Crowdstrike Holding Inc: A delicate interconnected world
Few have missed this summer's major global IT meltdown, which centred on the company Crowdstrike Holding Inc. The company is a cybersecurity company that sells IT solutions for security and their most famous product is a system called Falcon. The majority of the company's turnover is based on subscriptions from this service. The company also has other services such as a security system called Charlotte AI and as the name suggests it uses artificial intelligence.
This summer's IT problems led to more than 8 million computers experiencing problems after an update went wrong. After a little more than a week, the company announced that the problem had been resolved. The company's shareholders and some customers have sued the company, claiming the company provided "false and misleading" information about their software and testing. Companies such as Delta Air Lines have also chosen to sue Crowdstrike but for a different reason as the IT failure cost Delta Air Lines 500 million USD in lost revenue and compensation to passengers.
In terms of the stock's performance, it went from an all-time high of USD 390 to where it is now trading around USD 225 (02/08/2024). The stock's decline corresponds to a lost market capitalisation of a little more than 40%. The question now is what the stock's future holds and whether the rebound can come or whether future legal processes will weigh on the company for some time to come.
Vontobel recently launched Mini Future on Crowdstrike Holdings Inc and they can be found here: https://markets.vontobel.com/sv-se/produkter/leverage/mini-future?u=584849216
Risks
Disclaimer:
This information is neither an investment advice nor an investment or investment strategy recommendation, but advertisement. The complete information on the products (securities) mentioned herein, in particular the structure and risks associated with an investment, are described in the base prospectus, together with any supplements, as well as the final terms relating to the securities. The base prospectus and final terms constitute the solely binding sales documents for the products mentioned herein. It is recommended that potential investors read these documents before making any investment decision. The documents and the key information document are published on the website of the issuer, Vontobel Financial Products GmbH, Bockenheimer Landstrasse 24, 60323 Frankfurt am Main, Germany, on https://prospectus.vontobel.com and are available from the issuer free of charge. The approval of the prospectus should not be understood as an endorsement of the securities. The securities are products that are not simple and may be difficult to understand. This information includes or relates to figures of past performance. Past performance is not a reliable indicator of future performance. This information may only be distributed or published in countries where such distribution or publication is permitted by applicable law. As stated in the relevant base prospectus, the distribution of the securities mentioned in this information is subject to restrictions in certain jurisdictions. This advertisement may not be reproduced or redistributed without prior permission by Vontobel.
© Bank Vontobel Europe AG and / or affiliated companies. All rights reserved.
Credit risk of the issuer:
Investors in the products are exposed to the risk that the Issuer or the Guarantor may not be able to meet its obligations under the products. A total loss of the invested capital is possible. The products are not subject to any deposit protection.
Market risk:
The value of the products can fall significantly below the purchase price due to changes in market factors, especially if the value of the underlying asset falls. The products are not capital-protected
Risk with leverage products:
Due to the leverage effect, there is an increased risk of loss (risk of total loss) with leverage products, e.g. Bull & Bear Certificates, Warrants and Mini Futures.
Product costs:
Product and possible financing costs reduce the value of the products.
Currency risk:
If the product currency differs from the currency of the underlying asset, the value of a product will also depend on the exchange rate between the respective currencies. As a result, the value of a product can fluctuate significantly.