Who’s Winning the Oil Game? A Financial Face-Off

Shell: Struggling Profits, Big Promises

Shell reported Q4 2024 earnings of $1.20 per ADS (American Depository Share), missing the Zacks Consensus Estimate of $1.78 and significantly lower than $2.22 per ADS in Q4 2023. The company’s revenue dropped to $66.8 billion from $80.1 billion, falling short of expectations by 16.6%. The decline was driven by weaker realized prices, reduced trading margins, and lower LNG sales.

Shell repurchased $3.6 billion in shares and increased its dividend by 5%, with plans for another $3.5 billion in repurchases in Q1 2025. Here is the oil giant’s income per segment:

• Upstream: Profit fell to $1.7 billion from $3.1 billion, missing expectations due to lower oil and gas prices. Liquids prices fell 11%, while natural gas declined 7%.
• Chemicals & Products: Reported a $229 million loss, reversing a $29 million profit from the previous year, due to lower margins and unfavorable tax movements.
• Integrated Gas: Adjusted income dropped to $2.2 billion from $4 billion, missing the expected $2.8 billion due to a 14.3% drop in LNG sales.
• Marketing: Income rose to $839 million from $794 million, but missed expectations of $885 million.
• Renewables & Energy Solutions: Recorded a $311 million loss, down from a $173 million profit a year earlier, due to rising costs and adverse tax effects.

Chevron: A Mixed Bag of Losses and Growth

Chevron’s Q4 earnings fell below Wall Street expectations, reporting adjusted EPS of $2.06 versus the estimated $2.11. This led to a 4% drop in its stock price. The company’s downstream segment posted a $248 million loss, compared to a $1.15 billion profit in Q4 2023. This is because refining margins weakened amid declining fuel demand in the U.S. and China.

• Oil & Gas Production: Profits rose to $4.3 billion from $1.59 billion a year ago, despite a flat overall output of 3.35 million boepd (Barrels of oil equivalent per day). Permian Basin production grew 14% to a record 992,000 boepd.
• Refining: Weak jet fuel demand contributed to the company’s first refining loss since 2020.

Chevron expects global output to grow 6-8% in 2025 and 3-6% in 2026. The company raised its quarterly dividend by 5% and reaffirmed share buyback plans of $10-$20 billion annually.

Exxon: Defying Expectations Amid Industry Headwinds

Exxon announced Q4 2024 earnings of $7.6 billion, or $1.72 per share, exceeding analyst estimates of $1.56. Despite lower oil prices, higher production helped offset the weaker refining margins of this big oil company.

• Oil & Gas Production: Adjusted earnings rose to $6.28 billion from $4.15 billion a year earlier. Production increased to 4.6 million boepd, driven by low production costs in the Permian Basin and Guyana projects.
• Refining: Earnings from gasoline and diesel production dropped sharply to $323 million from $3.2 billion a year earlier due to increased refinery capacity in Asia.

Exxon reported $33.7 billion in earnings for 2024, down from $38.57 billion in 2023, but highlighted strong operational efficiency and profitability.

The three energy giants all faced challenges in Q4 2024, with weaker refining margins and lower oil prices impacting profitability. However, Exxon outperformed expectations, while Chevron and Shell struggled with underwhelming results. All three companies remain focused on capital discipline, shareholder returns, and production efficiency moving forward.

The Green Pivot: Are Big Oil’s Net Zero Pledges Enough?

Shell, Chevron, and ExxonMobil are charting distinct paths toward sustainability as the energy landscape evolves. Their climate commitments, emissions targets, and investment in renewables illustrate their vision for a lower-carbon future.

Each of the energy giants has its own roadmap to net-zero emissions, with varying approaches and strategies. To have a clearer picture of how much carbon pollution each of them emitted in 2023, look at the image below.

While some are making bolder moves in renewables, others remain focused on carbon capture and efficiency improvements. Understanding Shell, Chevron, and ExxonMobil’s strategies provides insight into the future of the oil and gas industry. 

