Delta Air Lines faces $380 million revenue hit from Microsoft-CrowdStrike outage, pursuing legal claims for damages.

From Barchart: 2024-08-09 09:38:09

Delta Air Lines estimates a $380 million direct revenue hit from the massive IT outage caused by Microsoft and CrowdStrike, resulting in over 7000 flight cancellations. The airline is pursuing legal claims to recover at least $500 million in damages.

The outage on July 19 impacted global operations of major organizations, including airlines, due to a defect in CrowdStrike’s software update for Windows hosts. Around 8.5 million computers were affected, leading to chaos in various sectors.

The outage extended to several days, affecting other U.S. airlines like American, United, and Frontier, with Delta experiencing operational disruptions and 7000 flight cancellations. The direct revenue impact for the September quarter is estimated at $380 million, with additional expenses of $170 million.

Non-fuel expenses related to the outage are estimated at $170 million, and fuel expenses are projected to be $50 million lower due to the cancellations. Delta CEO expressed dissatisfaction with the disruption, stating customers and employees deserve better service.

Delta faced U.S. Department of Transportation investigation for a longer recovery period post-outage. CrowdStrike denied sole responsibility for the disruptions, refuting allegations of negligence. The airline aims to recover financially from the incident and improve operational efficiency moving forward.



Read more at Barchart: Delta Sees $380 Mln Revenue Hit From Microsoft-CrowdStrike Outage