What changed in this filing

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Item 2. Management’s Discussion and Analysis

2023-05-04 compared with 2022-11-02 · 210 added, 418 removed, 314 unchanged (67% of the section changed)

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

orward-Looking Statements

Forward-Looking Statements

This Quarterly Report on Form 10-Q, including this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part I, Item 2, contains information that may constitute forward-looking statements.

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Recent Developments Affecting our Results of Operations

The travel industry continues to be adversely affected by the global health crisis due to the outbreak of the coronavirus ("COVID-19"), including variants, as well as by government directives that have been enacted to slow the spread of the virus.

In 2020, we experienced significant decreases in transaction-based revenue in our Travel Solutions segment, including increased cancellation activity beyond what was initially estimated, as well as a reduction in SynXis Software and Services revenue in our Hospitality Solutions segment due to a decrease in transaction volumes as a result of the COVID-19 pandemic.

As expected, this pandemic has continued to have a material impact to our consolidated financial results in 2021 and 2022.

Despite the continued negative impacts of the COVID-19 pandemic on our business and global travel volumes, as COVID-19 vaccines have continued to be administered and some travel restrictions have been relaxed, we have seen some gradual improvement in our key volume metrics during 2021 and 2022.

With the continued increase in volumes, our incentive consideration costs are also increasing significantly compared to 2021 and 2020.

The inputs into our judgments and estimates consider the economic implications of COVID-19 on our critical and significant accounting estimates.

Our air booking cancellation reserve totaled $9 million and $18 million as of September 30, 2022, and December 31, 2021, respectively, as cancellation activity has continued to decline over the year.

Given the uncertainties surrounding the duration and effects of COVID-19, including any variants, on transaction volumes in the global travel industry, particularly air travel transaction volumes and future cancellation activity, including from airlines’ insolvency or suspension of service or aircraft groundings, we cannot provide assurance that the assumptions used in the estimates will be accurate and the impacts could be material on our cancellation reserves, credit loss provisions and results of operations.

We believe the ongoing effects of COVID-19 on our operations and global bookings will continue to have a material negative impact on our financial results and liquidity, and this negative impact may continue well beyond the containment of the outbreak.

We believe our cash position and the liquidity measures we have taken since 2020 will provide additional flexibility as

we manage through the global economic recovery from the COVID-19 pandemic.

See “—Recent Events Impacting Our Liquidity and Capital Resources” and “—Senior Secured Credit Facilities.” As a result, we believe that we have resources to sufficiently fund our liquidity requirements over at least the next twelve months;

The travel industry continues to be adversely affected by the global health crisis due to the outbreak of the coronavirus, including variants ("COVID-19").

The travel ecosystem has shifted over the past few years, including through the COVID-19 pandemic, resulting in the changing needs of our airline, hotel and agency customers.

This pandemic has resulted in continued material headwinds for our consolidated financial results in 2022 and through the first quarter of 2023.

Despite the continued impacts of the COVID-19 pandemic on our business and global travel volumes, as travel restrictions have been relaxed and travel patterns return, we have seen gradual improvement in our key volume metrics during 2022 and through the first quarter of 2023.

With the continued increase in volumes, our incentive consideration costs are also increasing significantly compared to previous periods.

We believe our cash position and the liquidity measures we have taken will continue to provide flexibility as we manage through the global economic recovery from the COVID-19 pandemic.

As a result, we believe that we have resources to sufficiently fund our liquidity requirements over at least the next twelve months;

however, given the magnitude of travel decline and the unknown duration of the COVID-19 impact, we will continue to monitor our liquidity levels and take additional steps should we determine they are necessary.

See “—Recent Events Impacting Our Liquidity and Capital Resources” and “—Senior Secured Credit Facilities.”

On May 4, 2023, we announced planned actions impacting our workforce.

We estimate that these actions will reduce our operating expense on an annual basis by approximately $200 million.

Restructuring and other costs from these actions are estimated to be approximately $70 million.

In August 2022, we completed the acquisition of Conferma Limited ("Conferma"), a virtual payments technology company, to expand our investment in technology for the payments ecosystem in the travel industry .

We acquired all of the outstanding stock and ownership interest of Conferma, for net cash considerations of $65 million and conversion of a pre-existing loan into share capital.

We acquired all of the outstanding stock and ownership interest of Conferma, for net cash consideration of $62 million and conversion of a pre-existing loan into

share capital.

We have consolidated the results of Conferma from the date of acquisition into our Travel Solutions segment, which did not have a material impact on our results of operations.

In May 2022, we acquired 8 million shares of Class A Common Stock, par value of $0.0001 per share, of Global Business Travel Group, Inc.(“GBT”) for an aggregate purchase price of $80 million.

As of September 30, 2022, we continued to own these 8 million shares.

We recognized unrealized losses of $5 million and $35 million during the three and nine months ended September 30, 2022, respectively, from the investment in GBT.

Fair Value Measurements for further details.

In February 2023, we sold 19% of the common shares of the direct parent of Conferma to a third party for proceeds of $16 million, resulting in a redeemable non-controlling interest.

On October 28, 2021, we announced that we entered into an agreement with a third party to sell our suite of flight and crew management and optimization solutions, which represents our AirCentre airline operations portfolio within Travel Solution’s IT Solutions.

On February 28, 2022, we sold the AirCentre product portfolio, related technology and intellectual property for $392 million .

We recorded a pre-tax gain on sale of approximately $180 million, which includes an adjustment recorded in the second quarter of 2022 related to $12 million in contingencies identified in connection with the sale (after-tax $112 million ) in Other, net in our consolidated statements of operations for the nine months ended September 30, 2022.

In connection with the closing, we entered into a transition services agreement with the purchaser, pursuant to which we will continue to provide certain services and conduct certain operations in connection with the transferred business while it transitions to the purchaser’s system, in return for compensation from the purchaser with respect to these costs.

We recorded a pre-tax gain on sale of approximately $192 million (after-tax $121 million) in Other, net in our consolidated statements of operations for the three months ended March 31, 2022 , which was subsequently adjusted in the second quarter of 2022 related to $12 million in contingencies identified in connection with the sale .

Acquisitions and Dispositions for further details.

Subsequent to the initiation of the current military conflict in Ukraine, air travel in and to Russia, Ukraine, and Belarus has substantially declined, including, with respect to Russia and Belarus, as a result of sanctions imposed on those countries.

While none of Russia, Ukraine, and Belarus constituted a significant portion of our financial results in 2021, we have experienced significantly reduced GDS bookings and passengers boarded in Russia, Belarus, and Ukraine beginning in the middle of the first quarter of 2022, and these reductions are ongoing.

For reference, our Travel Solutions revenue generated in Russia represented a low-single digit percentage of our total 2019 Travel Solutions revenue.

An expansion in the scope of the current conflict or any economic disruption, or any expansion of sanctions or export controls, could have a material adverse effect on our results of operations.

See “Risk Factors—Our business could be harmed by adverse global and regional economic and political conditions” and “—Any failure to comply with regulations or any changes in such regulations governing our businesses could adversely affect us.”

During the nine months ended September 30, 2022, we recognized $24 million of previously deferred revenue due to a change in facts and circumstances associated with a certain Travel Solutions customer located in Russia.

It is no longer considered probable that this revenue will be reversed and this amount was fully paid by the customer.

Revenue from Contracts with Customers for details regarding the impact on revenue.

Revenue recognized during the nine months ended September 30, 2022 from customers located in Russia represented a low-single digit percentage of our total 2022 Travel Solutions revenue, excluding the release of previously deferred revenue above.

In March 2022, we terminated our distribution agreement with a Travel Solutions customer located in Russia.

In the second quarter of 2022, this customer was removed from the International Air Transport Association clearinghouse.

This removal negatively impacted our ability to collect amounts due to us pursuant to our IT Solutions agreement with this customer;

however, an alternative payment method was established.

In March 2022, we terminated our distribution agreement with a Travel Solutions customer located in Russia which impacted our revenue in 2022.

In August 2022, Russia adopted legislation and related regulations that, effective October 30, 2022, require activities related to the development, creation and operation of automated information systems for processing domestic air transportation within the Russian Federation to be owned and operated by Russian residents or legal entities with no updates from or connection with systems abroad.

This legislation and these regulations are expected to significantly restrict or prohibit our ability to provide these services in Russia, which is expected to negatively impact our future revenue and results.

While we received payments from the customer through the alternative payment method described above during the third quarter of 2022 and during October 2022, it is currently uncertain whether future payments will be received from the customer after this legislation became effective on October 30, 2022.

Our consolidated balance sheets include net assets of approximately $19 million as of September 30, 2022 related to customers located in Russia.

If we are unable to collect amounts due to us, these net assets could be impaired in 2022 or in future periods.

During the three months ended September 30, 2022, we recorded an impairment of $5 million due to the expected impact of the Russian legislation described above on the future recoverability of certain assets related to these customers.

In addition, we accelerated the amortization of customer advances into revenue, which reduced our IT Solutions revenue by $4 million.

A Travel Solutions customer of these types of services located in Russia ceased using our systems on that date.

This legislation and these regulations have prohibited our ability to provide these services in Russia, which has and is expected to continue to negatively impact our revenue and results.

During the three months ended March 31, 2022, we recognized $24 million of previously deferred revenue due to a change in facts and circumstances associated with a certain Travel Solutions customer located in Russia.

This amount was fully paid by the customer and it was no longer considered probable that this revenue would be reversed.

Revenue from Contracts with Customers for details regarding the impact on revenue.

Factors Affecting our Results

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Corporate cost of revenue, excluding technology costs, includes certain expenses such as stock-based compensation, restructuring charges and other items not identifiable with either of our segments.

Depreciation and amortization included in cost of revenue, excluding technology costs, is associated with capitalized implementation costs and intangible assets associated with contracts, supplier and distributor agreements purchased through acquisitions or established with our take private transaction in 2007.

Technology Costs

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Technology costs are less variable in nature and therefore may not correlate with related changes in revenue.

Depreciation and amortization included in technology costs is associated with software developed for internal use that supports our products, assets supporting our technology platform, businesses and systems and intangible assets for technology purchased through acquisitions or established through the take private transaction in 2007.