Shell’s Carbon Commitment: Big Talk or Real Action?

Shell aims to become a net-zero emissions energy business by 2050 as part of its Powering Progress strategy. This commitment includes eliminating operational emissions and reducing the emissions from the energy products it sells. 

The company has set several targets to achieve this goal:

• 50% absolute emissions reduction by 2030 (Scopes 1 and 2) compared to 2016 levels.
• Eliminate routine flaring of natural gas by 2025 to curb carbon emissions.
• Reduce methane emissions intensity below 0.2% and reach near-zero methane emissions by 2030.
• 15-20% reduction in customer emissions from oil products by 2030 (Scope 3, Category 11, 2021 baseline).

Progress Achieved

By the end of 2023, Shell had cut more than 60% of its emissions goal for 2030. The company’s methane emissions intensity was 0.05% for facilities with marketed gas and 0.001% for facilities without marketed gas.

Shell tracks its emissions reductions through Net Carbon Intensity (NCI), which measures emissions per unit of energy sold. Key milestones include:

• 6-8% reduction achieved in 2023 (from 2016 levels)
• 9-12% reduction target for 2024
• 100% reduction goal by 2050

Shell’s strategy for 2030 balances energy security with sustainability. The company plans to reduce emissions by evolving its product mix and shifting towards low-carbon solutions such as biofuels, hydrogen, and renewables. 

Shell has also invested heavily in carbon offset initiatives to negate its GHG emissions. However, under CEO Wael Sawan’s leadership, the oil giant is reducing its focus on nature-based projects and is considering engineered carbon removals instead.

• READ MORE: Shell and Microsoft Are The Biggest Carbon Credit Buyers in 2024: What Projects Do They Support?

Today, 70% of Shell’s cash flow comes from Integrated Gas and Upstream businesses, while 75% of its emissions come from Downstream, Renewables, and Energy Solutions. Additionally, Shell has invested heavily in offshore wind projects, with plans to expand its renewable energy portfolio across multiple continents.

Chevron’s Climate Play: Real Solutions or Greenwashing?

Chevron is investing $8 billion in lower-carbon energy projects from 2021-2028, including renewable fuels, carbon capture, hydrogen, and offsets. An additional $2 billion is allocated to reducing emissions within its operations. 

The company is also developing new partnerships with tech firms to enhance energy efficiency and reduce its environmental impact.

Chevron targets net-zero upstream Scope 1 and 2 emissions by 2050 but acknowledges that achieving this goal depends on technological advances, regulatory support, and viable carbon capture and offset mechanisms.

2028 Carbon Intensity Targets

Chevron’s plans to lower carbon intensity include:

• 71 g CO₂e/MJ portfolio carbon intensity (Scope 1, 2, and 3)
• 24 kg CO₂e/boe oil carbon intensity (Scope 1 and 2)
• 24 kg CO₂e/boe gas carbon intensity (Scope 1 and 2)
• 36 kg CO₂e/boe refining carbon intensity (Scope 1 and 2)

GHG Reduction Initiatives

Chevron uses the Marginal Abatement Cost Curve (MACC) to optimize carbon reduction. The company has identified 150+ GHG abatement projects, with over $600 million in investments planned for 2024. 

Between 2021-2028, Chevron expects $2 billion in GHG reduction investments, targeting 4 million metric tons (mt) of annual emissions reductions. Here are the company’s other sustainability plans and strategies to achieve its ambitious 2050 net zero goal. 

Methane and Renewable Energy Expansion

• Methane emissions goal of 2.0 kg CO₂e/boe by 2028
• Advanced methane detection programs, including satellite monitoring
• Growing renewable fuels capacity to 100 mbd by 2030, including renewable diesel and sustainable aviation fuel
• Significant CCUS investments, including Bayou Bend (Texas) and Gorgon (Australia)
• Expanding hydrogen production to 150 mtpa by 2030
• Developing advanced geothermal energy projects to enhance clean energy production

SEE MORE: Chevron Reports Lower Q2 Earnings! What About Its Emissions?

