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The information provided in this blog is for informational purposes only and should not be considered as financial, investment, or professional advice. The valuations and analyses presented here are based on publicly available
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I. Executive Summary
Have you ever flown with British Airways, Lufthansa, Qantas or Ryanair? Booked a flight through a travel agent or through your company’s travel tool? Checked in at an airport kiosk?
Chances are that, somewhere behind the screen, Amadeus processed that transaction.
Amadeus is the plumbing of global air travel. It connects airlines with travel agencies, and at the same time it runs the core systems that airlines use to sell tickets, check in passengers and board flights. Very few companies sit in both places.
The numbers speak by themselves. In 2025 Amadeus processed 484.5m travel agency air bookings and boarded 2,248.6m passengers on its airline systems — roughly 45% of all passengers flown in the world. Revenue reached €6,517m (+8.5% at constant currency), with a 38% EBITDA margin, a 16.5% ROIC (32% excluding goodwill) and €1,278m of free cash flow after interest and leases.
The investment case rests on five pillars:
First, a dominant position in two businesses. Amadeus is the largest of the three global distribution systems (GDS), and the clear leader in airline passenger systems, where it boards more than three times the passengers of Sabre, its closest competitor.
Second, pricing power. Bookings are still 17% below 2019, yet revenue is 17% above which means that Amadeus has been able to increase revenue per booking by c.27% since 2019, and revenue per passenger boarded c.14%.
Third, a highly cash-generative business: c.€1.3bn of FCF per year, with a conservative balance sheet (0.9x net debt/EBITDA) and an investment grade rating.
Fourth, shareholder-friendly capital allocation: 87% of the cumulative FCF generated between 2016 and 2025 was returned to shareholders through dividends and buybacks.
Fifth, a reasonable valuation: c.18x earnings and c.18x FCF, the lowest multiples in a decade outside COVID.
So why is the stock at €53.48, c.35% below its 2018 highs and down c.15% this year? Three reasons:
First, Mr. Market decided in January 2026 that AI agents will eat software, and Amadeus was thrown in the same basket. Same as SaaSmaguedon, these companies were also affected by the same reasoning.
Second, the conflict in the Middle East hit air traffic from March 2026, and Amadeus trimmed its 2026 revenue guidance on July 31st.
Third, Sabre has been gaining some booking share during 2026, and is now accusing Amadeus of monopoly behavior in airline IT (which this is in fact a positive sign, meaning that Amadeus is way ahead them).
While I will need to do further analysis, it appears that their service represents a very small fraction of their cost base, and it’s a critical part of their systems.
💬 My view: Amadeus is a high-quality infrastructure businesses in travel. The airline IT business is as strong as ever, and the distribution business has shown that it can grow revenue even with fewer bookings. The AI narrative is not new — we discussed it a few weeks ago in our Booking Holdings thesis — and in the case of Amadeus, AI agents still need someone to price, book and issue the ticket. Several quarters ago investors were paying 25–30x earnings. Today they pay less than 18x for a business that keeps delivering.
Same as past editions, we keep our quality testing, which is called The Quality Journal Test, keeping the same criteria as before. The result for Amadeus: 4 Pass, 2 Partial, 0 Fail.