Selling, General and Administrative Expenses

Selling, general and administrative expenses consist of professional service fees, certain settlement charges or reimbursements, costs to defend legal disputes, provision for expected credit losses, other overhead costs, and personnel-related expenses, including stock-based compensation, for employees engaged in sales, sales support, account management and who administratively support the business in finance, legal, human resources, information technology and communications.

Depreciation and amortization included in selling, general and administrative expenses is associated with property and equipment, acquired customer relationships, trademarks and brand names purchased through acquisitions or established through the take private transaction in 2007.

Intersegment Transactions

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The following table sets forth these key metrics for the periods indicated (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 % Change 2022 2021 % Change

Three Months Ended March 31,

2023 2022 % Change

Travel Solutions

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We have included both financial measures compiled in accordance with GAAP and certain non-GAAP financial measures in this Quarterly Report on Form 10-Q, including Adjusted Operating Income (Loss) , Adjusted Net Loss from continuing operations ("Adjusted Net Loss"), Adjusted EBITDA, Free Cash Flow and ratios based on these financial measures.

We define Adjusted Operating Income (Loss) 1 as operating loss adjusted for equity method loss, impairment and related charges, acquisition-related amortization, restructuring and other costs, acquisition-related costs, litigation costs, net, and stock-based compensation.

We define Adjusted Net Loss 1 as net loss attributable to common stockholders adjusted for loss from discontinued operations, net of tax, net income attributable to noncontrolling interests, preferred stock dividends, impairment and related charges, acquisition-related amortization, restructuring and other costs, loss on extinguishment of debt, other, net, acquisition-related costs, litigation costs, net, stock-based compensation, and the tax impact of adjustments.

We define Adjusted EBITDA 1 as loss from continuing operations adjusted for depreciation and amortization of property and equipment, amortization of capitalized implementation costs, acquisition-related amortization, impairment and related charges, restructuring and other costs, interest expense, net, other, net, loss on extinguishment of debt, acquisition-related costs, litigation costs, net, stock-based compensation and the remaining benefit for income taxes.

We define Adjusted Operating Income (Loss) 1 as operating loss adjusted for equity method loss, acquisition-related amortization, restructuring and other costs, acquisition-related costs, litigation costs, net, and stock-based compensation.

We define Adjusted Net Loss 1 as net loss attributable to common stockholders adjusted for loss from discontinued operations, net of tax, net income attributable to noncontrolling interests, preferred stock dividends, acquisition-related amortization, restructuring and other costs, loss on extinguishment of debt, other, net, acquisition-related costs, litigation costs, net, stock-based compensation, and the tax impact of adjustments.

We define Adjusted EBITDA 1 as loss from continuing operations adjusted for depreciation and amortization of property and equipment, amortization of capitalized implementation costs, acquisition-related amortization, restructuring and other costs, interest expense, net, other, net, loss on extinguishment of debt, acquisition-related costs, litigation costs, net, stock-based compensation and the remaining provision for income taxes.

We define Free Cash Flow as cash used in operating activities less cash used in additions to property and equipment.

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We believe that these non-GAAP financial measures are used by investors, analysts and other interested parties as measures of financial performance and to evaluate our ability to service debt obligations, fund capital expenditures, fund our investments in technology transformation, and meet working capital requirements.

capital structures (affecting interest expense), tax positions and the impact of depreciation and amortization expense.

We also believe that Adjusted Operating Income (Loss), Adjusted Net Loss and Adjusted EBITDA assist investors in company-to-company and period-to-period comparisons by excluding differences caused by variations in capital structures (affecting interest expense), tax positions and the impact of depreciation and amortization expense.

In addition, amounts derived from Adjusted EBITDA are a primary component of certain covenants under our senior secured credit facilities.

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______________________

(1) For previous periods, no impairment and related charges or restructuring and other costs were recognized.

(1) For previous periods, no restructuring and other costs were recognized.

Accordingly, such costs were not previously included in the calculation of this non-GAAP financial measure.

The following table sets forth the reconciliation of Net loss attributable to common stockholders to Adjusted Net Loss from continuing operations, Operating loss to Adjusted Operating Income (Loss), and Loss from continuing operations to Adjusted EBITDA (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

Net loss attributable to common stockholders $ (140,722) $ (240,641) $ (291,396) $ (758,029)

Three Months Ended March 31,

Net (loss) income attributable to common stockholders $ (104,280) $ 42,060

Loss (income) from discontinued operations, net of tax 403 (134)

Net income attributable to noncontrolling interests (1)

776 714 1,933 1,657

Net (loss) income attributable to noncontrolling interests (1)

Preferred stock dividends 5,346 5,346

Loss from continuing operations (134,154) (234,713) (272,828) (739,958)

Impairment and related charges (2)

5,146 — 5,146 —

(Loss) income from continuing operations (99,366) 47,544

Acquisition-related amortization (2a)

9,824 15,939 41,075 48,296

Restructuring and other costs (4)

9,944 269 14,279 (5,722)

Loss on extinguishment of debt — 3,533

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Acquisition-related costs (5)

424 870 6,333 3,299

Litigation costs, net (6)

15,365 4,862 31,380 17,113

Stock-based compensation 17,005 27,605

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Equity method income (loss) 423 (170)

Impairment and related charges (2)

5,146 — 5,146 —

Acquisition-related amortization (2a)

9,824 15,939 41,075 48,296

Restructuring and other costs (4)

9,944 269 14,279 (5,722)

Acquisition-related costs (5)

424 870 6,333 3,299

Litigation costs, net (6)

15,365 4,862 31,380 17,113

Stock-based compensation 17,005 27,605

Adjusted Operating Income (Loss) $ 27,677 $ (29,155)

Loss from continuing operations (134,154) $ (234,713) (272,828) $ (739,958)

(Loss) income from continuing operations (99,366) $ 47,544

Depreciation and amortization of property and equipment (2b)

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Amortization of capitalized implementation costs (2c)

10,813 8,718 27,329 25,506

Acquisition-related amortization (2a)

9,824 15,939 41,075 48,296

Impairment and related charges (2)

5,146 — 5,146 —

Restructuring and other costs (4)

9,944 269 14,279 (5,722)

Interest expense, net 99,784 61,058

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Acquisition-related costs (5)

424 870 6,333 3,299

Litigation costs, net (6)

15,365 4,862 31,380 17,113

Stock-based compensation 17,005 27,605

Benefit for income taxes (6,989) (6,613) (2,195) (4,513)

Provision (benefit) for income taxes 2,199 (596)

Adjusted EBITDA $ 58,062 $ 5,150

The following tables set forth the reconciliation of Adjusted Operating Income (Loss) to Operating income (loss) in our statement of operations and Adjusted EBITDA to Income (loss) from continuing operations in our statement of operations by business segment (in thousands):

Three Months Ended September 30, 2022

The following table sets forth the reconciliation of diluted weighted-average common shares outstanding, calculated in

accordance with GAAP, to the adjusted diluted weighted-average shares outstanding (in thousands):

Three Months Ended March 31,

GAAP diluted weighted-average common shares outstanding 328,928 409,378

Dilutive effect of stock options and restricted stock awards — 4,251

Dilutive effect of exchangeable notes — 42,302

Dilutive effect of preferred shares — 39,167

Adjusted diluted weighted-average common shares outstanding 328,928 323,658

The following tables set forth the reconciliation of Adjusted Operating Income (Loss) to Operating loss in our statement of operations and Adjusted EBITDA to (Loss) income from continuing operations in our statement of operations by business segment (in thousands):

Three Months Ended March 31, 2023

Travel Solutions Hospitality Solutions Corporate Total

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Equity method income 423 — — 423

Impairment and related charges (2)

— — 5,146 5,146

Acquisition-related amortization (2a)

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Acquisition-related costs (5)

Litigation costs, net (7)

— — 15,365 15,365

Stock-based compensation — 17,005 17,005

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— — 9,934 9,934

Impairment and related charges (2)

— — 5,146 5,146

Restructuring and other costs (4)

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Acquisition-related costs (5)

Litigation costs, net (7)

— — 15,365 15,365

Stock-based compensation — — 17,005 17,005

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Equity method income 423

Benefit for income taxes 6,989

Loss from continuing operations $ (134,154)

Three Months Ended September 30, 2021

Travel Solutions Hospitality Solutions Corporate Total

Adjusted Operating Loss $ (39,078) $ (8,868) $ (54,698) $ (102,644)

Equity method loss (114) — — (114)

Acquisition-related amortization (3a)

— — 15,939 15,939

Restructuring and other costs (5)

Acquisition-related costs (6)

Litigation costs, net (7)

— — 4,862 4,862

Stock-based compensation — — 32,218 32,218

Operating loss $ (38,964) $ (8,868) $ (108,856) $ (156,688)

Adjusted EBITDA $ 2,421 $ (2,880) $ (54,469) $ (54,928)

Depreciation and amortization of property and equipment (3b)

33,866 4,903 229 38,998

Amortization of capitalized implementation costs (3c)

7,633 1,085 — 8,718

Acquisition-related amortization (3a)

— — 15,939 15,939

Restructuring and other costs (5)

Acquisition-related costs (6)

Litigation costs, net (7)

— — 4,862 4,862

Stock-based compensation — — 32,218 32,218

Equity method loss (114) — — (114)

Operating loss $ (38,964) $ (8,868) $ (108,856) $ (156,688)

Interest expense, net (65,461)

Other, net (4)

Loss on extinguishment of debt (13,070)

Equity method loss (114)

Benefit for income taxes 6,613

Provision for income taxes (2,199)

Loss from continuing operations $ (99,366)

Nine Months Ended September 30, 2022

Three Months Ended March 31, 2022

Travel Solutions Hospitality Solutions Corporate Total

Adjusted Operating Income (Loss) $ 45,306 $ (15,117) $ (59,344) $ (29,155)

Equity method income 215 — — 215

Impairment and related charges (2)

— — 5,146 5,146

Acquisition-related amortization (3a)

— — 41,075 41,075

Restructuring and other costs (5)

— — 14,279 14,279

Acquisition-related costs (6)

— — 6,333 6,333

Litigation costs, net (7)