ExxonMobil’s Bold Bet on Decarbonization

ExxonMobil has cut 23% of nitrogen oxides, sulfur oxides, and volatile organic compounds emissions since 2016. In 2023, its GHG emissions stood at 111 MMTCO₂e, marking a 2 MMT reduction from the previous year. The company is also exploring new ways to enhance energy efficiency across its global operations.

ExxonMobil aims for a 20% absolute reduction in GHG emissions by 2030, compared to 2016 levels. The company aligns its emissions reductions with the Paris Agreement while emphasizing intensity-based reductions.

Beyond burning down emissions in its own operations, Exxon is also helping other industries decarbonize. Its Low Carbon Solutions business focuses on hard-to-decarbonize sectors like heavy industry, power, and transportation. The oil giant seeks to lead in profitable, large-scale emission reduction solutions, with the following key strategies. 

Key Sustainability Actions

• Investing in carbon capture, biofuels, and hydrogen
• Advancing methane management with innovative detection technologies
• Deploying CCUS projects, including the world’s largest CCUS facility at LaBarge, Wyoming
• Developing low-carbon solutions for hard-to-abate industries
• Launching a $17 billion investment plan in lower-carbon solutions through 2027
• Exploring direct air capture (DAC) technologies to remove CO₂ from the atmosphere

READ MORE: ExxonMobil’s First-of-its-Kind Carbon Capture Solution for the U.S. Data Centers

Big Oil’s Race Against Time

Shell, Chevron, and ExxonMobil are taking different approaches to sustainability and emissions reduction. While Shell focuses on reducing absolute emissions and net carbon intensity, Chevron prioritizes carbon intensity reduction and methane management. ExxonMobil, meanwhile, is expanding CCUS and methane detection efforts to lower emissions. 

As global climate policies tighten, Shell, Chevron, ExxonMobil, and other energy companies should accelerate their transition strategies to meet net-zero targets. 

• FURTHER READING: Shell’s Polaris Project Fuels Canada’s Carbon Capture Revolution

The post Big Oil’s Showdown: How Shell, Chevron & ExxonMobil Balance Big Profits with Net Zero? appeared first on Carbon Credits.

Visa and Mastercard, processing billions of payment transactions yearly, reported strong financial growth in 2025, driven by rising payment volumes and cross-border transactions. However, their massive operations generate significant carbon emissions, pushing them to adopt sustainability and net zero strategies. 

Strong Numbers, Stronger Strategy: Visa’s Q1 2025 Performance

Visa reported strong Q1 2025 results, with net revenue rising 10% year-over-year (YoY) to $9.5 billion. Net income also increased 5% to $5.1 billion, while GAAP earnings per share (EPS) grew 8% to $2.58 and non-GAAP EPS stood at $2.75. Visa’s board declared a quarterly cash dividend of $0.59 per share.

The company attributed its growth to strong consumer spending, a rise in payment volume, and an increase in cross-border transactions. CEO Ryan McInerney highlighted three major growth drivers:

• Consumer payments,
• New payment flows, and
• Value-added services.

These areas continue to expand as Visa strengthens its global network.

A key move during the quarter was Visa’s acquisition of Featurespace, an artificial intelligence-powered fraud protection firm. This acquisition aligns with Visa’s long-term goal of enhancing transaction security. 

While Visa continues to grow, its expenses are also increasing, particularly in research and development. However, its strong revenue growth has helped maintain profitability and reinforce its position as a leader in the payments industry.

Mastering Growth: How Mastercard Outpaced Expectations

Mastercard posted strong 2024 results, with net revenue increasing 12% YoY to $28.2 billion, beating market expectations. Adjusted EPS grew 19% to $14.60, exceeding analyst estimates. Its adjusted operating margin improved slightly to 58.4%.

In Q4 2024, Mastercard’s gross dollar volume reached $2.6 trillion, up 12% YoY. Cross-border volumes, a key revenue driver, rose 20%, while switched transactions increased 11% to 42.2 billion. The company’s value-added services generated $3.1 billion in revenue, up 16%.

