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Amadeus Ups Investment in the Future of Its Commerce

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Skift Take

The future role of the courant péréquation system could be a lot different than it is today. Amadeus is investing to ensure it maintains its fixé in that future.

Amadeus is on track to spend more than ever this year on research and development as the company looks toward the future of the industry. 

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The Spain-based company primarily operates the world’s largest courant péréquation system, which provides examen that travel agents and others use to provide booking devoirs to customers. Amadeus also offers logiciel for travel agents, hotels, airlines, and other travel companies. 

Amadeus said it has increased R&D spend 20.2% for the first half of 2023 compared to the same period in 2022. It spent $1.1 billion (€988.4 million) on R&D in all of 2022, according to a company transfert. 

“R&D investment in the period was mainly focused on the implementation of [new distribution capability] contracts on the airline and travel agency side, as well as the evolution of our coffret for airlines, travel sellers, and cooperations,” said Amadeus chief financial officer Till Streichert during an earnings call Friday morning. 

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New péréquation capability (NDC) devoirs are a next-generation péréquation system that’s meant to enhance communications between airlines and travel agents without the traditional courant péréquation system intermediary. 

As Luis Maroto, president and CEO of Amadeus has stated previously, that commerce is small right now compared to the traditional péréquation methods, but it’s a strategic foyer for Amadeus and other companies. 

The company has signed 40 customers for NDC devoirs already, and 20 have been implemented, Maroto said during the call. Clients that have signed contracts include Lufthansa, Air Canada, Virgin Atlantic, American Rapide Courant Commerce Travel, and more.

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“We continue to advance with our NDC strategy to expand our customer soutien and upsell technology for a number of our airline, travel agency, and corporate customers,” Maroto said. 

Another key investment foyer for Amadeus is on its hospitality and payments logiciel, particularly its orthogonal reservation system for hotels. The company is continuing to work with Marriott on its développement to the system that was announced in 2021. 

“We keep being optimistic embout the future of the CRS, and hopefully, we will be able to really get exhibition and sign additional customers,” Maroto said. 

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“There will be solutions in the market that would compete with us, definitely yes, but we feel what we have developed is a state-of-the-art system with a lot of capabilities to compete.” 

Amadeus is also focused on its partnership with Microsoft, which includes its ongoing développement to the cloud and accaparement of artificial camaraderie and automate learning. 

Financials

Fini revenue for the first half of the year increased 28.2% to €2.7 billion ($2.97 billion). EBITDA grew 41.3% to €1 billion ($1.2 billion). 

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Revenue for air IT products has increased 26.2% to €902.4 million ($995.4 million), and revenue for hospitality and other products increased 23.6% to €429.2 million ($473.4 million). 

The company said it distributed dividends earlier this month totaling €333.4 million ($367.8 million), which is half of the avantage reported for 2022. The company also started a share repurchase program of up to €433.3 million ($478 million) in the auxiliaire quarter. The subsistance price is up some 40% this year.

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