— — 31,380 31,380

Stock-based compensation — — 70,081 70,081

Operating income (loss) $ 172,286 $ (38,469) $ (340,077) $ (206,260)

Adjusted EBITDA $ 256,830 $ (21,967) $ (170,996) $ 63,867

Depreciation and amortization of property and equipment (3b)

60,735 12,767 787 74,289

Amortization of capitalized implementation costs (3c)

23,594 3,735 — 27,329

Acquisition-related amortization (3a)

— — 41,075 41,075

Impairment and related charges (2)

— — 5,146 5,146

Restructuring and other costs (5)

— — 14,279 14,279

Acquisition-related costs (6)

— — 6,333 6,333

Litigation costs, net (7)

— — 31,380 31,380

Stock-based compensation — — 70,081 70,081

Equity method income 215 — — 215

Operating income (loss) $ 172,286 $ (38,469) $ (340,077) $ (206,260)

Interest expense, net (205,062)

Other, net (4)

Loss on extinguishment of debt (3,533)

Equity method income 215

Benefit for income taxes 2,195

Loss from continuing operations $ (272,828)

Nine Months Ended September 30, 2021

Travel Solutions Hospitality Solutions Corporate Total

Adjusted Operating Loss $ (212,393) $ (30,976) $ (147,529) $ (390,898)

Equity method loss (170) — — (170)

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— — 15,803 15,803

Restructuring and other costs (5)

— — (5,722) (5,722)

Acquisition-related costs (5)

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Stock-based compensation — — 27,605 27,605

Operating loss $ (211,998) $ (30,976) $ (296,637) $ (539,611)

Operating income (loss) $ 45,476 $ (15,117) $ (109,891) $ (79,532)

Adjusted EBITDA $ 73,560 $ (9,317) $ (59,093) $ 5,150

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— — 15,803 15,803

Restructuring and other costs (5)

— — (5,722) (5,722)

Acquisition-related costs (5)

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Equity method loss (170) — — (170)

Operating loss $ (211,998) $ (30,976) $ (296,637) $ (539,611)

Operating income (loss) $ 45,476 $ (15,117) $ (109,891) $ (79,532)

Interest expense, net (61,058)

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Benefit for income taxes 596

Loss from continuing operations $ (739,958)

Income from continuing operations $ 47,544

The following tables present information from our statements of cash flows and set forth the reconciliation of Free Cash Flow to cash used in operating activities, the most directly comparable GAAP measure (in thousands):

Nine Months Ended September 30,

Three Months Ended March 31,

Cash used in operating activities $ (72,409) $ (139,083)

Cash provided by (used in) investing activities 186,251 (5,535)

Cash used in financing activities (61,646) (37,013)

Nine Months Ended September 30,

Cash (used in) provided by investing activities (18,110) 374,865

Cash provided by (used in) financing activities 111,939 (25,835)

Three Months Ended March 31,

Cash used in operating activities $ (72,409) $ (139,083)

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(1) Net income attributable to noncontrolling interests represents an adjustment to include earnings allocated to noncontrolling interests held in (i) Sabre Travel Network Middle East of 40%, (ii) Sabre Seyahat Dagitim Sistemleri A.S.

of 40%, (iii) Sabre Travel Network Lanka (Pte) Ltd of 40%, and (iv) Sabre Bulgaria of 40%.

(2) Impairment and related charges represents a $5 million impairment charge associated with the impact of regulatory changes in Russia on the future recoverability of certain assets.

of 40%, (iii) Sabre Travel Network Lanka (Pte) Ltd of 40%, (iv) Sabre Bulgaria of 4 0%, and (v) FERMR Holdings Limited (the direct parent of Conferma) of 19%.

(2) Depreciation and amortization expenses:

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(c) Amortization of capitalized implementation costs represents amortization of upfront costs to implement new customer contracts under our SaaS and hosted revenue model.

(4) Other, net incl udes a $180 million gain on the sale of AirCentre during 2022, a fair value loss of $5 million and $35 million on our GBT investment for the three and nine months ended September 30, 2022, respectively, and a $15 million gain on sale of equity securities during

the first quarter of 2021.

(3 ) Other, net includes a $192 million gain on the sale of AirCentre during the three months ended March 31, 2022.

In addition, all periods presented include foreign exchange gains and losses related to the remeasurement of foreign currency denominated balances included in our consolidated balance sheets into the relevant functional currency.

(5) Restructuring and other costs represents charges, and adjustments to those charges, associated with planning and implementing business restructuring activities, including costs associated with third party consultants advising on our business structure and strategy going forward which are integral to the restructuring plan and severance benefits related to employee terminations, which primarily occurred in July 2022.

During 2021, adjustments to charges were recorded in conjunction with the changes implemented in 2020 to support the new organizational structure and to respond to the impacts of the COVID-19 pandemic on our business, facilities and cost structure.

(4) Restructuring and other costs represents adjustments to charges recorded in previous periods associated with severance benefits related to employee terminations.

(5) Acquisition-related costs represent fees and expenses incurred associated with acquisition and disposition-related activities.

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Contingencies, to our consolidated financial statements.

(8) The tax impact of adjustments includes the tax effect of each separate adjustment based on the statutory tax rate for the jurisdiction(s) in which the adjustment was taxable or deductible, the impact of the adjustments on valuation allowance assessments, and the tax effect of items that relate to tax specific financial transactions, tax law changes, uncertain tax positions, and other items.

(7) The tax impact of adjustments includes the tax effect of each separate adjustment based on the statutory tax rate for the jurisdiction(s) in which the adjustment was taxable or deductible, and the tax effect of items that relate to tax specific financial transactions, tax law changes, uncertain tax positions, and other items.

Results of Operations

The following table sets forth our consolidated statements of operations data for each of the periods presented:

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

(Amounts in thousands) (Amounts in thousands)

Three Months Ended March 31,

(Amounts in thousands)

Revenue $ 742,695 $ 584,910

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Other, net 2,407 191,241

Loss from continuing operations before income taxes (141,143) (241,326) (275,023) (744,471)

Benefit for income taxes (6,989) (6,613) (2,195) (4,513)

Loss from continuing operations $ (134,154) $ (234,713) $ (272,828) $ (739,958)

Three Months Ended September 30, 2022 and 2021

Three Months Ended September 30,

2022 2021 Change

(Amounts in thousands)

Travel Solutions $ 603,647 $ 390,353 $ 213,294 55 %

Hospitality Solutions 67,497 55,179 12,318 22 %

Total segment revenue 671,144 445,532 225,612 51 %

Eliminations (7,750) (4,446) (3,304) 74 %

Total revenue $ 663,394 $ 441,086 $ 222,308 50 %

Travel Solutions— R evenue increased $213 million, or 55%, for the three months ended September 30, 2022 compared to the same period in the prior year, primarily due to:

• a $185 million, or 76%, increase in transaction-based distribution revenue due to a 50% increase in Direct Billable Bookings to 80 million primarily as a result of the continued recovery trends from the COVID-19 pandemic and favorable rate impacts from improved international and corporate bookings;

• a $28 million increase in IT solutions revenue consisting of a $31 million, or 53%, increase in reservation revenue primarily due to a 56% increase in Passengers Boarded to 180 million as a result of the continued recovery trends from the COVID-19 pandemic and a $7 million increase due to the recognition of a termination fee on a carrier in the process of de-migrating from our system, partially offset by a $4 million reduction associated with a Russian carrier and an unfavorable rate mix due to revenue that does not fluctuate with our volumes.

Additionally, commercial and operations revenue decreased $3 million due to the sale of our AirCentre portfolio on February 28, 2022, partially offset by $4 million increase due to the aforementioned termination fee on the carrier that is de-migrating and other product revenue.

Hospitality Solutions— Revenue increased $12 million, or 22%, for the three months ended September 30, 2022 compared to the same period in the prior year.

The increase was primarily driven by a $12 million increase in SynXis Software and Services revenue due to an increase in transaction volumes of 18% to 32 million, as a result of the continued recovery from the COVID-19 pandemic.

Cost of revenue, excluding technology costs

Three Months Ended September 30,

2022 2021 Change

(Amounts in thousands)

Travel Solutions $ 235,240 $ 136,676 $ 98,564 72 %

Hospitality Solutions 33,767 26,125 7,642 29 %

Eliminations (7,750) (4,446) (3,304) 74 %

Total segment cost of revenue, excluding technology costs 261,257 158,355 102,902 65 %

Corporate 1,868 2,884 (1,016) (35) %

Depreciation and amortization 11,205 10,190 1,015 10 %

Total cost of revenue, excluding technology costs $ 274,330 $ 171,429 $ 102,901 60 %

Travel Solutions— Cost of revenue, excluding technology costs, increased $99 million, or 72%, for the three months ended September 30, 2022 compared to the same period in the prior year.

The increase was primarily driven by a $97 million increase in incentive consideration due to higher transaction volume as well as an increase in rates given the continued recovery from the COVID-19 pandemic.

Hospitality Solutions— Cost of revenue, excluding technology costs, increased $8 million, or 29%, for the three months ended September 30, 2022 compared to the same period in the prior year primarily due to costs associated with increased transaction volumes.

Technology Costs

Three Months Ended September 30,

2022 2021 Change

(Amounts in thousands)

Travel Solutions $ 229,789 $ 221,630 $ 8,159 4 %

Hospitality Solutions 31,237 26,725 4,512 17 %

Corporate 12,214 20,756 (8,542) (41) %

Total technology costs $ 273,240 $ 269,111 $ 4,129 2 %

Travel Solutions— Technology costs increased $8 million, or 4%, for the three months ended September 30, 2022 compared to the same period in the prior year.

The increase was primarily driven by a $12 million increase in technology costs due to higher transaction volumes given the continued recovery from the COVID-19 pandemic and expected temporary costs resulting from our cloud migration efforts.

Additionally, labor and professional services increased $7 million to support our technology transformation initiatives and other ongoing business expenses increased by $3 million.

These increases were partially offset by a decrease in depreciation and amortization of $14 million primarily due to a change in the mix of our technology spend beginning in 2019 resulting in less capitalized internal use software as well as reduced costs due to the sale of our AirCentre portfolio.

We expect decreases in depreciation and amortization to continue due to these factors.

