2026. Moving to slide 5 and details on full year 2025 results. Overall results were positive across the board. Total distribution bookings grew 1% year-on-year, and full-year air distribution bookings were also positive. Within airline technology, passengers boarded grew 2% year-on-year. Hotel distribution bookings increased 5% year-on-year to 42 million, and the attachment rate to air bookings increased over 130 basis points year-on-year. Gross hotel booking value transacted through the platform now exceeds $20 billion annually.

Speaker #3: We exited 2025 with NDC representing approximately 4% of total air distribution bookings, and we expect our rate of NDC bookings to accelerate throughout 2026.

Speaker #3: Moving to slide five and details on full-year 2025 results. Overall results were positive across the board. Total distribution bookings grew 1% year-on-year, and full-year air distribution bookings were also positive.

Speaker #3: Within airline technology, passengers boarded grew 2% year-on-year. Hotel distribution bookings increased 5% year-on-year to 42 million, and the attachment rate to air bookings increased over 130 basis points year-on-year.

Speaker #3: Gross hotel booking value transacted through the platform now exceeds $20 billion annually. These positive results drew full-year revenue growth, and combined with ongoing expense management, normalized adjusted EBITDA grew 10%.

Kurt Ekert: These positive results drove full-year revenue growth and, combined with ongoing expense management, normalized Adjusted EBITDA grew 10%. Normalized Adjusted EBITDA margin improved over 160 basis points to 19%. Moving to slide 6. Our cloud-native technology foundation is driving growth across our portfolio. Within airline technology, we are delivering a growing suite of modular, AI-driven solutions, ranging from new tools that optimize revenue in real time to a growing suite of GenAI chat and servicing capabilities. As airlines transition to modular offer order-based systems, we believe Sabre is well positioned to be the vendor of choice for their transformation.... With our Sabre Mosaic Airline technology gaining momentum, we expect to drive positive IT solutions revenue growth for 2026. Our travel marketplace provides a single connection to what we believe is the widest breadth of travel content in the industry.

Speaker #3: Normalized adjusted EBITDA margin improved over 160 basis points to 19%. Moving to slide six. Our cloud-native technology foundation is driving growth across our portfolio.

Speaker #3: Within airline technology, we are delivering a growing suite of modular AI-driven solutions. Ranging from new tools that optimize revenue in real-time, to a growing suite of GenAI chat and servicing capabilities.

Speaker #3: As airlines transition to modular, offer order-based systems, we believe Sabre is well positioned to be the vendor of choice for their transformation. With our Sabre Mosaic airline technology gaining momentum, we expect to drive positive IT solutions revenue growth for 2026.

Speaker #3: Our travel marketplace provides a single connection to what we believe is the widest breadth of travel content in the industry. Air expansion is the combination of our distribution expansion and multi-source platform growth strategies.

Kurt Ekert: Air expansion is the combination of our distribution expansion and multi-source platform growth strategies. Despite a challenging 2025, we ended the year with strong momentum, driven by continued share gains, growth in NDC bookings, and our new LCC solution, which is now fully launched, as well as continued growth from the Sabre Mosaic marketplace. We expect to see a meaningful year-on-year acceleration in air bookings growth. Overall, we expect annual volume growth for both 2026 and 2027 to be in the mid-single digits. Importantly, now 6 weeks into the quarter, the strength we saw in December has continued and is broad-based across all regions and also within corporate travel.

Speaker #3: Despite a challenging 2025, we ended the year with strong momentum. Driven by continued share gains, growth in NDC bookings, and our new LCC solution, which is now fully launched, as well as continued growth from the Sabre Mosaic marketplace, we expect to see a meaningful year-on-year acceleration in air bookings growth.

Speaker #3: Overall, we expect annual volume growth for both 2026 and 2027 to be in the mid-single digits. Importantly, now six weeks into the quarter, the strength we saw in December has continued.

Speaker #3: And as broad-based across all regions, and also within corporate travel. Lodging expansion continues to scale delivering over 350 million dollars in annual LGS revenue in 2025, and we expect continued solid revenue growth in 2026.

Kurt Ekert: Lodging expansion continues to scale, delivering over $350 million in annual LGS revenue in 2025, and we expect continued solid revenue growth in 2026. Finally, we believe that Payment Suite, our integrated Fintech hub, is well positioned for sustained growth. It remains one of the fastest-growing areas within Sabre, with strong demand for our solutions that simplify operations, increase payment flexibility, and automate risk and fraud management. I'll now hand the call over to Garry, who will discuss AI and Sabre's AI strategy in greater detail.

Speaker #3: Finally, we believe that payment suite our integrated fintech hub is well positioned for sustained growth. It remains one of the fastest-growing areas within Sabre, with strong demand for our solutions that simplify operations, increase payment flexibility, and automate risk and fraud management.

Speaker #3: I'll now hand the call over to Gary, who will discuss AI and Sabre's AI strategy in greater detail.

Speaker #2: Thank you, Kurt. Moving to slide seven. AI needs us to power results, and we believe it is a huge opportunity for us. Let me explain why from a technology perspective.

Garry Wiseman: Thank you, Kurt. Moving to slide 7. AI needs us to power results, and we believe it is a huge opportunity for us. Let me explain why from a technology perspective. We sit on over 50 petabytes of curated travel data, and we have the greatest depth and breadth of content in the travel space. We process 14,000 transactions per second and 11 billion shopping signals per month. These unparalleled demand signals don't exist anywhere in the public domain. However, we enable pure-play AI companies to participate in a complex space with a simple connection to these insights. We believe we're also critical in an AI-first world because of our proprietary and constantly evolving logic. Travel is extraordinarily complex.

Speaker #2: We sit on over 50 petabytes of curated travel data, and we have the greatest depth and breadth of content in the travel space. We process 14,000 transactions per second and 11 billion shopping centers per month.

Speaker #2: These unparalleled demand signals don't exist anywhere in the public domain. However, we enable pure-play AI companies to participate in a complex space with a simple connection to these insights.

Speaker #2: We believe we're also critical in an AI-first world because of our proprietary and constantly evolving logic. Travel is extraordinarily ily complex. We house over 50 years of servicing workflows, travel policies, and compliance logic across 200-plus countries, and thousands of supplier-specific fare rules and partner network agreements.

Garry Wiseman: We house over 50 years of servicing workflows, travel policies, and compliance logic across 200+ countries and thousands of supplier-specific fare rules and partner network agreements, all built through billions of real transactions. In short, we believe we have solved for almost every single edge case that has ever existed in travel anywhere in the world. This logic is proprietary and cannot be scraped from the web or reverse engineered. AI engines cannot independently obtain and orchestrate this logic. While chatbots can generate itineraries, they can't book or service them reliably at scale. For example, we aggregate and normalize real-time flight results in sub-seconds across hundreds of sources. This is a huge technical hurdle for most AI players today, and this is why Virgin Australia, PayPal, and a growing pipeline are building on us, not around us. And finally, we have a first-mover advantage in the industry.

Speaker #2: All built through billions of real transactions. In short, we believe we have solved for almost every single edge case that has ever existed in travel, any around the world.

Speaker #2: This logic is proprietary and cannot be scraped from the web or reverse engineered. AI engines cannot independently obtain and orchestrate this logic. While chatbots can generate itineraries, they can't book or service them reliably at scale.

Speaker #2: For example, we aggregate and normalize real-time flight results in sub-seconds across hundreds of sources. This is a huge technical hurdle for most AI players today.

Speaker #2: And this is why Virgin Australia PayPal and a growing pipeline are building on us, not around us. And finally, we have a first-mover advantage in the industry.

Speaker #2: We launched the first agentic APIs and MCP server for travel almost six months ago. This was purpose-built for LLM consumption at enterprise scale. It is in production now while competitors have yet to unveil their agentic APIs.

Garry Wiseman: We launched the first agentic APIs and MCP server for travel almost 6 months ago. This was purpose-built for LLM consumption at enterprise scale. It is in production now, while competitors have yet to unveil their agentic APIs. Our open modular platform plugs into wherever travel gets sold and wherever consumers go next, which we believe is conversational commerce. In summary, we own the foundational layer AI needs to transact travel. We believe the shift to agentic makes us more essential than ever. Moving to slide 8, I'll discuss our 3 recent strategic partnerships, which serve to demonstrate our leadership position within AI infrastructure. We believe Sabre is becoming the essential AI infrastructure for travel, serving both established companies, modernizing their stack, and AI-native startups building next-generation experiences. Our 3 recent partnerships confirm this.

