Google’s parent company, Alphabet, reduced its stake in CrowdStrike by half before the cybersecurity firm’s faulty software update caused a global IT outage.
In a recent regulatory filing, Alphabet disclosed that it currently owns 427,895 shares of CrowdStrike, 50% down from the 855,789 shares it held last quarter.
CrowdStrike’s botched software update to the vulnerability scanner Falcon Sensor on July 19 caused businesses across the world to experience crashes on their devices running the Windows operating system. This caused a global disruption across a number of industries, causing commercial flights to be grounded and banking and healthcare services to malfunction.
In the days after the incident, CrowdStrike’s stock plunged by 30% from its $377.37 per share price. The free fall continued since, with the company’s shares losing more than 42% of its value and closing at $217.89 on Friday. The stock is now 11.75% down year-to-date.
The consequences of a global IT outage on CrowdStrike won’t just end in falling stock and loss of reputation. The company is currently facing a first-class action lawsuit for “violating federal securities law,” while Delta Airlines also plans to sue for damages. Delta’s CEO Ed Bastian previously stated that the incident caused the company to cancel more than 5,000 flights and incur a half-a-billion dollars loss.