Business counts the cost of CrowdStrike outage

Cybersecurity group’s glitchy security software update sees its shares slide almost 30% over past week

Shares in CrowdStrike slumped on Monday as business tried to come to terms with the financial and other cost of last Friday's global outage. Photograph: Michael Nagle/Bloomberg

Business and organisations were counting the costs of last week’s global IT outage, as the efforts to recover from the disruption continued.

But experts warned that companies should be prepared for similar incidents, saying it was “inevitable” that they would occur.

“I think we should safely assume that something like this will happen again,” said EY UK and Ireland’s cybersecurity leader Puneet Kukreja. “If it’s not CrowdStrike, it will be product X; if it’s not that, it will be something else, given the interconnected nature in how the industry works.”

The global issue was caused by an update from cybersecurity company CrowdStrike, which crashed its clients’ Windows computers.

READ MORE

Mr Kukreja said the incident should serve as a wake-up call to companies, as had it been a cybersecurity incident the impact would have been more drastic.

The outage affected at least 8.5 million machines, according to Microsoft’s estimates, which adds up to less than 1 per cent of Windows machines. But experts said the true impact of the incident could be much higher.

“We’re looking at companies that were directly impacted by it but a big aspect of this would be the supply chain,” said security expert Brian Honan. “So you would have companies who weren’t using CrowdStrike but were indirectly impacted because one of their partners or one of their suppliers was using CrowdStrike. When they went down, those services weren’t available.”

Mr Honan warned that it could also serve as an indicator for threat actors about the kind of chaos that could be inflicted with a well-planned cyber attack.

CrowdStrike ‘close to rolling out fix’ after IT outage crashes 8.5m Windows devices globallyOpens in new window ]

Doctors’ surgeries and airlines were among those trying to catch up on Monday, with Delta Air Lines cancelling more than 600 additional flights as it continued to struggle to restore operations.

The British Medical Association (BMA) urged patience with GP practices at the start of the week. An estimated two-thirds of practices in Northern Ireland were impacted by the global IT problems and were forced to revert to paper-based processes in some instances.

Dr Frances O’Hagan, chairwoman of BMA’s Northern Ireland general practitioners committee, said Monday would see practices have to deal with the aftermath of the outage.

“A key online system we rely upon to access and update patients’ clinical records went down, causing a considerable backlog of work that will now have to dealt with in this coming week,” she said. “This will, of course, put considerable strain on general practice, however, staff will continue to provide care to the best of their ability.

“Whilst these systems return online, I would appeal to anyone accessing their GP to be patient while staff do their utmost to address this backlog of work.”

Pharmacy services were also “slower than usual” on Monday in the North as the recovery continued.

Nick Kaye, the chairman of the National Pharmacy Association,

asked customers to “be patient” with their local pharmacy teams.

Shares of CrowdStrike tumbled almost 13 per cent by lunchtime trading in New York to $265.40, after several analysts downgraded the stock on concerns over the financial fallout from the global cyber outage last week. That extended losses that have seen 29.5 per cent of the company’s market cap stripped away since the start of last week

CrowdStrike’s glitchy update to its security software disrupted internet services across the globe and leaving people without access to banking or healthcare services.

Shares of cybersecurity rivals Palo Alto Networks, Sentinel One and Fortinet were up between 1 per cent and 3 per cent in premarket trading on Monday. – Additional reporting: Reuters

Ciara O'Brien

Ciara O'Brien

Ciara O'Brien is an Irish Times business and technology journalist