Speaker #2: Our open modular platform plugs into wherever travel gets sold and wherever consumers go next, which we believe is conversational commerce. In summary, we own the foundational layer AI needs for transact travel.

Speaker #2: We believe the shift to agentic makes us more essential than ever. Moving to slide eight. I'll discuss our three recent strategic partnerships. Which serve to demonstrate our leadership position within AI infrastructure.

Speaker #2: We believe Sabre is becoming the essential AI infrastructure for travel, serving both established companies modernizing their stack, and AI-native startups building next-generation experiences. Our three recent partnerships confirm this.

Speaker #2: PayPal and Mind Trip are building with us a next-generation agentic experience, unifying discovery, planning, booking, payment, and servicing in one conversational interface. Mind Trip brings the consumer platform.

Garry Wiseman: PayPal and Mindtrip are building with us a next-generation agentic experience, unifying discovery, planning, booking, payment, and servicing in one conversational interface. Mindtrip brings the consumer platform, PayPal brings flexible payments and agentic commerce, and Sabre brings an enterprise travel platform and agentic AI expertise. The product launch is targeted for Q2 2026. BizTrip, a Silicon Valley-based AI-native TMC, is combining our agentic capabilities with their AI assistants to build corporate travel functionality, handling complex bookings, real-time itinerary management, and intelligent policy automation through natural language interfaces. They're leveraging our travel marketplace, agentic APIs, and global network. Virgin Australia is the first airline deploying our Concierge IQ solution. It handles layered questions, delivers accurate bookable results, and goes beyond booking to managing rebooking, miles redemption, refunds, and backtracking. Virgin Australia is seeing improved experience and higher satisfaction with Concierge IQ.

Speaker #2: PayPal brings flexible payments, and agentic commerce. And Sabre brings an enterprise travel platform and agentic AI expertise. The product launch is targeted for the second quarter of 2026.

Speaker #2: Beer Strip. A Silicon Valley-based AI-native TMC is combining our agentic capabilities with their AI assistants to build corporate travel functionality handling complex bookings real-time itinerary management, and intelligent policy automation through natural language interfaces.

Speaker #2: They're leveraging our travel marketplace agentic APIs and global network. Virgin Australia is the first airline deploying our Concierge IQ solution. It handles layered questions, delivers accurate bookable results, and goes beyond booking to managing rebooking, miles redemption, refunds, and backtracking.

Speaker #2: Virgin Australia is seeing improved experience and higher satisfaction with concierge IQ. Additionally, we're exposing this functionality via our new ChatGPT plugin for Virgin Australia.

Garry Wiseman: Additionally, we're exposing this functionality via our new ChatGPT plugin for Virgin Australia.... This ChatGPT plugin solution is available for all of our travel supply partners. Our AI solutions help our customers compete and win in the emerging AI ecosystem. Further, we believe we're well positioned to win in the new channel of conversational travel commerce by providing comprehensive shopping, booking, and servicing capabilities to any company that is developing an agentic travel experience. Thank you. Now over to you, Mike.

Speaker #2: This ChatGPT plugin solution is available for all of our travel supply partners. Our AI solutions help our customers compete and win in the emerging AI ecosystem.

Speaker #2: Further, we believe we're well positioned to win in the new channel of conversational travel commerce by providing comprehensive shopping, booking, and servicing capabilities to any company that is developing an agentic travel experience.

Speaker #2: Thank you. Now over to you, Mike.

Speaker #3: Thanks, Gary. And good morning, everyone. Please turn to slide 10. Fourth quarter financial results were solid, and generally met the expectations we shared on our third quarter call.

Mike Randolfi: Thanks, Garry, and good morning, everyone. Please turn to slide 10. Q4 financial results were solid and generally met the expectations we shared on our Q3 call. These results reflect the continued improvement in operating trends we saw at the end of the Q3, partially offset by impacts related to the government shutdown during the quarter. In the Q4, total revenue grew by 3% year-over-year, consistent with our guidance of low single-digit year-over-year growth. Distribution revenue grew $27 million, an increase of 5%, primarily due to an increase in air and hotel distribution bookings, favorable rate impacts, and an increase in other revenue. Air distribution bookings grew 4% year-over-year, below the guidance of 6% to 8% we provided on our Q3 earnings call.

Speaker #3: These results reflect the continued improvement in operating trends we saw at the end of the third quarter partially offset by impacts related to the government shutdown during the quarter.

Speaker #3: In the fourth quarter, total revenue grew by 3% year-on-year. Consistent with our guidance of low single-digit year-on-year growth. Distribution revenue grew 27 million dollars, an increase of 5% primarily due to an increase in air, hotel distribution bookings, favorable rate impacts, and an increase in other revenue.

Speaker #3: Air distribution bookings grew 4% year-on-year, below the guidance of 6% to 8% we provided on our third quarter earnings call. While our previous outlook accounted for the government and military travel reductions known at the time, the impacts were broader than expected due to lower inbound US traffic and an increase in flight cancellations.

Mike Randolfi: While our previous outlook accounted for the government and military travel reductions known at the time, the impacts were broader than expected due to lower inbound US traffic and an increase in flight cancellations. As Kurt mentioned, we ended the year with strong momentum, achieving 7% air distribution bookings growth in December, and we anticipate mid-single-digit air distribution bookings growth in Q1. IT solutions revenue of $140 million was within the range of expectations we shared on our Q3 call. Gross margin of 58% was also in line with our expectations. The year-on-year decrease in gross margin was primarily due to revenue mix and FX impacts of a weaker US dollar.

Speaker #3: As Kurt mentioned, we ended the year with strong momentum, achieving 7% air distribution bookings growth in December, and we anticipate mid-single-digit air distribution bookings growth in the first quarter.

Speaker #3: IT solutions revenue of 140 million dollars was within the range of expectations we shared on our third quarter call. Gross margin of 58% was also in line with our expectations.

Speaker #3: The year-on-year decrease in gross margin was primarily due to revenue mix, and FX impacts of a weaker US dollar. Fourth quarter 2025 normalized adjusted EBITDA of 119 million dollars, increased 10% year-on-year.

Mike Randolfi: Q4 2025 normalized Adjusted EBITDA of $119 million increased 10% year-on-year, with normalized Adjusted EBITDA margin expanding by 107 basis points to 18%. Normalized Adjusted EBITDA growth was driven by higher revenue and continued expense management. Pro forma free cash flow was $116 million for the fourth quarter, a year-on-year increase of $45 million. And recall, our quarterly pro forma free cash flow includes the negative impact of $19 million of disbursements related to refinancing fees and interest paid earlier than previously expected. Moving to slide 11 and full year 2025 results. For the full year, Sabre reported revenue of $2.8 billion, up 1% year-on-year, driven primarily by growth in distribution revenue. Gross margin for the year was 57.2% within our expectations.

Speaker #3: With normalized adjusted EBITDA margin expanding by 107 basis points to 18%. Normalized adjusted EBITDA growth was driven by higher revenue, and continued expense management.

Speaker #3: Pro forma free cash flow was 116 million dollars for the fourth quarter, a year-on-year increase of 45 million dollars, and recall our quarterly pro forma free cash flow includes the negative impact of 19 million dollars of disbursements related to refinancing fees and interest paid earlier than previously expected.

Speaker #3: Moving to slide 11 and full year 2025 results. For the full year, Sabre reported revenue of 2.8 billion dollars, up 1% year-on-year, driven primarily by growth in distribution revenue.

Speaker #3: Gross margin for the year was 57.2% within our expectations. Full year 2025 normalized adjusted EBITDA of 536 million dollars, increased 10% year-on-year, with normalized adjusted EBITDA margin expanding by 166 basis points to 19%.

Mike Randolfi: Full year 2025 normalized adjusted EBITDA of $536 million increased 10% year-on-year, with normalized adjusted EBITDA margin expanding by 166 basis points to 19%. Pro forma free cash flow was $57 million. We ended the year with a strong cash balance of $910 million, which includes $98 million in restricted cash for debt payments in Q1 2026. Moving to slide 12. Full year results were largely in line with the expectations we outlined on our Q3 earnings call. Revenue growth of 1% met our guidance for flat year-on-year growth. Normalized adjusted EBITDA of $536 million was above our guidance of approximately $530 million, driven by continued cost management.

Speaker #3: Pro forma free cash flow was 57 million dollars, we ended the year with a strong cash balance of 910 million dollars, which includes 98 million dollars of restricted cash for debt payments in the first quarter of 2026.

