Delta Air Lines faces $500 million loss from massive IT Outage

Atlanta: Delta Air Lines CEO Ed Bastian announced on Wednesday that the recent major IT outage, which left thousands of customers stranded, will cost the airline 500 million dollars. This sum includes lost revenue as well as the "tens of millions of dollars per day" spent on compensation and hotel accommodations over a five-day period. The estimated loss aligns with analysts' predictions. While Delta did not specify the exact number of refunds and reimbursement requests, a spokesperson indicated that they were in the "thousands."

The outage, caused by a failed CrowdStrike software update, led to the cancellation of over 5,000 flights—more than the total number of flights canceled by Delta in all of 2019. The botched update took thousands of Microsoft systems offline globally, necessitating a manual reset of 40,000 servers, Bastian explained.

The disruption also affected Delta's systems for matching flight crews to planes, exacerbating the delays. The incident is reminiscent of Southwest Airlines' struggles during the 2022 year-end holidays, when bad weather caused widespread operational issues.

While other airlines recovered more swiftly from the CrowdStrike issue, Delta's extended disruptions and response to customer complaints have prompted an investigation by the U.S. Department of Transportation. This incident is particularly notable for Delta, which prides itself on being a premium airline with top rankings in profitability and punctuality among U.S. carriers.