Microsoft Skyrockets in Q2 2025 with $75B Azure Boom and Massive Carbon Removal Push

2025-07-31

Microsoft continues to assert dominance across cloud computing and climate tech. In Q2 2025, the tech giant didn’t just post blowout Azure and AI-related earnings.

It also emerged as the largest buyer in history of durable carbon removal credits, a bold move that signals a new frontier for corporate climate accountability. Microsoft’s Q2 numbers weren’t just big. They were transformational.

Key Takeaways

Microsoft dominated Q2 2025 carbon removal credit purchases, securing 14.6 million tonnes across five major deals.
The tech giant now owns 79.5% of total durable carbon removal (CDR) volume, according to CDR.fyi.
Azure and AI services contributed to Microsoft's revenue surge to over $75 billion in the quarter.
CDR purchases align with Microsoft’s net-zero by 2030 climate target and growing demand for engineered climate solutions.
Other major buyers in Q2 included JPMorgan Chase, Capgemini, and Mitsui, showing broader institutional momentum.

Microsoft’s Climate Commitment Reaches Record Scale

According to the latest data from CDR.fyi, Q2 2025 was the strongest quarter ever for the durable carbon dioxide removal market.

Total contracted volume hit 15.48 million tonnes, more than doubling all previous quarters combined. Microsoft alone accounted for 93.8% of that with five headline-grabbing deals.

Its largest deal: 6.75 million tonnes from AtmosClear. Other significant contracts came from:

CO₂ Limited (~3.7 million tonnes)
Stockholm Exergi
Exomad Green (1.24 million tonnes of biochar)
Hafslund Celsio

With these buys, Microsoft’s total CDR volume has reached nearly 25 million tonnes since 2020, far ahead of any other corporate entity.

This strategy reflects Microsoft’s long-standing pledge to not only be carbon neutral but also carbon negative by 2030. It’s not just about pledges anymore. It’s about scale.

Azure and AI Revenues Soar

While the carbon removal headlines turned heads in sustainability circles, Microsoft also delivered standout financial results. Azure posted over $75 billion in revenue, a major milestone in the cloud computing race.

The continued integration of generative AI into its services, especially through OpenAI partnerships and Azure AI. has been a key growth engine.

Azure’s dominance reinforces Microsoft’s unique market positioning: a company that’s both monetizing AI at scale and reinvesting earnings into long-term planetary health goals.

BECCS and Biochar Take the Lead in CDR Tech

The carbon credits purchased by Microsoft and others aren’t abstract promises.

They’re tied to specific, measurable technologies, especially BECCS (Bioenergy with Carbon Capture and Storage) and biochar. BECCS made up 86% of contracted volume in Q2 2025.

Biochar, a carbon-rich byproduct from burning biomass, also performed well. It accounted for 89.4% of all delivered credits, proving to be a highly effective and scalable carbon removal strategy.

Leading suppliers included Exomad Green, Aperam BioEnergia, Wakefield Biochar, and Carboneers.

These projects are seeing strong traction in Nordic countries, where forest biomass feedstocks and CO₂ storage infrastructure (like Norway’s Northern Lights) make BECCS more feasible at scale.

Non-Microsoft Buyers Gain Ground

Although Microsoft dwarfed everyone else, Q2 also saw increased participation from non-tech entities. JPMorgan Chase, for example, purchased:

450,000 tonnes of BECCS
50,000 tonnes of DACCS (Direct Air Capture and Storage)

Other notable buyers included:

Capgemini
Mitsui O.S.K Lines
SAP
Helsingborgshem
Wihlborgs
Wild Assets

This uptick in buyer diversity signals that durable CDR is no longer a tech-only arena. Financial institutions and traditional industries are beginning to build their climate compliance portfolios with engineered carbon removals, and not just nature-based offsets.

Investment Slows, But Market Signals Are Strong

Despite the surge in contracted volume, venture capital investment in CDR companies dipped. Q2 saw only $122 million raised across eight companies, compared to $137 million across 24 in Q1.

This shift reflects a maturing market where revenue-generating corporate deals are taking precedence over speculative VC funding. Projects are now scaling through supply contracts rather than pitch decks.

Still, challenges remain. Durable credits currently cost around $180 per tonne, far higher than nature-based options averaging $35. And while BECCS and biochar are maturing, technologies like DACCS remain costly and logistically complex.

Final Thoughts

Microsoft’s Q2 2025 was a masterclass in parallel execution, delivering market-beating earnings while scaling one of the most ambitious carbon removal portfolios in the world.

From Azure dominance to CDR megadeals, Microsoft is positioning itself not only as an AI superpower but also as the corporate climate leader to beat.

As the global CDR market heads toward a projected $50 billion by 2030, and possibly $250 billion by 2035, Microsoft is already building its moat. Others will need to catch up or risk falling behind in both innovation and environmental responsibility.

FAQ

How much carbon removal did Microsoft buy in Q2 2025?

Microsoft bought 14.6 million tonnes of durable carbon removal credits across five major contracts.

What is BECCS and why is it important?

BECCS (Bioenergy with Carbon Capture and Storage) is a method of removing carbon by capturing emissions from biomass energy production. It's considered one of the most reliable forms of engineered carbon removal.

How much did Azure earn in Q2 2025?

Azure contributed to a record quarter for Microsoft, bringing in over $75 billion in cloud revenue.

Why did VC investment in carbon removal slow down?

Fewer VC deals occurred because the market is shifting toward corporate-funded scale-ups rather than early-stage startups. Contracts from companies like Microsoft are now driving growth.