Speaker #3: Moving to slide 12. Full year results were largely in line with the expectations we outlined on our third quarter earnings call. Revenue growth of 1%, met our guidance for flat year-on-year growth.

Speaker #3: Normalized adjusted EBITDA of 536 million dollars was above our guidance of approximately 530 million dollars, driven by continued cost management. Pro forma free cash flow of 57 million dollars includes 19 million dollars of disbursements related to refinancing fees and interest paid earlier than previously expected due to the refinancing activity in 2025.

Mike Randolfi: Pro forma free cash flow of $57 million includes $19 million of disbursements related to refinancing fees and interest paid earlier than previously expected due to the refinancing activity in 2025. Turning to slide 13. In 2025, we made significant progress on our capital structure, lowering overall debt and extending our maturities. We paid off over $1 billion of debt using cash on the balance sheet and proceeds from the sale of Hospitality Solutions. Importantly, we have also extended our debt maturity profile. Following two successful refinancings in 2025, we have no large debt maturities until the spring of 2029, and over 90% of our debt matures in 2029 or later.

Speaker #3: Turning to slide 13. In 2025, we made significant progress on our capital structure. Lowering overall debt and extending our maturities. We paid off over $1 billion of debt using cash on the balance sheet and proceeds from the sale of hospitality solutions.

Speaker #3: Importantly, we have also extended our debt maturity profile. Following two successful refinancings in 2025, we have no large debt maturities until the spring of 2029, an over 90% of our debt matures in 2029 or later.

Speaker #3: Through growth and pro forma adjusted EBITDA, and the reduction of debt combined with our strong year-end cash balance, we have reduced our pro forma net leverage ratio by approximately 25% versus year-end 2024.

Mike Randolfi: Through growth in pro forma Adjusted EBITDA and the reduction of debt, combined with our strong year-end cash balance, we have reduced our pro forma net leverage ratio by approximately 25% versus year-end 2024. We remain focused on further delevering, and I'm proud of the work we have done this year. Moving to slide 14 and our outlook for 2026, including a walk from 2026 pro forma Adjusted EBITDA to free cash flow. Consistent with our strategy, we are providing 2026 guidance as well as commentary on 2027 to demonstrate that we believe we are well positioned to generate sustainable, positive, free cash flow over the long term. Our outlook excludes the potential upside from Agentic AI initiatives, which we believe could be meaningful, but it's too early to quantify.

Speaker #3: We remain focused on further delivering, and I'm proud of the work we have done this year. Moving to slide 14 and our outlook for 2026, including a walk from 2026 pro forma adjusted EBITDA to free cash flow.

Speaker #3: Consistent with our strategy, we are providing 2026 guidance, as well as commentary on 2027 to demonstrate that we believe we are well positioned to generate sustainable, positive, free cash flow over the long term.

Speaker #3: Our outlook excludes the potential upside from agentic AI initiatives, which we believe could be meaningful, but it's too early to quantify. For full year 2026, we expect mid-single-digit volume growth driven by continued share gains, growth of NDC bookings, and our recently launched LCC solution.

Mike Randolfi: For full year 2026, we expect mid-single-digit volume growth, driven by continued share gains, growth of NDC bookings, and our recently launched LCC solution. We expect the growth in volumes will lead to year-on-year revenue growth of mid-single digits. We also expect IT solutions revenue to grow in the mid-single digits for the year and to be in the range of $140 to 150 million per quarter, with growth coming primarily in the back half of the year. As mentioned, we do expect that a portion of 2026 revenue growth will be driven by increasing NDC and LCC volumes, which drive incremental gross profit at a slightly lower margin.

Speaker #3: We expect a growth in volumes will lead to year-on-year revenue growth of mid-single digits. We also expect IT solutions revenue to grow in the mid-single digits for the year, and to be in the range of 140 to 150 million dollars per quarter, with growth coming primarily in the back half of the year.

Speaker #3: As mentioned, we do expect that a portion of 2026 revenue growth will be driven by increasing NDC and LCC volumes, which drive incremental gross profit at a slightly lower margin.

Speaker #3: In addition to the impact of these accelerating volumes, some additional expected changes in mix as well as FX pressure, we anticipate 2026 pro forma gross margin to be in the range of 56% to 57%.

Mike Randolfi: In addition to the impact of these accelerating volumes, some additional expected changes in mix as well as FX pressure, we anticipate 2026 pro forma gross margin to be in the range of 56% to 57%. We are targeting to keep pro forma adjusted technology and pro forma adjusted SG&A lines relatively flat over the next 2 to 3 years through an inflation offset program. The goal of this program is to offset normal inflationary pressures over the next 2 to 3 years. We anticipate the pro forma adjusted technology line will reflect a low single-digit % increase due to increased technology costs from higher volumes. We expect pro forma adjusted SG&A will decrease by a low single-digit amount for the full year 2026.

Speaker #3: We are targeting to keep pro forma adjusted technology and pro forma adjusted SG&A lines relatively flat over the next two to three years through an inflation offset program.

Speaker #3: The goal of this program is to offset normal inflationary pressures over the next two to three years. We anticipate the pro forma adjusted technology line will reflect a low single-digit percent increase due to increased technology cost from higher volumes.

Speaker #3: We expect pro forma adjusted SG&A will decrease by a low single-digit amount for the full year 2026. Through keeping costs relatively flat, we expect strong flow-through from revenue growth to pro forma adjusted EBITDA, which is expected to be approximately 585 million dollars in 2026.

Mike Randolfi: Through keeping costs relatively flat, we expect strong flow-through from revenue growth to pro forma Adjusted EBITDA, which is expected to be approximately $585 million in 2026. We do not expect any significant change to our annual CapEx spend of approximately $80 million. Annual cash interest in 2026 is expected to be approximately $470 million. This represents a year-on-year increase of approximately $140 million. The increase is primarily due to Sabre no longer receiving the cash benefit from the payment-in-kind instrument Sabre had in place from June 2023 through May 2025, which provided us with the option to defer cash interest. As part of our inflation offset program, we estimate total restructuring costs will be around $65 million.

Speaker #3: We do not expect any significant change to our annual CapEx spend of approximately $80 million. Annual cash interest in 2026 is expected to be approximately $470 million.

Speaker #3: This represents a year-on-year increase of approximately $140 million. The increase is primarily due to Sabre no longer receiving the cash benefit from the paid-in-kind instrument Sabre had in place from June 2023 through May of 2025, which provided us with the option to defer cash interest.

Speaker #3: As part of our inflation offset program, we estimate total restructuring costs will be around 65 million dollars. In the fourth quarter of 2025, we recorded a 51 million dollar restructuring charge related to this program.

Mike Randolfi: In the Q4 of 2025, we recorded a $51 million restructuring charge related to this program. We expect approximately $60 million of cash outflows related to the program in 2026. One item to note before discussing our free cash flow guidance. Going forward, we will not be utilizing the pro forma free cash flow metric as there are no further adjustments to be made to free cash flow for the sale of Hospitality Solutions. We expect 2026 free cash flow to be negative $70 million, driven primarily by the impact of the $60 million in restructuring costs associated with our previously discussed inflation offset program. Excluding the restructuring charge, free cash flow for 2026 would be near breakeven.

Speaker #3: We expect approximately 60 million dollars of cash outflows related to the program in 2026. One item to note before discussing our free cash flow guidance going forward, we will not be utilizing the pro forma free cash flow metric, as there are no further adjustments to be made to free cash flow for the sale of hospitality solutions.

Speaker #3: We expect 2026 free cash flow to be negative 70 million dollars driven primarily by the impact of the 60 million dollars in restructuring costs associated with our previously discussed inflation offset program.

Speaker #3: Excluding the restructuring charge, free cash flow for 2026 would be near break-even. Looking beyond 2026, with the continued execution of our growth strategies, we anticipate the positive growth trends we have guided to in 2026 will extend into 2027.

Mike Randolfi: Looking beyond 2026, with the continued execution of our growth strategies, we anticipate the positive growth trends we have guided to in 2026 will extend into 2027. Our current expectation is also for mid-single-digit revenue growth in 2027, driven by continued revenue growth and ongoing cost discipline. We expect sustained year-on-year Adjusted EBITDA growth and, importantly, positive Free Cash Flow in 2027. Looking at slide 15 and our expectations for Q1. We expect solid growth in Q1, with volume and revenue growth in the mid-single digits. We anticipate our Q1 revenue growth will result in higher year-on-year gross income. We expect Q1 pro forma gross margin to be at the lower end of our expected annual range of 56% to 57%, primarily due to revenue mix and FX impacts of a weaker dollar.