Mastercard’s value-added services and solutions business also played a critical role in its financial performance. Net revenue from these services reached $3.1 billion, a 16% YoY increase, driven by demand for security, digital authentication, and market insights. 

Unlike Visa, Mastercard experienced a sharper increase in operating expenses, which climbed by 14% YoY to $3.3 billion. The rise was mainly due to higher general and administrative costs. However, adjusted operating income still grew by 15% YoY to $4.22 billion.

Both Visa and Mastercard reported strong financial growth, but Mastercard outpaced Visa in revenue, EPS growth, and transaction volume. Visa focused on operational efficiency and security investments, while Mastercard’s cross-border transactions and value-added services drove its growth. 

A Green Rivalry: Who’s Leading the Sustainability and Net Zero Race?

Despite rising expenses, both companies remain leaders in the global payments industry. However, their massive operations with billions of transactions processed annually generate carbon emissions, prompting them to reduce their environmental footprint. While they share common goals, their sustainability and net zero approaches differ.

Swiping Towards Sustainability: Visa’s Carbon Goals and Green Investments

Visa aims to reach net-zero emissions by 2040, aligning with the Paris Agreement’s 1.5°C pathway. It has been carbon neutral in its operations since 2020, achieving this by reducing direct greenhouse gas (GHG) emissions and purchasing carbon offsets. The company sources 100% renewable electricity for its offices and data centers, significantly cutting GHG emissions. 

Visa has made notable strides in reducing its operational emissions, particularly in Scope 1 and 2 emissions, which saw a downward trend from 2009 to 2022. However, in 2023, Scope 1 and 2 emissions increased from 6,400 to 10,600 metric tons of CO2 equivalent, primarily due to a slight uptick in Scope 2 emissions, rising from zero in 2022 to 300 metric tons. 

Despite this, Visa continues to offset its emissions significantly toward net zero. The payment processor has invested in carbon offsets equivalent to 66,300 metric tons of CO2 in 2023. 

In terms of Scope 3 emissions, Visa experienced a slight rise in 2023, reaching 409,500 metric tons of CO2 equivalent. This is driven mainly by increases in employee commuting and business travel, while emissions from purchased goods and services saw a small decrease.

Carbon Offsets, Green Finance, and Climate Tech Solutions

Visa invests in renewable energy projects and high-quality carbon offset programs. The company supports global reforestation initiatives and clean energy transition projects. 

In 2023, Visa’s environmental investments helped mitigate the equivalent of 400,000 metric tons of CO2 emissions.

The payment processor’s sustainability efforts extend to financial products. Visa has partnered with fintech firms to introduce carbon footprint tracking tools for consumers. 

Through the Visa Eco Benefits program, banks can offer sustainability-focused rewards and carbon offset options. Additionally, Visa has worked with financial institutions to issue over 20 million eco-friendly payment cards made from recycled materials or biodegradable alternatives.

Furthermore, Visa is integrating sustainability into mobility and payment solutions. The company supports contactless payments for public transit to reduce reliance on cash and has collaborated with EV charging networks to streamline payments. 

The company is also investing in climate-focused fintech startups that develop solutions for carbon tracking and sustainable finance. However, compared to its competitor, its indirect emissions strategy is less aggressive.

Priceless Progress: Mastercard’s Commitment to a Net-Zero Future

Mastercard has been carbon neutral in its operations since 2021 and aims to reach net-zero emissions by 2040. Like Visa, it sources 100% renewable electricity for its offices and data centers.

• RELATED: Trump’s Bold $20 Billion AI Plan: Fueling America’s Data Centers with Foreign Capital 

Mastercard has made significant progress in reducing its GHG emissions as part of its commitment to environmental sustainability. In 2023, the company achieved a 1% reduction in total emissions, totaling 557,545 metric tons of CO2 equivalent across Scope 1, 2, and 3. 

