CrowdStrike Outage Nets Short Sellers $978 Million Windfall
- Bets against CrowdStrike rose by $12 billion this year: S3
- Cybersecurity stock extended last week’s losses on Monday
Blank digital billboards in Times Square in New York on July 19.
Photographer: Michael Nagle/BloombergThis article is for subscribers only.
Short sellers piling into bets against CrowdStrike Holdings Inc. have been rewarded after a botched software update from the firm sparked a global IT outage and sent shares plunging to their worst two-day stretch on record.
The contrarian group reaped paper profits of $978 million on the cybersecurity software company’s 23% two-day drop, according to data from S3 Partners LLC. The selloff was enough to swing CrowdStrike short sellers to gains year to date and pushed July paper profits to nearly $1.5 billion. Shares of the company slumped 13% Monday, adding to Friday’s losses.