Sabre Corp. said yesterday it will cut its workforce by more than 900 workers and cease hiring for some positions in an effort to recover from a $6.5 million second-quarter loss.
In its second-quarter earnings call, the Southlake, TX-based GDS said the downsizing, along with other cost-cutting measures, will result in $110 million in savings by next year. Most of the layoffs are in management positions, at the vice-president level and above.
“It’s a tough decision,” said Sabre CEO Sean Menke. “This is a year of transition,” intended to transform Sabre into a more competitive business with a leaner organization.
"We continued to make good progress across a number of key initiatives, including strengthening the senior leadership team, insourcing our shopping complex and Global Network Operations Center, accelerating the development of our next-generation hospitality property management system and undertaking a thorough review of our Airline Solutions portfolio," Menke said.
But the company faces issues. It reduced its profitability expectations going forward, citing a combination of factors, including: its decision to halt work on the implementation of its SabreSonic reservation system by airberlin; higher stability, security and technology costs related to a security incident in the Sabre Hospitality central reservation system; and accounting changes to its revenues from Alitalia, which is in the middle of a "bankruptcy-like process."
Sabre’s revenues were up 6.6%, to $900.7 million for the quarter, ahead of analyst forecasts.