Microsoft's carbon emissions grew 25 percent year-over-year during its 2025 fiscal year, with the company attributing most of the increase to rapid expansion of artificial intelligence data centre infrastructure. This trajectory puts considerable pressure on the firm's commitment to become carbon negative by 2030, a target now just four years away, as the company's current emissions trajectory runs counter to its stated environmental ambitions.

The company revealed that part of the reported increase stems from discontinuing purchases of unbundled renewable energy certificates and instead concentrating efforts on delivering carbon-free electricity directly to the grids where it operates. Microsoft contends this approach will yield greater environmental benefits over time despite the near-term reporting increase. The firm also highlighted counterbalancing achievements, including matching all its annual global electricity consumption with renewable energy and extracting more water from the environment than it consumed, as part of its broader push toward multiple environmental targets.