Hospitality Solutions— Technology costs increased $5 million, or 17%, for the three months ended September 30, 2022 compared to the same period in the prior year due to a $5 million increase in technology costs to support our technology transformation initiatives, including the migration of SynXis to the cloud and an increase in labor and professional services of $1 million to support our technology transformation initiatives.

This increase was partially offset by a $1 million decrease in depreciation and amortization due to a change in the mix of our technology spend beginning in 2019 resulting in less capitalized internal use software.

Corporate— Technology costs decreased $9 million, or 41%, for the three months ended September 30, 2022 compared to the same period in the prior year primarily due to a decrease in depreciation and amortization associated with a reduction in intangible amortization as a result of the completion of amortization of technology assets from prior acquisitions and a $2 million decrease in stock-based compensation.

Selling, General and Administrative Expenses

Three Months Ended September 30,

2022 2021 Change

(Amounts in thousands)

Travel Solutions $ 59,585 $ 62,804 $ (3,219) (5) %

Hospitality Solutions 12,521 10,081 2,440 24 %

Corporate 100,253 84,349 15,904 19 %

Total selling, general and administrative expenses $ 172,359 $ 157,234 $ 15,125 10 %

Travel Solutions— Selling, general and administrative expenses decreased $3 million, or 5%, for the three months ended September 30, 2022 compared to the same period in the prior year primarily due to a $1 million decrease in depreciation and amortization as well as reduced costs due to the sale of our AirCentre portfolio, a $1 million decrease in the provision for credit losses and a $2 million decrease due to other ongoing business expenses.

Hospitality Solutions —Selling, general and administrative expenses increased $2 million, or 24%, for the three months ended September 30, 2022 compared to the same period in the prior year primarily due to an increase in the provision for expected credit losses due to the unfavorable comparison to a provision reversal in the prior year as the economy began to recover and payment experience began to improve, as well as an increase in labor and professional services.

Corporate— Selling, general and administrative expenses increased $16 million, or 19%, for the three months ended September 30, 2022 compared to the same period in the pri or year.

This increase was driven by a $15 million increase due to litigation reserves, a $5 million increase related to an impairment associated with an IT Solutions customer located in Russia, a $3 million increase in severance as a result of business restructuring, a $4 million increase in professional services related to our business structure and strategy to support the long-term growth of the business, a $1 million increase in risk and security costs, and a $2 million increase in other ongoing business expenses.

These increases were partially offset by an $11 million decrease in stock-based compensation primarily due to forfeitures of unvested shares and a $5 million decrease in legal costs.

Interest expense, net

Three Months Ended September 30,

2022 2021 Change

(Amounts in thousands)

Interest expense, net $ 77,120 $ 65,461 $ 11,659 18 %

Interest expense increased $12 million, or 18% during the three months ended September 30, 2022 compared to the same period in the prior year primarily due to higher interest rates on our term loans.

This increase was partially offset by a decline caused by our interest rate swaps.

Derivatives for further details regarding our interest rate swaps.

Loss on extinguishment of debt

We recognized a loss on extinguishment of debt of $13 million for the three months ended September 20, 2021 as a result of the refinancing that occurred in the third quarter of 2021.

Debt for further details.

Three Months Ended September 30,

2022 2021 Change

(Amounts in thousands)

Other, net $ 7,687 $ 5,993 $ 1,694 28 %

Other, n et increased $2 million for the three months ended September 30, 2022 compared to the same period in the prior year primarily due to a fair value loss of $5 million on o ur GBT investment and a $5 million increase due to modification costs in connection with the refinancing that occurred in August 2022.

These increases were partially offset by a $4 million gain recognized in conjunction with the acquisition of Conferma, a $2 million decrease due to a pension settlement charge in the prior year that did not reoccur in the current year, and a $2 million decrease due to modification costs in connection with refinancing activity in 2021.

Acquisitions and Dispositions for further details regarding the acquisition of Conferma, Note 6.

Debt for further details regarding the August 2022 refinancing and the 2021 refinancing and Note 8.

Fair Value Measurements for further details regarding the GBT investment.

Benefit for Income Taxes

Three Months Ended September 30,

2022 2021 Change

(Amounts in thousands)

Benefit for income taxes $ (6,989) $ (6,613) $ (376) 6 %

For the three months ended September 30, 2022 , we recognized a $7 million income tax benefit, representing an effective tax rate of 5%, compared to an income tax benefit of $7 million, representing an effective tax rate of 3% for the three months ended September 30, 2021.

The increase in the effective tax rate for the three months ended September 30, 2022 as compared to the same period in 2021 was primarily due to a decrease in valuation allowance recorded in the current period and various discrete items recorded in each of the respective three month periods.

The difference between our effective tax rates and the U.S.

federal statutory income tax rate primarily results from valuation allowances, our geographic mix of taxable income in various tax jurisdictions, tax permanent differences and tax credits.

Nine Months Ended September 30, 2022 and 2021

Nine Months Ended September 30,

(Loss) income from continuing operations before income taxes (97,167) 46,948

Provision (benefit) for income taxes 2,199 (596)

(Loss) income from continuing operations $ (99,366) $ 47,544

Three Months Ended March 31, 2023 and 2022

Three Months Ended March 31,

2023 2022 Change

5 unchanged sentences

Total revenue $ 742,695 $ 584,910 $ 157,785 27 %

Travel Solutions— Rev enue increased $684 million, or 65%, for the nine months ended September 30, 2022 compared to the same period in the prior year, primarily due to:

• a $590 million, or 96%, increase in transaction-based distribution revenue due to a 51% increase in Direct Billable Bookings to 226 million primarily as a result of the continued recovery trends from the COVID-19 pandemic and favorable rate impacts from improved international and corporate bookings;

• a $94 million increase in IT solutions revenue consisting of a $107 million, or 71%, increase in reservation revenue primarily due to a 59% increase in Passengers Boarded to 469 million as a result of the continued recovery trends from the COVID-19 pandemic, $24 million of previously deferred revenue recognized during the three months ended March 31, 2022 due to a change in facts and circumstances associated with a Russian carrier, a $9 million increase due to the recognition of a termination fee on a carrier in the process of de-migrating from our systems, which will not repeat in 2023 and the recognition of $3 million in previously deferred revenue from a customer that entered liquidation.

Revenue from Contracts with Customers.

This increase was partially offset by an unfavorable rate mix due to revenue that does not fluctuate with our volumes and a $4 million reduction associated with a Russian carrier.

Additionally, commercial and operations revenue decreased $13 million due to the sale of our AirCentre portfolio on February 28, 2022, partially offset by other product revenue and a $6 million increase due to the aforementioned termination fee on the carrier that is de-migrating.

Hospitality Solutions— Revenue increased $42 million, or 28%, for the nine months ended September 30, 2022 compared to the same period in the prior year.

The increase was primarily driven by a $37 million increase in SynXis Software and Services revenue due to an increase in transaction volumes of 23% to 84 million, as a result of the continued recovery from the COVID-19 pandemic and an increase of $4 million in DX revenue.

Travel Solutions— R evenue increased $143 million, or 27%, for the three months ended March 31, 2023 compared to the same period in the prior year, primarily due to:

• a $183 million, or 53%, increase in transaction-based distribution revenue primarily due to a 49% increase in Direct Billable Bookings to 97 million and favorable rate impacts from improved international and corporate bookings;

• a $40 million, or 21% decrease in IT solutions revenue primarily due to a $36 million decrease from the sale of our AirCentre portfolio on February 28, 2022 and $37 million lower revenue from a de-migrated Russian carrier, of which $24 million is related to previously deferred revenue recognized during the three months ended March 31, 2022 due to a change in facts and circumstances.

These reductions were partially offset by an increase in revenue of $15 million primarily due to a 28% increase in passengers boarded to 165 million and a $16 million increase due to the recognition of a termination fee on a de-migrated carrier that previously terminated.

Hospitality Solutions— Revenue increased $18 million, or 32%, for the three months ended March 31, 2023 compared to the same period in the prior year.

The increase was primarily driven by a $17 million increase in SynXis Software and Services revenue due to an increase in transaction volumes of 21% to 28 million, a favorable mix within our customer base, and a $1 million increase in DX revenue.

Cost of revenue, excluding technology costs

Nine Months Ended September 30,

Three Months Ended March 31,

2023 2022 Change

7 unchanged sentences

Total cost of revenue, excluding technology costs $ 307,042 $ 223,034 $ 84,008 38 %

Travel Solutions— Cost of revenue, excluding technology costs, increased $257 million, or 64%, for the nine months ended September 30, 2022 compared to the same period in the prior year.

The increase was primarily driven by a $264 million increase in incentive consideration due to higher transaction volume as well as an increase in rates given the continued recovery from the COVID-19 pandemic.

This increase was partially offset by a decrease in labor and professional services costs resulting from the sale of AirCentre and other labor related expenses.

Hospitality Solutions— Cost of revenue, excluding technology costs, increased $24 million, or 34%, for the nine months ended September 30, 2022 compared to the same period in the prior year primarily due to costs associated with increased transaction volumes.

Travel Solutions— Cost of revenue, excluding technology costs, increased $78 million, or 41%, for the three months ended March 31, 2023 compared to the same period in the prior year.

The increase was primarily driven by an $85 million increase in incentive consideration due to higher transaction volume as well as an increase in rates.

This increase was partially offset by a $7 million decrease in labor and professional costs primarily due to the sale of AirCentre.

Hospitality Solutions— Cost of revenue, excluding technology costs, increased $9 million, or 34%, for the three months ended March 31, 2023 compared to the same period in the prior year primarily due to costs associated with increased transaction volumes and the mix of our customer base.

Technology Costs

Nine Months Ended September 30,

Three Months Ended March 31,

2023 2022 Change

4 unchanged sentences

Total technology costs $ 271,438 $ 273,730 $ (2,292) (1) %

Travel Solutions— Technology costs increased $28 million, or 4%, for the nine months ended September 30, 2022 compared to the same period in the prior year.

The increase was due to a $52 million increase in technology costs due to higher transaction volumes given the continued recovery from the COVID-19 pandemic and expected temporary costs resulting from our cloud migration efforts.

