You may have witnessed this at celebratory functions or a New Year’s Eve party. The person performing the act grazes the sword along the neck of the bottle. If done correctly, the cork and the lip are shot from the bottle after striking. The glass is cleanly sheared off at the point of separation.
They make special Champagne swords for performing Sabrage, but they’re really not necessary. Though less dramatic, it can be performed with almost any blunt, knife-like utensil. The lip is typically struck by the blunt side anyway.
Disclaimer: If you are perfecting your sabrage technique at home, I suggest picking up some cheap, bottom-shelf sparkling wine. Once you get good at it, THEN break out the Krug or Dom Perignon to impress women at parties. You can spend serious dollars and waste a lot of bubbly practicing this. Just saying.