Speaker #3: Our current expectation is also for mid-single-digit revenue growth in 2027. Driven by continued revenue growth and ongoing cost discipline, we expect sustained year-on-year adjusted EBITDA growth and, importantly, positive free cash flow in 2027.

Speaker #3: Looking at slide 15 and our expectations for the first quarter, we expect solid growth in the first quarter with volume and revenue growth in the mid-single digits.

Speaker #3: We anticipate our first quarter revenue growth will result in higher year-on-year gross income. We expect first quarter pro forma gross margin to be at the lower end of our expected annual range of 56 to 57%, primarily due to revenue mix and FX impacts of a weaker dollar.

Speaker #3: We expect gross margins for the remaining three quarters of 2026 to be higher versus the first quarter due to the impact of higher margin sales including media as well as payments.

Mike Randolfi: We expect gross margins for the remaining 3 quarters of 2026 to be higher versus Q1, due to the impact of higher-margin sales, including media, as well as payments. Additionally, in Q1, we expect pro forma adjusted technology expense will be higher on a year-on-year basis, primarily due to volume growth and typical wage inflation. Moving to pro forma adjusted SG&A, we expect a year-on-year increase due to a combination of typical wage inflation and the impact of a sales tax refund benefit of $7 million in the prior year that is not expected to recur. For the remainder of 2026, we expect that costs will generally trend down due to the impacts of our inflation offset program. Overall, we expect Q1 pro forma adjusted EBITDA to be approximately $130 million.

Speaker #3: Additionally, in the first quarter, we expect pro forma adjusted technology expense will be higher on a year-on-year basis, primarily due to volume growth and typical wage inflation.

Speaker #3: Moving to pro forma adjusted SG&A, we expect a year-on-year increase due to a combination of typical wage inflation and the impact of a sales tax refund benefit of 7 million dollars in the prior year that is not expected to recur.

Speaker #3: For the remainder of '26, we expect that costs will generally trend down due to the impacts of our inflation offset program. Overall, we expect first quarter pro forma adjusted EBITDA to be approximately $130 million.

Speaker #3: We expect quarterly free cash flow to follow historical seasonality and expect the first and third quarters to reflect the majority of the full-year increase to cash interest expense.

Mike Randolfi: We expect quarterly free cash flow to follow historical seasonality and expect Q1 and Q3 to reflect the majority of the full-year increase to cash interest expense. For additional details, we've included a schedule of expected quarterly cash interest within our website financials available on our investor relations website. Our strategy remains focused on generating free cash flow, delevering our balance sheet, and driving sustainable growth through innovation. We made significant progress against these priorities in 2025. Building on the momentum we exited 2025 with, we are excited for the year ahead, and we are optimistic that Sabre is positioned to transition to a period of higher revenue growth going forward. With that, operator, please open the line for questions.

Speaker #3: For additional details, we've included a schedule of expected quarterly cash interest within our website financials available on our investor relations website. Our strategy remains focused on generating free cash flow, de-levering our balance sheet, and driving sustainable growth through innovation.

Speaker #3: We made significant progress against these priorities in 2025, building on the momentum we exited 2025 with. We are excited for the year ahead, and we are optimistic that Sabre is positioned to transition to a period of higher revenue growth going forward.

Speaker #3: And with that operator, please open the line for questions.

Speaker #1: Thank you. Ladies and gentlemen, as a reminder to ask a question, you will need to press star 11 on your telephone and wait for your name to be announced.

Operator: Thank you. Ladies and gentlemen, as a reminder, to ask a question, you will need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, simply press star one one again. Please stand by while we compile the Q&A roster. Our first question coming from the line of Dan Wasielek. Good morning, sir. Your line is now open.

Speaker #1: So we draw your question. Simply press star 11 again. Please stand by while we compile the Q&A roster. And our first question coming from the line of Dan Wasilek.

Speaker #1: Good morning, Star. Your line is now open.

Speaker #2: Hey, guys. Good morning. Nice quarter. Probably a question here for Gary. So, you guys have obviously been hard at work with your AI tool development.

[Analyst]: Hey, guys, good morning. Nice quarter. Probably a question here for Garry. So guys have obviously been hard at work with your AI tool development. I can see how that strengthens your network ecosystem. Just wondering kind of what still needs to be done in your view, on the AI front, what should we be looking for? And then in the prepared comments, it was mentioned, you know, upside opportunities from AI. Just wondering if you maybe could provide some more color on what those might be. Thank you.

Speaker #2: I can see how that strengthens your network ecosystem. Just wondering kind of what still needs to be done in your view on the AI front?

Speaker #2: What should we be looking for? And then in the prepared comments, it was mentioned upside opportunities from AI. Just wondering if maybe you could provide some more color on what those might be.

Speaker #2: Thank you. Thank you very much. Go ahead, Gary. Just jump right in.

Garry Wiseman: Yeah. Hey, good morning-

Kurt Ekert: Yeah, thank you very much.

Garry Wiseman: Oh.

Kurt Ekert: Go ahead, Garry. Just jump right in.

Garry Wiseman: Yeah. So I think on the AI front, relative towards the travel use cases, for me, really what is gonna be the next stage here is to generally show the end-to-end experience of conversational commerce in travel. And so that's what we're doing with the partnership that you've seen with Mindtrip and with PayPal, where through the Mindtrip app itself, you can have a great experience in terms of building an itinerary that's personalized, that's highly relevant towards your needs as you try and plan your next trip.

Speaker #3: Yeah. So I think only AI front relative towards the travel use cases for me really what is going to be the next stage here is to generally show the end-to-end experience of conversational commerce in travel.

Speaker #3: And so that's what we're doing with the partnership that you've seen with MindTrip and with PayPal, where, through the MindTrip app itself, you can have a great experience in terms of building an itinerary that's personalized and highly relevant to your needs as you try and plan your next trip.

Speaker #3: We then come in in terms of making sure that we provide you the greatest offers in terms of how to get there, where to stay.

Garry Wiseman: We then come in, in terms of making sure that we provide you the greatest offers in terms of how to get there, where to stay, and then obviously with PayPal, they then are able to help in terms of the payment, whether it's a single payment or actually payment over time through installments, to make sure that you can actually afford that particular trip. So that's been one of the things for me that's been missing when it came to AI and a travel experience, is that no one has really done that end-to-end yet, from really the discovery, the planning, the booking, the payment, and the servicing. So that's what I'm super excited to see as we go into Q2 2026. Go ahead, Kurt.

Speaker #3: And then obviously with PayPal, they then are able to help in terms of the payment, whether it's a single payment or actually payment over time.

Speaker #3: Through installments, to make sure that you can actually afford that particular trip. So that's been one of the things for me that's been missing when it came to AI and a travel experience is that no one has really done that end-to-end yet, from really the discovery, the planning, the booking.

Speaker #3: The payments and the servicing. So that's what I'm super excited to see as we go into the second quarter of 2026. Go ahead, Kurt.

Speaker #2: Yeah. And I was just going to add one of the interesting things that is unique about Sabre is Gary alluded to in the prepared remarks is we already have the full breadth of data content intelligence shopping servicing capabilities putting the front end agentic layer on there as Gary would articulate is actually not that technically complex.

Kurt Ekert: Yeah, I was just gonna add, one of the interesting things that is unique about Sabre, as Gary alluded to in the prepared remarks, is we already have the full breadth of data, content, intelligent shopping, servicing capabilities. Putting the front-end agentic layer on there, as Gary would articulate, is actually not that technically complex. It's just a matter of extending our capabilities into it as a new ecosystem of agentic travel.

Speaker #2: It's just a matter of extending our capabilities into what is a new ecosystem of agentic travel.

[Analyst]: And thank you. And then, you know, anything, I guess, that you're willing to remark on, like, upside opportunities that might evolve from AI in the years to come?

Speaker #4: And thank you. And then, is there anything, I guess, that you're willing to remark on—upside opportunities that might evolve from AI in the years to come?

Speaker #2: Yeah. I think the best way to think about this in my eyes is if you think back, if you're as old as I am, 30 years ago, you saw the emergence of online travel agents as a fundamentally new channel.

