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Airline stock market reaction to CrowdStrike IT outage: An event study analysis

Author

Listed:
  • Costa, João
  • Cró, Susana
  • Moutinho, Nuno
  • Martins, António Miguel

Abstract

This study investigates the short-term market effect of CrowdStrike IT outage in the airline industry. Using an event study methodology, we evidence that airline stocks respond significantly negatively to the technology disruption within two days before and after the event day. IT disruptions, by creating friction in daily operations, such as broken schedules, delayed or cancelled flights, negative externalities, and customer dissatisfaction, lead to loss of value for airlines. The results also show that the most affected airlines are those from main CrowdStrike customers countries (mainly non-Asian countries) and an irrelevance of the business model. Finally, the extent of the stock market's response to the CrowdStrike IT outage is influenced by other airline characteristics such as profitability, size, leverage, and cyber risk rating.

Suggested Citation

  • Costa, João & Cró, Susana & Moutinho, Nuno & Martins, António Miguel, 2025. "Airline stock market reaction to CrowdStrike IT outage: An event study analysis," Finance Research Letters, Elsevier, vol. 77(C).
    • Handle: RePEc:eee:finlet:v:77:y:2025:i:c:s1544612325004088
    DOI: 10.1016/j.frl.2025.107145
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    More about this item

    Keywords

    Airlines; Event study; Stock market reaction; CrowdStrike; IT outage;
    All these keywords.

    JEL classification:

    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading

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