Additionally, labor and professional services increased $22 million to support our technology transformation initiatives, and other ongoing business expenses increased by $3 million.

We have incurred a significant amount of incremental technology costs in 2022 over the prior year as a result of our technology transformation and expect that to continue for the remainder of 2022.

This increase was partially offset by a decrease in depreciation and amortization of $48 million primarily due to a change in the mix of our technology spend beginning in 2019 resulting in less capitalized internal use software as well as a reduction due to the sale of our AirCentre portfolio.

We expect decreases in depreciation and amortization to continue due to these factors .

Hospitality Solutions— Technology costs increased $20 million, or 28%, for the nine months ended September 30, 2022 compared to the same period in the prior year due to a $13 million increase in labor and professional services costs and an $11 million increase in technology costs to support our technology transformation initiatives, including the migration of SynXis to the cloud.

This increase was partially offset by a $3 million decrease in depreciation and amortization primarily driven by a change in the mix of our technology spend beginning in 2019 resulting in less capitalized internal use softw are.

The migration to the cloud for SynXis is expected to result in higher cloud-based transaction costs for Hospitality Solutions whereas historically it incurred data center operating costs and incurred hardware and infrastructure costs, which were capitalized, and became fully depreciated in prior periods.

Corporate— Technology costs decreased $7 million, or 12%, for the nine months ended September 30, 2022 compared to the same period in the prior year primarily due to a $5 million decrease in depreciation and amortization associated with a reduction in intangible amortization as a result of the completion of amortization of technology assets from prior acquisitions and a $3 million decrease in labor and professional services.

Travel Solutions— Technology cos ts increased $8 million, or 3%, for the three months ended March 31, 2023 compared to the same period in the prior year.

The increase was primarily driven by an $18 million increase in labor and professional services costs to support our technology transformation initiatives.

This increase was partially offset by a $5 million decrease in technology costs due to cost savings related to our mainframe offloads and data migrations.

A dditionally, depreciation and amortization decreased by $5 million pr imarily due to the sale of our AirCentre portfolio and the completion of amortization of capitalized internal use software.

Hospitality Solutions— Technology cost s increased $1 million, or 5%, for the three months ended March 31, 2023 compared to the same period in the prior year due to a $4 million increase in technology costs to support our technology transformation initiatives, including the migration of SynXis to the cloud.

This increase was partially offset by a $2 million decrease in labor and professional services.

Corporate— Technology costs decreased $11 million, or 57%, for the three months ended March 31, 2023 compared to the same period in the prior year due to a $5 million decrease in depreciation and amortization associated with a reduction in intangible amortization as a result of the completion of amortization of technology assets from prior acquisitions, a $4 million decrease in labor and professional services and a $2 million decrease in stock-based compensation.

Selling, General and Administrative Expenses

Nine Months Ended September 30,

Three Months Ended March 31,

2023 2022 Change

4 unchanged sentences

Total selling, general and administrative expenses $ 164,428 $ 167,678 $ (3,250) (2) %

Travel Solutions— Selling, general and administrative expenses increased $14 million, or 7%, for the nine months ended September 30, 2022 compared to the same period in the prior year.

The increase was driven by a $7 million in crease in the provision for expected credit losses due to the unfavorable comparison to a provision reversal in the prior year as the economy began to recover and payment experience began to improve, a $6 million increase in legal costs incurred due to ongoing litigation and a $3 million increase due to continued investments in our internal business systems.

These increases were partially offset by a $3 million d ecrease in depreciation and amortization.

Hospitality Solutions— Selling, general and administrative expenses increased $4 million, or 13%, for the nine months ended September 30, 2022 compared to the same period in the prior year primarily due to a $6 million increase in labor and professional services costs related to our business strategy to support the long-term growth of the business and a $2 million increase due to continued investments in our internal business systems.

This increase was partially offset by a $3 million decrease in the provision for expected credit losses due to an improvement in our expected credit losses in the current year as a result of the continued recovery from the COVID-19 pandemic, and lower depreciation and amortization.

Corporate— Selling, general and administrative expenses increased $52 million, or 22%, for the nine months ended September 30, 2022 compared to the same period in the pri or year.

This increase was driven by a $17 million increase in professional services related to acquisition and disposition-related activities and costs related to our business structure and strategy to support the long-term growth of the business, a $15 million increase due to litigation reserves, a $7 million increase in risk and security costs, a $6 million increase in transaction tax expense, a $5 million increase related to an impairment associated with an IT Solutions customer located in Russia, a $5 million increase for restructuring costs and the reversal of severance costs in the prior year associated with the reduction of our workforce in 2020, and a $7 million increase in other ongoing business expenses.

This increase was partially offset by a $12 million decrease in stock-based compensation primarily due to forfeitures of unvested shares .

Travel Solutions— Selling, general and administrative expenses increased $12 million, or 18%, for the three months ended March 31, 2023 compared to the same period in the prior year primarily due to a $6 million increase in the provision for credit losses and a $5 million increase due to continued investment in our internal business systems.

Corporate— Selling, general and administrative expenses decreased $16 million, or 18%, for the three months ended March 31, 2023 compared to the same period in the pri or year.

This decrease was driven by an $8 million decrease in stock-based compensation primarily due to forfeitures of unvested shares, a $3 million decrease in professional services related to our business structure and strategy, a $3 million decrease in technology costs, and a reduction in other business expenses.

These decreases were partially offset by a $2 million increase in labor and professional services and a $1 million increase in risk and security costs.

Interest expense, net

Nine Months Ended September 30,

Three Months Ended March 31,

2023 2022 Change

1 unchanged sentence

Interest expense, net $ 99,784 $ 61,058 $ 38,726 63 %

Interest expense increased $11 million, or 6% during the nine months ended September 30, 2022 compared to the same period in the prior year primarily due to higher interest rates on our term loans.

Interest expense increased $39 million, or 63%, during the three months ended March 31, 2023 compared to the same period in the prior year primarily due to higher interest rates on our term loans.

This increase was partially offset by the impact of our interest rate swaps.

Debt for further details regarding these debt transactions and Note 7.

Derivatives for further details regarding our interest rate swaps.

Loss on extinguishment of debt

We recognized a loss on extinguishment of debt of $4 million du ring the nine months ended September 30, 2022 as a result of the refinancing that occurred in the first quarter of 2022 and a loss on extinguishment of debt of $13 million as a result of the refinancing that occurred in the third quarter of 2021.

We recognized a loss on extinguishment of debt of $4 million for the three months ended March 31, 2022 as a result of the refinancing that occurred in the first quarter of 2022.

Debt for further details.

Nine Months Ended September 30,

Three Months Ended March 31,

2023 2022 Change

1 unchanged sentence

Other, net $ (2,407) $ (191,241) $ 188,834 (99) %

Other, net decreased $137 million for the nine months ended September 30, 2022 compared to the same period in the prior year primarily due to the gain on the sale of AirCentre of $180 million partially offset by a fair value loss of $35 million on our GBT investment and a $15 million gain on sale of investment recorded in the first quarter of 2021.

Measurements for further details regarding the GBT investment and Note 3.

Acquisitions and Dispositions for further details regarding the AirCentre sale.

Benefit for Income Taxes

Nine Months Ended September 30,

Other, n et decreased $189 million for the three months ended March 31, 2023 compared to the same period in the prior year primarily due to the sale of AirCentre in the first quarter of 2022, which resulted in a gain of approximately $192 million.

Acquisitions and Dispositions for further details regarding the sale of AirCentre.

Provision (benefit) for Income Taxes

Three Months Ended March 31,

2023 2022 Change

(Amounts in thousands)

Benefit for income taxes $ (2,195) $ (4,513) $ 2,318 (51) %

For the nine months ended September 30, 2022, we recognized a $2 million income tax benefit, representing an effective tax rate of less than 1%, compared to an income tax benefit of $5 million, representing an effective tax rate of less than 1% for the nine months ended September 30, 2021.

The slight increase in the effective tax rate for the nine months ended September 30, 2022 as compared to the same period in 2021 was primarily due to a decrease in valuation allowance recorded in the current period and various discrete items recorded in each of the respective nine month periods.

Provision (benefit) for income taxes $ 2,199 $ (596) $ 2,795 (469) %

For the three months ended March 31, 2023, we recognized $2 million of income tax expense, representing an effective tax rate of less than 1%, compared to an income tax benefit of $1 million, also representing an effective tax rate of less than 1% for the three months ended March 31, 2022.

The effective tax rate remained relatively flat for the for the three months ended March 31, 2023 as compared to the same period in 2022.

The difference between our effective tax rates and the U.S.

2 unchanged sentences

Our current principal source of liquidity is our cash and cash equivalents on hand.

As of September 30, 2022 and December 31, 2021, our cash and cash equivalents and outstanding letters of credit were as follows (in thousands):

September 30, 2022 December 31, 2021

As of March 31, 2023 and December 31, 2022, our cash and cash equivalents and outstanding letters of credit were as follows (in thousands):

March 31, 2023 December 31, 2022

Cash and cash equivalents $ 817,075 $ 794,888

Available balance under the AR Facility 3,700 —

AR Facility outstanding balance 115,000 —

Available under the bilateral letter of credit facility 8,618 8,473

Outstanding letters of credit under the bilateral letter of credit facility 11,381 11,527

On March 30, 2023, we drew $115 million under the AR Facility to supplement our liquidity, which remained outstanding as of March 31, 2023.

As of March 31, 2023 , the borrowing base was $119 million, of which Sabre had availability of $4 million.

Our AR Facility matures on January 14, 2025 at the earliest and February 13, 2026 at the latest, depending on certain "springing" maturity conditions.

The AR Facility allows us the ability to prepay the principal amount prior to the maturity date without penalty.

We consider cash equivalents to be highly liquid investments that are readily convertible into cash.

2 unchanged sentences

We invest in a money market fund which is classified as cash and cash equivalents in our consolidated balance sheets and statements of cash flows.

We held no short-term investments as of September 30, 2022 and December 31, 2021.

We had $21 million held as cash collateral for standby letters of credit in restricted cash on our consolidated balance sheets as of September 30, 2022 and December 31, 2021.

