The company is on track for its first pullback in the market since 2023.
Microsoft dramatically scaled back its carbon removal purchases in the first half of 2026, buying 8.5 million metric tons of credits through mid-July, about 80% less than a year earlier. The decline comes as the technology giant increases spending on AI infrastructure and data centers.
The reduction could mark Microsoft’s first retreat from the carbon removal market since 2023. At the same time, its emissions increased 25% in 2025, highlighting the tension between its rapidly expanding AI operations and previously stated climate goals.
Microsoft said its carbon removal program has not been abandoned and that purchases are just one part of its overall decarbonization strategy. The company remains by far the largest buyer in the voluntary market, representing almost half of all carbon removal transactions so far in 2026.
The pullback also comes amid a slowdown in carbon removal demand. Global sales totaled 18 million metric tons through mid-July, down 66% from the same period last year, raising concerns about funding for technologies needed to remove billions of tons of CO2 from the atmosphere annually.
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