Sabra Corporation was founded in 1960. The travel technology company, which is based out of Southlake, Texas, just happens to be the biggest Global Distribution Systems provider for air bookings in North America. The company was founded by American Airlines, but it was spun off in 2000. Subsequently, Silver Lake Partners and Texas Pacific Group acquired the corporation in 2007. Seven years later, SABR stock began trading publicly on the NASDAQ.
In 2016, it was estimated that Sabre Corporation had approximately 10,000 employees. Now, Sabre Corp. is facing tough times. It has decided to initiate cutbacks after reporting a $6.5 million loss for the second quarter. Around 3,000 of the company’s employees are located in North Texas. Soon, 900 jobs will be cut. 300 of the layoffs will impact employees at the company’s Southlake headquarters.
Sabre played down the layoffs in a recent statement. “From time to time we adjust staffing to meet business requirements and opportunities, just like any well-managed company must do. We will continue to hire and grow with a focus on skill sets and needs that reflect business priorities.” It also said that the job cuts would prevent some open spots from being filled.
Since 2014, Sabre claims to have increased their North Texas employee count by four hundred. Just last year, the company expanded its headquarters. Sabre has experienced recent turbulence as airlines continue to encourage customers to buy tickets directly from their website, instead of using the global distribution system, which is used by travel agents.
To stave off the added competition, Sabre has attempted to expand their offerings to including hotel property management software and a desktop software designed with travel agents in mind. Coincidentally, Sabre has also been locked in a legal battle with its founder, American Airlines. A jury agreed with American Airlines’ assessment that Sabre had violated antitrust laws by requiring airlines to enter into contracts. The contracts disallowed airlines from offering airfares to travel agents directly, without Sabre from being involved.
The jury ruled against Sabre, awarding American Airlines with $15 million. The ruling is being appealed by Sabre. Now, Sabre will attempt to right the ship by introducing cost reduction initiatives and layoffs, which it says will deliver $110 million in annual savings starting in 2018. SABR stock has also had a rough year. The stock started 2017 off around $25 per share. During Tuesday’s trading window, the stock dropped more than 10% to close the trading day at $19.81.