CrowdStrike (NASDAQ: CRWD) has been one of the most prolific security software providers in recent times thanks to its Falcon platform. However, a faulty Falcon update on Jul 19 resulted in a global IT outage. CRWD shares dropped 11% on Jul 19 and have been on a downward spiral since then. The blue screen of death (BSOD) outage reportedly impacted 8.5 million Windows machines. In its preliminary Post Incident Review, CRWD has blamed the BSOD outage on a bug in the Rapid Response Content, which somehow went undetected during validation checks. Losses from the massive IT outage are now expected between $400 million and $1.5 billion, per cyber analytics firm Cybercube, as cited by Reuters. Insurer Parametrix estimates insured losses between $540 million and $1.08 billion for Fortune 500 companies, excluding Microsoft. Apart from the staggering losses, recovery from the IT outage is expected to take several days. CRWD's software runs at the kernel level of a computer, which helps it to detect cyberattacks more efficiently. However, computers affected by the bug are required to be rebooted manually to safe mode by an administrator and then delete the affected file. This is expected to be a time-consuming process. The incident has significantly impacted CrowdStrike's reputation and brand value. CRWD is taking correctional measures as per the PIR, including enhanced software testing procedures, as well as a plan to conduct validation exercises through third-party. However, prospects don't look bright as the reputational damage can result in customer exodus, thereby hurting top-line growth. Since the incident, CRWD shares have declined more than 15%. Year-to-date, shares of this Zacks Rank #5 (Strong Sell) company have gained 1.1%, underperforming the Zacks ...