Microsoft's carbon emissions spike 25% as AI datacenter demand surges

Microsoft’s 2026 sustainability report shows its carbon emissions rose 25% in 2025, reaching 34 million metric tons “without select interventions.” The increase is primarily due to the expansion of datacenter infrastructure to support AI compute demands, as well as the company’s February 2025 decision to stop acquiring non-additional, unbundled renewable energy certificates. Microsoft first set a goal to become carbon negative by 2030, but this marks the second consecutive year of rising emissions, following a similar spike in 2024.

The report acknowledges that “while AI infrastructure is driving demand for energy, water, land, and materials, sustainability solutions are not scaling fast enough to meet demand.” The tech giant is not alone — Google reported a 25% increase in supply chain emissions in its own 2026 report, and Amazon noted a 16% rise. Amazon also disclosed its data centers used 2.5 billion gallons of water in 2025, claiming it used less than Microsoft. These figures highlight the growing tension between AI-driven expansion and corporate climate pledges.