Notably, its Scope 1 and 2 emissions, which account for 9% of total GHG emissions, decreased by 7%, producing 52,054 metric tons of CO2 equivalent. These emissions have declined significantly, 48%, from its 2016 baseline. 

For Scope 3 emissions, which make up 78% of the company’s total emissions, Mastercard saw a 3% reduction in its supply chain emissions in 2023, totaling 437,588 metric tons of CO2 equivalent. 

The payment processor remains on track to meet its 2025 targets of reducing Scope 1 and 2 emissions by 38% and Scope 3 emissions by 20% compared to 2016 levels.

Mastercard‘s Scope 3 emissions came from indirect sources, primarily from its financial partners and supply chain. To address this, the company has integrated sustainability criteria into its vendor selection process and encourages its banking partners to reduce their own carbon footprints.

Mastercard’s Green Finance and Reforestation Efforts

Mastercard takes a different approach to carbon offsets and net zero from Visa. The company launched the Priceless Planet Coalition, a global reforestation initiative aiming to restore 100 million trees by 2025. 

Through this initiative, Mastercard has already funded the planting of 60 million trees across 20 countries, aiming to remove approximately 10 million metric tons of CO2 from the atmosphere by 2030.

Mastercard has also taken the lead in sustainable financial tools. The Mastercard Carbon Calculator, developed with Doconomy, allows consumers to track the carbon footprint of their purchases directly within their banking apps. Over 50 banks worldwide have integrated this tool, helping millions of users make informed spending decisions.

Additionally, Mastercard has expanded its ESG-linked financial products, including green bonds and sustainability-focused credit cards. In 2023, the company supported the issuance of $500 million in ESG-linked financial products, reinforcing its commitment to sustainable finance.

• SEE MORE: Sustainable Bonds in 2025 Could be A $1 Trillion Market, Moody Says

Mastercard is also investing in climate technology and EV infrastructure. It has partnered with global EV charging networks to streamline payment processes and promote wider EV adoption. The company is also funding fintech startups that focus on climate risk management and sustainable investment platforms.

Visa vs. Mastercard: Who Leads in Sustainability?

Both Visa and Mastercard are making significant strides in financials and net zero. They both have achieved carbon neutrality in their operations, but Mastercard appears to have a more comprehensive and aggressive approach.

By integrating sustainability into financial products, investing in large-scale reforestation, and actively reducing indirect emissions, Mastercard sets a higher standard in climate action. Visa, on the other hand, excels in operational efficiency and renewable energy adoption but may need to expand its influence over its financial network to achieve a more substantial impact.

The post Visa vs. Mastercard: Who’s Leading the Charge in Finance, Sustainability, and Net Zero? appeared first on Carbon Credits.

Apple revealed its fiscal 2025 first-quarter results on Thursday, showcasing a positive performance. The company reported $124.3 billion in quarterly revenue, marking a 4% increase compared to the same period last year. Additionally, diluted earnings per share rose by 10%, reaching $2.40.

Tim Cook, Apple’s CEO said,

“Today Apple is reporting our best quarter ever, with revenue of $124.3 billion, up 4 percent from a year ago. We were thrilled to bring customers our best-ever lineup of products and services during the holiday season. Through the power of Apple silicon, we’re unlocking new possibilities for our users with Apple Intelligence, which makes apps and experiences even better and more personal. And we’re excited that Apple Intelligence will be available in even more languages this April.”

Net Sales Three Months Ended (December 28, 2024 Vs December 30, 2023)

Overall Revenue Rises but iPhone Sales Down

Despite the positive growth in overall revenue, iPhone sales were down. The company earned $69.1 billion from iPhone sales during the last quarter of 2024. It reported a significant drop in revenue from the Chinese market compared to the previous year.

Kevan Parekh, Apple’s CFO also noted,

“Our record revenue and strong operating margins drove EPS to a new all-time record with double-digit growth and allowed us to return over $30 billion to shareholders. We are also pleased that our installed base of active devices has reached a new all-time high across all products and geographic segments.”

Apple Shares Surge

However, Apple’s shares jumped following the earnings announcement which indicates its future growth trajectory and investor confidence.

Another turning point for Apple was the release of the Chinese AI DeepSeek R1 recently. The AI tool quickly climbed to the top of the iOS app store, surpassing ChatGPT and even Meta’s AI tools. Consequently, Apple’s shares rose by over 3%, making CEO Tim Cook $23 million richer.

Apple Inc. (AAPL)

• READ MORE: Is Apple Leading the Way in Tech and Sustainability? Q3 Results Beat Expectations

Apple’s Commitment to Carbon Neutrality

Apple aims to achieve carbon neutrality across its entire carbon footprint by 2030. The company has laid out ambitious strategies to cut greenhouse gas emissions across all scopes by 75% compared to 2015 levels.

• For 2023, Apple’s total net carbon footprint was down to 15,600,000 mtCO2e from 20,300,000 mtCO2e in 2022. 

In 2020 the company became carbon neutral for its corporate operations. They achieved this huge milestone by:

• Improving energy efficiency by sourcing 100% renewable electricity for all facilities,
• Offsetting emissions that were harder to eliminate with high-quality carbon credits.

Renewable Energy Adoption

Apple continues to prioritize clean energy. In 2023, the company’s suppliers procured 16.5 gigawatts of renewable energy, generating 25.5 million megawatt-hours of clean power.

• Notably these efforts helped avoid 18.5 million metric tons of greenhouse gas emissions in 2023—a 6.5% improvement over 2022.

Additionally, Apple’s offices, retail stores, and data centers are powered entirely by renewable electricity, with energy efficiency measures constantly optimized.

The company’s efforts extend beyond facilities. Apple also focuses on its product designs and materials, actively working to reduce the carbon intensity of its products and increase the use of recycled materials.

In 2023, 22% of materials used in Apple products came from renewable or recycled sources. But Apple wants to transition to 100% recycled cobalt, tin, gold, and rare earth elements by 2025.

• RELATED: Apple’s iPhone 16 Slashes Carbon Footprint by 30%

    Apple’s comprehensive carbon footprint 2023

Energy Efficiency in Products

Product energy use accounts for 29% of Apple’s overall carbon footprint. To address this, Apple designs its hardware and software with energy efficiency in mind. For instance, the Mac devices powered by Apple silicon have significantly improved energy performance. Chips introduced in 2023 enabled Mac devices like the Mac mini with M2 to consume less power while delivering higher performance.

Investing in Nature-Based Solutions

Apple’s Restore Fund highlights its commitment to nature-based carbon removal. In March 2024, key manufacturing partners, including Taiwan Semiconductor Manufacturing Company (TSMC) and Murata, joined Apple’s $280 million investment in the fund. Managed by Climate Asset Management, this initiative not only aims to scale carbon removals but also supports local communities through economic development and ecological benefits.

Apple’s Investment in High-Quality Carbon Credits

Apple continues to offset emissions through high-quality carbon credits, supporting projects that restore ecosystems and benefit local communities.

Protecting Kenya’s Chyulu Hills

The Chyulu Hills REDD+ Project spans 410,000 hectares in southeastern Kenya, focusing on forest conservation and biodiversity restoration. It protects wildlife while creating sustainable livelihoods for Indigenous and local communities. In 2023, Apple retired 230,000 mtCO2e credits from this project, contributing to climate change mitigation.

Reforesting China’s Barren Lands

The Guinan Afforestation Project in Guizhou, China, plants trees across 46,000 hectares of degraded land. This initiative enhances biodiversity, conserves soil and water, and provides jobs for local communities. Apple retired 255,000 mtCO2e credits from the 2019–2021 vintages.

                      Apple’s progress toward carbon neutrality

These projects showcase Apple’s commitment to impactful carbon removal and sustainable development. Through these comprehensive initiatives, Apple continues to march toward a sustainable future and achieve its 2030 net zero goals.

