In an exclusive interview with CNBC’s ‘Squawk Box,’ Delta Air Lines CEO Ed Bastian revealed the significant fallout from the CrowdStrike-Microsoft outage earlier this month, which cost the airline industry leader half a billion dollars in just five days. The extensive disruption led to thousands of flight cancellations and operational chaos, particularly affecting Delta as the official airline for Team USA during the Olympic Games in Paris.

A Challenging Recovery

“Everything, except for Joe’s ability to enter the app, is back working, and we have been up for over a week,” Bastian said. He acknowledged the unprecedented nature of the outage, emphasizing, “Over the last seven days, we had less than 100 cancellations in aggregate. We brought so many of the production crews and the athletes over, and it was just a really, really tough situation.”

Reflecting on the immediate response, Bastian noted, “We did everything we could to take care of our customers over that time frame. We provided compensation, arranged hotels, and ensured that our passengers were as comfortable as possible despite the circumstances.”

Lessons Learned

Bastian was candid about the lessons learned from the incident. “People wonder how this could happen if we have redundancies. We built hundreds of millions of dollars in redundancies. The issue is with Microsoft and CrowdStrike, and we are heavily invested in both,” he explained. “We got hit the hardest in terms of recovery capability.”

He elaborated on the challenges of relying on leading tech competitors who don’t always align their systems effectively. “Microsoft and CrowdStrike are the top two competitors in cybersecurity. They don’t necessarily partner at the level we need them to,” Bastian said. “This is a call to the industry. Everyone talks about making sure big tech is responsible. Well, guys, this cost us half a billion dollars.”

Legal Repercussions

Bastian confirmed that Delta is considering its options when asked about potential legal actions. “We have no choice,” he stated. “Over five days, between lost revenue and the tens of millions of dollars per day in compensation and hotels, we did everything we could to take care of our customers. We have to protect our shareholders, our customers, and our employees from the damage.”

Regarding possible lawsuits, Bastian expressed frustration with the tech companies’ response. “Do you really want to know what they offered us? Nothing. Free consulting advice to help us. Exactly,” he said. “We have to ensure that this doesn’t happen again and that our stakeholders are compensated for the losses.”

Reassessing Technology Partnerships

The outage has prompted Delta to reconsider its technology partnerships. “It has been a wake-up call for me,” Bastian admitted. “We thought we had the best setup between Microsoft and CrowdStrike, but they are integrated, which caused a lot of the slowdown. We had 40,000 servers that we had to touch and reset, and it didn’t all come back on the way they left.”

He pointed out the broader issue within the tech industry, where companies often prioritize growth over exceptional service. “The question is, is the priority growing the business or delivering exceptional service to their existing customer base? They have not delivered exceptional service,” Bastian emphasized. “It’s not just CrowdStrike and Microsoft. It’s other names as well.”

Bastian also hinted at potential changes in their IT strategy. “We have to rethink how we fortify our systems. We may need to decouple some of these integrated solutions and look for more reliable alternatives,” he said. “Microsoft has our business, but they need to fortify their current offerings while building the future.”

Industry-Wide Implications

The incident has broader implications for the airline industry and its reliance on technology. “This outage is a wake-up call not just for Delta but for the entire industry. We need to ensure that our tech partners are held accountable and that their systems are resilient,” Bastian stated.

He also highlighted the need for better collaboration between tech companies. “We need these tech giants to work together more effectively. Our operations are mission-critical, and we can’t afford these kinds of disruptions,” he said.

Enhancing Customer Experience

Despite the setback, Delta remains committed to enhancing its customer experience. “The challenges in our industry have historically been seen as a commodity,” Bastian said. “Delta has looked to differentiate its people, its service, and the quality of what we deliver. The only way we can do that is by leading with our front foot on premium and having a higher-end opportunity for people to buy up.”

Discussing Delta’s premium offerings, Bastian said, “Our Delta One experience, which I had the opportunity to go through at JFK, is an example of how we aim to provide a superior experience. It’s not just about what’s on the plane but also the services and amenities we offer at every touchpoint.”

Seeking Fair Compensation

As Delta navigates the aftermath of the CrowdStrike-Microsoft outage, its leadership is focused on learning from the incident and strengthening its technological resilience. The experience underscores the critical importance of robust, reliable IT systems in maintaining seamless operations and customer trust in the aviation industry.

Bastian concluded, “We’re not looking to wipe out these companies, but we are looking for fair compensation and assurances that this won’t happen again. Our commitment is to our passengers, our employees, and our stakeholders. We will continue to push for the highest standards in all aspects of our operations.”

In a rapidly evolving digital landscape, Delta’s response to this crisis may set a precedent for how airlines and other industries approach cybersecurity and technology partnerships in the future.