Microsoft says it has reached ”positive water balance” five years earlier than planned, but the headline comes with a familiar asterisk: the company still isn’t disclosing its full water consumption figures. That makes the claim impressive on paper and awkward in practice, especially as AI training and cloud workloads keep pushing data-center demand in the opposite direction.
The company says it replenished more water than it used across its global operations in the 2025 financial year, which ended in June 2025. It also says water-use efficiency in its own data centers has improved by almost 90% since the early 2000s, dropping from 2.3 liters per kWh to 0.27 liters per kWh in 2025. The catch: that figure covers Microsoft-owned sites, while the company also leases a lot of capacity.
Microsoft’s water-use efficiency has fallen sharply
Microsoft says it has cut water intensity by 25% versus its 2022 baseline, putting it past the halfway mark toward a 40% reduction target by the end of the decade. The company last fully disclosed water-use data in 2022, when consumption topped 6.39 million m3, up 34% from the year before. That makes the newer efficiency gains look real, but also makes it hard to judge how much total demand is still rising underneath them.
- Owned data centers: 0.27 liters per kWh in 2025
- Water intensity: down 25% from the 2022 baseline
- Reported improvement in water-use efficiency: almost 90% since the early 2000s
Cooling choices are doing the heavy lifting
The shift away from evaporative cooling toward direct air and liquid cooling is doing most of the work here, including closed-loop direct liquid cooling systems. Microsoft says new builds are expected to use those setups, which is exactly the kind of engineering move cloud giants are making as rack densities rise and heat becomes more expensive to ignore than electricity. Roughly 90% of its 2025-owned data-center fleet now uses systems that need little water or almost none at all.
The company’s climate math still depends heavily on geography. In cooler places such as Dublin and Amsterdam, water is needed less than 5% of the time for cooling systems, while in hotter Phoenix that rises to as much as 40% of the time. That gap is a reminder that ”water-positive” is not a single operating model; it is a patchwork of local compromises, design choices, and weather.
Non-potable water and rain capture are expanding
Microsoft is also leaning harder on treated and non-potable water. In Quincy, Singapore and San Antonio, that category accounts for 74%, 99% and 79% of water use, respectively. Meanwhile, rainwater collection systems are already in place in the Netherlands, Sweden, and Ireland, with Canada, the UK, Finland, Italy, South Africa, and Austria next in line.
That approach mirrors what rivals are doing, at least in public. Amazon said recently that it used more than 9.46 million m3 of water last year and still aims to be water-positive by 2030, while Google has the same target. The pressure is obvious: if every cloud company keeps expanding its datacenter footprint, ”replenished more than used” becomes a race against growth, not a victory lap.
Microsoft’s next test is scale, not slogans
Microsoft itself admits that staying water-positive gets harder as its data-center portfolio grows. The company is also looking at finer-grained cooling choices based on the hardware in each facility, which sounds boring and is exactly the sort of boring that matters. The open question is simple: can efficiency gains keep pace with the next wave of server demand, or will water targets keep sliding just behind the expansion curve?