All in all, with a revenue boom and low emissions, Apple shines in 2025.

FURTHER READING:

• Meta Vs. Microsoft: Who’s Leading the Q4 Revenue Game and Net Zero Goals? • Carbon Credits
• Tesla’s Carbon Credit Revenue Soars to $2.76 Billion Amid Profit Drop

The post Apple’s Best Quarter Ever: Q1 FY 2025 Revenue Hits $124.3 Billion, Carbon Emissions Drop appeared first on Carbon Credits.

Performance Summary

• Profit of $20.83 billion for Q4, marking a 49% increase from $14.02 billion in the same period last year.
• This translated to earnings of $8.02 per share, up from $5.33 per share a year ago. Revenue for the quarter grew by 21%, reaching $48.39 billion, compared to $40.11 billion in Q4
• For the entire 2024, revenue reached $164.5 billion, a 22% increase compared to 2023. Higher ad impressions and an increase in the average price per ad drove this growth.

Meta’s Family of Apps, including Facebook, Instagram, and WhatsApp, saw strong user engagement. Daily active users reached 3.35 billion in December, marking a 5% year-over-year growth.

Rising Costs and AI Investment

While revenue soared, expenses also increased. Costs and expenses for the full year rose by 8% to $95.12 billion. In Q4 alone, Meta reported $25.02 billion in costs, including a $1.55 billion reduction in legal losses, which offset some expenses. Capital expenditures for the year totaled $39.23 billion.

CEO Mark Zuckerberg expressed himself on Meta’s solid performance. He said,

“I expect 2025 to be the year when a highly intelligent and personalized AI assistant reaches more than 1 billion people, and I expect Meta AI to lead the way.”

Meta’s strong Q4 results reflect its ability to leverage advertising growth and user engagement while navigating rising costs. However, with significant investments in AI on the horizon, 2025 will be a key year for the company’s long-term vision.

• RELATED: Meta’s Q2 Triumph: Earnings Soar And Carbon Removal Deals Multiply

Microsoft’s Robust Results Driven by AI and Cloud Growth

Microsoft also posted its financial results for the quarter ending December 31, 2024, fueled by strong performance in its AI and cloud segments. The performance snapshot is explained below:

• Revenue reached $69.6 billion, a 12% increase compared to the same period in 2023.
• Operating income grew 17% to $31.7 billion. Net income rose 10% to $24.1 billion, with earnings per share at $3.23.

Satya Nadella, chairman and CEO of Microsoft noted,

“We are innovating across our tech stack and helping customers unlock the full ROI of AI to capture the massive opportunity ahead. Already, our AI business has surpassed an annual revenue run rate of $13 billion, up 175% year-over-year.”

Key Business Highlights

• The Productivity and Business Processes segment reported $29.4 billion in revenue, a 14% increase driven by strong demand for Microsoft 365 and Dynamics 365.
• Intelligent Cloud revenue grew 19% to $25.5 billion, with Azure and other cloud services leading the growth with a 31% increase.
• The More Personal Computing segment remained flat at $14.7 billion, although search and advertising revenue grew by 21%, and Windows OEM revenue increased by 4%.

Cloud and AI Lead the Way

Amy Hood, executive vice president and chief financial officer of Microsoft said,

“This quarter Microsoft Cloud revenue was $40.9 billion, up 21% year-over-year. We remain committed to balancing operational discipline with continued investments in our cloud and AI infrastructure.”

Looking ahead, Microsoft expects Azure growth of 31-32% for the third fiscal quarter. At the same time, Hood also highlighted challenges with capacity constraints but remains optimistic about future growth opportunities.

• RELATED: Microsoft Reported Q2 Record Earnings, How About Its Carbon Negative Goals? 

Meta Vs Microsoft: Comparative Analysis of Emission Reduction and Net Zero Goals

Both Microsoft and Meta are committed to reducing their greenhouse gas (GHG) emissions, with ambitious goals aimed at achieving net-zero across their global operations and value chains. However, their emissions profiles and strategies show some key differences.

