A widespread Microsoft Corp. (NASDAQ:MSFT) cloud service disruption on Thursday led to the grounding and cancellation of flights for several airlines, including Frontier Group Holdings Inc. (NASDAQ:ULCC), Allegiant Travel Company (NASDAQ:ALGT), and Sun Country Airlines (NASDAQ:SNCY).
What Happened: Microsoft reported issues with its cloud services in the Central U.S. region, which significantly impacted the operations of several airlines, Reuters reported on Friday.
The low-cost carriers, including Frontier Airlines, Allegiant, and Sun Country, experienced outages that affected their day-to-day operations.
Frontier Airlines confirmed that a "major Microsoft technical outage" had temporarily disrupted its operations. On the other hand, Sun Country pointed to a third-party vendor that affected its booking and check-in facilities, without naming the company. Allegiant's website was also affected, leading to its unavailability.
As a result, Frontier Airlines had to cancel 147 flights and delay 212 others on Thursday. Allegiant and Sun Country also experienced significant disruptions, with 45% and 23% of their flights delayed, respectively.
Microsoft's outage began at approximately 6 p.m. ET on Thursday, affecting a subset of its customers with issues in multiple Azure services in the Central U.S. region. Azure is a cloud computing platform that offers services for building, deploying, and managing applications and services.
Why It Matters: This is not the first time Microsoft has faced issues with its cloud services. In January 2023, Microsoft 365 experienced a global outage that impacted services like Teams, Outlook, and Xbox Live. The company later identified a potential networking issue.
Microsoft's cloud services have also been subject to scrutiny. In May, a Spanish startup group filed a complaint against Microsoft's cloud practices, alleging that the tech giant was using its dominant position to force the adoption of its Azure cloud. This complaint adds to the challenges faced by Microsoft's rapidly expanding cloud computing services.
In its annual sustainability report in May, Microsoft reported a nearly 30% increase in emissions since 2020, primarily driven by the expansion of data centers required for AI and cloud computing.
Price Action: Microsoft Corp's stock closed at $440.37 on Thursday, down 0.71% for the day. In after-hours trading, the stock rose 0.28%. Year to date, Microsoft shares have gained 18.74%, according to data from Benzinga Pro.
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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote