Delta Air Lines experienced a significant operational setback on Monday as cancellations increased due to a severe technology outage that affected the airline’s IT systems globally. By the morning of the following Monday, Delta reported a staggering 703 cancellations, pushing the total to over 4,500 since the disruption began.
This situation has caused a marked decrease in Delta's stock value, with shares falling 1.8% during Monday's trading session. Ed Bastian, Delta's Chief Executive Officer, addressed the situation in a message directed at customers, stating, "Like many companies worldwide, Delta was impacted on Friday morning by an outside vendor technology issue, which prompted us to pause flying while our systems were offline." This pause in operations has undoubtedly had a ripple effect on the airline's scheduling and customer service.
A significant number of Delta's operational applications utilize the Microsoft Windows operating system, which fell victim to a problematic update from CrowdStrike. Notably, one of Delta's critical tools responsible for tracking crews faced major disruptions due to this incident. As reported, the halt in operations led to more than 3,500 cancellations affecting Delta and Delta Connection flights through the preceding Saturday alone, with additional cancellations reported on Sunday.
Bastian emphasized the challenge posed by the timing of the outage, occurring during what is typically one of the busiest travel weekends of the summer. With flight loads exceeding 90%, the airline faced substantial difficulties in rebooking affected passengers. "I want to apologize to every one of you who have been impacted by these events," Bastian remarked in his communication.
FlightAware's data indicated that Delta has been the hardest hit among carriers due to this incident. Comparatively, United Airlines canceled 1,407 flights over the same period from Friday to Sunday, with an additional 17 cancellations by Monday morning. American Airlines reported 593 cancellations during the same timeframe.
The aftershocks of the outage are also being felt in the stock market, particularly for CrowdStrike, whose shares plummeted by 11% during intraday trading on Monday after a similar drop on Friday. Amidst these challenges, Oppenheimer opted to remove CrowdStrike from its list of top picks, highlighting expectations for ongoing pressure on its share performance following what has been termed the largest IT outage in history.
With the air travel landscape grappling to recover from the profound effects of this disruption, stakeholders await updates on operational stability from Delta and the affected technology companies..