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    Home » Delta CEO Reports $500 Million Loss Due to CrowdStrike-Microsoft Outage
    General

    Delta CEO Reports $500 Million Loss Due to CrowdStrike-Microsoft Outage

    FeyisayoBy FeyisayoAugust 6, 20246 Mins Read
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    Delta Airlines
    Source: Pinterest
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    Sometime in July, CrowdStrike distributed a faulty update to security software that caused a lot of problems with users running the software with Microsoft Windows. 

    People stranded at the airport due to CrowdStrike outage
    Source: Pinterest

    Railway ports, 911 operations, and multiple airports around the world reported huge disruptions, with airlines like Delta reporting a loss of $500 million. 

    What Is CrowdStrike?

    CrowdStrike is an American multinational cybersecurity company based in Austin, Texas. Founded 13 years ago, CrowdStrike has grown significantly over the years, with almost 8,500 people employed by the company. While the company is not a household name that many know, its software is widely used across many countries in the world. 

    CrowdStrike Logo
    Source: Pinterest

    The firm usually solves cyber problems, but in July 2024, it caused a massive worldwide disruption as many countries were affected by the incident. 

    What Caused the Crowdstrike Outage?

    The CrowdStrike outage was caused by the distribution of a faulty update to its Falcon Sensor security software that worked with Microsoft Windows PCs and caused a wide outage. 

    CrowdStrike Logo
    Source: Pinterest

    According to the company‘s boss, the issues affected only Microsoft computers, and other operating systems were not affected in any way. However, he emphasized that it was not a security incident or a cyber-attack. It was caused by a faulty update that caused issues for Microsoft PCs running with the software installed. 

    When Was the Microsoft Crowdstrike Outage?

    The widespread Microsoft-Crowdstrike happened on Friday, July 19, 2024. This faulty update was not caught early and it took a couple of hours before the company could figure out what exactly went wrong. 

    CrowdStrike Logo
    Source: Pinterest

    The company’s head issued a statement saying that a bug in the update caused this outage, and those using other Operating Systems (OS) like Apple’s iOS did not have cause to worry, as it was not going to affect them. 

    ALSO READ: SpaceX’s Falcon 9 Rocket Grounded After Rare Inflight Failure

    How Many Computers Were Affected?

    CrowdStrike may not be a very popular name, but the company has many users. In its last quarterly report, the company declared that it had almost 24,000 customers. 

    CrowdStrike outage
    Source: Pinterest

    Since one customer is usually a huge organization with many users, it is hard to say the exact number of computers that were affected. However, it was estimated that about 8.5 million Microsoft Windows PCs all around the world crashed on that day.  

    Which Organizations Were Affected?

    The outage affected many institutions worldwide. Several airports in the UK, such as Tokyo, Amsterdam, and Delhi, were affected. In the U.S., airlines like Ryanair, United, American, and Delta Airlines had to cancel many flights and ground some for most of the day. 

    A person at an airport
    Source: Pinterest

    In addition, railway companies also had several delays in their operations for the day. Hospitals and Alaska’s 911 services also experienced outages, while Sky News was off the air for many hours that morning. 

    How the Outage Affected Delta Airlines

    Delta Airlines CEO Ed Bastian spoke on the massive CrowdStrike outage that happened in July. The company had to ground many flights and cancel even more due to the CrowdStrike incident that occurred that day. 

    People stranded at the airport due to CrowdStrike outage
    Source: Pinterest

    Airports were filled with long lines of affected customers who had places to be but could not fly due to the outage. The company’s representatives had to talk to the customers and make arrangements to make up for the unexpected delays. 

    Delta CEO Says It Will Cost the Airline $500 Million

    According to him, it stranded thousands of the company‘s customers and is going to cost Delta Airlines a staggering $500 million. 

    Delta Airlines CEO Ed Bastian
    Source: Pinterest

    Not only did the airline lose revenue on that day, but it also lost millions of dollars for over five days due to the compensations and hotels it had to offer its affected customers. Reimbursement requests and refunds were also processed, and the company lost thousands of dollars for over five days. 

    Delta Canceled Over 5,000 Flights

    Bastian also said that the airline canceled over 5,000 flights worldwide from July 19th through July 25th because of the severity of the outage. The faulty CrowdStrike affected thousands of the company’s Microsoft PCs around the world and took them all offline. 

    Microsoft Logo
    Source: Pinterest

    According to the CEO, Delta Airlines’ IT departments had to manually reset over 40,000 servers around the world to get them working again. Many disruptions also occurred because the flight crew could not be properly assigned to their planes. 

    ALSO READ: Man Purchased Lifetime Flight Pass in 1990. Here’s His Story Now

    Technology and Huge Disruptions 

    This incident clearly outlines how most of the world’s organizations depend heavily on technology and operational software for their daily activities. While many airlines recovered quickly, Delta Airlines spent more than five days working on the problem and trying to get its affairs back in order. 

    Delta Airlines
    Source: Pinterest

    The response from customers during this period has now caused the U.S. Department of Transportation to open an investigation into the premium airline company. 

    Delta Is Seeking Damages for the Disruptions

    Bastain also told CNBC’s “Squawk Box” that the airline has “no choice” but to seek damages for the disruptions caused by CrowdStrike soon. The software company was given priority access to Delta’s technological ecosystem, which was a critical part of its daily operations. 

    Delta Airlines CEO Ed Bastian
    Source: Pinterest

    Therefore, Bastain said it was unacceptable to say that a bug occurred because the software was not tested properly. 

    No Financial Help From CrowdStrike Yet

    Delta CEO also revealed that CrowdStrike has made no offers to help the company financially since the incident occurred. Instead, the software company only offered Delta Airlines free consulting services to help them deal with the outage. Many are speculating that a lawsuit could follow soon because of this. 

    Delta Airlines CEO Ed Bastian
    Source: Pinterest

    However, CrowdStrike emailed a statement saying that the company has “no knowledge of a lawsuit and has no further comment.” 

    Delta Airlines Hired a Prominent Attorney

    Delta Airlines seems to be gearing up for a legal battle. The company recently hired David Boies, a prominent attorney known for his legal cases. 

    A lawyer
    Source: Pinterest

    CNBC reported that the attorney was hired to seek damages, not only from the cybersecurity firm but also from Microsoft. According to Bastian, this move is necessary to protect the brand, its shareholders, customers, staff, and employees from the impact of the damages that occurred on that day.  

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