While the COVID-19 pandemic has had an adverse impact on our business, we expect to recognize federal taxable income in 2022 based on our operating and non-operating results, the annual limitation on the use of Net Operating Loss ("NOL") carryforwards and a provision of the Tax Cuts and Jobs Act.

As a result, while we expect to be a U.S.

federal cash taxpayer in 2022, we expect to also benefit from the usage of NOLs in 2022 to the extent available.

We expect to continue to benefit from our NOLs in the near-term beyond 2022.

We held no short-term investments as of March 31, 2023 and December 31, 2022.

We had $21 million held as cash collateral for standby letters of credit in restricted cash on our consolidated balance sheets as of March 31, 2023 and December 31, 2022.

Liquidity Outlook

The reduction in revenues as the result of COVID-19 has significantly adversely affected our liquidity.

Given the uncertainties surrounding the duration and effects of COVID-19, including any variants, on transaction volumes in the global travel industry, particularly air travel transaction volumes, including from airlines’ insolvency or suspension of service or aircraft groundings, we cannot provide assurance that the assumptions used to estimate our liquidity requirements will be accurate.

The ongoing effects of COVID-19 on our operations and global bookings have had, and we believe they will continue to have, a material negative impact on our financial results and liquidity, and this negative impact may continue notwithstanding any ongoing recovery from the outbreak.

Given the uncertainties surrounding the duration and effects of COVID-19, on transaction volumes in the global travel industry, particularly air travel transaction volumes, including from airlines’ insolvency or suspension of service or aircraft groundings, we cannot provide assurance that the assumptions used to estimate our liquidity requirements will be accurate.

However, based on our assumptions and estimates with respect to our financial condition, we believe that we have resources to sufficiently fund our liquidity requirements over at least the next twelve months.

As previously disclosed, we responded with measures to increase our cash position during 2020, including the suspension of quarterly cash dividends on our common stock, effective with respect to the dividends occurring after the March 30, 2020 payment and share repurchases under our $500 million share repurchase program (the "Share Repurchase Program"), borrowing under our Revolver, implementing cost savings measures, and completing debt and equity offerings.

In addition, in the third quarter of 2021, we refinanced and extended the maturity on a portion of our debt and amended the financial performance covenant to remove minimum liquidity and leverage ratio requirements and in the first and third quarters of 2022, we refinanced and extended the maturity on another portion of our debt.

We believe these actions will provide additional flexibility as we manage through the global economic recovery from the COVID-19 pandemic.

Given the magnitude of travel decline, the uncertain economic environment and the unknown duration of the COVID-19 impact, we will continue to monitor travel activity and take additional steps should we determine they are necessary.

As previously disclosed, we responded to the impact of COVID-19 on our business with measures to increase our cash position during 2020, including the suspension of quarterly cash dividends on our common stock, effective with respect to the dividends occurring after the March 30, 2020 payment and share repurchases under our $500 million share repurchase program (the "Share Repurchase Program"), and completing debt and equity offerings.

Additionally, given the market conditions resulting from COVID-19, we responded with cost savings measures during 2020, including the reduction of our workforce through voluntary severance and early retirement programs and a right-sizing of our global organization.

In 2021, we refinanced and extended the maturity on a portion of our debt and amended the financial performance covenant to remove minimum liquidity and leverage ratio requirements.

In 2022, we further refinanced and extended the maturity on other portions of our debt, which also negatively impacted our results due to increasing interest rates.

We believe our cash position and the liquidity measures we have taken will provide additional flexibility as we manage through the industry's recovery from the COVID-19 pandemic.

We will continue to monitor our liquidity levels and take additional steps should we determine they are necessary.

We utilize cash and cash equivalents primarily to pay our operating expenses, make capital expenditures, invest in our information technology infrastructure, products and offerings, pay taxes, pay quarterly dividends on our Preferred Stock (as defined below) when declared, and service our debt and other long-term liabilities.

Free cash flow is calculated as cash flow from operations reduced by additions to property and equipment.

For 2022, we expect our free cash flow to improve on an annual basis from 2021, turning positive within the fourth quarter of 2022.

This expectation is based on industry projections regarding anticipated recovery levels in air travel and could change.

Cash payments for restructuring and other related costs are expected to be approximately $50 million for the full year 2023, which will impact our free cash flow.

See “—Risk Factors" for further details.

Given the magnitude of travel decline and the unknown duration of the COVID-19 impact, we will continue to monitor travel activity and take additional steps should we determine they are necessary.

Additionally, we may review

opportunities to refinance our existing debt, as well as conduct debt or equity offerings to support future strategic investments, support operational requirements, provide additional liquidity, or pay down debt.

On July 12, 2021, we refinanced the Revolver and terminated the commitments thereunder, replacing it with term loans.

See “— Senior Secured Credit Facilities" below.

We had outstanding letters of credit totaling $11 million and $10 million as of September 30, 2022 and December 31, 2021, respectively, which were secured by a $20 million cash collateral deposit account.

Our ability to generate cash depends on many factors beyond our control, and any failure to meet our debt service obligations could harm our business, financial condition and results of operations.

Our ability to make payments on and to refinance our indebtedness, and to fund working capital needs and planned capital expenditures will depend on our ability to generate cash in the future, which is subject to general economic, financial, competitive, business, legislative, regulatory and other factors that are beyond our control, including the impacts of COVID-19.

See “Risk Factors—The COVID-19 pandemic has had and is expected to continue to have a significant adverse impact on our business, including our financial results and prospects, and the travel suppliers on whom our business relies." and "—We may require more cash than we generate in our operating activities, and additional funding on reasonable terms or at all may not be available.”

On an ongoing basis, we will evaluate and consider strategic acquisitions, divestitures, joint ventures, equity method investments, or repurchasing our outstanding debt obligations in open market or in privately negotiated transactions, as well as other transactions we believe may create stockholder value or enhance financial performance.

See “Risk Factors—The COVID-19 pandemic has had and is expected to continue to have a significant adverse impact on our business, including our financial results and

prospects, and the travel suppliers on whom our business relies." and "—We may require more cash than we generate in our operating activities, and additional funding on reasonable terms or at all may not be available.”

On an ongoing basis, we will evaluate and consider strategic acquisitions, divestitures, joint ventures, equity method investments, refinancing our existing debt or repurchasing our outstanding debt obligations in open market or in privately negotiated transactions, as well as other transactions we believe may create stockholder value or enhance financial performance.

These transactions may require cash expenditures or generate proceeds and, to the extent they require cash expenditures, may be funded through a combination of cash on hand, debt or equity offerings.

While the COVID-19 pandemic has had an adverse impact on our business, we recognized federal taxable income in 2022 based on our operating and non-operating results along with provisions of the Tax Cuts and Jobs Act that limit interest expense deduction and the annual use of Net Operating Loss ("NOL") carryforwards, and requires companies to capitalize and amortize research and development costs.

As a result, we expect to be a U.S.

federal cash taxpayer in 2023, and we also expect to benefit from the usage of NOLs in 2023 to the extent available.

We expect to continue to benefit from our NOLs and certain tax credits in the near-term beyond 2023.

Capital Resources

As of March 31, 2023, our outstanding debt totaled $4,855 million, which is net of debt issuance costs and unamortized discounts.

Currently approximately 28% of our debt, net of cash and hedging impacts from interest rates swaps, is variable and impacted by changes in interest rates.

See “Risk Factors—We are exposed to interest rate fluctuations.." In the future, we may review opportunities to refinance our existing debt, as well as conduct debt or equity offerings to support future strategic investments, support operational requirements, provide additional liquidity, or pay down debt.

The global capital markets experienced periods of volatility throughout 2022 and the first quarter of 2023, in response to the conflict in Ukraine, increases in the rate of inflation, and uncertainty regarding the path of U.S.

monetary policy.

During 2022, we refinanced portions of our debt which resulted in higher interest rates than prior years, increasing our current and future interest expense.

We expect to further refinance portions of our debt in 2023 and 2024 which, at current interest rates, may negatively impact our interest expense.

In addition, as a result of the judgment in our antitrust litigation with US Airways, we may be required as early as 2024 to pay US Airways' reasonable attorneys' fees and costs.

Contingencies, to our consolidated financial statements.

Depending on the amount of attorneys' fees and costs, if any, that might be awarded to US Airways, if we do not have sufficient cash on hand, we may be required to seek financing from private or public financing sources, which may not be assured.

Our continued access to capital resources depends on multiple factors, including global economic conditions, the condition of global financial markets, the availability of sufficient amounts of financing, our ability to meet debt covenant requirements, our operating performance, and our credit ratings.

These external events could lead to further market disruption and potential increases to our funding costs.

While the terms of our outstanding indebtedness allow us to incur additional debt, subject to limitations, our ability to incur additional secured indebtedness is significantly limited.

As a result, we expect that any such incremental indebtedness, if available and to the extent issued in the future, would likely be unsecured.

If our credit ratings were to be downgraded, or financing sources were to become more limited or to ascribe higher risk to our rating levels or our industry, our access to capital and the cost of any financing would be negatively impacted.

There is no guarantee that additional debt financing will be available in the future to fund our obligations, or that it will be available on commercially reasonable terms, in which case we may need to seek other sources of funding.

In addition, the terms of future debt agreements could include more restrictive covenants than those we are currently subject to, which could restrict our business operations.

For more information, see "Risk Factors—We may require more cash than we generate in our operating activities, and additional funding on reasonable terms or at all may not be available."

Under the Amended and Restated Credit Agreement, the loan parties are subject to certain customary non-financial covenants, including restrictions on incurring certain types of indebtedness, creation of liens on certain assets, making of certain investments, and payment of dividends.

In the first quarter of 2023, we entered into a securitization transaction on our accounts receivable balances pursuant to the AR facility which provided a maximum of $200 million in additional funding.

As of March 31, 2023, we were in compliance with all covenants under the terms of the Amended and Restated Credit Agreement and the AR Facility.

We are required to pay down our term loans by an amount equal to 50% of annual excess cash flow, as defined in the Amended and Restated Credit Agreement.

This percentage requirement may decrease or be eliminated if certain leverage ratios are achieved.

Based on our results for the year ended December 31, 2021, we were not required to make an excess cash flow payment in 2022, and no excess cash flow payment is required in 2023 with respect to our results for the year ended December 31, 2022.