Kurt Ekert: Yeah, I, I think the best way to think about this in my eyes is, if you think back, if you're as old as I am, 30 years ago, you saw the emergence of online travel agents as a fundamentally new channel. That had the impact of taking share away from both supplier direct and indirect channels at the time. I think what you're gonna see with agentic travel, these are the agentic players as well as tech platforms, is that is going to emerge similar to the way OTAs emerged as a fundamentally new channel, probably happen even more rapidly than what you saw with the emergence of OTAs. When you think about which channels are at risk, I think it's those that are subject to an internet or electronic experience today. So less impacted should be corporate travel and brick-and-mortar travel agencies.

Speaker #2: And that had the impact of taking share away from both supplier direct and indirect channels at the time. I think what you're going to see with agentic travel these are the agentic players as well as tech platforms is that is going to emerge similar to the way OTAs emerge as a fundamentally new channel probably happen even more rapidly than what you saw with the emergence of OTAs.

Speaker #2: When you think about which channels are at risk, I think it's those that are subject to an internet or electronic experience today. So less impacted should be corporate travel, and brick-and-mortar travel agencies.

Speaker #2: More impacted would be supplier direct, where you have non-loyal travelers. Metasearch, which is not an end-to-end experience because you're being linked off. And then third would be OTAs, and obviously OTAs are going to play in this very differently.

Kurt Ekert: More impacted would be, supplier direct, where you have non-loyal travelers. Meta search, which is not an end-to-end experience because you're being linked off. And then third would be OTAs, and obviously OTAs are going to play in this very differently. So we think the offensive opportunity for Sabre is very substantial. Again, very hard to articulate how large that agentic sector is going to be and the pace at which is going to play, but we believe we have a distinct market advantage in terms of speed to market today. So we're looking to plant flags very aggressively.

Speaker #2: So we think the offensive opportunity for Sabre is very substantial. Again, very hard to articulate how large that agentic sector is going to be and the pace at which is going to play.

Speaker #2: But we believe we have a distinct market advantage in terms of speed to market today. So we're looking to plant flags very aggressively.

Speaker #4: Okay. Great. Thank you.

[Analyst]: Okay, great. Thank you.

Speaker #1: Thank you. And our next question comes from the line of Josh Bear with Morgan Stanley. Your line is now open.

Operator: Thank you. Our next question coming from the line of Josh Baer with Morgan Stanley. Your line is now open.

Speaker #2: Thanks for the question. I think you did a great job addressing the topic of agentic and AI bots. I was hoping you could do the same with just direct connects generally.

Josh Baer: Thanks for the question. I think you did a great job addressing the topic of agentic and AI bots. I was hoping you'd do the same with just direct connects generally. One of the challenges of airlines and OTAs, other travel buyers, just building direct connects, is the huge cost burden in establishing and also maintaining and supporting those connections. From an R&D and a developer and infrastructure perspective, does the introduction of GenAI change that economic equation at all? Just thinking about lower costs of coding, increasing productivity of a developer. Yeah, if you could weigh in there on that topic. Thanks.

Speaker #2: One of the challenges for airlines, OTAs, and other travel buyers just building direct connects is the huge cost burden in establishing, maintaining, and supporting those connections.

Speaker #2: From an R&D and a developer and infrastructure perspective, does the introduction of GenAI change that economic equation at all? Just thinking about lower cost of coding increasing productivity of a developer yeah, if you could weigh in there on that topic.

Speaker #2: Thanks.

Speaker #5: Yeah. This is Curt. Let me have Gary jump in first on what I'll call the physics of direct connect and how that will emerge in an agentic world.

Kurt Ekert: Yeah, this is Kurt. Let me have Garry jump in first on the, what I'll call the physics of a direct connect and how that will emerge in an agentic world, and then I'll comment on the industry structure a bit.

Speaker #5: And then I'll comment on the industry structure a bit.

Speaker #3: Yes. Thank you. Thank you, Curt. So really, this comes down to what makes this a great partner for an AI company or any company to work with rather than attempt to really replicate what we do.

Garry Wiseman: Yeah, thank you. Thank you, Kurt. So, so really, you know, this comes down to what makes us a great partner for an AI company or any company to work with, rather than attempt to really replicate what we do. So we, we have a highly scalable marketplace, obviously, with that vast selection of travel content that we both have the contractual rights to aggregate, normalize, and display at a speed that an AI agent could not do in a real-time fashion, which is due to our volumes, which means that we can predictably cache content in such a way that individual suppliers cannot. And hence, we can cope with that look-to-book ratio that is a severe tax on suppliers' infrastructure costs.

Speaker #3: So, we have a highly scalable marketplace. Obviously, with that vast selection of travel content that we both have the contractual rights to aggregate, normalize, and display at a speed that an AI agent could not do in a real-time fashion—which is due to our volumes—which means that we can predictably cache content in such a way that individual suppliers cannot.

Speaker #3: And hence, we can cope with that look-to-book ratio that is a severe tax on suppliers' infrastructure costs. So this is something, again, that—whether it's in a general web search or in any type of shopping scenario, that could be AI or not—is something that we excel at in terms of responding in subsecond times, compared to what is today taking eight to nine seconds if you connect directly to a supplier and are shopping on their APIs independently.

Garry Wiseman: So this is something, again, that, whether it's in a general web search or any type of shopping scenario that could be AI or not, is something that we excel at in terms of responding in subsecond times compared to what is today taking, you know, 8 to 9 seconds, if you connect directly to supplier and are shopping on their APIs independently. Kurt?

Speaker #3: Curt?

Speaker #2: Yeah. Thank you, Gary. And so think about direct connects generally. For folks who enable a direct connect and Sabre is an amalgam of 500 airline direct connects and thousands of hotel direct connects, for example.

Kurt Ekert: Yeah. Thank you, Garry. And so think about direct connects generally for folks who enable a direct connect, and Sabre is an amalgam of 500 airline direct connects and thousands of hotel direct connects, for example. When you have look-to-book coming inbound and you have massive complexity, that creates challenges both for the supplier, who's dealing with this inbound traffic. Number two is for the person doing the direct connect, very difficult to manage that environment. We've spoken previously about the opportunity for re-intermediation of some of the direct connect traffic. I think you'll see that in some of our results going forward. With agentic AI, that problem is going to be exacerbated for both the suppliers with inbound traffic and response times, and two, for folks who may have those direct connects in place, like OTAs.

Speaker #2: When you have look-to-book coming inbound and you have massive complexity, that creates challenges both for the supplier who's dealing with this inbound traffic. Number two is for the person doing the direct connect.

Speaker #2: It's very difficult to manage that environment. We've spoken previously about the opportunity for reintermediation of some of the direct connect traffic. I think you'll see that in some of our results going forward.

Speaker #2: With agentic AI, that problem is going to be exacerbated for both the suppliers with inbound traffic and response times. And two, for folks who may have those direct connects in place like OTAs.

Speaker #2: So, I actually think the utility that we provide tomorrow, in an agentic world, is actually going to be even more important than it was yesterday.

Kurt Ekert: So I actually think the utility that we provide tomorrow in an agentic world is actually gonna be even more important than it was yesterday.

Speaker #4: Okay. That's helpful. And then was just hoping you could unpack this inflation offset program a little bit further. What exactly is inflating? Is that just wages?

Victor Chung: Okay, that's helpful. And then was just hoping you could unpack this inflation offset program a little bit further. What exactly is inflating? Is that just wages? Is it other costs? And what exactly is offsetting? Thanks.

Victor Cheng: Okay, that's helpful. And then was just hoping you could unpack this inflation offset program a little bit further. What exactly is inflating? Is that just wages? Is it other costs? And what exactly is offsetting? Thanks.

Speaker #4: Is it other costs? And what exactly is offsetting? Thanks.

Speaker #6: Yeah. As part of any cost as part of any cost, you over time have some inflation. Primarily wage inflation, but then you also have some contractual inflation, technology costs tend to go up.

Mike Randolfi: Yeah, you know, as part of any cost, you over time have some inflation, primarily wage inflation, but then you also have some contractual inflation, technology costs tend to go up. You know, one of our goals is to keep our key line items of technology cost and SG&A roughly flat, except for, you know, some volume-related hosting costs. So we've embarked on a program basically to drive efficiency and effectiveness through our organization, with the goal of over the next 2 to 3 years, keeping those cost line items relatively flat, such that as we grow bookings and revenue, we see strong flow-through to EBITDA and EBITDA margin accretion and ultimately greater free cash flow.

Speaker #6: One of our goals is to keep our key line items of technology cost and SG&A roughly flat except for some volume-related hosting costs. So we've embarked on a program basically to drive efficiency and effectiveness through our organization.

