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CrowdStrike ( CRWD ) software update triggers outages for Microsoft ( MSFT )

users

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CrowdStrike ( CRWD ) ranks among leading global cybersecurity firms

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Wide range of industries affected

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Companies reporting restored services after outages

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CrowdStrike ( CRWD ) shares fall, cybersecurity rivals gain

July 19 (Reuters) - A worldwide tech outage crippled

industries from travel to finance on Friday before services

started coming back online after hours of disruption,

highlighting the risks of a global shift towards digital,

interconnected technologies.

A software update by global cybersecurity firm CrowdStrike ( CRWD )

appeared to have triggered systems problems that

grounded flights, forced some broadcasters off air and left

customers without access to services such as healthcare or

banking.

CrowdStrike ( CRWD ) CEO George Kurtz said on social media platform X

that a defect was found "in a single content update for Windows

hosts" that affected Microsoft's ( MSFT ) customers and that a

fix was being deployed.

Microsoft ( MSFT ) said later on Friday that the issue had been

fixed.

"We're deeply sorry for the impact that we've caused to

customers, to travellers, to anyone affected by this, including

our company," Kurtz told NBC News' "Today" programme.

"Many of the customers are rebooting the system and it's

coming up and it'll be operational," Kurtz said. "It could be

some time for some systems that won't automatically recover."

But even as companies and institutions began restoring

regular services, experts said the cyber outage revealed the

risks of an increasingly online world.

"This is a very, very uncomfortable illustration of the

fragility of the world's core Internet infrastructure," said

Ciaran Martin, professor at Oxford University's Blavatnik School

of Government and former head of the UK National Cyber Security

Centre. While the core problem appeared simple, which should

make it short-lived, its immediate impact was remarkable, Martin

said.

"I'm struggling to think of an outage at quite this scale."

Accelerated by the COVID-19 pandemic, governments and

businesses alike have become increasingly dependent on a handful

of interconnected technology companies over the past two

decades, which explains why one software issue rippled far and

wide.

DISRUPTION

Early on Friday, major U.S. airlines - American Airlines ( AAL )

, Delta Air Lines ( DAL ) and United Airlines -

grounded flights, while other carriers and airports around the

world reported delays and disruptions.

Banks and financial services companies from Australia to

India and Germany warned customers of disruptions and traders

across markets spoke of problems executing transactions.

"We are having the mother of all global market outages," one

trader said.

In Britain, booking systems used by doctors were offline,

multiple reports posted on X by medical officials said, while

Sky News, one of the country's major news broadcasters, was

taken off air and apologised for being unable to transmit live.

Soccer club Manchester United ( MANU ) said on X that it had to postpone

a scheduled release of tickets.

Airports from Los Angeles to Singapore, Hong Kong, Amsterdam

and Berlin said some airlines were having to check in passengers

manually, causing delays.

Government agencies were also affected with the Dutch and

United Arab Emirates' foreign ministries reporting some

disruptions.

As the day progressed, more and more companies reported a

return to normal service, including Spanish airport operator

Aena, U.S. carriers American Airlines ( AAL ), Frontier and

Spirit, Dubai International Airport operator and

Australia's Commonwealth Bank.

LSEG Group also said its data and services were

back up and running after an outage that caused some disruption

across financial markets.

Still, industry experts weighed the potential impact for the

sector of what one called the biggest ever IT outage.

"IT security tools are all designed to ensure that companies

can continue to operate in the worst-case scenario of a data

breach, so to be the root cause of a global IT outage is an

unmitigated disaster," said Ajay Unni, CEO of StickmanCyber, one

of Australia's largest cybersecurity services companies.

U.S.-based CrowdStrike ( CRWD ), with a market value of about $83

billion, is among leading cybersecurity companies, counting more

than 20,000 subscribers around the world, its website shows.

Its shares were down 14.5% shortly after the Wall Street

open, while its cyber rivals were up, with SentinelOne more than

10% higher and Palo Alto Networks up 2.6%. Microsoft ( MSFT ) was down

almost 1.5%.