Meta’s Commitment to Net Zero Emissions

As per its latest sustainability report, in 2023, Meta’s net emissions equaled 7.4 million metric tons of CO2. Key commitments include:

• Reducing Scope 1 and 2 emissions by 42% by 2031, compared to a 2021 baseline, and ensuring maximum suppliers adopt science-aligned GHG reduction targets by 2026.
• Keep Scope 3 emissions at or below 2021 levels by 2031.
• Since 2020, Meta has successfully maintained net zero emissions in its operations, and it is on track to achieve net zero across its entire value chain by 2030.

To address residual emissions, Meta is investing in both nature-based and technological carbon removal projects, which help mitigate climate change and provide broader environmental benefits, including enhanced biodiversity.

Scaling Renewable Energy

Renewable energy has played a pivotal role in Meta’s emissions reduction strategy.

• In 2023 alone, the company’s renewable energy initiatives helped cut operational emissions by 5.1 million tons of CO2e, while value chain emissions were reduced by 1.4 million tons of CO2e.

Through strategic partnerships with utilities such as Pacific Power and Dominion Energy, Meta has facilitated the addition of 2,600 MW of new wind and solar capacity in the U.S., making clean energy more accessible.

• As of 2023, Meta’s global renewable energy portfolio exceeded 11,700 MW, with over 6,700 MW of that capacity online in the U.S.

Data Center Efficiency and Carbon Removal Solutions

Meta’s data center facilities have achieved LEED Gold Certification or higher and are powered by 100% renewable energy to meet their electricity needs.

In addition, 91% of the construction waste generated by Meta’s data centers was recycled in 2023. Additionally, it reduces embedded carbon by extending hardware lifespan and using recycled plastics and metals, promoting a circular model to cut waste and carbon impact.

Meta also uses “green tariffs”, which allow the company to purchase renewable energy directly from electricity providers. This not only supports clean energy projects but also increases the accessibility of renewable resources to a wider customer base.

• READ MORE: Meta Invests in 4 Big U.S. Solar Projects to Power its Growing Energy Needs

In 2023, Microsoft made significant strides in its commitment to sustainability, expanding its contracted renewable energy portfolio to over 19.8 GW across 21 countries.

Scope Emissions

• Scope 3 emissions which account for over 96% of Microsoft’s total emissions rose by 30.9% in 2023.
• Overall greenhouse gas (GHG) emissions were 15.4 MtCO₂e in 2023, a 29.1% rise as compared to the 2020 baseline.

This increase was largely driven by upstream purchased goods and services and downstream use of sold products. However, as per Microsoft, it has achieved a 6% reduction in Scope 1 and 2 emissions compared to its 2020 baseline by adopting renewable energy and energy efficiency initiatives.

Data Centers Efficiency and Fleet Electrification

In its data centers, Microsoft has focused on maximizing energy efficiency. In 2023, its data centers achieved a Power Usage Effectiveness (PUE) score of 1.12, demonstrating the company’s commitment to minimizing energy use while optimizing operations.

Additionally, the company reduced its Azure hardware needs by 1.5%, minimizing embodied carbon in the process. It is also transitioning to a 100% electric fleet by 2030, with infrastructure development already underway at its Redmond headquarters.

Overall, both companies are taking significant steps toward reducing their carbon footprint. Meta is focused on keeping Scope 3 emissions steady while scaling renewable energy adoption, whereas Microsoft faces a rise in Scope 3 emissions which is a matter of concern.

Additionally, Microsoft’s total GHG emissions are significantly higher than Meta’s. Yet it’s continuing to prioritize its energy efficiency in its operations and decarbonize its supply chain to achieve its net zero goals.

• FURTHER READING: Microsoft Buys 3.5 Million Carbon Credits to Offset AI’s Soaring Emissions

The post Meta Vs. Microsoft: Who’s Leading the Q4 Revenue Game and Net Zero Goals? appeared first on Carbon Credits.