Delta CEO says massive tech outage cost company $500 million

In the wake of last month's massive cyber outage involving a botched CrowdStrike software update, Delta Air Lines CEO Ed Bastian told CNBC that the airline lost $500 million.

Bastian said the outage did not just cost Delta lost revenue, but the company was also forced to pay for reimbursements and hotel costs. The CEO said the company has hired attorney David Boies to help the airline recoup some of its losses.

“We have to protect our shareholders. We have to protect our customers, our employees, for the damage, not just to the cost of it, but to the brand, the reputational damage,” he told CNBC.

The July 21 tech outage impacted many institutions, from banking to government services. The outage occurred when CrowdStrike sent corrupted computer code to computers using Microsoft operating systems. The aviation industry was particularly hard hit as Delta's competitors United and American also had numerous delays and cancellations.

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While Delta's competitors were able to recover and offer relatively normal service by the following weekend, Delta languished with hundreds of delays and cancelations in the five days following the outage.

The service disruption prompted the Department of Transportation to launch an investigation into the company's response.

Bastian said that Delta relies on CrowdStike and Microsoft services more than its competitors, causing it to be hit the hardest.

"This is a call to the industry," he said.

“If you’re going to be having access, priority access to the Delta ecosystem in terms of technology, you’ve got to test the stuff. You can’t come into a mission-critical 24/7 operation and tell us we have a bug,” Bastian told CNBC. "It doesn't work.

Bastian said Delta has to rethink using Microsoft systems, noting that they are "fragile."

"When was the last time you heard of a big outage at Apple," he said. "I have tremendous respect for Microsoft. But again they are building the future and they have to fortify the current."