Microsoft’s latest sustainability report reveals a 25% spike in carbon emissions last year, reaching 34 million metric tons. The culprit? Massive expansion of data center infrastructure to support AI, plus a decision to stop buying certain renewable energy certificates. Microsoft set a goal to be carbon negative by 2030, but this is the second straight year emissions have climbed. The company admits sustainability solutions simply aren’t scaling fast enough to keep up with AI’s hunger for energy, water, and materials. Google and Amazon are in the same boat, with similar emission increases driven by data center growth. Why it matters: This report exposes the uncomfortable tension between Big Tech’s AI ambitions and their climate pledges — as AI booms, carbon goals may be the first casualty.