Delta says chaos following CrowdStrike outage cost company $550 million

Delta Air Lines He said last Thursday Crowd Strike The outage and subsequent cancellation of group flights cost her about $550 million and she said she was seeking compensation from the company as well. Microsoft.

The Atlanta-based airline said in a securities filing that the financial impact includes a $380 million revenue decline in the current quarter “driven primarily by refunding customers for canceled flights and providing compensation to customers in the form of cash and Sky Miles.”

The company said the incident, which led to the cancellation of about 7,000 flights, also meant a cost of $170 million “associated with the technology-induced outage and subsequent operational recovery,” adding that its fuel bill was likely to be about $50 million lower due to the flight cancellations.

Delta has struggled more than its competitors to recover from the July 19 outage that grounded millions of Windows-based devices worldwide. The outage occurred during the height of the summer travel season, stranding thousands of Delta customers, a rare occurrence for a company that markets itself as a premium airline with top marks for reliability.

“An outage of this length and magnitude is unacceptable, and our customers and employees deserve better,” CEO Ed Bastian said in the filing. “Since the incident, our employees have restored operations to an industry-leading level of performance that our customers expect from Delta.”

Delta’s flight cancellations in the days following the outage exceeded the total for all of 2019. The U.S. Department of Transportation said last month it was investigating Delta’s response to the outages and flight cancellations.

CrowdStrike responded in a statement Thursday that Delta “continues to push a misleading narrative” and said the company’s chief security officer was in “direct contact” with Delta’s chief information and security officer “within hours of the incident, providing information and offering support.”

In a letter to CrowdStrike's attorneys on Thursday, Delta attorney David Boies said the outage affected 1.3 million customers and shut down 37,000 Delta computers.

Earlier this week, lawyers for CrowdStrike and Microsoft responded to Delta, saying they had reached out to offer assistance. Microsoft on Wednesday suggested that Delta had not invested enough in its technology compared to its competitors.

“If CrowdStrike truly seeks to avoid a lawsuit from Delta, it must accept real responsibility for its actions and compensate Delta for the significant damage it has caused to Delta’s business, reputation, and goodwill,” Boyes said in the letter to CrowdStrike on Thursday.

About 60% of Delta's “critical applications” and data rely on Microsoft and CrowdStrike, he said, adding that the disruption “required significant human intervention by skilled crew professionals to move Delta employees and aircraft to the correct locations to resume normal and safe operations.”