Speaker #6: With the goal of over the next two to three years, keeping those cost line items relatively flat such that as we grow bookings and revenue, we see strong flow-through to either DA and EBITDA margin accretion and ultimately greater free cash flow.

Speaker #4: Okay. So that's layoffs and future restructurings?

Victor Chung: Okay, so that's layoffs and future restructurings?

Victor Cheng: Okay, so that's layoffs and future restructurings?

Speaker #6: The way I would think categories: one is leveraging best-in-class geographical location. Second, working with third parties who have certain expertise and efficiencies to a greater degree.

Mike Randolfi: The way I would think about it is I'd put it in three categories. One is leveraging best-in-class geographical location. Second, working with third parties who have certain expertise and efficiencies to a greater degree, and then further embedding AI into our workforce and greater enabling our teams to be as productive as possible. That's the focus.

Speaker #6: And then further embedding AI into our workforce and greater enabling our teams to be as productive as possible. And that's the focus.

Speaker #2: Yeah. And I would just say in doing this, we hold two things relatively sacrosanct. One is operational delivery for our customers. And then two is research and development and just anecdotally we'll have more engineers working on Sabre a year from now than we do today.

Kurt Ekert: And I would just say, in doing this, we hold two things relatively sacrosanct. One is operational delivery for our customers, and then two is research and development. And just anecdotally, we'll have more engineers working on Sabre a year from now than we do today. We're gonna be ramping engineers through the year, and doing that effectively through this program.

Speaker #2: We're going to be ramping engineers through the year and doing that effectively through this program.

Speaker #4: Okay. Thank you.

Victor Chung: Okay, thank you.

Victor Cheng: Okay, thank you.

Speaker #1: Thank you. And our next question coming from the line of Jack Halford with Kansas Fitzgerald. Your line is now open.

Operator: Thank you. Our next question coming from the line of Jack Halpert with Cantor Fitzgerald. Your line is now open.

Speaker #3: Hey. Thanks for taking the question, guys. Just another on the agentic AI stuff. So we know you have a relationship with Google for other parts of the business.

Jack Halpert: Hey, thanks for taking the question, guys. Just another on the agentic AI stuff. So we know you have a relationship with Google for other parts of the business. Do you see any opportunity to deepen your relationship with, Gemini on the agentic AI front? And are you having any conversations with other, leading AI labs, OpenAI, et cetera? And then just secondly, on capital allocation, I know you made a lot of progress on the debt paydown this year. Moving forward, can you talk about how you're thinking about capital allocation for 2026 and beyond? Is the debt profile still the number one priority, or do you feel like you're at a good level to start shifting investment more towards growth initiatives? Thanks.

Brett Knoblauch: Hey, thanks for taking the question, guys. Just another on the agentic AI stuff. So we know you have a relationship with Google for other parts of the business. Do you see any opportunity to deepen your relationship with, Gemini on the agentic AI front? And are you having any conversations with other, leading AI labs, OpenAI, et cetera? And then just secondly, on capital allocation, I know you made a lot of progress on the debt paydown this year. Moving forward, can you talk about how you're thinking about capital allocation for 2026 and beyond? Is the debt profile still the number one priority, or do you feel like you're at a good level to start shifting investment more towards growth initiatives? Thanks.

Speaker #3: Do you see any opportunity to deepen your relationship with Gemini on the agentic AI front? And are you having any conversations with other leading AI labs—OpenAI, etc.?

Speaker #3: And then, just secondly, on capital allocation—I know you made a lot of progress on the debt paydown this year. Moving forward, can you talk about how you're thinking about capital allocation for 2026 and beyond?

Speaker #3: Is the debt profile still the number one priority? Or do you feel like you're at a good level to start shifting investment more towards growth initiatives?

Speaker #3: Thanks.

Speaker #2: Thanks, Jack. I'll take the first question and then ask Mike to speak about capital allocation. So we've got a great relationship with Google. Our AI infrastructure is effectively built on Google's Vertex and now Gemini AI capabilities.

Kurt Ekert: Thanks, Jack. I'll take the first question and then ask Mike to speak about capital allocation. So, we've got a great relationship with Google. Our AI infrastructure is effectively built on Google's Vertex and now Gemini AI capabilities. I'd say what you've seen is the tip of the iceberg in terms of relationships and partnerships that are going to come in the market. We're in conversations with effectively all the meaningful large players out there, which is why we believe this is such a significant opportunity for Sabre. Let me turn it to Mike to speak about capital allocation.

Speaker #2: I'd say what you've seen is the tip of the iceberg in terms of relationships and partnerships that are going to come in the market.

Speaker #2: We're in conversations with, effectively, all the meaningful large players out there. Which is why we believe this is such a significant opportunity for Sabre.

Speaker #2: And let me turn it to Mike to speak about capital allocation.

Speaker #6: Yeah. First, I'd start with the back part of your question first. And I would say we prioritize our investment in our growth initiatives, our growth strategies.

Mike Randolfi: Yeah. First, I'd start with the back part of your question first, and I would say we prioritize our investment in our growth initiatives, our growth strategies, and our agentic AI push forward. So that's a priority. That's always been a priority. With regards to capital structure, you know, we've been thoughtful and proactive with regards to our capital structure. We'll continue to do so, but I think we're actually in a pretty good place today. We ended the year with $910 million of cash on the balance sheet. Now $98 million of that's in escrow for some debt paydowns in March of 2026. So really, the usable cash is $812 million.

Speaker #6: And our agentic AI push forward. So that's a priority that's always been a priority. With regards to capital structure, we've been thoughtful and proactive with regards to our capital structure.

Speaker #6: We'll continue to do so. But I think we're actually in a pretty good place today. We ended the year with $910 million of cash in a balance sheet.

Speaker #6: Now, $98 million of that's in escrow for some debt paydowns in March of 2026. So really, the usable cash is $812 million. We expect to ultimately be generating positive free cash flow over the long run.

Mike Randolfi: We expect to, you know, ultimately be generating positive free cash flow over the long run. And if you look at our maturity ladder, I think we've put ourselves in a pretty good place. We have no large maturities up until June 2029, and we've done that pretty efficiently in terms of cost. So we think we're in a pretty good place at the moment.

Speaker #6: And if you look at our maturity ladder, I think we've put ourselves in a pretty good place. We have no large maturities up until June of 2029.

Speaker #6: And we've done that pretty efficiently in terms of cost. So we think we're in a pretty good place at the moment.

Speaker #3: Great. Thank you, guys.

Jack Halpert: Great. Thank you, guys.

Brett Knoblauch: Great. Thank you, guys.

Speaker #1: Thank you. And as a reminder, Lisa and gentlemen, to ask the question, please press star 11. And our next question in queue coming from the line of Victor Chang with Bank of America.

Operator: Thank you. As a reminder, ladies and gentlemen, to ask a question, please press star one one. Our next question in queue coming from the line of Victor Chang with Bank of America. Your line is now open.

Speaker #1: Your line is now open.

Speaker #5: Hi. Thanks for taking my questions and good slides on the agentic AI initiatives. Maybe on the volume growth for this year, can you walk us through maybe the key benefit?

Victor Chung: Hi, thanks for taking my questions, and good slides on the agentic AI initiatives. Maybe on the volume growth for this year, can you walk us through maybe the case that, obviously, you're guiding mid-single digit for Q1 and full year. I think earlier this year, you sort of analyzed some of the share gains that you have. What is sustainable growth in H2? Is that related to the multi-source, low-cost carrier initiative? How is that working? Secondly, on NDC, you talk about that going up 4%. Can you talk a bit about, like, where are you seeing that growth coming from? Are TMCs finally getting on board, and maybe by region as well? Thank you. I will have a quick follow-up.

Victor Cheng: Hi, thanks for taking my questions, and good slides on the agentic AI initiatives. Maybe on the volume growth for this year, can you walk us through maybe the case that, obviously, you're guiding mid-single digit for Q1 and full year. I think earlier this year, you sort of analyzed some of the share gains that you have. What is sustainable growth in H2? Is that related to the multi-source, low-cost carrier initiative? How is that working? Secondly, on NDC, you talk about that going up 4%. Can you talk a bit about, like, where are you seeing that growth coming from? Are TMCs finally getting on board, and maybe by region as well? Thank you. I will have a quick follow-up.

Speaker #5: Obviously, you're getting it's another different Q1 and full year. I think earlier this year, you still analyzed some of the share gains that you have.

