Technology powers Sabre to operate in the travel and tourism industry. The company provides software and services to connect travel suppliers -- such as airlines, hotels, car rental brands, rail carriers, cruise lines, and tour operators -- with travel buyers through one central marketplace. Sabre Travel Network is used by more than 400,000 travel professionals globally to book airline tickets, rental cars, hotel rooms, and vacation packages. The company also provides software, e-business tools, and consulting services to improve the operations of air carriers, airports, and hotels through Sabre Airline and Hospitality Solutions. Sabre sold its Travelocity.com holding just a year after going public in 2014.
In January 2014, the company initially filed to raise around $100 million, but it ended up raising about $627 million. Sabre used the proceeds to pay down debt.
Sabre operates two main business segments: Travel Network and Airlines and Hospitality Solutions. The Travel Network division, which generated 71% of the company's total revenue in 2015, is the global business-to-business travel marketplace that connects travel suppliers (including airlines, hotels, car rental brands, rail carriers, cruise lines and tour operators) to a large network of travel buyers (such as online and offline travel agencies, travel management companies, and corporate travel departments).
The Airlines and Hospitality Solutions segment, which made up 29% of total revenues in 2015, provides software technology products and services through software-as-as-service (SaaS) and hosted delivery models to airlines, hotel properties, and other travel suppliers.
Within this segment, the Airlines Solutions business provides software to help airline travelers through three channels: its reservation system, the SabreSonic Customer Sales & Service (SabreSonic CSS); Sabre AirVision Marketing & Planning, which helps commercial airlines improve profitability and develop their brand; and Sabre AirCenter Enterprise Solutions, which drives operational effectiveness between planning and management of airline, airport, and customer operations. Sabre's Hospitality Solutions business provides software to some 20,000 hotel properties around the world. Its products and services include the SynXis central reservation system (CRS); property management services through Sabre Property Management System (PMS); and marketing and consulting services designed to optimize distribution and marketing.
Sabre operates its business in 108 locations in 54 countries. Besides the worldwide headquarters in Southlake, Texas, Sabre has head offices in London and Singapore. It has 10 additional offices across North America and 13 offices across Latin America that serve in various sales, administration, software development and customer service capacities for all their business segments.
Travel Network has its European regional headquarters in London, with 22 additional offices across Europe.
Travel Network and Airline and Hospitality Solutions have their APAC regional operations headquarters in three offices located in Singapore. it also has additional offices Kuala Lumpur.
Sabre maintains half a dozen global development centers in the US, Argentina, Poland, India, Uruguay, and the Philippines. Some 20 Customer Care Centers, where most of the direct contact with clients takes place, are located in North America, South America, Europe, the Middle East, and India. It has IT development centers in India and the US.
Sales and Marketing
The company has customers in more than 160 countries.
Travel Network's customers consist of travel suppliers, including airlines, hotels, car rental brands, rail carriers, cruise lines, tour operators, attractions and services; a large network of travel buyers, including OTAs, offline travel agencies, TMCs and corporate travel departments; and travelers and other sellers of travel and consumers of travel information. Customers are primarily located in the US, Canada, Europe, Latin America, and Asia.
Sabre spent $10 million on advertising in 2015 compared to $17 million on advertising in 2014, and $16 million in 2013.
In 2015 Sabre's net revenues increased by 13%.
Revenues from the Travel Network rose primarily due to the acquisition of Abacus (which develops travel solutions and services for travel agencies). Direct Billable Bookings increased by 18%, and an increase in revenue was partially offset by decrease in other revenues related to services it provided to Abacus prior to the acquisition.
Airline and Hospitality Solutions revenues increased due to growth in Airline Solutions' SabreSonic revenues driven by a 15% rise in passenger boarding combined with a broader adoption of its products by existing customers.
The growth in passenger boardings was driven by existing customers and also by the shift of American Airlines to SabreSonic. In addition, revenues associated with the extension of a services contract with a significant customer increased by $10 million in 2015. This contract was extended in conjunction with a litigation settlement agreement with that customer in 2012. Also, the increase in Hospitality Solutions revenues was primarily driven by growth in central reservation system transactions.
Sabre has recorded an increasing trend in net income in the last five years.
Net income increased by 688% in 2015 due to income from discontinued operations of Travelocity-North America and Travelocity-Europe.
Cash from operating activities increased by 37% compared to 2014.
Sabre's growth strategy includes developing innovative technology products; geographically expanding into high-growth markets in Europe, the Asia Pacific, and Latin America; pursuing new travel supplier and Airlines Solutions customers either through acquisitions or on its own; and strengthening its relationships with existing customers through strategic cross-selling of products and services.
Sabre has also exited the online travel agency business to free up resources and focus on growth opportunities in the company's Airline and Hospitality Solutions and Travel Network segments. In early 2015, the company sold its well-known Travelocity.com business to rival Expedia for $280 million, netting a gain of $141 million on the sale. In late 2014, Sabre sold lastminute.com (the European division of Travelocity) to Bravofly Rumbo Group, and also sold its business-to-business private white label website offering Travel Partner Network to net $10 million in proceeds.
To expand its product lines, Sabre launched three new data products on the heels of its IPO in 2014. The new products were geared toward airlines, hotels, and corporations, and help these customers use the data they already have to create operational opportunities and generate new revenue.
Mergers and Acquisitions
In 2016 Sabre bought Trust Group of Companies, a central reservation, revenue management and hotel marketing provider with a significant presence in Europe, the Middle East and Africa and the Asia-Pacific region, for $154 million.
A year earlier the company acquired the remaining 65% stake that it did not already own in Abacus International Pte Ltd (AIPL), a Singapore-based business-to-business travel e-commerce provider serving the Asia-Pacific region, from a consortium of 11 airlines.
In 2014 Sabre purchased Genares Worldwide Reservation Services, a global, privately-held hospitality technology company, which added some 2,300 independent and chain hotel properties to Hospitality Solutions' portfolio.