Bernstein downgraded Sabre to Market-Perform with a $1.50 price target, citing longer-term pressure on global distribution systems from artificial intelligence. The firm argued that while airline IT systems remain well defended, GDS operators face challenges monetizing AI-based distribution. Airline Passenger Service Systems, governed by decade-long contracts, continue to provide stable revenue streams.

Bernstein noted that airlines' cultural risk aversion supports renewals with incumbent providers, discouraging self-building or switching to unproven vendors. AI-driven revenue gains outweigh potential cost savings, as airline IT spending typically accounts for just 1% to 2% of sales. Even large cost cuts would add only about 0.5 percentage points to margins, while incremental revenue improvements have a larger profit impact in this low-margin industry.

The firm expects bookings to shift natively into LLM interfaces over time, likely through direct airline APIs, but sees limited near-term impact. Direct bookings are likely to migrate first, while GDS profits remain concentrated in corporate and offline agency channels that are slower to change. Bernstein maintained an Outperform rating on Amadeus, citing its leadership in airline IT. The firm cut booking forecasts for Sabre, removed expected gains from previously signed business, and now expects leverage to stay above 5 times net debt to EBITDA into the 2030s.