But while competitors like United and American Airlines were able to pick themselves back up only a few days later (United canceled nearly 1,500 flights by comparison), Delta was still scrambling. A Thursday note from Bernstein Research illuminates what went so wrong.

Delta scuttled about 30% of its flights the weekend of July 19, according to the note, while United canceled about 12%, and American canceled about 5%. The primary reason for this is Delta’s heavy reliance on its Atlanta hub where about 20% of the airlines’ flights transit—the percentage is greater than most major airlines and their respective hubs—which meant Delta travelers with canceled flights were mostly concentrated in a single location.

“When you talk about what Atlanta is to Delta’s network, it’s just more important and has more traffic connecting through it than what you see in other networks,” the note’s author and Bernstein senior analyst David Vernon told Fortune.

The airline also has a higher average number of seats per aircraft than its competitors, Vernon and co-author Justine Laufer argued, meaning it has more passengers to accommodate in times of crisis. Historically, however, more customers relative to other airlines has been a boon for Delta. But this time, the airline’s more diverse fleet of aircraft made it more challenging to transfer customers to different flights across varying models and manufacturers.

Identifying the rationale underlying Delta’s vulnerability won’t erase its summer hardships. Beyond having to eat millions of dollars in losses from canceled flights, Delta has squabled with CrowdStrike over who’s to blame for the aftershocks of the outage. Bastian has claimed CrowdStrike did not offer to help the beleaguered airline, which it said was heavily reliant on Microsoft and CrowdStrike. The tech companies responded in kind, alleging Delta did not take accountability for its own technological shortcomings and that its competitors leaned more heavily on Microsoft and CrowdStrike tech, yet did not experience the same consequences. The airline announced in late August its chief operating officer Michael Spanos would be leaving the company, though Spanos reportedly told Bastian his plans to leave before the outage took place. Spanos was appointed CEO at Outback Steakhouse’s parent company last month.

Schadenfreude capitalism

But to make matters worse for Delta, not only did competitors more easily shrug off the CrowdStrike outage, they may have even benefitted from Delta’s misfortunes. JetBlue Airways raised its revenue outlook Thursday, citing “revenue uplift from the re-accommodation of customers affected by other airlines’ cancellations,” in addition to streamlined operations and a healthy summer travel season. JetBlue was not heavily impacted by the outage.

“Although some of the positive adjustment may have been temporary, as the carrier picked up some CrowdStrike-impacted passengers in July, the carrier’s overall update looked encouraging,” Citi analyst Stephen Trent said in a note.

Among the reasons Bernstein’s research cites for Delta’s disproportionate suffering, none of them have to do with the airline being in a technology deficit that would foundationally put it as a disadvantage in cases of extenuating incidents like the CrowdStrike outage. Southwest suffered this fate in 2022, when the airline canceled almost 17,000 flights after a brutal winter storm, but was unable to recover from the meltdown due to outdated software.

Non-aircraft capital expenditures were high for Delta, making up about 2.25% of its 2023 revenue, compared to the industry average of 2%, the note said. It suggests a sufficient investment in IT—over $1 billion. Though Delta’s wide range of aircraft hurt it during the CrowdStrike outage, it also helped the company maintain a 83.5% on-time rate for its flights, topping its competitors, according to data Bernstein acquired from the Department of Transportation.

Moreover, while Delta’s network and its Atlanta hub were a negative for the airline after the CrowdStrike outage, it ultimately continues to serve as its profit center, Vernon argued. “Any airline would chop off its own arm for an Atlanta hub,” he said. The geographic position serves as a major connector between U.S. cities and it resides within a two-hour flight of 80% of the U.S. population. It’s the world’s busiest airport.

Delta’s true test will be how it responds if a similar accident happens again, and how well its long term investments will serve passengers willing to give the airline another shot.

“That’s a one-time loss of revenue,” Vernon said. “The question is, will they stay gone, or will they come back? Does the benefit of Delta’s service, does the benefit of Delta’s reward program and quality of the experiences get people to come back?”

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