Speaker #5: So, what is sustaining growth in H2? Is that related to the multi-source low-cost carrier initiative? How is that working? And then secondly, on NDC, you talk about that going up 4%.

Speaker #5: Can you talk a bit about where you're seeing that growth coming from? Are TMCs finally getting on board? And maybe by region as well?

Speaker #5: Thank you. And I will have a quick follow-up.

Speaker #2: Okay. Victor, thank you. Multi-part question, of course, as usual. Number one is with respect to distribution volume growth for this calendar year. As we indicated, we expect to see mid-single-digit distribution volume growth for 2026.

Kurt Ekert: ... Okay, Victor, thank you. Multi-part question, of course, as usual. Number one is with respect to distribution volume growth for this calendar year. As we indicated, we expect to see mid-single-digit distribution volume growth for 2026, and again for 2027. As we indicated in December, we saw 7% air distribution volume growth. We've seen a similar trend year to date so far. That's broad-based across all regions. It includes corporate travel, which we had indicated was actually negative last year, so much healthier market environment today. When we look at this in a componentized fashion, first of all, we expect our assumption is the GDS market, which we sit, is largely flat from 25 to 26. So the growth that we're indicating is largely organic performance by Sabre.

Speaker #2: And again, for 2027. As we indicated in December, we saw 7% air distribution volume growth. We've seen a similar trend year to date so far.

Speaker #2: That's broad-based across all regions. It includes corporate travel. Which we had indicated was actually negative last year. So much healthier market environment today. When we look at this in a componentized fashion, first of all, we expect that our assumption is the GDS market, which we sit is largely flat from 25 to 26.

Speaker #2: So the growth that we're indicating is largely organic performance by Sabre. Number one, we expect to continue to take share. That'll be the realization of share takeaways that we implemented last year.

Kurt Ekert: Number one, we expect to continue to take share. That'll be the realization of share takeaways that we implemented last year. We have other things that are being implemented, and we expect to continue to win at pace. Two is NDC, which reached 4% adoption at the end of last year. We expect that to continue to scale, and I'll speak about that further in a second. Three is, we spoke last year about the integration of additional low-cost carrier inventory and the launch of our multi-source platform and new low-cost carrier. That is all fully in production today. It's one of the key reasons we're winning, and we expect to pick up incremental bookings from those carriers as well. With NDC, more specifically, we're seeing it pretty broad-based in terms of adoption by OTA and TMC.

Speaker #2: We have other things that are being implemented. And we expect to continue to win at pace. Two is NDC, which reached 4% adoption at the end of last year.

Speaker #2: We expect that to continue to scale. And I'll speak about that further in a second. And then three is we spoke last year about the integration of additional low-cost carrier inventory and the launch of our multi-source platform and new low-cost carrier.

Speaker #2: That is all fully in production today. It's one of the key reasons we're winning. And we expect to pick up incremental bookings from those carriers as well.

Speaker #2: With NDC more specifically, we're seeing a pretty broad-based in terms of adoption by OTA and TMC. And I'd say it varies by region, but it's very specific to carrier.

Kurt Ekert: And I'd say it varies by region, but it's very specific to carrier. So for example, you might have a large carrier in South America which has broad NDC adoption, and if that's a top territory carrier, that will drive adoption for the region in total. But I would say generally, you're at a point now where, as we indicated, we have 42 carriers live within our NDC solution. We've done a significant amount of work on functionality to basically normalize workflow differences between EDIFACT and NDC for the travel agent, and that's mitigating any productivity or user experience impacts that they may have had previously. So again, we expect that to scale at pace as we go forward.

Speaker #2: So for example, you might have a large carrier in South America, which has broad NDC adoption. And if that's a top two or three carrier, that will drive adoption for the region in total.

Speaker #2: But I would say generally, you're at a point now where, as we indicated, we have 42 carriers live within our NDC solution. We've done a significant amount of work on functionality to basically normalize workflow differences between EDIFACT and NDC for the travel agent.

Speaker #2: And that's mitigating any productivity or user experience impacts that they may have had previously. So again, we expect that to scale at pace as we go forward.

Speaker #5: Thank you. That makes sense. And maybe a quick follow-up on the restructuring. Should we expect the inflation offset program to continue and kind of any cash flow impact for 27 as well, potentially?

Victor Chung: Thank you. That makes sense. Maybe quick follow-up on the restructuring. Should we expect the inflation offset program to continue, and kind of any cash flow impact for 2027 as well, potentially?

Victor Cheng: Thank you. That makes sense. Maybe quick follow-up on the restructuring. Should we expect the inflation offset program to continue, and kind of any cash flow impact for 2027 as well, potentially?

Speaker #6: Sure. So we believe the total quantum of the restructuring will be around $65 million. As we talked about, we had a $51 million charge in the fourth quarter of 2025.

Mike Randolfi: Sure. So we believe the total quantum of the restructuring will be around $65 million. As we talked about, we had a $51 million charge in Q4 2025. The bulk of the cash flow impact will be during this year, in 2026, and that's the $60 million you see in our guidance slide. So in 2027, any, any, cash flow impacts we expect would be de minimis. Could be some, but I would expect it to be de minimis.

Speaker #6: The bulk of the cash flow impact will be during this year, in 2026. And that's the $60 million you see in our guidance slide.

Speaker #6: So in 2027, any cash flow impacts we expect would be de minimis. Could be some, but I would expect it to be de minimis.

Speaker #5: Okay. Thank you.

Victor Chung: Okay, thank you.

Victor Cheng: Okay, thank you.

Speaker #1: Thank you. Now, last question, and we'll come from the line of Chad Kelly with Oppenheimer. Your line is now open.

Operator: Thank you. Now, last question will come from the line of Jed Kelly with Oppenheimer. Your line is now open.

Speaker #4: Hey, great. Great. Thanks for taking my questions. Just on the free cash flow guidance, can you give us an update on how your discussion's going with sort of your debt holders and free cash flow being flat?

Jed Kelly: Hey, great. Great, thanks for taking my questions. Just on the free cash flow guidance, can you give us an update on how your discussion's going with sort of your debt holders and, you know, free cash flow being flat? Would love to hear an update there. Thanks.

Speaker #4: Would love to hear an update there. Thanks.

Speaker #6: Yeah. I mean, well, Jed, as you know, we just completed a significant refinancing of $1.8 billion. That refinancing went very, very well. We did that at an interest cost of $11.8%.

Mike Randolfi: Yeah, I mean, well, Jed, we just—as you know, we just completed a significant refinancing of $1.8 billion. That refinancing went very, very well. We did that at an interest cost of 11.8%. And the free cash flow profile today is the same as when we, you know, conducted that refinancing. So, you know, overall, you know, we're focused on generating positive free cash flow. We expect to generate positive free cash flow in 2027, and we have a strong cash balance.

Speaker #6: And the free cash flow profile today is the same as when we conducted that refinancing. So, overall, we're focused on generating positive free cash flow.

Speaker #6: We expect to generate positive free cash flow in 2027, and we have a strong cash balance.

Speaker #2: Yeah. And Jed, just keep in mind, as Mike indicated during the prepared remarks, free cash flow projection for this year includes the $60 million of impact from restructuring.

Kurt Ekert: Yeah, and Jed, just keep in mind, as Mike indicated during the prepared remarks, free cash flow projection for this year includes the $60 million of impact from restructuring.

Mike Randolfi: Yeah.

Speaker #2: And then about a $130 million year-on-year difference from the PIC moving to cash. So there's no more PIC debt that we hold today.

Kurt Ekert: Then about $130 million year-on-year difference from the PIK moving to cash. So there's no, there's no more PIK debt that we hold today.

Speaker #4: And then would love to hear your, I guess, some last—I'll ask a couple. You said corporate travel is holding up pretty well. That's good to hear.

Jed Kelly: And then would love to hear your – I guess, because I'm last, I'll ask a couple. You said corporate travel's holding up pretty well. That's good to hear. Is that kind of a comp issue, or what's going on there, and where are you seeing the strength? Is it coming more from the traditional travel agencies, or is it coming from some of these new self-service players that we hear about?

Speaker #4: Is that kind of an accom issue, or what's going on there? And where are you seeing the strength? Is it coming more from the traditional travel agencies, or is it coming from some of these new self-service players that we hear about?

Speaker #2: I'd say corporate travel and TMC traffic, which was trailing the market last year, are showing positive signs in the first part of this year.

