Delta says chaos after CrowdStrike outage cost it $550 million

Delta Air Lines on Thursday said last month’s CrowdStrike outage and subsequent mass flight cancellations cost it some $550 million and reiterated that it is pursuing legal claims against the company as well as Microsoft.

The financial impact includes a $380 million revenue hit in the current quarter “primarily driven by refunding customers for cancelled flights and providing customer compensation in the form of cash and SkyMiles,” the Atlanta-based airline said in a securities filing.

The incident, in which it canceled some 7,000 flights, also meant a $170 million expense “associated with the technology-driven outage and subsequent operational recovery,” the carrier said, adding that its fuel bill will likely be $50 million lower because of the scrubbed flights.

Delta struggled more than its competitors to recover from the July 19 outage, which took millions of Windows-based machines offline around the world. The disruptions occurred at the height of the summer travel season, leaving thousands of Delta customers stranded, a rare incident for the carrier that markets itself as a premium carrier that gets top marks for reliability.

“An operational disruption 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 people have returned the operation to an industry-leading position that is consistent with the level of performance our customers expect from Delta.”