The recent global technology outage triggered by CrowdStrike’s faulty update resulted in an estimated loss of $5.4 billion for Fortune 500 companies, according to a Parametrix report.
The projected financial losses do not include Microsoft, whose systems suffered massive outages as a result of the crash. According to insurance company Parametrix, banking and healthcare firms, as well as major airlines, are expected to suffer the most. The total amount of insured losses for companies beyond the Microsoft Fortune 500 could range from $540 million to $1.08 billion.
Various industries are still trying to fix the damage from the CrowdStrike outage, which brought thousands of flights to a halt, caused disruptions in hospitals, and crippled payment systems.
It became the largest IT outage in history. It showed that modern tech systems are built on shaky foundations, and faulty code in a single update can bring the entire world to a standstill.
Reputational loss
CrowdStrike is a Texas-based multi-billion-dollar company that has lost about 22% of its market value since the outage. On Wednesday, CrowdStrike released a report detailing what went wrong in the update.
The main cause of the outage was due to an update that CrowdStrike implemented to its flagship Falcon platform designed to protect businesses from cyber-attacks and disruptions. However, the update contained a bug that led to a massive crash of 8.5 million Windows computers.
Before the incident, the company was valued at around $83bn. According to its website, it serves about 538 Fortune 1000 companies and operates worldwide. However, such ubiquity made the impact of the failed update particularly severe, demonstrating how many companies depended on the same products to maintain operations.
Days later, Delta Air Lines is still in turmoil as it cancels and reschedules hundreds of flights. On Tuesday, the US Department of Transportation launched an investigation into Delta over its handling of the issue.