Kurt Ekert: I'd say corporate travel and TMC traffic, which was trailing the market last year, we're seeing positive signs in the first part of this year. That's fairly broad, both with traditional or existing players, as well as some of the new entrants, and we have good exposure to both parties.

Speaker #2: That's fairly broad both with traditional or existing players as well as some of the as well as some of the new entrants. And we have good exposure to both parties.

Speaker #4: Got it. And then I guess, just my final one—I appreciate all the commentary around AI. And you've been in the travel industry for a while.

Jed Kelly: Got it. And then, I guess, just my final one, you know, appreciate all the commentary around AI. Just... I know you've been in the travel industry for a while. You know, when you hear all these direct connections, and you can see the market's pretty excited about it, if you just, you know, look at the relative outperformance between Marriott and, like, a Booking or any third-party travel agent. I guess just wondering, as we kind of see this evolve, how does this differ than search, where, you know, I assume these direct connections were available for a while, but the suppliers never took advantage of search? And I guess, what makes this different? Because I got to assume Google's not gonna give away their, you know, search advertising business.

Speaker #4: When you hear all these direct connections, and you can see the market's pretty excited about it if you just look at the relative outperformance between Marriott and a Booking or any third-party travel agent.

Speaker #4: I guess, just wondering, as we kind of see this evolve, how does this differ from search, where I assume these direct connections were available for a while, but the suppliers never took advantage of search?

Speaker #4: And I guess what makes this difference? Because I’ve got to assume Google’s not going to give away their search advertising business, and OpenAI is going to need a pretty big auction advertising business to pay for all their compute requirements.

Jed Kelly: And, you know, OpenAI is gonna need a pretty big auction advertising business to pay for all their compute requirements. So just wondering how you kind of see this evolving. Thanks.

Speaker #4: So, just wondering how you kind of see this evolving? Thanks.

Speaker #2: Yeah. So what's interesting, what's very different about—let me compare this to MetaSearch, which is Google Flight Search or Kayak, for example—where you get to compare, as a consumer, many different price points.

Kurt Ekert: ... Yeah. So what's interesting, what's very different about. Let me compare this to meta search, which is Google Flight Search or Kayak, for example, where you, you get to compare as a consumer, many different price points, and then you get launched into a different ecosystem to consummate your booking, into the supplier direct or into the OTA, for example. What we've heard from effectively every agentic player in large tech platform that we've spoken to in recent months is, they wanna have an integrated end-to-end experience to include changes, servicing, et cetera, which doesn't sound like a meta search experience whatsoever. Sounds more like an agency experience. And so, as Gary indicated, we think we're very well positioned to enable that.

Speaker #2: And then you get launched into a different ecosystem to consummate your booking into the supplier direct or into the OTA, for example. What we've heard from effectively every agentic player in large tech platform that we've spoken to in recent months is they want to have an integrated, end-to-end experience to include changes, servicing, etc.

Speaker #2: Which doesn't sound like a MetaSearch experience whatsoever. It sounds more like an agency experience. And so, as Gary indicated, we think we're very well positioned to enable that.

Speaker #2: But when you think about this on a channel basis—and I talked earlier about supplier direct, let's say, non-loyal customers, and MetaSearch—we have a de minimis, or almost no, share impact from either of those two channels today.

Kurt Ekert: But when you think about this on a channel basis, and I talked earlier about supply, supplier direct, let's say, non-loyal customers and meta search, we have a de minimis or almost no share impact from either of those two channels today. So as an intermediary, to the extent that those channels are impacted, that will have no adverse effect on Sabre. If OTAs are adversely impacted, that's between 20% and 25% of our intermediary trading volumes, but we think the OTAs, especially folks like Priceline or Expedia, are very well positioned to compete there. So we look at this and say, agentic and us backing the agentics is an offensive new opportunity. To the extent there's downside risk, the downside risk to us, given our ecosystem, is relatively small.

Speaker #2: So as an intermediary to the extent that those channels are impacted, that will have no adverse effect on Sabre. If OTAs are adversely impacted, that's between 20 and 25 percent of our intermediary trading volumes.

Speaker #2: But we think the OTAs, especially folks like Priceline or Expedia, are very well positioned to compete there. So we look at this and say agentic, and us backing the agentics, as an offensive new opportunity to the extent there's downside risk.

Speaker #2: The downside risk to us, given our ecosystem, is relatively small.

Speaker #4: Got it. And then nice announcement with Mind Trip. PayPal, the Mind Trip people, pretty interesting platform they're building. Can you just expound on that and just I know you said it in your prepared remarks, but any additional color you can add for people on the call?

Jed Kelly: Got it. You know, nice, nice announcement with Mindtrip and PayPal, building Mindtrip people, you know, pretty interesting platform they're building. Can you just expound on that and just, I know you said it in your prepared remarks, but any additional color you can add for people on the call?

Speaker #2: Yeah. Gary's been the architect of that, so I'll ask him to step right in.

Kurt Ekert: Yeah. Garry's been the architect of that, so I'll ask him to step right in.

Speaker #3: Yeah. So, as I mentioned earlier, in terms of the way we're working together here is that Mind Trip is that front-end experience where they're using agentic capabilities in order to really allow discovery and trip planning.

Garry Wiseman: Yeah. So as I mentioned earlier, in terms of the way we're working together here is that, you know, Mindtrip is that front-end experience, where they're using agentic capabilities in order to really allow discovery and trip planning. So let's say you wanna go to Japan, you've got two teenagers, one's into manga. You can tell it that, and it'll start to suggest an outline of places to go, things to go and see. And then combined with that, it'll start calling us for hotel information as it's planning the itinerary to map out what a, you know, what a good hotel would be near a particular attraction that might interest you. And eventually, it'll start to call us for flights as it builds the full itinerary.

Speaker #3: So let's say you want to go to Japan; you've got two teenagers, one's into manga. You can tell it that, and it'll start to suggest an outline of places to go, things to go and see.

Speaker #3: And then combined with that, it'll start calling us for hotel information. As it's planning the itinerary to map out what a good hotel would be near a particular attraction that might interest you.

Speaker #3: And eventually, it'll start to call us for flights as it builds the full itinerary. And then, from that point onwards, as you decide, 'Okay, this is the trip I actually want to go for,' that's where PayPal comes into the mix.

Garry Wiseman: And then from that point onwards, as you decide, okay, this is, this is the trip I actually wanna go for, that's where PayPal comes into the mix. So PayPal, as I said earlier, they, they have the instant payment option, of course, but then also they provide installment payments. As you know, travel these days, particularly international travel, can get quite expensive. So the ability to pay in installments is also, I think, a, a very critical part of this particular experience. And then after that, we provide the, the booking and the servicing capabilities. So if during the trip you're running into issues, you need to reschedule things, rebook, et cetera, you can come back to the, the Mindtrip app and simply tell it that, you'd like to change your flight.

Speaker #3: So PayPal, as I said earlier, they have the instant payment option, of course. But then also, they provide installment payments, as travel these days—particularly international travel—can get quite expensive.

Speaker #3: So, the ability to pay an installment is also, I think, a very critical part of this particular experience. And then, after that, we provide the booking and the servicing capabilities.

Speaker #3: So if during the trip, you're running into issues, you need to reschedule things, rebook, etc., you can come back to the Mind Trip app and simply tell it that you'd like to change your flight.

Speaker #3: So, it's really an end-to-end experience for consumers as they look to discover, plan, book, and then be serviced throughout the travel experience.

Garry Wiseman: So it's really an end-to-end experience for consumers as they look to discover, plan, book, and then be serviced throughout the travel experience.

Speaker #4: Great. Very helpful, and I appreciate you answering all the questions.

Jed Kelly: Great. Very helpful, and appreciate you answering all the questions.

Speaker #3: Of course.

Garry Wiseman: Of course.

Speaker #1: Thank you. This ends the Q&A portion of the call. I will now turn the call back over to Mr. Ekert, CEO, for any closing remarks.

Operator: Thank you. This ends the Q&A portion of the call. I will now turn the call back over to Mr. Ekert, CEO, for any closing remarks.

Speaker #2: Thank you, everybody, for the interest today. We are extremely optimistic and excited for the year and the years ahead, and look forward to sharing results with you in the next quarter and quarters ahead.

Kurt Ekert: Thank you, everybody, for the interest today. We are extremely optimistic and excited for the year and the years ahead, and look forward to sharing results with you in the next quarter and quarters ahead. Take care.

Speaker #2: Take care.

Operator: Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.

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