We are further required to pay down the term loans with proceeds from certain asset sales, net of taxes, or borrowings, that are not otherwise reinvested in the business, as provided in the Amended and Restated Credit Agreement.

As of March 31, 2023, we have reinvested $245 million of the proceeds from the disposition of AirCentre.

Additional reinvestments are expected prior to May of 2023.

To the extent not considered reinvested into the business, any remaining proceeds from the disposition of AirCentre, net of taxes, will be used to pay down the term loans.

As of March 31, 2023, we had outstanding approximately $1 billion of variable debt that is indexed to the London Interbank Offered Rate ("LIBOR") consisting of 2021 Term Loan B-1 for $396 million and 2021 Term Loan B-2 for $628 million.

In July 2017, the Financial Conduct Authority announced its intention to phase out LIBOR by the end of 2021, and subsequently

extended the phase-out date to June 30, 2023.

In July 2021, we entered into the 2021 Refinancing which, among other things, allows for the LIBOR rate to be phased out and replaced with SOFR plus a credit spread adjustment factor for 2021 Term Loan B-1 and 2021 Term Loan B-2, and we therefore do not anticipate a material impact from the anticipated phase out of LIBOR with respect to these loans.

Recent Events Impacting Our Liquidity and Capital Resources

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See “— Senior Secured Credit Facilities" below.

On December 6, 2022, Sabre GLBL entered into a new debt agreement consisting of $555 million aggregate principal amount of 11.250% senior secured notes due 2027 (the “December 2027 Notes”).

We used the proceeds of the December 2027 Notes issuance to redeem the remaining principal balance on the Term Loan B of $536 million, plus $1 million of accrued interest (the “December 2022 Refinancing”).

We recognized a loss on extinguishment of debt of $1 million during the year ended December 31, 2022 in connection the December 2022 Refinancing, which consisted of the write-off of unamortized debt issuance costs and discount of $1 million.

Debt, to our consolidated financial statements for further information.

On February 14, 2023, Sabre Securitization, LLC, an indirect, consolidated subsidiary of Sabre Corporation and a special purpose entity (“Sabre Securitization”), entered into a three-year committed accounts receivable securitization facility (the “AR Facility”) of up to $200 million with PNC Bank, N.A.

On March 30, 2023, we borrowed $115 million under the AR Facility.

These proceeds are being used for general corporate purposes.

The Preferred Stock accumulates cumulative dividends at a rate per annum equal to 6.50% and dividends are payable when, as and if declared by our board of directors, out of funds legally available for their payment to the extent paid in cash, quarterly in arrears on March 1, June 1, September 1 and December 1 of each year, beginning on December 1, 2020 and ending on, and including, September 1, 2023.

Declared dividends on the Preferred Stock are payable, at our election, in cash, shares of our common stock or a combination of cash and shares of our common stock.

We recorded $5 million and $16 million, respectively, of accrued preferred stock dividends in our consolidated results of operations for the three and nine months ended September 30, 2022 and 2021, respectively.

During the three and nine months ended September 30, 2022 and 2021, we paid cash dividends on our preferred stock of $5 million and $16 million.

On October 18, 2022, the Board of Directors declared a dividend of $1.625 per share on Preferred Stock payable on December 1, 2022 to holders of record of the Preferred Stock on November 15, 2022.

On March 16, 2020, we announced the suspension of the payment of quarterly cash dividends on our common stock, effective with respect to the dividends occurring after the March 30, 2020 payment.

We recorded $5 million of accrued preferred stock dividends in our consolidated results of operations for the three months ended March 31, 2023 and 2022.

During the three months ended March 31, 2023 and 2022, we paid cash dividends on our preferred stock of $5 million.

On April 26, 2023, the Board of Directors declared a dividend of $1.625 per share on Preferred Stock payable on June 1, 2023 to holders of record of the Preferred Stock on May 15, 2023.

Share Repurchase Program

In February 2017, we announced the approval of the Share Repurchase Program to purchase up to $500 million of Sabre's common stock outstanding.

In February 2017, we announced the approval of a multi-year share repurchase program (the "Share Repurchase Program") to purchase up to $500 million of Sabre's common stock outstanding.

Repurchases under the Share Repurchase Program may take place in the open market or privately negotiated transactions.

For the nine months ended September 30, 2022, we did not repurchase any shares pursuant to the Share Repurchase Program.

For the three months ended March 31, 2023, we did not repurchase any shares pursuant to the Share Repurchase Program.

On March 16, 2020, we announced the suspension of share repurchases under the Share Repurchase Program in conjunction with the cash management measures we are undertaking as a result of the market conditions caused by COVID-19.

Approximately $287 million remains authorized for repurchases under the Share Repurchase Program as of September 30, 2022.

Approximately $287 million remains authorized for repurchases under the Share Repurchase Program as of March 31, 2023.

Senior Secured Credit Facilities

On August 23, 2017, Sabre GLBL entered into a Fourth Incremental Term Facility Amendment to our Amended and Restated Credit Agreement, Term Loan A Refinancing Amendment to our Amended and Restated Credit Agreement, and Second Revolving Facility Refinancing Amendment to our Amended and Restated Credit Agreement (the “2017 Refinancing”).

The 2017 Refinancing included a $400 million revolving credit facility ("Revolver") as well as the application of the proceeds of the

approximately $1,891 million incremental Term Loan B facility (“Term Loan B”) and $570 million Term Loan A facility (“Term Loan A”).

On August 27, 2020, Sabre GLBL entered into a Third Revolving Facility Refinancing Amendment to the Amended and Restated Credit Agreement (the "Third Revolving Refinancing Amendment") and the First Term A Loan Extension Amendment to the Amended and Restated Credit Agreement (the "Term A Loan Extension Amendment" and, together with the Third Revolving Refinancing Amendment, the "2020 Refinancing"), which extended the maturity of the Revolver from July 1, 2022 to November 23, 2023 at the earliest and February 22, 2024 at the latest, depending on certain "springing" maturity conditions as described in the Third Revolving Refinancing Amendment.

In addition to extending the maturity date of the Revolver, the 2020 Refinancing also provided that, during any covenant suspension resulting from a "Material Travel Event Disruption" (as defined in the Amended and Restated Credit Agreement), including during the current covenant suspension period, we were required to maintain liquidity of at least $300 million on a monthly basis, which was lowered in December 2020 from $450 million.

In addition, during this covenant suspension, the 2020 Refinancing limited certain payments to equity holders, certain investments, certain prepayments of unsecured debt and the ability of certain subsidiaries to incur additional debt.

The applicable margins for the Revolver were between 2.50% and 1.75% per annum for Eurocurrency rate loans and between 1.50% and 0.75% per annum for base rate loans, with the applicable margin for any quarter reduced by 25 basis points (up to 75 basis points total) if the Senior Secured First-Lien Net Leverage Ratio (as defined in the Amended and Restated Credit Agreement) was less than 3.75 to 1.0, 3.00 to 1.0, or 2.25 to 1.0, respectively.

These interest rate spreads for the Revolver were increased by 0.25%, during covenant suspension, in connection with the 2020 Refinancing.

On December 17, 2020, Sabre GLBL entered into a Sixth Term A Loan Refinancing and Incremental Amendment to our Amended and Restated Credit Agreement, resulting in additional Term Loan B borrowings of $637 million ("Other Term B Loans") due December 17, 2027.

The applicable interest rate margins for the Other Term B Loans are 4.00% per annum for Eurocurrency rate loans and 3.00% per annum for base rate loans, with a floor of 0.75% for the Eurocurrency rate, and 1.75% for the base rate, respectively.

The net proceeds of $623 million from the issuance, net of underwriting fees and commissions, were used to fully redeem both the $500 million outstanding 5.25% senior secured notes due November 2023 and the $134 million outstanding Term Loan A.

We incurred no material additional indebtedness as a result of these transactions, other than amounts for certain interest, fees and expenses.

We recognized a loss on extinguishment of debt of $11 million during the year ended December 31, 2020 in connection with these transactions, which consisted of a redemption premium of $6 million and the write-off of unamortized debt issuance costs of $5 million.

On July 12, 2021, we entered into agreements to refinance the Other Term Loan B facility and the Revolver, and terminated the revolving commitments thereunder (the "2021 Refinancing").

We incurred no additional indebtedness as a result of the 2021 Refinancing, other than amounts covering certain interest, fees and expenses.

Among other things, the 2021 Refinancing amended the financial performance covenant to remove the minimum liquidity requirement of $300 million, the Total Net Leverage Ratio maintenance requirement, and certain other limitations.

The 2021 Refinancing included the application of the proceeds of (i) a new $404 million term loan “B-1” facility (the “New Term B-1 Facility”) and (ii) a new $644 million term loan “B-2” facility (the "New Term B-2 Facility" and together with the New Term B-1 Facility, the “New Facilities”), borrowed by Sabre GLBL under our Amended and Restated Credit Agreement, to pay down in full approximately $634 million of Other Term B Loans and the outstanding $400 million Revolver balance, and to terminate the revolving commitments thereunder.

The remaining proceeds, net of a $3 million discount, were used to pay a $6 million redemption premium and $6 million in other fees associated with the refinancing.

We recognized a loss on extinguishment of debt in connection with these transactions during the year ended December 31, 2021 of $13 million and debt modification costs for financing fees of $2 million recorded to Other, net.

The New Facilities mature on December 17, 2027, and we have the ability to prepay the New Facilities after December 17, 2021 without a premium.

In addition, on July 2, 2021, in anticipation of the Revolver repayment and termination of the revolving commitments (and related letter of credit subfacility), Sabre GLBL entered into a new $20 million bilateral letter of credit facility, which is secured by a cash collateral deposit account and included as restricted cash on our consolidated balance sheets.

On March 9, 2022, we entered into an amendment to refinance a portion of the Term Loan B facility (the "March 2022 Refinancing").

We incurred no additional indebtedness as a result of the March 2022 Refinancing, other than amounts covering t discounts and certain fees and expenses.

On March 9, 2022, we entered into an amendment to refinance another portion of our then-outstanding Term Loan B facility (the "March 2022 Refinancing").

Our Senior Secured Credit Facility is governed by the Amended and Restated Credit Agreement including the Sixth Term A Loan Refinancing and Incremental Amendments entered into in December 2020 and all preceding amendments.

We incurred no additional indebtedness as a result of the March 2022 Refinancing, other than amounts covering discounts and certain fees and expenses.

The March 2022 Refinancing included the application of the proceeds of a new $625 million term loan “B” facility (the “2022 Term Loan B-1 Facility”), borrowed by Sabre GLBL under our Amended and Restated Credit Agreement, with the effect of extending the maturity of approximately $623 million of the existing Term Loan B credit facility under the Amended and Restated Credit Agreement.

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We incurred an additional discount of $5 million and other fees of $3 million which were funded with cash on hand.

We recognized a loss on extinguishment of debt in connection with the March 2022 Refinancing during the nine months ended September 30, 2022 of $4 million and debt modification costs for financing fees of $1 million recorded to Other, net.

We recognized a loss on extinguishment of debt in connection with the March 2022 Refinancing during the year ended December 31, 2022, of $4 million and debt modification costs for financing fees of $1 million recorded to Other, net.

The 2022 Term Loan B-1 Facility matures on June 30, 2028 and offers us the ability to prepay or repay the 2022 Term Loan B-1 Facility after 12 months or to prepay or repay at a 101 premium before that date.

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We incurred an additional discount of $9 million and other fees of $2 million which were funded with cash on hand.

We recognized debt modification costs for financing fees in connection with the August 2022 Refinancing during the nine months ended September 30, 2022 of $5 million recorded to Other, net.

We recognized debt modification costs for financing fees in connection with the August 2022 Refinancing during the year ended December 31, 2022 of $5 million recorded to Other, net.

No loss on extinguishment of debt was recorded as a result of the August 2022 Refinancing.

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As of September 30, 2022, we are in compliance with all covenants under the terms of the Amended and Restated Credit Agreement.

We are also required to pay down the term loans by an amount equal to 50% of annual excess cash flow, as defined in the Amended and Restated Credit Agreement.

This percentage requirement may decrease or be eliminated if certain leverage ratios are achieved.

Based on our results for the year ended December 31, 2020, we were not required to make an excess cash flow payment in 2021, and no excess cash flow payment is required in 2022 with respect to our results for the year ended December 31, 2021.

We are further required to pay down the term loans with proceeds from certain asset sales or borrowings, that are not otherwise reinvested in the business within 15 months, as defined in the Amended and Restated Credit Agreement, which is expected to include a payment in May 2023 for a portion of the proceeds from the disposition of AirCentre to the extent not considered reinvested into the business, as defined in the agreement.

This payment is expected to be no more than $150 million, but may change based on actual amounts reinvested.

As of September 30, 2022, we had outstanding approximately $1.6 billion of variable debt that is indexed to the London Interbank Offered Rate ("LIBOR") consisting of Term Loan B for $536 million, Term Loan B-1 for $398 million and Term Loan B-2 for $631 million.

In July 2017, the Financial Conduct Authority announced its intention to phase out LIBOR by the end of 2021, and subsequently extended the phase-out date to June 30, 2023.

In July 2021, we entered into the 2021 Refinancing which, among other things, allows for the LIBOR rate to be phased out and replaced with SOFR plus a credit spread adjustment factor for Term Loan B-1 and Term Loan B-2, and we therefore do not anticipate a material impact from the anticipated phase out of LIBOR with respect to these loans.

In March and August 2022, we entered into the March 2022 Refinancing and August 2022 Refinancing, respectively, which extended the maturity and replaced LIBOR with Term SOFR on a portion of our Term Loan B facility.

The remaining Term Loan B allows for a transition to the Prime rate plus a margin, and assuming the discontinuation of LIBOR in June 2023, we estimate the impact of transitioning to the Prime rate in June 2023, assuming changes in Prime rates aligned with expected changes in the federal funds rate, which are based on market data and analysts’ forecasts, would result in an aggregate of approximately $11 million of incremental interest expense over the remaining life of Term Loan B.

We intend to seek an amendment with our lenders of Term Loan B prior to June 2023 to provide for a transition to SOFR or another alternative to LIBOR in anticipation of its discontinuation, but there can be no assurance that we will be able to reach an agreement with our lenders for any such amendment or that the incremental amount of any interest pursuant to such amendment would be significantly less than current requirements.

See “Risk Factors—We are exposed to interest rate fluctuations.”

Nine Months Ended September 30,

As of March 31, 2023, we are in compliance with all covenants under the terms of the Amended and Restated Credit Agreement.

Three Months Ended March 31,

(Amounts in thousands)

Cash used in operating activities $ (72,409) $ (139,083)

Cash provided by (used in) investing activities 186,251 (5,535)

Cash used in financing activities (61,646) (37,013)

Cash used in discontinued operations (3,231) (2,376)

Cash (used in) provided by investing activities (18,110) 374,865

Cash provided by (used in) financing activities 111,939 (25,835)

Cash provided by (used in) discontinued operations 52 (1,680)

Effect of exchange rate changes on cash, cash equivalents and restricted cash 715 (205)

Decrease in cash, cash equivalents and restricted cash $ (195,593) $ (454,857)

Increase in cash, cash equivalents and restricted cash $ 22,187 $ 208,062

Operating Activities

Cash used in operating activities totaled $315 million for the nine months ended September 30, 2022.

The $93 million increase in operating cash flow from the same period in the prior year was primarily due to the impact of COVID-19 on the travel industry and on our results of operations, partially offset by an increase of $67 million associated with payments to our employees under performance-based bonus plans that did not occur in the prior year and an increase in interest payments related to our term loans.

Cash used in operating activities total ed $72 million for the three months ended March 31, 2023.

The $67 million increase in operating cash flow from the same period in the prior year was primarily due to increased transaction volumes, partially offset by a $29 million increase in interest payments related to our debt.

Investing Activities

For the nine months ended September 30, 2022, we received proceeds of $392 million from the sale of AirCentre, partially offset by $53 million of cash used on capital expenditures primarily related to software developed for internal use, $80 million of cash for the investment in GBT, and $73 million for Conferma and other acquisitions.

For the nine months ended September 30, 2021, we received proceeds of $25 million from the sale of certain investments and assets, offset by $30 million of cash used on capital expenditures primarily related to software developed for internal use.

For the three months ended March 31, 2023, we used $18 million of cash for capital expenditures primarily related to software developed for internal use.

For the three months ended March 31, 2022, we received proceeds of $392 million from the sale of AirCentre, partially offset by $17 million of cash used on capital expenditures primarily related to software developed for internal use.

Financing Activities

For the nine months ended September 30, 2022, financing activities used $62 million.

Significant highlights of our financing activities include:

• proceeds of $624 million and $650 million from the issuance of the 2022 Term Loan B-1 Facility and the 2022 Term Loan B-2 Facility, respectively;

• payment of $1.3 billion on Term Loan B ;

• payment of $11 million on Term B-1 Facility, Term B-2 Facility and 2022 Term Loan B-1;

• payment of $24 million for debt discount and issuance costs;

• net payments of $16 million from the settlement of employee stock-option awards;

• payment of $16 million in dividends on our preferred stock.

For the nine months ended September 30, 2021, financing activities used $37 million.

For the three months ended March 31, 2023, financing activities provide d $112 million.

Sig nificant highlights of our financing activities include:

• proceeds of $115 million from borrowings on our AR Facility;

• proceeds of $16 million from the sale of our common shares of Conferma;

• payment o f $6 million o n our term loans;

• payment of $2 million f or debt discount and issuance costs;

• net payme nts of $5 million fro m the settlement of employee stock-option awards;

• payment o f $5 million in dividends on our preferred stock.

For the three months ended March 31, 2022, financing activities used $26 million.

Significant highlights of our financing activities include:

• proceeds of $403 million and $642 million from the issuance of New Term B-1 Facility and New Term B-2 Facility, respectively;

• proceeds of $25 million from the Revolver;

• proceeds of $625 million from the issuance of New Other Term B Facility;

• payment of $623 million on Term Loan B;

• payment of $3 million on 2021 Term Loan B-1 and 2021 Term Loan B-2;

• payment of $10 million for debt prepayment fees and issuance costs;

• net payments of $10 million from the settlement of employee stock-option awards;

• payment of $5 million in dividends on our preferred stock.

• payment of $12 million in debt discount and issuance costs;

• payments of $400 million for the Revolver;

• payment of $654 million on Term Loan B and Other Term Loan B.

Contractual Obligations

There were no material changes to our future minimum contractual obligations since December 31, 2021 as previously disclosed in our Annual Report on Form 10-K filed with the SEC on February 18, 2022, other than the impact of interest rates on our debt.

As of September 30, 2022, we had a total debt obligation of $6.3 billion, with $98 million due for the remainder of 2022.

We had no off balance sheet arrangements during the nine months ended September 30, 2022 and year ended December 31, 2021.

There were no material changes to our future minimum contractual obligations since December 31, 2022 as previously disclosed in our Annual Report on Form 10-K filed with the SEC on February 17, 2023, other than the impact of interest rates on our debt and additional borrowings under the three-year committed accounts receivable securitization facility of $115 million.

As of March 31, 2023, we had a total debt obligation of $6.4 billion, with $345 million due for the remainder of 2023.

We had no off balance sheet arrangements during the three months ended March 31, 2023 and year ended December 31, 2022.

Recent Accounting Pronouncements

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We regard an accounting estimate underlying our financial statements as a “critical accounting estimate” if the accounting estimate requires us to make assumptions about matters that are uncertain at the time of estimation and if changes in the estimate are reasonably likely to occur and could have a material effect on the presentation of financial condition, changes in financial condition, or results of operations.

For a discussion of the accounting policies involving material estimates and assumptions that we believe are most critical to the preparation of our financial statements, how we apply such policies and how results differing from our estimates and assumptions would affect the amounts presented in our financial statements, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates”

included in our Annual Report on Form 10-K filed with the SEC on February 18, 2022.

Since the date of the annual report on Form 10-K filed with the SEC on February 17, 2023, there have been no material changes to our critical accounting estimates.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis