One email was all it took. An employee clicked what looked like a routine sign‑in request. Behind the scenes, attackers swiped credentials, slipped past security controls, impersonated a trusted user, and gained access to critical systems. In other cases, similar intrusions delayed paychecks, rerouted invoices, stole sensitive data, locked up entire networks, interrupted patient care, and strained already tight budgets at schools and critical services.
Those attacks were powered by Tycoon 2FA. Today, Microsoft, Europol, and industry partners announced a coordinated action to disrupt the service responsible for tens of millions of fraudulent emails reaching over 500,000 organizations each month worldwide.
Disrupting a global phishing operation
Active since at least 2023, Tycoon 2FA enabled thousands of cybercriminals to impersonate real users and gain unauthorized access to email and online service accounts, including Microsoft 365, Outlook, and Gmail. Unlike traditional phishing kits, Tycoon 2FA was designed to defeat additional security protections, including multifactor authentication, allowing cybercriminals to log in as legitimate users without triggering alerts, even on protected accounts.
Acting under a court order from the U.S. District Court for the Southern District of New York, and for the first time in coordination with Europol’s Cyber Intelligence Extension Programme (CIEP), Microsoft seized 330 active domains that powered Tycoon 2FA’s core infrastructure, including control panels and fraudulent login pages. The CIEP framework brought public‑ and private‑sector partners together to move from simply sharing intelligence to coordinated, cross‑border action, accelerating disruption and limiting further harm.
Taking this infrastructure offline cuts off a major pipeline for account takeovers and helps protect people and organizations from follow‑on attacks such as data theft, ransomware, business email compromise, and financial fraud.
The scale and real‑world impact of Tycoon 2FA
By mid‑2025, Tycoon 2FA accounted for approximately 62 percent of all phishing attempts Microsoft blocked, including more than 30 million emails in a single month. That placed Tycoon 2FA among the largest phishing operations globally.
Despite extensive defenses, the service is linked to an estimated 96,000 distinct phishing victims worldwide since 2023, including more than 55,000 Microsoft customers.
Healthcare and education organizations were hit hardest. More than 100 members of Health‑ISAC, a global threat-sharing group for the health sector and a co-plaintiff in this case, were successfully phished. In New York alone, at least two hospitals, six municipal schools, and three universities faced attempted or successful compromise through Tycoon 2FA. These incidents had tangible consequences: disrupted operations, diverted resources, and delayed patient care.
Why Tycoon 2FA was so dangerous
Tycoon 2FA combined convincing phishing templates, realistic landing pages, and real‑time capture of credentials and authentication codes into an easy‑to‑use package that scaled quickly. By lowering the technical barrier to entry, it allowed criminals with limited expertise to run sophisticated impersonation campaigns.
With each successful phishing victim, attackers could operate with the same level of trust as legitimate users moving laterally across systems, accessing sensitive data, and abusing sign‑on connections without raising alarms. Research from Microsoft Threat Intelligence provides more details on how Tycoon 2FA operated.
The Tycoon 2FA customer dashboard.
This shift reflects a broader trend in cybercrime: identity, not infrastructure, has become the primary target. A single compromised account can now unlock banking systems, healthcare portals, workplace applications, and social media accounts.
Inside the impersonation economy
Tycoon 2FA operated like a business within the broader impersonation‑for‑hire ecosystem. The primary developer, Saad Fridi, who is believed to be based in Pakistan, worked alongside partners responsible for marketing, payments, and technical support.
Cybercriminals typically used Tycoon 2FA alongside other illicit services. While Tycoon 2FA captured credentials and session tokens, other services handled mass email delivery, malware distribution, hosting, and access monetization. For example, RedVDS, disrupted by Microsoft in January 2026, provided inexpensive virtual computers, which cybercriminals paired with Tycoon 2FA to deliver phishing campaigns. Together, these different services created an interconnected ecosystem for identity‑based attacks. Disrupting one component can have cascading effects across the cybercrime economy.
Sustained pressure reshapes the market
Over the past 18 months, Microsoft’s Digital Crimes Unit has targeted multiple services that enable impersonation and initial access, including extensive disruption operations of Lumma Stealer, RaccoonO365, Fake ONNX (aka “Caffeine”), and RedVDS.
When widely used tools are disrupted, attackers are forced to adapt, often shifting to alternatives like Tycoon 2FA. This substitution pattern shows how sustained pressure prevents any single service from remaining dominant while steadily raising the cost and risk of cybercrime.
These efforts have led to arrests in Egypt and Nigeria, complete service shutdowns, infrastructure loss, and reputational damage for operators beyond law‑enforcement reach. RedVDS alone lost more than 95 percent of its infrastructure since January 2026, significantly degrading its ability to support mass impersonation campaigns and other online scams.
As pressure increased, many operators tightened access controls, retreated into closed channels, or shut down entirely to avoid legal action. In Tycoon 2FA’s case, Microsoft could not purchase access to the service; the operator rejected attempts by our investigators, requiring a trusted intermediary. In fact, Tycoon 2FA’s operator and the now‑arrested developer of RaccoonO365 communicated with one another, highlighting the ecosystem’s interdependence and how disruptions in one area influence activity elsewhere.
Correspondence suggesting interactions between the operators of RaccoonO365 and Tycoon 2FA.
Global threats require global action
Cybercrime operates across borders, and effective response must do the same. Disrupting Tycoon 2FA spanned multiple jurisdictions, underscoring why sustained, coordinated pressure is essential, especially as cybercrime becomes more scalable through automation and AI.
Microsoft Threat Intelligence, joining many security researchers, identified Tycoon 2FA as one of the most significant threats to identity-based attacks. Microsoft’s Digital Crimes Unit consulted with Europol, which also tracked the actor based on intelligence supplied by TrendAI. Through the CIEP, Europol convened partners to take action. Microsoft worked with industry partners to pursue a coordinated infrastructure disruption, while law enforcement authorities in Latvia, Lithuania, Portugal, Poland, Spain, and the United Kingdom conducted seizures of infrastructure and carried out other operational measures linked to Tycoon 2FA.
Industry partners, including Proofpoint, Intel 471, and eSentire, expanded visibility through telemetry, threat intelligence, and criminal‑forum insight. Cloudflare assisted by taking down infrastructure outside U.S. jurisdiction, while Health‑ISAC quantified impacts on healthcare organizations. SpyCloud contributed key victimology data, Resecurity facilitated access to Tycoon 2FA, and Coinbasehelped trace the movement of stolen funds. Finally, the Shadowserver Foundation supported notifications to more than 200 computer emergency response teams worldwide, helping limit further harm.
No single organization could have assembled this full picture alone.
Splash page appearing on seized domains.
Sustaining pressure, together
Stopping identity‑based cybercrime requires action across individuals, organizations, and governments. Multifactor authentication, scrutiny of unexpected messages, strong session controls, and coordinated threat‑sharing all reduce risk. Early enforcement matters too; it prevents small intrusions from escalating into systemic harm.Microsoft will continue applying the lessons learned from Tycoon 2FA and prior disruptions to fragment the impersonation economy, limit scale, and make cybercrime riskier and less profitable.
On Tuesday, February 23rd, Microsoft Senior Director of Education and Workforce Policy Allyson Knox testified before the House Education & Workforce Subcommittee on Early Childhood, Elementary, and Secondary Education. To view the proceedings, visit the committee’s website.
STATEMENT OF ALLYSON KNOX
SENIOR DIRECTOR OF EDUCATION AND WORKFORCE POLICY
MICROSOFT CORPORATION
BEFORE THE
EDUCATION AND WORKFORCE COMMITTEE
SUBCOMMITTEE ON EARLY CHILDHOOD, ELEMENTARY, AND SECONDARY EDUCATION
UNITED STATES HOUSE OF REPRESENTATIVES
“BUILDING AN AI-READY AMERICA: TEACHING IN THE AI AGE”
TUESDAY, FEBRUARY 24, 2026
WASHINGTON, D.C.
Good afternoon and thank you, Chairman Kiley, Ranking Member Bonamici, Members of the Subcommittee for inviting me to testify today. My name is Allyson Knox. I am Senior Director of Education and Workforce Policy at Microsoft, and I am pleased to have this opportunity to discuss issues related to artificial intelligence and its impact on teachers.
Today, I will share insights we have gathered from teachers about their experiences, challenges, and needs as they integrate AI in education; outline the steps Microsoft and other organizations are taking to facilitate this transition; and recommend legislative approaches to help policymakers strengthen these efforts. These legislative approaches include supporting professional development for teachers; encouraging public-private partnerships; promoting AI literacy; providing guidance on responsible AI use; and supporting innovation.
I would like to begin by quoting from Microsoft’s vice-chair and president, Brad Smith, in his recent foreword to Degrees of Change: What AI Means for Education and the Next Generation[i]:
“Generative AI has become the fastest-spreading technology in human history, adopted at a pace that even the most seasoned technologists could scarcely imagine. This speed is breathtaking, but it also compels us to pause and ask, “Are we ready for what comes next?” AI’s promise is extraordinary. It can help solve problems that have challenged humanity for decades—improving health outcomes, advancing education, and unlocking new opportunities for economic growth. But, like every transformative technology before it, AI brings new questions and new responsibilities.”
This thought-provoking quote is apt for today’s conversation on how AI is impacting teachers. The speed of AI adoption in our nation’s schools and classrooms is indeed breathtaking. Just three years ago, AI had barely made a mark in education. However, our 2025 Study on AI in Education found that 80% of U.S. K-12 teachers have used AI in their roles or for school-related purposes at least once or twice and one-fifth report daily use of AI. Additionally, 58% of K-12 teachers think AI usage at their school/district will increase in the next year.[ii]
What we are hearing from teachers on the impact of AI:
The breadth of adoption has been profound. We have heard directly from teachers who are using AI to streamline lesson planning, curriculum development, and personalize student learning in ways that were unimaginable a few years ago.[iii] AI is also reducing the time it takes to carry out administrative tasks, allowing more time for teachers to focus on their students.
Despite these benefits, we know teachers face challenges when it comes to AI in the classroom. We found roughly one in three teachers lack confidence in using AI effectively and responsibly. Many teachers also express concerns about how AI can exacerbate cheating and are worried about issues such as data privacy and student safety.
Teachers know AI is here to stay, and based upon countless surveys, forums, and focus groups, teachers are ready to tackle these challenges and ask for support in three main areas:
AI literacy – Teachers want the skills, knowledge, and support to build AI literacy and critical thinking in their students;
AI guardrails – Teachers want students to use AI responsibly and safely; and
AI tools – Teachers want classroom-ready AI tools and opportunities to provide feedback that improve them.
I’m excited to share a few ways Microsoft, along with many of our partners, are committed to providing teachers with the support they are requesting.
1.AI literacy – Teachers want the skills, knowledge, and support to build AI literacy and critical thinking in their students
At the core of this support is listening to and learning from teachers and understanding what they want and need to become AI literate themselves and teach AI literacy to their students. These conversations have resulted in exciting initiatives, including the recent launch of the Microsoft Elevate for teachers program, part of the company’s broader commitment[iii] to help schools and educators build skills, expand opportunities, and ensure everyone benefits from AI.
Microsoft Elevate for Educators
The Microsoft Elevate for Educators program equips educators and school leaders with access to one of the world’s largest and most connected peer educator networks and offers free professional development resources. It will provide free access to a new industry-recognized credential for educators, developed in partnership with one of the leading national nonprofit focused on technology and innovation (ISTE+ASCD).[vi] This partnership is aligned to the AI Literacy Framework, which is intended to help educators gain confidence and expertise in integrating AI into their teaching and learning. As part of this work, we also support ISTE+ASCD in advancing AI in teacher preparation programs.
National Academy for AI Instruction
Along with OpenAI and Anthropic, we are supporting the National Academy for AI Instruction, through a partnership with the American Federation of Teachers and the United Federation of Teachers. The Academy describes itself as a national training hub designed by educators – shaping the future of AI in public education, grounded in safety and people-first technology, and improving student learning. From everything we have heard from teachers, this is exactly the type of support they need to promote AI literacy. The Academy also focuses on building critical thinking skills for students and educators.
Rob Weil, who heads up the Academy, recently shared an update on their work with me. He noted through direct engagement with teachers, they listen to what the primary concerns teachers have around using AI in the classroom are, and then work with them to design trainings that are directly responsive to their concerns and meet them where they are – including using whatever technology they are already using in their classroom.
Their goal is to train 400,000 teachers over the next 5 years. The Academy is centered around a “train the trainer” model, building capacity to provide AI literacy to teachers at scale – providing the potential of millions of teachers to benefit from this initiative. Weil noted that interest and participation in the Academy has been taking off, largely due to word of mouth. This month, 1,000 teachers showed up for a virtual session, and another in-person session was overprescribed had to turn away a hundred interested teachers.
Why the interest? Teachers want to learn from their peers and trusted partners; they also want to ensure they are using AI effectively and safely. Weil explained that one of the most popular aspects of the training is centered around the Academy’s Commonsense Guardrails for Using Advanced Technology in Schools,[v] which helps empower teachers to address the challenges they are facing in implementing AI. Some teachers describe AI as the wild-wild west, and this guide has helped provide a roadmap for understanding how to navigate bringing this technology into the classroom.
The trainings also provide real-world, hands-on experiences with using technology which teachers themselves are bringing to the table. At the trainings, teachers are asked what they could use the most help with and then have time to experiment with different tools to do things like start a draft of a lesson plan or an outline for a rubric – allowing them more time and flexibility to incorporate their expertise. In addition, the Academy creates opportunities for educators to influence the development of AI for schools.
Support for Special Education Teachers
We also recognize the potential that AI holds to support students with disabilities – and the need to ensure special education teachers have the support and resources to fully unlock this technology.
Recently, we launched a course to support educators in exploring how Microsoft AI tools can be thoughtfully used in special education environments to reduce administrative demands, strengthen accessibility, and support clear communication with families. Throughout the learning path, responsible use of AI, privacy, and transparency are emphasized so educators can determine when and how AI fits into their practice in ways that align with student needs and professional values.
After our engagements, we tailored our trainings to special education teachers by incorporating their direct feedback. Key topics included privacy with sensitive medical information and using AI to assist parents and caregivers in IEP meetings. We emphasized clear communication, parental inclusion, and ensuring parents understand the meeting’s goals and how best to support their children.
Finally, special education involves a collaborative team beyond just teachers, and we’ve revised our approach to address the needs of occupational therapists, physical therapists, and all other members involved in special education.
Support for Teachers in Rural America
We have found there’s a significant gap in daily AI usage by urban teachers versus their rural and suburban counterparts (39% vs. 24%).[iv] This gap underscores why ensuring AI tools, resources, and professional development are attuned to the needs of rural teachers is critical.
For the last five years, we’ve been working with the National Future Farmers of America (FFA) and agricultural science teachers to develop FarmBeats for Students and ensure it is responsive to agricultural science teachers’ needs. We engaged in an iterative process with them – collaboratively designing and building curriculum and training with agricultural science teachers from the very beginning of development.
FarmBeats for Students brings AI to agricultural education through a hands-on educational program that brings precision agriculture directly into the classroom. The program consists of an affordable hardware kit and a free curriculum aligned with rigorous educational standards. Activities give students direct experience with topics like digital sensors, data analysis, and AI.
We brought FarmBeats for Students to the National FFA convention and held a series of workshops with teachers across the country. They experimented with the kits and provided input to ensure this technology was directly responsive to what they wanted to see in the classroom.
In addition to our partnership with the National FFA, Microsoft helps meet the needs of rural teachers by deploying the online content referenced above through Elevate, as well as supporting community-based organizations that help facilitate activities and events which promote AI literacy in rural communities.
AI Literacy Frameworks, Standards, and Guidance
Teachers want frameworks that help them integrate AI into their classrooms. We are pleased there is bipartisan interest in establishing strong frameworks around AI and education, especially highlighting the need for widespread AI literacy. Microsoft has provided support, guidance, and input to organizations and initiatives such as Code.org and TeachAI who work to develop and promote frameworks, guidance, and standards.
Microsoft encourages state and local policymakers to review and leverage these resources as they incorporate AI in education:
The TeachAI Foundational Policies[vii]: This resource, endorsed by dozens of policy organizations and associations, provides practical guidance for national, state, and local leaders to harness AI’s benefits in teaching and learning while mitigating risks. The policies focus on five priorities—fostering leadership, promoting AI literacy, providing clear guidance, building educator capacity, and supporting responsible innovation—to ensure AI strengthens education systems and prepares learners for an AI‑enabled workforce.
The TeachAI AI Guidance for Schools Toolkit[viii]: The Toolkit helps education authorities, school leaders, and educators develop clear, responsible guidance for using AI in K–12 education, balancing potential benefits with risks such as privacy, bias, and academic integrity. It provides a practical framework, principles, sample policies, and communication templates to support safe and human‑centered AI adoption across school systems. The Toolkit has been used by the majority of states in constructing guidance for schools.
The AI Literacy Framework[ix]: The AI Literacy Framework defines the knowledge, skills, and attitudes students and educators need to understand, use, and critically evaluate AI in education. It is organized around four core domains—Engaging with AI, Creating with AI, Managing AI, and Designing AI—and emphasizes critical thinking, ethics, and human judgment alongside technical understanding. It also emphasizes the foundational computer science concepts that prepare students to not just use AI but understand how AI works and its societal impacts. The framework is designed to be interdisciplinary, practical, and durable, helping schools integrate AI literacy into curriculum, professional learning, and policy in age‑appropriate ways.
2.AI guardrails – Teachers want students to use AI responsibly and safely
We have heard from teachers that one of the greatest hesitations they have with AI is around safety for students. This includes ensuring AI tools used in the classroom protect student privacy, don’t collect their information, and are safe from a mental health perspective.
Some of the strategies teachers use to promote safety are a significant focus in the professional development referenced earlier. In addition, the frameworks include key components to help teachers understand responsible AI use.
Microsoft takes our responsibility as a developer and deployer of AI technology very seriously. Paramount to deploying this technology in classrooms is ensuring it is responsible. Microsoft has identified six principles that we believe should guide AI development and use.
Fairness: AI systems should treat all people fairly.
Reliability and Safety: AI systems should perform reliably and safely.
Privacy and Security: AI systems should be secure and respect privacy.
Inclusiveness: AI systems should empower everyone and engage all people.
Transparency: AI systems should be understandable.
Accountability: People should be accountable for AI systems.
These principles are the foundation for other tools and resources we share with teachers to provide guidelines for them to deploy AI in the classroom.
As another example of our commitment to safety, earlier this month, on Safer Internet Day, we launched our new Microsoft Education Security Toolkit,[x] which provides educators and IT teams with practical guidance tailored to the realities of modern education.
3. AI tools – Teachers want classroom-ready AI tools and opportunities to provide feedback that improve them
Teachers often lack the right AI tools tailored to their needs for boosting student achievement. It’s essential to develop AI solutions based on teacher input rather than just delivering generic options. Microsoft strives to meet this responsibility by designing tools and partnerships that address educators’ needs. We believe this approach creates a critical feedback loop that will allow us to constantly evolve our tools to maximize their benefit in the classroom over time.
In fact, at Microsoft, our engineering teams collaborate closely with educators and students to advance the development of AI tools for classroom use. We partner with teacher organizations and directly engage with the disability community to better understand instructional requirements and design technology that enhance student learning outcomes. Some examples include:
Reading Progress
One of the tools we offer to teachers is called Reading Progress, which helps teachers analyze students’ fluency and generates reading passages and comprehension questions.
From the beginning of development, we worked with individual teachers through our Educator Insiders program and with entire schools or districts through our Technology Adoption Preview, where educators test prototypes of our products and provide feedback.
For example, teachers asked for a tool that could generate tailored passages to meet the needs of their students. We incorporated that feedback and now, teachers can get as specific as saying they want a passage generated about sports that is for a third-grade reading level and includes specific words their class is learning.
Teachers also told us they wanted reading comprehension questions generated faster and better. With AI, it’s easy to do this in a high-quality way.
Teachers report increased comprehension, higher reading fluency, and higher scores, especially for struggling or reluctant readers.
Teach for America (TFA)
Microsoft has been a proud supporter of TFA’s efforts to improve the education system and expand opportunities for children across the U.S. It has been great to see all of the ways in which TFA has worked to equip their teachers with AI fluency in order to help them integrate this technology into the classroom.
TFA recently completed a cloud migration to Microsoft Azure, unlocking countless avenues to improve program design and delivery, direct the most possible funds toward its mission to ensure all kids have access to an excellent education, and evolve to offer the best learning options inside and outside the classroom.
Where do we go from here
What is both exciting and daunting about AI is that while we can take lessons learned from previous technological transformations in the classroom, much of the book has not been written on AI adoption. Meaning tech companies, teachers, government, and other stakeholders have the opportunity to shape where AI goes in education and beyond.
I want to conclude my remarks today with policy recommendations for the Committee to consider:
Support professional development for teachers to effectively teach about AI and responsibly integrate AI tools in the classroom.
At the Federal level, this means providing priorities for competitive grant programs, such as those recently proposed by the U.S. Department of Education.
Encourage public-private partnerships.
Incentivize and prioritize Federal funds and grants that support partnerships between technology companies and educational programs, including apprenticeship and credentialed organizations, to develop up to-date AI curriculum.
Promote AI literacy across the U.S.
Integrate AI skills and concepts, including their foundational principles, social impacts, and ethical concerns, into existing curriculum and instruction.
Provide guidance.
Equip schools with guidance on the safe, effective, and responsible use of AI, including considerations related to student privacy, data security, accessibility, transparency, and appropriate human oversight.
Invest in innovation.
Support research and evaluation to better understand the impacts of AI in education, including its effects on teaching and learning and student outcomes, and to identify effective, scalable practices that mitigate the digital divide.
Ahead of Mobile World Congress, where global leaders, governments, and industry convene at the world’s largest connectivity event, Microsoft is marking a major milestone in our efforts to expand digital access worldwide. In 2022, we made a bold commitment to expand internet access to 250 million people by the end of 2025. Today, we are proud to share that we have met and exceeded that goal, extending connectivity coverage to over 299 million people worldwide, including more than 124 million across Africa.
This milestone represents more than a number. It reflects more than a decade of sustained collaboration with governments, nonprofits, local connectivity providers, and development partners around the world. Together, we have worked to reach communities where access has historically been limited, building pathways to education, healthcare, economic opportunity, and digital participation.
Reaching this milestone is also a moment of reflection and renewal. Building on years of progress, Microsoft is evolving its approach to digital access to focus not only on coverage, but on adoption, enablement, and long-term participation in the AI economy.
As part of this next chapter, we are announcing a new collaboration with Starlink. This collaboration expands the set of tools available to help deliver digital access in rural, agricultural, and hard-to-reach communities. Combined with local delivery partners and community institutions, it strengthens the foundation for AI-ready communities around the world.
Why digital access matters in the AI era
Despite continued progress, 2.2 billion people globally remain offline, and many more face barriers related to affordability, reliability, or access to relevant digital services. These gaps already limit opportunity and risk widening as AI becomes more central to how economies grow and societies function.
At Mobile World Congress 2024, Microsoft Vice Chair and President Brad Smith shared our AI Access Principles, underscoring that electricity and connectivity are essential foundations for an inclusive AI economy. Since then, the pace of change has only accelerated. In fact, Microsoft’s 2025 AI Diffusion Report shows that AI is being adopted faster than any general-purpose technology in history, yet adoption remains uneven. As the data illustrates, adoption in the Global North is accelerating faster than in the Global South. Differences in infrastructure, access to tools, and digital readiness all contribute to a growing divide between higher-income and lower-income economies.
This graphic from the 2025 AI Diffusion Report reinforces a clear insight: access to AI alone is not enough. For communities to participate meaningfully in the digital and AI era, connectivity must be paired with reliable energy, affordable devices, digital skills, and technologies designed for real-world use. Where these conditions exist, adoption follows. In Zambia, for example, country-wide generative AI adoption is 12 percent, but among those with internet access, it rises to 34 percent.
Deepening Microsoft’s approach to digital access
Building on what we have learned, Microsoft is advancing a more holistic digital access model that recognizes connectivity as only one part of a broader system. In practice, this means collaboration to deliver not only internet access but also more reliable energy infrastructure, access to water where relevant, devices, digital skills, and cloud and AI tools, all designed and deployed for the communities they serve. By working across organizations and governments to address these foundational needs in parallel, this approach helps ensure that digital access is usable, durable, and capable of supporting real-world outcomes.
A central focus of this work is community-based access models that are financially sustainable, scalable, and aligned with national development priorities. These models bring together local institutions such as schools, health facilities, cooperatives, and community hubs and are implemented in partnership with governments, businesses, nonprofits, and development finance organizations. By integrating infrastructure, enablement, and financing from the outset, these holistic programs can help unlock long-term investment, support responsible growth, and enable communities to fully participate in the digital and AI economy.
Progress at this scale is only possible through strong partnerships rooted in local delivery, community trust, and long-term sustainability. Microsoft’s work to extend connectivity to more than 299 million people has been built alongside partners who understand the realities of last-mile deployment and digital adoption.
In Africa, Microsoft works with partners such as Cassava Technologies to expand regional digital infrastructure and drive high-quality internet access across South Africa, Malawi, Kenya, and Zambia. Collaborations with local providers like Tizeti deliver affordable, reliable connectivity through solar-powered Wi-Fi networks across Nigeria and Ghana.
In Latin America, Microsoft’s partnership with Anditel focuses on expanding internet and energy access for rural and agrarian communities in Colombia through locally led models aligned with national priorities. In India, Microsoft works with AirJaldi to pair affordable connectivity with digital skills training and practical pathways for use, helping communities move beyond basic access toward meaningful adoption.
These partnerships made reaching the 250 million milestone possible. They also reflect a principle that continues to guide our work. Lasting digital access is built with communities, not for them.
Expanding the portfolio: Collaboration with Starlink
Building on this foundation, Microsoft continues to expand and diversify its portfolio to reach communities where traditional infrastructure alone cannot meet demand.
Through our collaboration with Starlink, Microsoft is combining low-Earth orbit satellite connectivity with community-based deployment models and local ecosystem partnerships. This is intended to expand the set of tools available to deliver digital access while remaining firmly embedded in a holistic, partnership-driven approach.
Kenya offers an early example of this model in practice. Working with Starlink and local internet service provider Mawingu Networks, Microsoft is supporting connectivity for 450 community hubs across rural and underserved regions, including farmer cooperatives, aggregation centers, and digital hubs. These deployments combine satellite connectivity with digital skills, tools, and ecosystem coordination to support agricultural productivity, access to markets, and adoption of digital and AI-enabled services.
Beyond 250 million: Building AI-ready communities
Surpassing the 250 million connectivity milestone is a moment to celebrate. It is also a starting point for what comes next.
The next chapter of Microsoft’s digital access work is planned to focus on ensuring that access translates into adoption, use, and long-term opportunity. By continuing to partner with governments, development finance institutions, nonprofits, and private-sector partners, and by expanding into energy access, financing mechanisms, and community-first AI solutions, Microsoft is working to ensure that everyone, everywhere, can participate in the digital and AI economy.
Microsoft announces at the India AI Impact Summit it is on pace to invest USD $50 billion by the end of the decade to help bring AI to countries across the Global South
Artificial intelligence is diffusing at an impressive speed, but its adoption around the world remains profoundly uneven. As Microsoft’s latest AI Diffusion Report shows, AI usage in the Global North is roughly twice that of the Global South. And this divide continues to widen. This disparity impacts not only national and regional economic growth, but whether AI can deliver on its broader promise of expanding opportunity and prosperity around the world.
The India AI Impact Summit rightly has placed this challenge at the center of its agenda. For more than a century, unequal access to electricity exacerbated a growing economic gap between the Global North and South. Unless we act with urgency, a growing AI divide will perpetuate this disparity in the century ahead.
Solutions will not come easily. The needs are multifaceted, and will require substantial investments and hard work by governments, the private sector, and nonprofit organizations. But the opportunity is clear. If AI is deployed broadly and used well by a young and growing population, it offers a real prospect for catch-up economic growth for the Global South. It might even provide the biggest such opportunity of the 21st century.
As a company, we are committed to playing an ambitious and constructive role in supporting this opportunity. This week in Delhi, we’re sharing that Microsoft is on pace to invest $50 billion by the end of the decade to help bring AI to countries across the Global South. This is based on a five-part program to drive AI impact, consisting of the following:
Building the infrastructure needed for AI diffusion
Empowering people through technology and skills for schools and nonprofits
Strengthening multilingual and multicultural AI capabilities
Enabling local AI innovations that address community needs
Measuring AI diffusion to guide future AI policies and investments
One thing that is clear this week at the summit in India is that success will require many deep partnerships. These must span borders and bring people and organizations together across the public, private, and nonprofit sectors.
1. Building the infrastructure needed for AI diffusion
Infrastructure is a prerequisite for AI diffusion, requiring reliable electricity, connectivity, and compute capacity. To help address infrastructure gaps and support the growing needs of the Global South, Microsoft has steadily increased its investments in AI-enabling infrastructure across these regions. In our last fiscal year alone, Microsoft invested more than $8 billion in datacenter infrastructure serving the Global South. This includes new infrastructure in India, Mexico, and countries in Africa, South America, Southeast Asia, and the Middle East.
We’re coupling our investments in datacenters with an ambitious effort to help close the Global South’s connectivity divide. We’ve been pursuing aggressively a global goal to extend internet access to 250 million people in unserved and underserved communities in the Global South, including 100 million people in Africa.
As we announced in November, we’ve already reached 117 million people across Africa through partnerships with organizations such as Cassava Technologies, Mawingu, and others that are building last‑mile networks across rural and urban communities alike. We’re closing in on our global goal of reaching 250 million people and will share an update on that progress soon.
We’re investing in AI infrastructure with sensitivity to digital sovereignty needs. We recognize that in a fragmented world, we must offer customers attractive choices for the use of our offerings. This includes sovereign controls in the public cloud, private sovereign offerings, and close collaboration with national partners.
We pursue all this with commitments to protect cybersecurity, privacy, and resilience. In the age of AI, we ensure that our customers’ AI-based innovations and intellectual property remain in their hands and under their control, rather than being transferred to AI providers.
Critically, we balance our focus on national sovereignty with our efforts to support digital trust and stability across borders. The Global South requires enormous investments to fund infrastructure for datacenters, connectivity, and electricity. It is difficult to imagine meeting all these needs without foreign direct investment, including from international technology firms.
This need is part of what informed our announcement last week at the Munich Security Conference of the new Trusted Tech Alliance. This new partnership brings together 16 leading technology companies from 11 countries and four continents. We’ve agreed together that we will adhere to five core principles designed to ensure trust in technology. Ultimately, we believe the Global South—as well as the rest of the world—needs both to protect its digital sovereignty and benefit from new investments and the best digital innovations the world has to offer.
2. Empowering people through technology and skills for schools and nonprofits
Ultimately, datacenters, connectivity, and electricity provide only part of the digital infrastructure a nation needs. History shows that the ability to provide access to technology and technology skills are equally important for economic development.
As a company, we’re focused on this in multiple ways. One critical aspect of our work is based on programs to provide cloud, AI, and other digital technologies to schools and nonprofits across the Global South. Another is our work to advance broad access to AI skills. In our last fiscal year, Microsoft invested more than $2 billion in these programs in the Global South. This includes direct financial grants, technology donations, skilling programs, and below-market product discounts.
AI skills are foundational to ensuring that AI expands opportunity and enables people to pursue more impactful real-world applications. With the launch of Microsoft Elevate in July, we committed to helping 20 million people in and beyond the Global South earn in-demand AI skilling credentials by 2028. After training 5.6 million people across India in 2025, we advanced this work by setting a goal last December to equip 20 million people in India with essential AI skills by 2030.
As part of that commitment, today we are announcing the launch of Elevate for Educators in India to strengthen the capacity of two million teachers across more than 200,000 schools, vocational institutes, and higher education settings. Our goal is to help the country’s teaching workforce lead confidently in an AI‑driven future. The program will be delivered in partnership with India’s national education and workforce training authorities, expanding equitable AI opportunities for eight million students.
Through Microsoft Elevate, we’re also working to introduce new educator credentials and a global professional learning community that enables teachers to share best practices with peers worldwide. This effort will involve large-scale capacity building initiatives, including AI Ambassadors, Educator Academies, AI Productivity Labs, and Centers of Excellence. It will equip 25,000 institutions with inclusive AI infrastructure while integrating AI learning pathways into major government platforms.
3. Strengthening multilingual and multicultural AI capabilities
Language is another major barrier to AI diffusion across the Global South, particularly in regions where digitally underrepresented languages prevail and access to essential services depends on local-language communication. For billions of people worldwide, AI systems perform less consistently in the languages they rely on most than in English.
That’s why we’re announcing this week new steps to increase our investments across the AI lifecycle, from data and models to evaluation and deployment, to strengthen multilingual and multicultural capabilities and support more inclusive AI systems that will better serve the Global South.
First, we’re investing upstream in language data and model capability. This includes support for LINGUA Africa, which builds on what we learned through LINGUA Europe: that investing in language data and model capability in partnership with local communities can materially improve AI performance for underrepresented languages.
Through LINGUA Africa—a $5.5 million open call led by the Masakhane African Languages Hub, Microsoft’s AI for Good Lab, and the Gates Foundation, with additional support from the UK government—we are prioritizing open, responsibly sourced data across text, speech, and vision as well as use-case-driven AI model development. By enabling African languages in high-impact sectors like education, food security, health, and government services, LINGUA Africa aims to ensure AI advances translate into tangible improvements in people’s daily lives.
Second, we’re advancing multilingual and multicultural evaluation tools. We’re helping expand the MLCommons AILuminate benchmark to include major Indic and Asian languages, enabling more reliable measurement of AI safety and security beyond English.
Today, even when automated evaluation tools expand language coverage, they too often rely on machine translation or English-first model behavior, with predictable failures when local expressions shift meaning. Partnering with academic and government institutions in India, Japan, Korea, and Singapore, and with industry, Microsoft is co-leading AILuminate’s multilingual, multicultural, and multimodal expansion that builds from the ground up. With a pilot dataset of 7,000 high-quality text-and-image prompts for Hindi, Tamil, Malay, Japanese, and Korean, we’re developing tools that reflect how risks manifest in local linguistic and cultural contexts, not just how they appear after translation.
Microsoft Research is also advancing Samiksha, a community-centered method for evaluating AI behavior in real-world contexts, in collaboration with Karya and The Collective Intelligence Project in India. Samiksha encodes local language use, culturally specific communication norms, and locally relevant use cases directly into core testing artifacts by surfacing failure modes that English-first evaluations routinely miss.
Finally, we’re working to scale content provenance for linguistic diversity. For trusted AI deployment, the ecosystem benefits from tools to identify the provenance of digital content like images, audio, or video, distinguishing whether it’s AI-generated. With partners in the Coalition for Content Provenance and Authenticity (C2PA), Microsoft is helping extend content provenance standards beyond an English-ready baseline. This includes forthcoming support for multiple Indic languages across metadata, specifications, and UX guidance, alongside efforts to support mobile-first deployment. With these investments, hundreds of millions more people in India will be better equipped to identify synthetic media in their primary language.
4. Enabling local AI innovations that address community needs
As India’s guiding sutras for the AI Impact Summit recognize, AI must be applied to address pressing challenges in collaboration with people and organizations in the Global South. Microsoft’s increasing investments prioritize locally defined problems, locally grounded expertise, and real-world impact. Our goal is straightforward: to ensure that AI solutions are not only technically sound, but socially relevant and sustainable.
Today, Microsoft is announcing a new AI initiative to strengthen food security across Sub-Saharan Africa, starting in Kenya and designed to scale across the region. Across Global South communities, food security and sustainable agriculture are critical to resilience and progress. In collaboration with NASA Harvest, the government of Kenya, the East Africa Grain Council, UNDP AI Hub for Sustainable Development, and FAO, our AI for Good Lab will use AI on top of satellite data to provide critical, timely food security insights. This builds on what we’ve learned in helping to address rice farming challenges in India, where severe groundwater depletion prompted 150,000 farmers in Punjab to adopt water-saving methods. In collaboration with The Nature Conservancy, Microsoft’s AI for Good Lab developed a classification system with satellite imagery to empower policymakers to track adoption of sustainable rice farming practices, target interventions, and measure water management impacts at scale.
Through Project Gecko, Microsoft Research is also co-designing AI technologies with local communities in East Africa and South Asia to support agriculture. This work includes the Paza family of automatic speech recognition models that can operate on mobile devices across six Kenyan languages, multilingual Copilots, and a Multimodal Critical Thinking (MMCT) Agent that can reason over community-generated video, voice, and text. Microsoft also launched PazaBench—the first automatic speech recognition leaderboard, with initial coverage of 39 African languages—and developed two playbooks for multilingual and multicultural capabilities, Paza and Vibhasha. Likewise, our AI for Good Lab developed a reproducible pipeline for adapting open-weight large language models to low-resource languages, demonstrating measurable gains for languages such as Chichewa, Inuktitut, and Māori.
5. Measuring AI diffusion to guide future AI policies and investments
Finally, accelerating diffusion requires a firm understanding of where AI is being used, how it is being adopted, and where gaps persist. Building on our AI Diffusion Reports and Microsoft GitHub’s long track record of contributing to the OECD AI Policy Observatory, the WIPO Global Innovation Index, and other cross‑country analyses, we’re increasing our investments in research and data sharing to track AI diffusion.
We’re advancing new methods for sharing AI adoption metrics. For example, based on models used in public code repositories hosted on Microsoft GitHub and privacy-preserving aggregated usage signals from Azure Foundry, we’re scaling this work through contributions to the forthcoming Global AI Adoption Index developed by the World Bank.
Signals from the global developer community that builds, adapts, and deploys AI-enabled software round out adoption research. At 24 million, the Indian developer community is the second largest national community on GitHub, where developers learn about and collaborate with the world on AI. The Indian community is also the fastest growing among the top 30 largest economies, with growth at more than 26 percent each year since 2020 and a recent surge of over 36 percent in annual growth as of Q4 2025. Indian developers rank second globally in open-source contributions, second in GitHub Education users, and second in contributions to public generative AI projects, with readiness to use tools like GitHub Copilot across academic, enterprise, and public interest settings enabling AI diffusion.
Insights from this evidence base help inform investments in infrastructure, language capabilities, skilling, or beyond, supporting more targeted and effective interventions to expand AI’s benefits. They also create a common empirical baseline to track progress over time—so AI diffusion becomes something we can measure and shape, not just observe.
Sustaining impact at scale through coordinated global action
For AI to diffuse broadly and deliver meaningful impact across regions, several conditions matter. As a company, we are focused on the need for accessible AI infrastructure, systems that work reliably in real-world contexts, and technologies that can be applied toward local challenges and opportunities. Microsoft is committed to working with partners to advance this work, including sharing data to track progress.
As we mark Safer Internet Day 2026, we’re reflecting on a simple but enduring principle: safety must be designed into online services, not bolted on. Microsoft’s work in this space spans more than two decades—from technology solutions like PhotoDNA to our investments in responsible gaming, public-private partnerships, and empowering users through education. This foundation guides our approach as we help individuals and families navigate a rapidly evolving landscape shaped by new technologies and new risks and as we innovate with next-generation AI offerings. At a moment when 91% of people tell us they worry about harms introduced by AI, our commitment to responsible innovation has never been more important—especially for our youngest users.
Read on for more about our longstanding efforts tocreate a safer digital environment, plus key findings from our Global Online Safety Survey and new examples of our work to empower families and communities through tools, research, and educational resources—including the latest release in Minecraft Education’s CyberSafe series.
Ten years of safety research
2026 marks the tenth year of our annual Global Online Safety Survey research. For a decade, we have invested in surveying teens and adults around the world about their experiences and perceptions of life online—aiming to provide fresh insights to support our collective work. That’s 130,000+ interviews across 37 countries, with the results available on our website. Ten years later, respondents tell us that they feel more connected and more productive, but less safe online.
This year’s Global Online Safety Survey also highlights the complexity of the digital environment young people now inhabit. Teens’ exposure to risk rose again, with hate speech (35%), scams (29%), and cyberbullying (23%) among the most commonly experienced harms. At the same time, teens demonstrated striking resilience: 72% talked to someone after experiencing a risk, and reporting behavior increased for the second consecutive year. But worries about the misuse of AIcontinue, underscoring againwhy safety-by-design for AI is essential, not optional. Find the full results and country-level summaries here.
Year on year, the research has told a story of evolving online safety risks and of the real-world impact. In 2026, the call to action is more urgent than ever—unless industry can deliver safe and age-appropriate experiences, young people risk losing access to technology.At Microsoft, spanning across our teams from Windows to Xbox, we have sought to continuously evolve our approach and to lead industry in advancing tailored and thoughtful safety solutions.
Evolving to meet the moment
Looking ahead, we know we need to continue to build strong guardrails to tackle acute risks and to leverage our experience while being informed by new research, new perspectives, and new technologies. The application process closed yesterday for our first AI Futures Youth Council, to be comprised of teens from across the US and EU. We’re looking forward to bringing those teens together soon for a first meeting to get their direct feedback on the role they want emerging technology to play in their lives and how we can best support their safety.
Microsoft has partnered with Cyberlite on a second youth-centered initiative to understand how teens aged 13–17 are engaging with AI companions. Through codesign workshops with students in India and Singapore, we’re capturing young people’s own perspectives on the benefits, risks, and emotional dimensions of AI use—insights that will directly inform educational resources for teens, parents, and educators. Early findings from the first workshop in December 2025 show that young people value AI as a judgment free space while also recognizing the tradeoffs: privacy risks, overreliance, and erosion of critical thinking loom larger for them than bad advice.
We’re also thinking about how we define safety in the next era of Windows, leveraging the Family Safety controls that have been integrated for over a decade. As many countries have raised the local age for digital consent, more parents will have the option to enable parental controls for teens up to the age of 18—leveraging these tools as part of a holistic approach to digital parenting. And to help parents set up and understand Family Safety, we’ve developed a shortnew guide.
Safety is also about transparency, empowerment, and education. At Xbox, bringing the joy of gaming to everyone means remaining transparent about the many ways we innovate so players, parents, and caregivers can feel confident that Xbox continues to be a place for positive play. You can read more about our recently published Xbox Transparency Report and the tools and resources available to players on the Xbox Wire blog.
We’re also excited to announce the latest release in Minecraft Education’s CyberSafe series: CyberSafe: Bad Connection? This series of immersive Minecraft worlds and educational resources is free and helps translate complex risks into fun learning experiences that meet young people in their favorite blocky world. Bad Connection?—the fifth in the series—reflects our commitment to evolving to meet new and challenging risks, with a focus on tackling serious risks related to online recruitment and radicalization. Learn more about how to access this new Minecraft world here.
The CyberSafe series has reached more than 80 million downloads since 2022 through a partnership between Minecraft Education, Xbox, and Microsoft, helping a generation of young players build the agency, resilience, and digital citizenship they need to navigate an increasingly online world. As part of our commitment to ensure people have the knowledge and skills they need to benefit from technology and stay safe, Microsoft Elevate is empowering educators and students with tools and guidance to build safer, more responsible digital habits, recognizing that AI is transforming how people learn, work, and connect. Our commitment to helping young people access technology safely is also why we’ve partnered with organizations, like the National 4-H Council to prepare young people for an AI-powered world through AI literacy and digital safety curriculum and game-based learning with Minecraft Education.
As we look ahead, our goal is clear: build technology that is safe by design, guided by evidence, and informed through partnership. The internet has changed profoundly over the past decade, and so too have the expectations of the people who use it. Safer Internet Day is a reminder that progress requires sustained collaboration across industry, civil society, researchers, and families.
—
Global Online Safety Survey Methodology
Microsoft has published annual research since 2016 that surveys how people of varying ages use and view online technology. This latest consumer-based report is based on a survey of nearly 15,000 teens (13–17) and adults that was conducted this past summer in 15 countries examining people’s attitudes and perceptions about online safety tools and interactions. Responses to online safety differ depending on the country. Full results can be accessedhere.
Eighty years ago, the first United Nations General Assembly convened in London, marking the start of a new era of global cooperation. Today, the context in which the UN operates has changed significantly. The UN system is being asked to deliver results with greater speed and precision, often amid tightening resources and growing demands. In response, the UN is advancing reforms to become more agile, accountable, and efficient.
The UN80 initiative, launched by UN Secretary-General Antonio Guterres, is about making the UN system fit for the future, strengthening its resilience, responsiveness, and capacity for innovation across humanitarian response, development, and international security.
Leaning in at a pivotal time
We are at a unique moment in history, the AI era, where digital and AI technologies can fundamentally reshape how large, complex institutions deliver for people around the world. For the UN, this is an opportunity not only to strengthen core systems such as procurement, service delivery, and supply chain management, but to reimagine how it meets the needs of constituents with greater speed, scale, and impact. Microsoft can support this moment by helping build the digital and AI foundations needed to modernize operations and unlock new solutions to global challenges at a scale not previously possible.
Our commitment to UN80
In December, all 193 Member States reached agreement on a package of measures to ensure financial stability and enhance efficiency across the UN system. Following that, and in the spirit of the US Government’s recent $2 billion contribution to fund humanitarian aid, Microsoft is announcing a pledge designed to support the UN system holistically. We hope that our pledge will inspire further action and help catalyze broader private sector resources and expertise. Microsoft’s UN80 pledge is structured around four pillars.
A UN80 innovation fund
Affordable pricing tailored for the UN
AI training and readiness for UN staff
Mobilizing private sector partners
Together, these commitments are intended to support the organization’s efforts to become more agile, efficient, and transparent through concrete action and investment. We describe each pillar in more detail below.
1.A UN80 innovation fund
Microsoft is committing a multi-million-dollar investment to establish an innovation fund that will support priority UN80 initiatives, particularly where AI and digital technologies can accelerate outcomes. This fund is designed to be collective, open to other private sector partners’ contributions, and focused on practical projects that strengthen UN capabilities and delivery.
2.Affordable pricing tailored for the UN
Microsoft is making a pricing commitment designed to improve affordability for the UN system. As part of this commitment, Microsoft will provide a specialized UN80 offer through June 2027 to improve affordability and help address financial constraints. Access to secure, modern digital tools is foundational to the UN’s ability to operate effectively across geographies and mandates.
3.AI training and readiness for all UN staff
We will make available free digital and AI literacy training and credentials to all UN staff. This includes training on the capabilities needed to adopt and scale technology responsibly across UN agencies, missions, and offices.
4.Mobilizing private sector partners
Microsoft is committing to bring together partners to align resources, expertise, and innovation in support of UN80 priorities. EY is taking a leadership position in the industry as the first partner to join this coalition, making a similar pledge to contribute their expertise and capacity in support of UN80-aligned initiatives. EY brings deep experience across the UN system as well as across multiple industries—expertise that will be invaluable in shaping new initiatives and collaborations to strengthen the capabilities needed to meet the UN80 commitments. Together, Microsoft and EY are working to anchor this early private-sector coalition in shared purpose and equip the UN with the tools and capabilities to advance reform at scale.
Building on a foundation of impact
This commitment builds on years of concrete collaboration where technology and partnerships have strengthened core UN systems. Through our work with the United Nations Children’s Fund (UNICEF), we’ve helped advance digital learning platforms that have reached millions of children worldwide, ensuring equitable access to education even in the most challenging circumstances. Our engagement with the International Telecommunication Union (ITU) has supported global connectivity initiatives, helping bridge the digital divide and foster inclusive access to technology. In humanitarian settings, our work with the United Nations High Commissioner for Refugees (UNHCR) is advancing AI-powered transcription, translation, and summarization to make refugee onboarding faster and more accessible in some of the world’s toughest environments.
Together with Microsoft’s AI for Good Lab and GitHub, UNHCR has also modernized mapping for the Kakuma refugee camp, enabling humanitarian teams to deliver aid more efficiently, plan infrastructure with precision, and uphold safety and dignity for over 300,000 displaced individuals. We partnered with the International Labour Organization (ILO) and the International Training Centre of the ILO through the Women in Digital Business initiative to equip women entrepreneurs with digital and AI skills—opening doors to growth, reaching new markets, and strengthening economic impact. In remote communities like Kaswanga in Rusinga Island, these tools are breaking barriers and rewriting futures as women turn local crafts and produce into nationwide businesses.
Together, these efforts show how responsible innovation can strengthen the UN’s ability to deliver at scale.
How we will support delivery
To support effective execution of these commitments, Microsoft is standing up a dedicated UN80 engagement team to serve as a point of contact for UN counterparts. This team will engage with UN leadership to help align priorities, coordinate partner contributions, and support the effective deployment of resources as the UN80 initiative takes shape.
UN80 provides an opportunity to build on this foundation and scale what works across the system.
As the UN enters its next 80 years, Microsoft stands with the organization as a committed partner, investing in the systems and capabilities needed to deliver in a changing world. Our hope is that UN80 is more than an aspiration, and that it promotes modernization, accountability, transparency, and efficiency for years to come.
UN does not endorse any company, brand, organization, product or service.
Today, Microsoftis announcing a coordinated legal action in the United States and, for the first time, the United Kingdom to disrupt RedVDS, a global cybercrime subscription service fueling millions in fraud losses. These efforts are part of a broader joint operation with international law enforcement, including German authorities and Europol, which has allowed Microsoft and its partners to seize key malicious infrastructure and take the RedVDS marketplace offline, a major step toward dismantling the networks behind AI-enabled fraud, such as real estate scams.
For as little as US$24 a month, RedVDS provides criminals with access to disposable virtual computers that make fraud cheap, scalable, and difficult to trace. Services like these have quietly become a driving force behind today’s surge in cyber‑enabled crime, powering attacks that harm individuals, businesses, and communities worldwide.Since March 2025,RedVDS‑enabled activity has driven roughly US$40 millionin reported fraud losses in the United States alone. Among the victims is H2-Pharma, an Alabama‑based pharmaceutical company that lost more than $7.3 million—money supposed to be used to sustain lifesaving cancer treatments, mental health medications, and children’s allergy drugs for patients across the country. In a separate case, the Gatehouse Dock Condominium Association in Florida was tricked out of nearly $500,000—funds contributed by residents and property owners for essential repairs. Both organizations are joining Microsoft as co‑plaintiffs in this civil action.
But these cases represent only a fraction of the harm. Fraud and scams frequently go unreported, victims are global, and cybercriminals routinely pivot across platforms and service providers. For the individual, fraud has lasting effects that extend beyond financial loss to emotional wellbeing, health, relationships, and long-term stability. As a result, the true toll of RedVDS‑enabled activity is far higher than the roughly US $40 million Microsoft can directly observe.
What RedVDS is—and why it matters
RedVDS is an online subscription service that is part of the growing cybercrime-as-a-service ecosystem where cybercriminals buy and sell services and tools to launch attacks at scale. It provides access to cheap, effective, and disposable virtual computers running unlicensed software, including Windows, allowing criminals to operate quickly, anonymously, and across borders.
A screenshot of RedVDS’s user dashboard, including a loyalty program and referral bonuses for customers.
Cybercriminals use RedVDS for a wide range of activities, including sending high‑volume phishing emails, hosting scam infrastructure, and facilitating fraud schemes. RedVDS is frequently paired with generative AI tools that help identify high‑value targets faster and generate more realistic, multimedia message email threads that mimic legitimate correspondences. In hundreds of cases, Microsoft observed attackers further augment their deception by leveraging face-swapping, video manipulation, and voice cloning AI tools to impersonate individuals and deceive victims.
In just one month, more than 2,600 distinct RedVDS virtual machines sent an average of one million phishing messages per day to Microsoft customers alone. While most were blocked or flagged as part of the 600 million cyberattacks Microsoft blocks per day, the sheer volume meant a small percentage may have succeeded in reaching the targets’ inboxes. Since September 2025, RedVDS‑enabled attacks have led to the compromise or fraudulent access of more than 191,000 organizations worldwide. These figures represent only a subset of the impacted accounts across all technology providers, illustrating how quickly this infrastructure increases the scale of cyberattacks.
Global density of compromised Microsoft email accounts using RedVDS from September 2025 through December 2025. The top five impacted countries are the United States, Canada, the United Kingdom, France, and India.
How RedVDS enables fraud
One of the most common ways RedVDS‑enabled attacks result in financial loss is through payment diversion fraud, also known as business email compromise, or “BEC.” In these schemes, attackers gain unauthorized access to email accounts, quietly monitor ongoing conversations, and wait for the right moment, such as an upcoming payment or wire transfer. At that point, they impersonate a trusted party and redirect funds, often moving the money within seconds. Both H2-Pharma and the Gatehouse Dock Condominium Association were targeted through sophisticated BEC schemes that exploited trust and timing.
BEC attack chain powered by RedVDS.
Sample impersonation email with fraudulent payment instructions.
RedVDS has also been heavily used to facilitate real estate payment diversion scams, one of the fastest‑growing forms of cyber‑enabled fraud. In these cases, attackers compromise the accounts of realtors, escrow agents, or title companies and send strategically timed emails with fraudulent payment instructions designed to divert closing funds, escrow payments, and other sizeable transactions. For families and first altogether. Microsoft has observed RedVDS‑enabled activity affecting more than 9,000 customers in the real estate sector alone, with particularly severe impact in countries such as Canada and Australia.
And the threat goes far beyond real estate. RedVDS‑enabled scams have hit construction, manufacturing, healthcare, logistics, education, legal services, and many other sectors—disrupting everything from production lines to patient .
A Global Response to a Global Threat
Cybercrime today is powered by shared infrastructure, which means disrupting individual attackers is not enough. Through this coordinated action, Microsoft has disrupted RedVDS’s operations, including seizing two domains that host the RedVDS marketplace and customer portal, while also laying the groundwork to identify the individuals behind them.
Microsoft’s legal actions are reinforced by close collaboration with law enforcement partners around the world, further disrupting the malicious operation. Germany’s Public Prosecutor’s Office Frankfurt am Main – Central Office for Combating Internet Crime (ZIT) and the German State Criminal Police Office Brandenburg have seized a critical server used to power RedVDS, effectively taking its central marketplace offline. At the same time and as part of this ongoing disruption, Microsoft is also working closely with international law enforcement, including Europol’s European Cybercrime Centre (EC3), to disrupt the broader network of servers and payment networks that supported RedVDS customers as part of the ongoing disruption.What people and organizations can do
We are deeply grateful to H2– -Pharma and the Gatehouse Dock Condominium Association for their willingness to come forward and share their experiences. Their cooperation, combined with Microsoft’s threat intelligence, made this action possible and will help protect future victims. Falling victim to a scam should never carry stigma. These attacks are executed by organized, professional criminal groups that intercept and manipulate legitimate communications between trusted parties.
Simple steps can significantly reduce risk, including slowing down and questioning urgency, calling points of contact back using numbers that are already known to you, verifying payment requests using additional contact information, enabling multifactor authentication, watching carefully for subtle changes in email addresses, keeping software up to date, and reporting suspicious activity to law enforcement. Every report helps dismantle networks like RedVDS and brings us closer to stopping cybercrime at scale.
Continuing a collective effort to disrupt cybercrime
This action against RedVDS builds on Microsoft’s ongoing efforts to disrupt fraud and scam infrastructure through legal and technical action, collaboration with law enforcement, and participation in global initiatives such as the National Cyber-Forensics and Training Alliance (NCFTA) and the Global Anti-Scam Alliance (GASA). It marks the 35th civil action targeting cybercrime infrastructure by Microsoft’s Digital Crimes Unit, underscoring a sustained strategy to go beyond individual takedowns and dismantle the services that criminals rely on to operate and scale.
As services like RedVDS continue to emerge, Microsoft will keep working with partners across sectors and borders to identify and disrupt the infrastructure behind cyber-enabled fraud, making it harder for criminals to profit and easier for people and organizations to stay safe online.
Microsoft’s 5-point plan to partner with local communities across the United States
This year marks America’s 250th year of independence. One of the trends that has repeatedly shaped the nation’s history is again in the news. As we’re experiencing at Microsoft, AI is the latest in a long line of new technologies to require large-scale infrastructure development.
Microsoft today is launching a new initiative to build what we call Community-First AI Infrastructure—a commitment to do this work differently than some others and to do it responsibly. This commits us to the concrete steps needed to be a good neighbor in the communities where we build, own, and operate our datacenters. It reflects our sense of civic responsibility as well as a broad and long-term view of what it will take to run a successful AI infrastructure business. In short, we will set a high bar.
As we launch this initiative, we think about it in the context of both the headlines of the day and the lessons from the past. Beginning in the 1770s, the country has advanced through successive eras built on huge infrastructure development based on canals, railroads, power plants, and the electrical grid, followed by the telephone system, highways, and airports. AI infrastructure has become the next chapter in this story.
Like major buildouts of the past, AI infrastructure is expensive and complex. Investments are advancing at a rapid pace. Today, these require large-scale spending by the private sector in land, construction, electricity, liquid cooling, high-bandwidth connectivity, and operations. This revives a longstanding question: how can our nation build transformative infrastructure in a way that strengthens, rather than strains, the local communities where it takes root?
Large AI investments are accelerating just as datacenter concerns are growing in local communities. The pattern is familiar. Whether it was canals, railroads, the electrical grid, or the interstate highway system, each era produced its own conflicts over who bore the burdens of progress. One enduring lesson is that successful infrastructure buildouts will only progress when communities feel that the gains outweigh the costs. Long-term success requires a commitment to address public needs, including by the private companies making these investments.
This must start by understanding local concerns. Residential electricity rates have recently risen in dozens of states, driven in part by several years of inflation, supply chain constraints, and long-overdue grid upgrades. Communities value new jobs and property tax revenue, but not if they come with higher power bills or tighter water supplies. Without addressing these issues directly, even supportive communities will question the role of datacenters in their backyard.
As a company, we believe in the many positive advances AI will bring to America’s future. From stronger economic growth to better medical advances and more affordable products, we believe AI will make a difference in everyday lives. But we also recognize that AI, like other fundamental technological shifts, will create new challenges as well. And we believe that tech companies like Microsoft have both a unique opportunity to help contribute to these advances and a heightened responsibility to address these challenges head-on.
This Community-First AI Infrastructure Initiative provides a framework for doing exactly that. It is anchored in five commitments, each a clear promise to the communities where we build, own, and operate Microsoft datacenters. These are:
We’ll pay our way to ensure our datacenters don’t increase your electricity prices.
We’ll minimize our water use and replenish more of your water than we use.
We’ll create jobs for your residents.
We’ll add to the tax base for your local hospitals, schools, parks, and libraries.
We’ll strengthen your community by investing in local AI training and nonprofits.
We describe our plans in detail below. We recognize that these will evolve and improve, based most importantly on what we learn from ongoing engagement with local communities across the country. We’ll also follow this plan for Community-First AI Infrastructure with similar plans for other countries, shaped to reflect their local needs and traditions.
But we are choosing the beginning of 2026 in Washington, DC to launch this effort in the United States. Our goal is to move quickly, partner with local communities, and bring these commitments to life in the first half of this year.
1.Electricity: We’ll pay our way to ensure our datacenters don’t increase your electricity prices.
There’s no denying that AI consumes large amounts of electricity. While advances in technology may someday change this, today, this is the reality.
The United States will retain its AI leadership role only if AI infrastructure can tap into a rapidly growing supply of electricity. The International Energy Agency (IEA) estimates that US datacenter electricity demand will more than triple by 2035, growing from 200 terawatt-hours to 640 terawatt-hours per year. This growth is taking place alongside rapid electrification of manufacturing and other sectors of the economy.
Our nation is addressing this reality at a demanding time. Even in the absence of datacenter construction, the United States is facing major electricity challenges. Much of the country’s electricity transmission infrastructure is more than 40 years old, and it’s under strain. Supply chain constraints on transformers and high-voltage equipment are delaying upgrades that would enable existing lines to deliver more electricity. New transmission can take more than 7 to 10 years due to permitting and siting delays. This creates a mismatch with growing electricity demand.
Some have suggested that AI will be so beneficial that the public should help pay for the added electricity the country needs for it. We believe in the benefits AI will create, but we disagree with this approach. Especially when tech companies are so profitable, we believe that it’s both unfair and politically unrealistic for our industry to ask the public to shoulder added electricity costs for AI. Instead, we believe the long-term success of AI infrastructure requires that tech companies pay their own way for the electricity costs they create.
This will require that we take four steps, and we’re committed to each:
First, we’ll ask utilities and public commissions to set our rates high enough to cover the electricity costs for our datacenters. This includes the costs of adding and using the electricity infrastructure needed for the datacenters we build, own, and operate. We will work closely with utility companies that set electricity prices and state commissions that approve these prices. Our goal is straightforward: to ensure that the electricity cost of serving our datacenters is not passed on to residential customers.
In some areas, communities are already starting to benefit from this approach. In Wyoming, for example, Microsoft and Black Hills Energy have developed an innovative utility partnership that ensures our datacenter growth strengthens—rather than burdens—the local community. And as part of our datacenter investment in Wisconsin, we are supporting a new rate structure that would charge “Very Large Customers,” including datacenters, the cost of the electricity required to serve them. This protects residents by preventing those costs from being passed on. But we recognize the need to ensure that datacenter communities benefit everywhere. We believe this approach can and should be a model for other states.
Second, we’ll collaborate early, closely, and transparently with local utilities to add electricity and the supporting infrastructure to the grid when needed for our datacenters. Addressing electricity costs is critical, but it is an incomplete solution for local communities unless we expand electricity supply. This expansion typically requires a complex effort that includes the expansion of electrical generation capacity and improvements in transmission and substation systems.
We’re committed to collaborating with local utilities. We will sit down and plan together, providing early transparency around our projected power requirements and contracting in advance for the electricity we will use. When our datacenter expansion requires improvements in transmission and substation capabilities, we will continue our existing practices by paying for these improvements.
This work will build on a spirit of partnership with utilities we’ve worked to foster across the country. For example, in the wholesale energy market that covers much of the Midwest called the Midcontinent Independent System Operator (MISO), we have contracted to add 7.9 GW of new electricity generation to the grid, which is more than double our current consumption.
Third, we’ll pursue innovation to make our datacenters more efficient. We are also using AI to reduce energy use and improve the performance of our software and hardware in the design and management of our datacenters. And we are collaborating closely with utilities to leverage tools like AI to improve planning, get more electricity from existing lines and equipment, improve system resilience and durability, and speed the development of new infrastructure, including nuclear energy technologies.
By embedding these innovations into datacenters and by collaborating directly with local utilities, communities gain access to systems that are more efficient, more reliable, and better prepared to support growth without increasing costs for households.
Fourth, we’ll advocate for the state and national public policies needed to support our neighboring communities with affordable, reliable, and sustainable power. Public policy plays an essential role in supporting communities with affordable, reliable, and sustainable access to electricity. In 2022, Microsoft established priorities for electricity policy advocacy: expanding clean electricity generation, modernizing the grid, and engaging local communities. Over the past three years, we have advocated across all three areas and engaged with government leaders at the federal, state, and local levels to do so. To date, however, progress has been uneven. This needs to change.
We will advocate for policies across these areas with an urgent focus on accelerating project permitting and interconnection of electricity projects, expediting the planning and expansion of the electricity grid, and designing new electricity rates for large electricity users.
2. Water: We’ll minimize our water use and replenish more of your water than we use.
Across the country, communities are asking pointed questions about how datacenters use water. These are arising in places already facing water stress, like Phoenix and Atlanta, as well as regions with more abundant supply, like Wisconsin. These concerns are often amplified by aging municipal water systems and infrastructure gaps. Local communities want and deserve reassurance that new AI infrastructure won’t strain their water resources.
Our commitment ensures that our presence will strengthen local water systems rather than burden them. We’ll do this by reducing the amount of water we use and by investing in local water systems and water replenishment projects.
First, we’re committed to reducing the amount of water our datacenters use. The chips that power datacenters produce heat. To manage that heat, datacenters historically relied upon evaporative cooling systems that drew on large volumes of water for cooling in hot weather. As AI workloads have increased, the demand for cooling has increased. The GPU chips that power AI workloads run at very high temperatures; without proper cooling, these chips would burn out within minutes.
The good news is that the tech sector has invested in new innovations to address these cooling needs. Now is the time when we need to step up, use these new technologies, and take added steps to address water use concerns.
Across our entire owned fleet of datacenters, we are committed as a company to a 40 percent improvement in datacenter water-use intensity by 2030. We are optimizing water usage for cooling, improving our ability to balance between water-based cooling and air cooling based on environmental conditions. We have also launched a new AI datacenter design that uses a closed-loop system. By constantly recirculating a cooling liquid, we can dramatically cut our water usage. In this next-generation design, already deployed in locations such as Wisconsin and Georgia, potable water is no longer needed for cooling, reducing pressure on local freshwater systems.
For communities where water infrastructure constraints pose challenges, we will collaborate with local utilities to understand whether current systems can support the additional demand associated with datacenter growth. If sufficient capacity does not exist, we work with our engineering teams to identify solutions that avoid burdening the community.
This approach will build on what we’ve learned from the recent work at our datacenters in Quincy, Washington, an arid region where the local groundwater supply was already under pressure. To avoid drawing from the community’s potable water, we partnered with the city to construct the Quincy Water Reuse Utility, which treats and recirculates datacenter cooling water rather than relying on local groundwater. This approach protects limited drinking-water supplies while ensuring that high-quality, recycled water can be used for datacenter cooling needs. Where future system improvements are required, Microsoft funds those upgrades in full, ensuring that the community doesn’t have to shoulder the cost of supporting our operations.
We also partner with utilities from day one to map out water, wastewater, and pressure needs, and we fully fund the infrastructure required for growth, ensuring local water systems are resilient. Beyond our own footprint, we invest directly in community water infrastructure, modernizing water systems, expanding access, increasing water reliability, and helping utilities maintain stable rates and pressure. For example, near our datacenter in Leesburg, Virginia, Microsoft is funding more than $25 million of water and sewer improvements to ensure the cost of serving our facilities does not fall on local ratepayers.
Second, we will ensure that we replenish more water than we withdraw. This means restoring measurable amounts of water to the same water districts where our datacenter’s water is used, so the total water returned exceeds total water used. This standard provides greater transparency and precision in tracking and reporting, aligned with emerging industry standards.
We will pursue projects that make the most important water contribution to each local community. For example, in the greater Phoenix area and nearby Nevada communities, our leak detection partnerships with local utilities identify and repair hidden breaks in aging water systems, preventing water losses and keeping municipal water in circulation for community use. These projects both add to the total usable water supply and improve the reliability of service for residents.
Across the Midwest, we are restoring historic oxbow wetlands. These are crescent-shaped water bodies that naturally recharge groundwater, reduce flood risk, and enhance habitats for native species. These wetlands act as nature’s reservoirs, capturing and slowly returning water to local aquifers throughout both wet seasons and droughts, creating year-round value for farms, ecosystems, and nearby communities.
Overall, we approach replenishment the same way a household might think about a bank account: our operations make water withdrawals, and our replenishment projects make deposits. Some deposits, like our leak detection projects, go straight into the checking account—depositing water into the municipal supply for immediate community use. Others, like wetland restoration, go into a savings account—investing in the watershed’s long-term capacity to store and supply the region. These projects are evaluated using recognized methods that convert on-the-ground improvements into measurable gallons (or cubic meters) of water restored to local ecosystems, ensuring that commitments reflect tangible local benefits, not abstract promises.
Third, we will support this work with greater local transparency. People deserve to know how much water our datacenters use, and we are committed to making that information accessible, clear, and easy to understand. Aligned with this goal, we will begin publishing water-use data for each datacenter region in the country, as well as our progress on replenishment. This approach will ensure that communities can understand both our operational footprint and the progress we are making against our water-positive goals.
Fourth, we will advocate for public policies to help minimize water use and strengthen resilience. This means championing policies that enable sustainable growth while safeguarding community resources. We will support state and federal efforts to make reclaimed and industrial recycled water the default supply for datacenters wherever feasible. We will advocate for harmonized transparency standards that allow communities to clearly understand water use and stewardship practices. And we will work to reduce permitting delays by promoting predictable pathways for water-efficient datacenter projects.
These actions reflect our belief that technology and environmental responsibility must advance together, ensuring that AI-driven progress aligns with long-term water resilience for people, places, and ecosystems. Our policy activities are rooted in protecting local communities. By prioritizing recycled water and efficiency, we will help reduce pressure on aging municipal systems and ensure reliable water access for people and businesses.
3.We’ll create jobs for your residents.
New datacenters create jobs—typically thousands during construction and hundreds during operations. For example, in Washington state more than 1,300 skilled trades workers are building Microsoft datacenters and by the end of next year more than 650 full-time employees and contractors will work across all our operational facilities there.
One of our goals is to help ensure that workers from the local community benefit from these opportunities. To achieve this, we will invest in new partnerships to help give local residents the skills and opportunities to fill these jobs in both the construction and operational phases.
The AI infrastructure construction boom is driving large-scale physical development, creating a huge demand for skilled tradespeople nationwide. As datacenters and the energy projects that support them grow quickly, firms are vying for a limited workforce. At one level, this is good news for people who already have the qualifications these jobs require. But at another level, there is a risk the jobs will not go to local residents who want to pursue these jobs unless they can acquire the skills required.
We will take a multifaceted approach.
First, we will invest in partnerships to help train local workers to support the construction and maintenance of datacenters. This includes a new and first-of-its-kind partnership between Microsoft and North America’s Building Trades Unions (NABTU) to strengthen apprenticeship and training programs in the skilled trades where datacenters are being built. We are launching today a new agreement that establishes a cooperative framework to focus on building a pipeline of skilled workers in regions where we are building datacenters. This will also help enable NABTU to identify qualified contractor partners to bid on our infrastructure projects.
Second, we will expand our Datacenter Academy program to train individuals to fill ongoing datacenter operations roles. This program works in partnership with local community colleges and vocational schools to train students for critical roles in datacenter operations and related careers, once construction is complete.
A good example of this work is our Datacenter Academy partnerships in Boydton, Virginia, where we have a large datacenter campus. The Academy works with Southside Virginia Community College and the Southern Virginia Higher Education Center, which have helped hundreds of students and adult learners earn industry-recognized certifications in information technology and critical facilities operations.
In 2024, this work expanded with the opening of a new Critical Environment Training Lab (SoVA) in South Hill. This provides hands-on training with electrical, mechanical, and cooling systems using decommissioned datacenter equipment donated by Microsoft. Graduates of these programs have gone on to pursue careers supporting datacenter operations in Southern Virginia, including roles with Microsoft and the broader ecosystem of companies that help operate and maintain digital infrastructure. We will pursue similar partnerships in other states, and we are committed to making this an ongoing part of our work in the communities where we build new datacenters.
Third, we will use our voice to encourage policymakers to support these new job opportunities. While this work is of heightened importance in communities with datacenters, the broader need for this type of skilled labor is national in scope. According to LinkedIn data, job postings for data center occupations or requiring at least one core data center skill, such as data center operations, grew by 23 percent globally and 13.5 percent in the US year-over-year in 2025. This is likely to represent an ongoing trend. Over the next decade, trillions in private investment will offer steady employment opportunities for American workers—including electricians, pipefitters, HVAC techs, welders, and construction crews—alongside manufacturing technicians for related components, like chips, power generation, and cooling systems.
However, this rapid demand for skilled labor is set to outpace the available pipeline of workers. Today, the Associated Builders and Contractors estimates that the construction industry is short roughly 439,000 workers, mostly among skilled workers who do things like lay pipe and wire electrical panels.[1] Manufacturers report shortages as well, with the CEO of Ford Motor Company recently highlighting 5,000 open mechanic jobs that pay more than $100,000 per year. And for datacenter operations, employers face shortages in hands-on infrastructure skills such as cabling, racking, and network hardware.
This problem is exacerbated by the demographics of an aging workforce and a decades-old policy trend of deprioritizing vocational education for young Americans. A generation of skilled workers, vocationally trained in high schools and apprenticeships in the 20th century, are retiring from the trades. In the first quarter-century of the 21st century, high schools pivoted towards preparing young people for higher education and advanced degrees, often at the expense of traditional shop classes and training in skilled craftsmanship.
The increased demand for skilled trades, paired with an aging workforce, requires an enhanced public-private workforce partnership. Secondary schools in the US can be incentivized to do more to educate young people about the trades through vocational schools and pre-apprenticeship programs. Registered apprenticeship programs offered nationally provide a fulfilling career path with long-term wages and benefits.
In partnership with labor, the federal government can champion a national apprenticeship and workforce development initiative that helps young and aspiring American workers near AI infrastructure projects, especially in rural and post-industrial regions. President Trump’s AI Action Plan rightly identifies this opportunity, and we will work closely with the Department of Labor to help scale this effort. The federal government can also help by streamlining the process by which businesses can establish and maintain a registered apprenticeship program. They can also maximize the use of existing federal dollars that directly support registered apprenticeship programs. This could entail modernizing the regulations for the National Apprenticeship Act or updating the statutory language itself.
4.We will add to the tax base for your local hospitals, schools, parks, and libraries.
One of the most tangible benefits from datacenter development is invisible to an individual driving nearby. It’s the property taxes paid by datacenters to the local municipality, which are substantial. But this too requires that the private sector take a responsible approach, as described below.
We won’t ask local municipalities to reduce their local property tax rates when we buy land or propose a datacenter presence. Instead, we’ll pay our full and fair share of local property taxes, adding revenue to local towns and cities. This is obviously critical to supporting the growth a local community often experiences when datacenters are built or expanded. And most importantly, at a time when many communities are facing revenue shortages that threaten vital public assets like hospitals, schools, parks, and libraries, we know from experience that this can make a big difference.
The benefits of this approach are nowhere more apparent than in Quincy, Washington, a small agricultural community about 150 miles east of Seattle where Microsoft built its first datacenter in 2008. Since then, we have built more than twenty datacenters in the area, providing ongoing employment to thousands of construction workers for almost two decades. Hundreds of technicians enjoy permanent jobs in those datacenters, earning salaries well above the median income for Quincy. And we estimate that for every direct construction job created, another one is created in related sectors, including security services, maintenance and repair, retail, restaurants, and more. Altogether, our datacenters drive more than $200 million in regional economic activity each year.
As a result, the share of Quincy residents living below the poverty line has been cut in half, dropping from 29.4 percent in 2013 to 13.1 percent in 2023. And county property tax revenues have more than tripled over the past two decades, from roughly $60 million to more than $180 million. This has enabled the city to invest in public services and amenities. Last year, as rural hospitals around the country cut back on critical care offerings and shuttered their doors, Quincy opened a new 54,000-square-foot medical center. The city has also made substantial renovations to its high school, adding state-of-the-art athletic facilities, an auditorium, and a career and technical training department.
We want to make sure that the other communities where our datacenters are located benefit from our presence in the same way. In all the regions where we build, own, and operate datacenters, we’re devoted to taking a civically responsible approach. This means recognizing the importance of civic services, including public safety, local healthcare, schools, libraries, and parks. As we become an important local employer, local communities can count on us to be a constructive contributor to local business and civic efforts.
5. We’ll strengthen your community by investing in local AI training and nonprofits.
We believe the datacenter communities that power AI should be among the first to benefit from it. As these communities help drive innovation and economic growth for the nation, it’s essential that they share in the economic, educational, and community benefits AI is creating. Especially as jobs evolve and require more AI skills, this requires local investments in AI education and training. To support this goal, we will provide free, age-appropriate, best-in-class AI training and education in these communities in partnership with trusted, local community-based organizations.
For years, we have been helping people gain essential digital skills in communities in and around our datacenters, such as Quincy in Eastern Washington, Boydton in Southern Virginia, and Mt. Pleasant in Southeast Wisconsin. One thing we’ve learned is that these communities have vibrant anchor institutions—schools, libraries, and local chambers of commerce—that form the backbone of local learning, workforce development, and economic growth. That’s why our approach as we go forward will be to invest in communities with our datacenters to partner with and provide support to these anchor institutions so that every community member can leverage the power of AI in how they live, work, and learn.
First, we will partner with local K-12 schools, community colleges, and universities to provide age-appropriate, responsible AI literacy training and learning experiences for students and teachers in our datacenter communities. This will build on some of our most recent experiences. For example, in Quincy, Washington, we partnered with Quincy High School and the local FFA chapter to teach students the critical AI and data skills needed for careers in precision agriculture. And in our datacenter region in Mt. Pleasant, Wisconsin, we recently launched an AI bootcamp for students and faculty with Gateway Technical College to cultivate a new generation of developers and creators of AI tools and technology across Wisconsin technical colleges.
Our commitment is to build on this work to help students and teachers responsibly and effectively engage with AI, create with AI, manage AI, and design with AI by bringing free, locally relevant, responsible AI training that is aligned with AI literacy standards to students in every K-12 school, community college, and university in our datacenter markets.
Second, we will support adults in our datacenter communities with AI tools and skills by creating neighborhood AI learning hubs in partnership with local libraries in our key datacenter markets. This approach will build upon our previous digital skilling partnerships with local libraries. For example, during COVID, we partnered with libraries in rural communities across the country, and more recently, we helped train libraries in our Quincy and Mt. Pleasant datacenter markets on AI so that they could help their patrons learn AI skills. Building on this work, we will invest in AI literacy skills development for librarians and provide access to free AI literacy training and certifications to local library patrons, including by equipping public terminals at local libraries in our datacenter regions with AI tools and services.
Third, we will support AI skills training for small businesses. We recognize that AI training will be critical for small businesses as they navigate the transition to the AI economy. These businesses are the backbone of local economies, and their success directly impacts job creation, workforce stability, and community vitality. Through a new workforce transformation initiative, we will deliver AI training, tools, and insights to local chambers of commerce that support these small businesses. We will also provide flexible grants for AI training and upskilling to local chambers of commerce and a variety of workforce organizations to help local businesses upskill employees, adopt AI responsibly, and prepare their workforce for ongoing transformation—ensuring that economic opportunity stays rooted in the communities where we build and operate datacenters.
Finally, we will invest in your local nonprofit community. A defining aspect of Microsoft’s own history and culture has long been a commitment to support the many nonprofit organizations that are vital to every community the company calls home. As we expand our datacenters in new communities, we’re committed to bringing this role to these new regions.
This starts with support for our employees in the local community. We provide two key benefits to all our full-time employees. First, we will match every hour they spend volunteering for a nonprofit with a donation to that group of $25. Second, we’ll match each dollar they donate to a nonprofit with an equal donation by Microsoft. These give all our employees, including in our datacenters, a total potential match of $15,000 each year.
This approach to community engagement is an important part of Microsoft’s culture, and it has become the largest nonprofit charitable matching program in the history of business. In 2024 in the United States, it raised $229.1 million in donations for 29,000 nonprofits, plus 964,000 volunteer hours contributed by our employees. It’s a part of Microsoft we’re excited to bring to the communities that have our datacenters.
We recognize that our support for the local community also needs to go beyond this type of program. Our broader contribution must start with listening. You know best what your town needs, what nonprofits are making a difference, and which organizations are best positioned to do more. We will provide locally based Microsoft liaisons in major US datacenter communities to work side by side with local leaders and nonprofits. Our local staff will provide a community connection to our various Microsoft teams and resources. Working together, we will shape our direction and connection to help further our support for local nonprofits.
Conclusion
Many lessons emerge from the nation’s 250-year history relating to technology and infrastructure. The first is that large-scale infrastructure expansion is vital to economic growth and everyday improvements in people’s lives. Our lives today rely on electrical appliances, automobiles, phones, airplanes, and much more that would be impossible without modern infrastructure.
But a second lesson illustrates an important tension. Major infrastructure expansion is always difficult. It’s expensive. It inevitably raises questions, concerns, and even controversies. This has been true for more than 200 years, and we should assume it will be true well into the future. This always requires that important decisions be made by government leaders from village presidents and town councils to the American President and Congress.
Third, the most important decisions are often made at the local level. This reflects the outsized impact—both positive and negative—of infrastructure expansion at the local level. It also reflects the American political tradition and our zoning and permitting laws, which rightly put decision-making authority closest to those elected to serve local communities.
There’s a final lesson that speaks most directly to us. Private companies can help by stepping up and acting in a responsible way. We cannot surmount inevitable community challenges by ourselves. But we can make everything easier by embracing a long-term vision. By recognizing our responsibility. By playing a constructive role. And by supporting the entire community.
As we look to the future, we are committing to taking this final lesson to heart. And making it a fundamental part of our efforts every day.
Global adoption of artificial intelligence continued to rise in the second half of 2025, increasing by 1.2 percentage points compared to the first half of the year, with roughly one in six people worldwide now using generative AI tools, remarkable progress for a technology that only recently entered mainstream use.
To track this trend, we measure AI diffusion as the share of people worldwide who have used a generative AI product during the reported period. This measure is derived from aggregated and anonymized Microsoft telemetry and then adjusted to reflect differences in OS and device-market share, internet penetration, and country population. Additional details on the methodology are available in our AI Diffusion technical paper.[1]
No single metric is perfect, and this one is no exception. Through the Microsoft AI Economy Institute, we continue to refine how we measure AI diffusion globally, including how adoption varies across countries in ways that best advance priorities such as scientific discovery and productivity gains. For this report, we rely on the strongest cross-country measure available today, and we expect to complement it over time with additional indicators as they emerge and mature.
Despite progress in AI adoption, the data shows a widening divide: adoption in the Global North grew nearly twice as fast as in the Global South. As a result, 24.7 percent of the working age population in the Global North is now using these tools, compared to only 14.1 percent in the Global South.
Countries that have invested early in digital infrastructure, AI skilling, and government adoption, such as the United Arab Emirates, Singapore, Norway, Ireland, France, and Spain, continue to lead. The UAE extended its lead as the #1 ranked country, with 64.0 percent of the working age population using AI at the end of 2025, compared to 59.4 percent earlier in the year. The UAE has opened a lead of more than three percentage points over Singapore, which continues in second place with 60.9 percent adoption.
The second half of the year in the United States shows that leadership in innovation and infrastructure, while critical, does not by themselves lead to broad AI adoption. The U.S. leads in both AI infrastructure and frontier model development, but it fell from 23rd to 24th place in AI usage among the working age population, with a 28.3 percent usage rate. It lags far behind smaller, more highly digitized and AI-focused economies.
South Korea stands out as the clearest end-of-year success story. It surged seven spots in the global rankings, climbing from 25th to 18th, driven by government policies, improved frontier model capabilities in the Korean language, and consumer-facing features that resonated with the population. Generative AI is now used in schools, workplaces, and public services, and South Korea has become one of ChatGPT’s fastest-growing markets, leading OpenAI to open an office in Seoul.[2]
A parallel development reshaping the global landscape in 2025 was the rapid rise of DeepSeek, an open-source AI platform that has gained significant traction in markets long underserved by traditional providers. By releasing its model under an open-source MIT license and offering a completely free chatbot, DeepSeek removed both financial and technical barriers that limit access to advanced AI. Its strongest adoption, not surprisingly has emerged across China, Russia, Iran, Cuba, and Belarus. But perhaps even more notable is DeepSeek’s surging popularity across Africa, where it is aided by strategic promotion and partnerships with firms such as Huawei.[3]
This rapid evolution underscores an increasingly important dimension of AI competition between the United States and China, involving a race to promote adoption of their respective national models. DeepSeek’s success reflects growing Chinese momentum across Africa, a trend that may continue to accelerate in 2026. DeepSeek’s ascent also underscores a broader truth: the global diffusion of AI is influenced by accessibility factors, and the next wave of users may come from communities that have historically had limited access to technological progress. The challenge ahead is ensuring that innovation spreads in ways that help narrow divides rather than deepen them.
Since opening our first Canadian office in Toronto in 1985, Microsoft has played an important role in every chapter of Canada’s digital story, long before cloud and AI were household words. That history matters. Over four decades, our company and our thousands of employees have grown alongside Canada. We’ve developed a deep appreciation for this nation’s culture, values, needs, and important role in the world.
Today we are announcing the most important commitment in Microsoft Canada’s history. We’re adding to our investments—with a total of $19 billion CAD between 2023 and 2027, including more than $7.5 billion CAD in the next two years. We’re building new digital and AI infrastructure needed for the nation’s growth and prosperity, with new capacity beginning to come online in the second half of 2026. Equally important, we’re launching a new five-point plan to promote and protect Canada’s digital sovereignty. And we’re combining this with ongoing and new work to invest in Canada’s people, ensuring they have access to the skills needed to succeed in an AI era.
This builds upon Microsoft’s longstanding and deep relationship with the Canadian people. With more than 5,300 employees across 11 cities nationwide, including Toronto, Vancouver, Montreal, Calgary, Edmonton, Ottawa, and Quebec City, we have employees in every region to bring talent closer to the communities we serve.
Beyond our own team, based on third party estimates, we’re fueling the broader tech ecosystem with more than 17,000 companies that are Microsoft partners in Canada generating between $33B CAD and $41B CAD in annual revenue. Based on this partnership model, Microsoft helps support 426,000 jobs across Canada, including close to 300,000 people who build solutions on Microsoft platforms or provide goods and services for these efforts. As we expand our AI and cloud footprint, these partnerships are helping Canadian organizations to modernize and compete globally.
Our commitment also extends beyond business. In 2024 alone, we donated $219M CAD in grants, employee giving, and technology services to Canadian non-profits and charities.
At its core, our commitment to Canada centres on three things: technology, trust, and talent.
Technology: Building the Backbone of Canada’s Digital Future
Canada’s AI transformation is accelerating. According to Microsoft’s AI Diffusion Leaderboard, Canada ranks 14th globally in AI adoption, with usage now topping a third of the population. Developer contributions are growing too with Canada ranking 14th worldwide in GitHub AI contributors.
This momentum is clear. Canada is a leader not just in AI research, but in putting AI to good use. But sustaining this momentum requires more than enthusiasm. It demands advanced AI infrastructure, sovereign safeguards, world-class cybersecurity, and a skilled workforce to keep pace with innovation. That’s why Microsoft is investing to create a secure, sustainable, and scalable backbone for AI adoption, empowering Canada to lead confidently in the AI era.
Our investment expands our Azure Canada Central and Canada East datacentre regions, delivering sustainable, secure, and scalable cloud and AI capabilities. These datacentres will power everything from modernized public services to advanced AI innovation—responsibly and within Canadian borders.
Every facility and datacentre we build in Canada reflects Microsoft’s global commitment to sustainability. We’re designing our facilities to be energy-efficient, powered increasingly by renewable energy, and optimized for water conservation through advanced cooling technologies. These steps align with our pledge to be carbon negative, water positive, and zero waste by 2030, ensuring that as we expand our AI and cloud footprint, we do so responsibly—minimizing environmental impact while supporting Canada’s clean energy goals.
Since early 2023, these investments have already launched major infrastructure projects, created thousands of jobs, and partnered with Canadian innovators to drive sustainability and economic growth. These datacentres also translate into thousands of construction and permanent engineering and technology jobs, partnerships with Canadian digital innovators, and a surge in local economic opportunity.
Our infrastructure expansion has helped transform and develop new industries—from retail and finance to cleantech and quantum computing. Firms like Canadian Tire, Manulife, BMO, and Gay Lea Foods are embracing AI to transform their businesses, and their stories are a testament to Canada’s leadership in digital adoption.
To help achieve our 2030 sustainability goals, Microsoft is also investing in Canadian cleantech innovation. Canada is recognized as a global leader in cleantech and carbon removal technologies, and we are proud to collaborate with outstanding Canadian companies like Eavor, Cyclic Materials, Arca, Deep Sky, and Carbon Engineering (via 1PointFive).
Trust: A Five-Point Plan to Protect Canada’s Digital Sovereignty
As important as our investment in AI infrastructure is the new company-wide initiative we are launching to protect Canada’s digital sovereignty. This builds on technology and expertise across Microsoft and is based on a five-part plan to defend Canada’s cybersecurity, keep Canadian data on Canadian soil, strengthen privacy protection, support leading local AI developers, and ensure the continuity of cloud and AI services.
Defending Canada’s cybersecurity
As we enter the second quarter of the 21st century, the protection of digital sovereignty starts with the protection of cybersecurity. Reflecting Microsoft’s long-term presence in Canada, we appreciate how much has changed since the century began. During the first quarter of the century, Canada’s population grew by more than 28 percent and its GDP in real terms grew by more than 55 percent. Changing geopolitics and navigation in the Arctic Ocean have put Canada in a more important global position than ever.
Canada’s growth and importance have made the country a bigger cybersecurity target.
Microsoft has long prioritized the protection of Canadian cybersecurity. With unmatched threat intelligence capabilities based on 100 trillion signals from around the world every day, we’ve seen increasing international targeting of Canadian digital assets, especially from China, Russia, North Korea, and countries across south Asia and the Middle East. This has included influence operations in advance of elections and digital espionage focused on government agencies.
Even more significant, Canada’s diverse and robust economy has become a target of sophisticated international ransomware attacks. Organized criminal groups—some with nation state sponsorship—are targeting every sector of the economy and the public, and they are starting to rely on even more sophisticated technology and techniques, including AI. Our assessment is that in 2025 more than half of cyberattacks against Canada with known motives have been based on financial objectives, and 80 percent of them have involved efforts to exfiltrate data. Almost 20 percent have targeted the healthcare and education sectors, which creates more widespread threats to the public.
To strengthen our protection of Canada’s cybersecurity, we are launching today in Ottawa a dedicated Threat Intelligence Hub. This Hub will house Microsoft subject matter experts in threat intelligence, threat protection research, and applied AI security research. They will have access to Microsoft threat intelligence data and assets from around the world, so they can work closely with the Government of Canada and law enforcement partners to track and interdict nation state actors and organized crime.
In recent months, our team in Canada has been working to thwart China-based threat actors and has been sharing intelligence related to North Korean IT workers using stolen or fake identities to secure jobs with technology companies in Canada. We are dedicated to making this cybersecurity protection even stronger going forward.
Keeping Canadian Data on Canadian Soil
We also recognize the importance of ensuring that our Canadian customers can keep their local data on Canadian soil. This is why we embarked a decade ago, in close consultation with national leaders, to build and open our first two Canadian datacentres to provide local data residency in Toronto and Quebec City. We have steadily expanded our local services each year since. In 2026, we will take three new steps to keep Canadian data on Canadian soil.
First, we will strengthen sovereign controls and expand our data residency commitments by offering in-country data processing for Copilot interactions.
Second, we will expand our Azure Local offering in Canada to enable the extension of Azure capabilities to customer-owned environments such as private cloud and on-premises infrastructure.
And third, we will launch Sovereign AI Landing Zone (SAIL) in Canada. This is an open-source AI Landing Zone whose code will be hosted publicly on GitHub, and which will provide a secure foundation for deploying AI solutions within Canada’s borders, so organizations can build, scale, and innovate while maintaining the highest standards of privacy and compliance.
Protecting Canadian privacy
We recognize that privacy is a cornerstone of digital trust. We have long protected the digital privacy of people across Canada. As we look to 2026, we will build on this strong foundation with new technical capabilities and legal measures.
Next year, Microsoft will bring the latest confidential computing capabilities to our Canadian datacentre regions. Confidential computing in Azure enables organizations to keep data encrypted and isolated, even while in use, helping meet stringent digital sovereignty requirements. Azure Key Vault will also be available to Canadian customers, supporting external key management and allowing encryption keys to remain under customer control, whether stored on-premises or with a trusted third-party Hardware Security Module (HSM).
We will couple these technical measures with expanded contractual protection. We are codifying our promise to protect our Canadian customers’ data with a contractual commitment, in which we agree to challenge any government demand for Canadian government or commercial customer data where we have a legal basis for doing so.
Supporting Canada’s AI developers
Canada’s growing AI and digital ecosystem also requires protection and support for the nation’s leading AI developers. We have expanded this work in 2025 and will continue to prioritize these efforts in the year ahead.
Our work with Cohere exemplifies this commitment: we are welcoming Cohere into the Microsoft Foundry’s first-party model lineup, making their advanced language models—Command A, Embed 4, and Rerank—accessible on Azure. This will amplify Canadian innovation on a global stage. This partnership is built on more than technology; it is grounded in trust and shared values, with initiatives to help Cohere scale across Canada and worldwide.
We will explore new ways to integrate Cohere’s sovereign, made-in-Canada AI models into Microsoft services, helping to ensure Canadian enterprises and the public sector benefit from secure, locally developed solutions that embody responsibility and integrity. Together with Canada’s leading innovators, we are building relationships that deliver opportunity and impact while reinforcing the trusted foundation of Canadian digital sovereignty.
Defending the continuity of Canadian cloud services
Finally, in the face of geopolitical uncertainty, continuity is essential. Microsoft pledges to rigorously defend the uninterrupted operation of cloud services for Canadian government customers. If ever confronted with an order to suspend or halt operations in Canada, we will pursue every available legal and diplomatic avenue—including litigation—to protect access to critical infrastructure. Our track record demonstrates our resolve to stand up for customer rights. We remain ready to reinforce this commitment through robust contractual agreements, confident in our ability to ensure the ongoing operation of Canadian datacentres. Ultimately, these efforts aim to deepen trust between people, institutions, and nations, grounded in mutual respect and a shared commitment to advancing Canada’s digital future.
Microsoft’s digital infrastructure in Canada is not built on wheels. It is permanent infrastructure, and fully subject to Canadian laws and regulations. We recognize and respect that our operations in Canada are governed by Canadian law, just as we adhere to local laws in every country where we operate.
Talent: Investing in the Future for Every Canadian
At its core, every datacentre we build and every AI capability we deploy is an investment in Canadians and their future. Because technology alone doesn’t drive transformation, people do. That’s why it’s imperative to ensure that every Canadian can develop the skills needed to succeed in an AI era.
The need is clear. By 2030, nearly 60 percent of workers worldwide will require new digital skills, yet today only 24 percent of Canadians have received AI training, compared to a global average of 39 percent. Closing this gap is critical for Canada’s competitiveness.
Our new Microsoft Elevate business unit is designed to put people first, making AI opportunities accessible across the country. Since July 2024, Microsoft Canada has engaged 5.7 million learners through free skilling programs, with more than 546,000 individuals completing an AI training course. And we’re not stopping there. By 2026, Microsoft Elevate will help 250,000 Canadians earn in-demand AI credentials, ensuring the workforce is ready for the next decade of innovation.
Our partnerships amplify this impact. The Nonprofit AI Impact Hub, developed with the Canadian Centre for Nonprofit Digital Resilience (CCNDR) and Imagine Canada, strengthens the digital resilience of Canada’s 170,000 charities and nonprofits, which collectively employ 2.7 million people. Through role-based AI training and micro-credentials, we’re equipping this sector with tools to serve communities better.
We’re also investing in the next generation. Today, we are proud to announce a new partnership with Actua, a national leader that brings STEM education to youth throughout Canada, including those in remote, rural, and Indigenous communities. Microsoft Canada and Actua are committed to working with Indigenous communities across Canada to support AI skills development, so that the benefits of AI are felt widely. This partnership will support Actua’s AI Ready and InSTEM (Indigenous Youth in STEM) programs, to equip 20,000 young Canadians with essential AI skills. The InSTEM program will add AI learning for Indigenous youth, blending technology with cultural heritage and knowledge. For instance, students learn how AI tools can help preserve Indigenous languages and support cultural identity.
Canada Can Count on Us
Few American companies have benefitted more than Microsoft from such longstanding ties to Canada. Living so close to the border, we have long appreciated the many attributes that make Canada so special. We share more than geography. We share priorities like security, sustainability, and inclusive growth.
Today, we’re taking this partnership to the next level. We believe Canada has what it takes to help lead the world in responsible AI innovation and adoption, and we’re committed to being a partner every step of the way.
Around the world, the dangers of extreme weather are a daily reality. In 2024, extreme weather displaced or disrupted the lives of more than 800,000 people worldwide —a reminder that accurate, timely forecasts aren’t just about data; they’re about people. From farmers deciding when to plant to coastal communities preparing for hurricanes, better forecasting can save lives, protect infrastructure, and support economies.
That is why Microsoft remains deeply committed to Aurora, an AI model designed to help scientists understand Earth systems in new ways. Trained on vast amounts of data, it’s tuned to model the Earth’s systems. Aurora has already shown promise across multiple scenarios, including predicting the weather, tracking hurricanes and air quality, and modeling ocean waves and energy flows.
Today, we are reaffirming our commitment: keep Aurora open, collaborative, and impactful so researchers can innovate faster and deliver solutions that help communities prepare, adapt, and thrive. Scientific progress depends on openness and a strong global community, which is why Aurora will progress as an open-source platform, enabling scientists everywhere to contribute and apply it to new climate and weather challenges.
The next phase: Fueling innovation through research partnerships
We’re collaborating with Professor Rich Turner, a leader in machine learning research, and his lab at the University of Cambridge through a Microsoft AI for Good grant and research scientists to continue development of Aurora. Originally developed by Microsoft Research AI for Science, with collaboration from Professor Turner, we believe Aurora has the potential to change the way scientists around the world can use AI for weather and climate science.
Building on our SPARROW initiative, we’re also investing in research of open-source weather stations that can expand access to high-quality environmental data. These affordable, community-deployable systems are designed to help fill critical observation gaps and strengthen the dependability of weather predictions where they matter most.
Making Aurora available to scientists everywhere
Aurora’s source code and model weights are already open—but we’re going further. Together with Turner and Cambridge, our AI for Good team will open-source future releases of Aurora and new models that are built upon it, including training pipelines. By making Aurora open and free to build upon, we’re enabling researchers and developers everywhere to collaborate, contribute, and drive innovation together.
Empowering national meteorological services
As with any technology, the measure of success for tools like Aurora is to have a positive impact on the lives of people. Empowering national meteorological services across the Global South, along with the Global North, is a priority. We’re particularly focused on the application of Aurora to help meteorological services develop and strengthen their own forecasting systems that are tailored to their own local environments. This will allow them to adapt, extend, and innovate on top of Aurora, improving the accuracy, reliability, and reach of their forecasts.
Enabling a cross-industry ecosystem
Aurora is trained on one of the largest collections of atmospheric data ever assembled to develop an AI forecasting model. It’s then fine-tuned to perform a variety of specific tasks, like predicting wave height or air quality, using modest amounts of additional data.
The application of such a model could unlock innovation across all kinds of other industries. For example, energy companies and commodity traders have expressed interest, particularly in seeing how Aurora can be adapted to better predict renewable power generation, anticipate extreme weather events, and help protect energy grids.
We are excited to see our work on Aurora graduate from a research project into a truly collaborative, open-source effort. By opening Aurora to the global community, we’re enabling breakthroughs in scientific understanding that we hope will transform humanitarian aid, optimize energy systems, advance sustainability, and even reshape financial services.
Today, I had the pleasure of joining a range of leaders for timely, impactful discussions on child well-being in the age of AI at the Vatican, building on thoughtful conversations held during the United Nations General Assembly. These issues are top of mind globally, from parents to policymakers to physicians.
At Microsoft, we remain focused on our goal of empowering young people to use technology safely, mindfully, and in pursuit of social, educational, and economic opportunities. That means taking new steps spurred by regulation, such as new age verification measures for our UK Xbox users, as well as adapting our longstanding commitments to responsible AI and child online safety and privacy to build trust in the AI era. Today, we’re sharing new research on youth perspectives, announcing the AI Futures Youth Council to amplify teen voices, and offering policy recommendations to help families navigate the digital world with confidence.
Centering young people’s voices: Announcing the AI Futures Youth Council and new age assurance research
In 2017, Microsoft led the industry with our first Council for Digital Good—a forum where we could hear directly from young people about their experiences and perceptions of online risk. In 2025, with AI reshaping our world—and their future—we again need to center the voices of young people as we think about responsible design for AI and how we set students up for the future. We are actively working with teens from the Asia-Pacific region to develop our first “for teens, by teens” guide to AI chatbots. Today, I’m pleased to announce the upcoming launch of our first “AI Futures Youth Council,” bringing together teens from the US and Europe to have their say on their future. We’ll share more about the application process soon.
We know that a critical precursor to providing young people positive and productive online experiences is understanding which users are young people. Around the globe, the debate over how to achieve age assurance online continues unabated. We have been grateful to work with CIPL and the WeProtect Global Alliance over the last year to explore how to achieve improved age assurance that is consistent with fundamental rights of privacy and access to information. As with any other safety intervention, our goal is to be proportionate and thoughtful where we take new steps, which is why we have focused on gaming in the first instance—reflecting the responsibilities we have to our youngest users and our ongoing commitment to player safety.
To inform our strategy and the broader policy conversation, we partnered with Praesidio Safeguarding to better understand youth perspectives on age assurance approaches across the UK, Ghana, and Indonesia. We are pleased to share that research today. The findings reinforce the importance of transparency, choice, and trust: teens want clear explanations of how their data is used, express concerns about exclusion where formal proof of age is lacking and show varying comfort levels with the use of biometric and behavioral data. Notably, young people value parental involvement but also highlight the need for independence and privacy as they mature. The results also highlight some of the important differences across geographies. For example, teenagers in Ghana often not only share devices with their families but may also share an account—underscoring a need for nuanced global approaches at multiple layers of the technology stack.
These insights underscore our belief that proportionality—matching safeguards to actual risks—is essential to building trust and empowering youth online. They also highlight the need for age assurance models that are inclusive, flexible, and respectful of youth autonomy—especially in global contexts where device and account sharing are common. We remain committed to ongoing dialogue and innovation, ensuring that our solutions evolve alongside the needs and expectations of children, families, and society at large.
Our policy recommendations: Empower young people to use technology safely
We believe technology should empower young people, not put them at risk. Given the diverse range of online services, it is important to remember there is no single “digital seatbelt” to protect and empower young people online.
We therefore offer the following recommendations as policymakers, regulators, and experts continue to discuss these issues, building on our 2024 blog:
Avoid blanket access restrictions. Age assurance requirements that block full access to a service—except in limited cases like sites dedicated to age-restricted content (e.g., pornography)—can unintentionally limit child rights, such as access to information. Instead, age assurance should be applied at the service level, target specific design features that pose heightened risks, and enable tailored experiences for children.
Focus on the highest risks for impact, such as content and features associated with documented harms to children, and as determined through democratic processes. Providers should take steps to assess and mitigate risks to children on their services, while ensuring documentation requirements or compliance obligations do not inadvertently undermine safety. A risk-based and proportionate approach—grounded in clear criteria and supported by interoperable standards—can also help ensure that age assurance is applied where most needed, without introducing unnecessary friction. Providers of high-risk services should bear the responsibility of age assurance.
Strengthen safeguards for AI companions. Recent tragic events have highlighted the need for continued care in developing AI companions, especially where these may be used by young people. At Microsoft, we are building AI services for empowerment and want the right guardrails in place to protect all users but welcome new, commonsense measures such as those enacted in California and Australia to reduce the potential harms related to suicide and self-injury risks, as well as to sexualized or violent content. We will continue to work closely with researchers and experts to understand and mitigate potential risks to young people in this fast-evolving field.
Incentivize age-appropriate design. Banning kids from online services isn’t the answer, but what constitutes an “age-appropriate” experience will vary. We have supported a duty of care approach to child safety where the duty can be implemented flexibly, guided by thoughtful and evidence-based regulatory guidance. Ongoing research and expert engagement are needed to understand how to advance child safety and rights on diverse services—not just social media.
Protect the privacy and security of all users. Tailoring age assurance requirements will help enable proportionate approaches to data processing. Current proposals for age verification by app stores risk creating significant privacy risks by collecting sensitive information and sharing unnecessary age data with a wide variety of services while also not solving the challenges lawmakers want to address. We continue to support federal privacy legislation in the US and encourage global efforts to develop standards and certifications for age assurance providers. Trusted credential sharing can also increasingly be enabled by emerging digital identity ecosystems—including government-issued IDs and wallet-based models—that preserve mutual privacy between issuers and relying parties.
Support, not overwhelm Our Global Online Safety Survey results show that while parents might underestimate the risks teens face online, teens are most likely to turn to a parent for help. Parents should not face a deluge of notifications nor bear the sole responsibility for safety but have access, awareness, and education on family safety tools that can help them make informed choices appropriate for their family and their values.
Foster multistakeholder collaboration. We believe it’s essential to elevate the voices and perspectives of young people, as well as for regulators and industry to engage with civil society and partner to advance practical solutions. As child safety regulations come into force, it will also be important to get feedback from affected communities on where regulation may have adverse rights impacts, as well as to understand where harm may have been averted. Public education will be needed to help all users understand why their online experiences might be changing.
We will continue learning, listening, and collaborating, especially with our new Council, and look forward to sharing our insights.
Artificial intelligence is transforming the way we work, learn, and innovate—and it’s doing so at a pace that surpasses every major technology before it. Microsoft’s inaugural AI Diffusion Report offers a comprehensive look at how AI adoption is accelerating worldwide, drawing on data from more than 100 countries. In less than three years, more than 1.2 billion people have used AI tools, a rate of adoption faster than the internet, the personal computer, or even the smartphone. This rapid diffusion underscores AI’s potential as a general-purpose technology but also highlights the urgent need to ensure equitable access.
The report introduces three indices—the AI Frontier Index, the AI Infrastructure Index, and the AI Diffusion Index—to help policymakers, researchers, and industry leaders understand where breakthroughs are happening, where capacity exists to scale, and where AI is being used to improve lives. These insights show that adoption is fastest where connectivity and digital infrastructure are strongest, while nearly four billion people still lack the basics needed to participate in the AI economy. Bridging this gap is essential to avoid deepening global divides.
Beyond the numbers, the report illustrates the need for collaborative action to expand access to digital infrastructure, strengthen skills development, and promote responsible AI policies. By investing in these foundational elements, governments and organizations can unlock AI’s potential for growth and innovation. The data makes clear that speed alone does not guarantee shared prosperity—broad accessibility does.
To explore the full findings and recommendations, read the AI Diffusion Report.
To prepare the United Arab Emirates’ next generation for an AI-driven workforce, today we’re providing an update on our ambitious commitment to skill one million people across the UAE with an expansion of our global skilling initiative, Microsoft Elevate.
With Microsoft Elevate UAE we are making significant progress toward our goal with programs that will equip more than 250,000 students, staff, and faculty and more than 55,000 government employees with in-demand AI skills. Through sustained programs and new partnerships, Microsoft Elevate is providing advanced AI tools, in-demand credentials and comprehensive training to the region as we continue to work together to provide growth and opportunity for all.
As we shared earlier this week, Microsoft will invest USD 15.2 billion in the UAE before the end of this decade in a sustained commitment that brings together technology, talent, and trust to help the nation seize the opportunities of the AI era.
Together we will continue to ensure the region is uniquely positioned to harness this pivotal moment and remain at the forefront of AI use and innovation.
Advancing AI skills for the UAE’s next generation
As an update to our broader commitment to drive AI literacy and readiness across the UAE, Microsoft is announcing new partnerships with leading educational institutions and nonprofits to equip educators and students with essential AI skills and valuable credentials.
In close collaboration with the Ministry of Artificial Intelligence, Digital Economy, and Remote Work Applications over the next year, we will provide training for more than 30,000 educators and 70,000 students across the UAE to ensure technology adoption is broad-based and that students are equipped to become leaders in AI for the future. Moreover, our technical graduate skilling program will upskill Emirati graduates, empowering them with the expertise needed to develop and train future AI models.
Our work with GEMS, the largest private school provider in the UAE, is embedding AI skills into all its schools and expanding training programs for 10,000 teachers and 150,000 students. This includes custom-built AI agents, Copilot workshops, and AI fluency programs for teachers, administrators, and students. Because preparing the future workforce starts with skilling educators, we are also focused on AI teacher readiness, with Copilot and Learning Accelerator access for almost 10,000 teachers and students in private schools across the UAE.
Through partnerships with nonprofits like INJAZ UAE, we are delivering AI Fundamentals courses to the UAE. The Skills Spot platform hosts signature courses for students, educators, and developers, credentialing over 58,000 learners in foundational AI skills, digital safety, and practical applications.
And in higher education, Microsoft has partnered with leading UAE institutions to deliver impactful skilling programs that empower both students and educators. Through collaborations such as the partnership with MBZUAI, which was awarded a Microsoft Economic AI Institute research fellowship, Microsoft is advancing AI literacy and research in the region. Microsoft has also established agreements focused on training with the Higher Colleges of Technology and UAE University. These programs are designed to equip participants with cutting-edge knowledge in artificial intelligence and digital skills, fostering innovation and enhancing the competitiveness of the UAE’s academic community. By investing in these trainings, Microsoft is helping to build a robust talent pipeline that supports the nation’s vision for a knowledge-based economy and positions graduates and educators to thrive.
Credentialing 55,000 UAE government employees and empowering future leaders
Last year, Microsoft partnered with UAE government entities to launch an initiative to upskill 120,000 government employees across the Federal Government, Abu Dhabi, Dubai, and Sharjah.
Today, we are announcing the next phase in our goal to equip public sector teams with AI skills that will help transform services, drive innovation, and prepare the workforce for the future
In partnership with G42, we have developed three specialized courses for government employees, delivered through the JAHIZ platform to ensure federal workers have a front-row seat in advancing their skills. This ambitious upskilling initiative for UAE federal government workers is designed to provide both foundational knowledge and real-world applications of AI for the public sector, with the goal of credentialing 55,000 federal employees over the next year. This investment in human capital will help ensure the UAE’s government is equipped to lead in digital transformation and meet the challenges of tomorrow with confidence.
We also know that preparing leaders for the future means going beyond technical skills. That’s why we continue to offer high-impact, in-person leadership development programs for government executives, CEOs, and senior decision-makers. Developed last year in collaboration with INSEAD, these tracks focus on strategic thinking, digital transformation, and the responsible adoption of AI. By building leadership capacity and fostering innovation, we are helping government entities across the UAE embrace change and realize the full potential of AI for the benefit of all. To date, we have partnered with INSEAD and learning partners locally to train 1,200 senior leaders across the UAE government and are proud to continue this effort to help strengthen the UAE’s position as a global leader in responsible AI governance.
Microsoft Elevate: A promise to the UAE
As AI and digital transformation reshape the world, closing the digital divide and expanding opportunities for all require collaboration across government, education, civil society, and industry. That’s why skilling is at the core of our commitment.
The UAE stands out as a leader in AI adoption, according to Microsoft’s AI Diffusion Technical Report. Yet, a significant skills gap remains, with more than 40% of working-age adults not yet using AI in the region. Initiatives like those we announced today in partnership with the Ministry of Education and others will continue to help address these gaps—and we are not done.
At Microsoft, we look forward to continuing our three decades of partnership across the region and bringing our capacity-building programs to the UAE through Microsoft Elevate. Our work together with local partners is not just a program; it is a promise to support the nation’s vision, empower its people, and help create universal opportunity.
At Microsoft, we are driven by the belief that technology has the power to create opportunity and growth for everyone. This conviction inspired the creation of TechSpark, a nationwide program designed to expand economic opportunity in local communities, bridge digital gaps, and ensure everyone can participate in the digital future.
As AI continues to accelerate innovation nationwide, today we welcome the 2026 TechSpark Fellows whose visionary organizations are at the forefront of harnessing AI and cloud technology to drive transformative impact and empower their communities throughout the United States. In addition to honoring these incredible individuals and organizations, today we also announce the expansion of the TechSpark Fellows program as we launch a new Alumni program, which together creates a national network of community innovators and leaders who share best practices, resources, and ideas to ensure their communities can leverage the power of technology to thrive.
Since launching the TechSpark Fellows program in 2023, Fellow organizations have joined forces with Microsoft to bridge digital divides and spark innovation. Collectively, these Fellow organizations have secured more than $249 million in follow-on funding, trained over 34,000 individuals in AI, data literacy, and emerging technologies, and built partnerships connecting public, private, and nonprofit organizations with new digital tools.
With the introduction of the new 2026 TechSpark Fellows cohort, we are proud to continue building on our tradition of driving meaningful impact across the nation. Today, a TechSpark Fellow or Alumni leader can be found in every single state, as well as in more than 11 Microsoft data center communities. This widespread presence ensures that our efforts to make a difference in local communities are closely connected with our ongoing investments in infrastructure technology. By maintaining this strong network of leaders, we can foster community impact and support the growth of technology initiatives hand in hand, ensuring that progress and opportunity reach even more people across the United States.
The TechSpark program has made a significant difference in communities from California to New Jersey, across Georgia to Tennessee, and many places in between. These efforts have resulted in the creation of more than 5,100 jobs, the training of over 72,000 individuals in artificial intelligence and digital skills, and the mobilization of more than $728 million in community funding to support local projects.
Welcoming the 2026 TechSpark Fellows
Each year, Microsoft TechSpark Fellows are appointed by nonprofit or community organizations that apply through a national call for participation. Each organization then receives a grant to support and scale their mission and can participate in a robust, seven-month learning and development experience designed to advance AI skilling, innovation, and adoption to support opportunity within their community.
TechSpark Fellows from these organizations are already shaping projects that range from empowering women to reenter the workforce through AI upskilling to building rural digital academies to advancing youth coding and data science programs. Below are just a few inspiring examples of this year’s TechSpark Fellows and the unique ways they are driving positive change in their communities:
The Illinois Science & Technology Coalition and Institute
The Illinois Science & Technology Coalition and Institute is strengthening the job pipeline in Illinois by connecting high school students with industry mentors for months-long, hands-on projects that reflect real workforce needs. Students work directly with professionals, including Microsoft mentors, on challenges tied to current industry priorities, gaining the skills, confidence, and experience needed to pursue careers in STEM fields. Through participation in the TechSpark Fellows program, the Illinois Science & Technology Coalition and Institute aims to expand opportunities for more schools and students across Illinois—deepening industry partnerships, strengthening hands-on learning, and preparing young people for future careers in STEM fields.
Climb Wyoming
Climb Wyoming transforms lives by helping low-income single mothers discover their full potential through integrated career training, mental health support, and meaningful employment with local employers. In Wyoming, single mothers and their children experience the highest rates of poverty in the United States, making Climb’s work both urgent and essential. The program provides immediate support and pathways to economic independence. On average, Climb graduates more than double their income two years after the program—a 121% increase in wages. As a TechSpark Fellow, Climb Wyoming looks to learn how to leverage AI and digital skilling to enhance career training for the women they serve.
Compudopt Georgia
Compudopt is closing the digital divide for families nationwide by providing free laptops and comprehensive tech education programs, from first graders to seniors. In 2025, Compudopt celebrated reaching one million people, offering digital literacy training that empowers entire households to thrive in a connected world. As part of the TechSpark Fellows program, Compudopt wants to learn how AI can further strengthen their mission, exploring new ways AI can enhance digital skilling, expand access, and help families unlock opportunities for work, learning, and daily life.
Building AI readiness for all
As we look to the future, we believe our responsibility is to continue to empower others and support their missions. The TechSpark Fellows program is just one way that we can leverage the power of technology and community to ensure that the promise of AI reaches every community across America. The progress made through TechSpark—helping leaders secure resources, equipping individuals with critical skills, and fostering innovation—demonstrates what’s possible when we work together.
The contrast in AI use across the United States reveals not just a disparity in adoption but a fundamental challenge in ensuring that AI brings people together rather than widening existing divides. Achieving an inclusive AI economy will require ongoing collaboration with local leaders, nonprofits, policymakers, and peers in the private sector.
TechSpark has shown that community and local leaders are the biggest assets in ensuring their home states, hometowns, and neighbors thrive. By listening deeply, partnering with purpose, and building strong connections with local changemakers, we can make certain that everyone has the tools, opportunities, and support to thrive in the AI era.
As Abu Dhabi and Dubai kick off a significant week hosting annual energy and technology conferences, we want to share details of our ongoing and planned investments in the United Arab Emirates. Roughly two and a half years ago, we embarked on a new AI initiative with the encouragement and support of both the United States and UAE governments. Much of this progress has involved a new partnership with G42, the UAE’s sovereign AI company, with whom we’re making critical progress.
All told, Microsoft will invest $15.2 billion USD in the UAE between the start of this initiative in 2023 and the end of this decade, in 2029. This is not money raised in the UAE. It’s money we’re spending in the UAE. And as we do everywhere in the world, we’re focused not just on growing our business but also on contributing to the local economy. This involves bringing together three critical factors – technology, talent, and trust.
On some days, it feels like the tech sector is gripped in a rhetorical race to announce ever larger, sky-high numbers. We believe in moving fast while staying grounded and being transparent about our investment details. And we want to share our strong conviction that our investments benefit the shareholders of our company, the people of the UAE, and the relationship between our two nations.
Our investment numbers
Our $15.2 billion USD investment includes the following:
Beginning in 2023 and through the end of this calendar year, Microsoft will have invested and spent just over $7.3 billion in the UAE. This includes our $1.5 billion equity investment in G42, more than $4.6 billion in capital expenses in advanced AI and cloud datacenters in the country, and more than $1.2 billion in local operating expenses and the cost of goods sold.
From the start of 2026 to the end of 2029, we will spend more than $7.9 billion in the UAE. This includes more than $5.5 billion in capital expenses for ongoing and planned expansion of our AI and cloud infrastructure, including new steps we will share publicly in Abu Dhabi this week. It also includes almost $2.4 billion in planned local operating expenses and the cost of goods sold.
An investment in world-leading technology
Some of our most important work involves exporting world-leading technology from the United States to the UAE. This includes the GPUs essential to power AI in our datacenters across the country that support the UAE’s people and institutions.
Microsoft was one of the few companies during the previous administration to secure export licenses from the Commerce Department to ship GPUs to the UAE. In no small measure, this is because of the substantial work we did to meet the strong cybersecurity, national security, and other technology conditions required by these licenses. These licenses enabled us to accumulate in the country the equivalent of 21,500 Nvidia A100 GPUs, based on a combination of A100, H100, and H200 chips.
Microsoft was also the first company this year under the Trump administration to secure export licenses from the Commerce Department to ship GPUs to the UAE. Approved in September, these were based on updated and stringent technology safeguards. These licenses enable us to ship the equivalent of 60,400 additional A100 chips, in this instance involving Nvidia’s even more advanced GB300 GPUs.
While the chips are powerful and the numbers are large, more important is their positive impact across the UAE. We’re using these GPUs to provide access to advanced AI models from OpenAI, Anthropic, open-source providers, and Microsoft itself. We’re supporting AI-enabled applications, including our Copilot applications, from a wide variety of local and international providers. And we’re partnering with G42 to support public and private sector organizations across the UAE economy, as well as consumers across the country.
The UAE’s ranking in the Microsoft AI Diffusion Reportpublished last week shows the country leading the world in per capita AI usage. With 59.4 percent of the population using generative AI, the UAE is ahead of Singapore, which is in second place at 58.6 percent. Beyond these two, no other country tops the 50 percent mark. Microsoft’s infrastructure challenge in the UAE is not a risk of getting ahead of demand but keeping pace with it.
Investing in talent
Microsoft’s investment in the UAE is not just about technology, it’s also about people. By cultivating AI talent and skilling individuals to develop, deploy, and use AI in a way that reflects the region’s unique needs, Microsoft is helping to ensure that the UAE remains on the leading edge of AI diffusion.
Today, Microsoft’s presence in the UAE reflects this commitment. Our growing team includes almost 1,000 full-time employees and related staff representing 40 nationalities. Nearly 100 of our employees are engineers, supported by an Emirati partner ecosystem that has grown almost threefold in just two years, now with 1,400 firms employing nearly 45,000 professionals across the country.
This year, we established the Global Engineering Development Center in Abu Dhabi to attract world-class tech talent to the UAE. Our engineers not only develop new products and services for Microsoft, but support institutions and businesses across the region so they can use AI and cloud technologies to transform their own operations. As we look to the future, we aspire to grow our engineering teams further and add a new focus on domain-specific AI models and applications that will propel advances in key scientific and technological fields.
We also opened a new center for the Microsoft AI for Good Lab in Abu Dhabi, staffed by PhD level research talent specializing in large-scale AI models, vision-language models, and post training techniques. Backed by Azure compute grants allocated to partner organizations, this team collaborates with nonprofits, start-ups, researchers, academic institutions, and local businesses to address humanitarian challenges across the Middle East and Africa using AI. Already, the Lab has partnered with researchers to train large language models for low-resource languages, including those spoken in Malawi, Tanzania, Kenya, Uganda, and the Democratic Republic of the Congo – helping ensure that AI serves communities that risk being left behind in the AI age.
As the Microsoft AI Diffusion Report underscores, people need digital proficiency to fully participate in an AI-driven economy. Without the right skills, AI risks deepening inequality rather than broadening opportunity. That’s why skilling is a core pillar of our investment in the UAE.
Last November, we committed to skill one million people in the UAE by the end of 2027–and we’re well on our way to meet – and exceed–our goal. Last month at GITEX, Microsoft partnered with UAE government entities to launch an initiative to upskill 120,000 government employees across the federal government, Abu Dhabi, Dubai, and Sharjah. We will also skill 175,000 students and 39,000 teachers through collaborations with GEMS, Abu Dhabi Department of Education (ADEK), and the Knowledge and Human Development Authority (KHDA). We will announce new steps in this area on Thursday in Dubai.
Talent is the engine of AI leadership. Attracting, nurturing, and building AI talent and know-how is essential to the UAE turning its vision of becoming a global leader into a reality.
Strengthening trust
Ultimately, the use of AI depends on trust. People and institutions need to trust that AI will be developed and deployed with responsible safeguards. They need to have confidence that the cybersecurity of AI chips, models, and services will be protected. And they rightly expect AI to serve the public broadly, with cause for optimism that AI will reach and support the Global South.
Given the role of export controls and other trade issues, the flow of advanced GPUs and AI models also requires trust between nations. This in turn requires clear rules and agreements, coupled with effective compliance systems. And as always, trust between nations depends on strong relationships between its people, grounded in mutual respect and appreciation for each other’s cultures.
We’re focused on supporting all these needs.
One important part of this is the Responsible AI Future Foundation, or RAIFF. G42, Microsoft, and Mohamed bin Zayed University of Artificial Intelligence (MBZUAI) founded this new foundation in Abu Dhabi in Februaryto promote responsible AI standards and best practices in the Middle East and across the Global South. This foundation is advancing research on the technical and ethical elements of responsible AI and is developing frameworks to ensure ethical development and deployment of AI systems, accounting for cultural diversity.
A second element comes to life through the first annual Abu Dhabi Global AI Summit, which began Sunday. Hosted by G42, Microsoft, the Responsible AI Future Foundation, and Eurasia Group’s GZERO Media, this Summit brings government ministers, private sector executives, and AI leaders together to discuss what’s needed to drive AI diffusion across the Global South. We meet at a time when there is a growing risk that uneven AI diffusion may widen the economic and societal gaps that divide the world. It’s imperative that governments, businesses, and non-governmental organizations collaborate and take new steps to promote broader access to AI.
Both these elements build on a third and deeper initiative that Microsoft and G42 have advanced during the past two years. In conjunction with our $1.5 billion investment, Microsoft and G42 created last April a first–of–its–kind binding frameworkbetween two private companies. Developed in close consultation with the U.S. and UAE governments, this Intergovernmental Assurance Agreement (IGAA) ensures that both our companies meet or exceed U.S. standards in critical areas such as cybersecurity and physical security, export controls and technology transfer, data protection and responsible AI, and Know Your Customer (KYC) best practices.
As we drafted the IGAA, we consulted not only leaders from government ministries in our two countries, but with members and staff of both political parties in both houses of Congress in Washington, D.C. We listened to feedback and adapted the IGAA to address their suggestions. And we’ve built a strong compliance infrastructure to implement these requirements based on industry best practices and auditing standards.
All these steps help bolster mutual confidence and trust between our two governments. But trust between nations also grows through relationships among people. That’s why we’re advancing a fourth and new element this week, traveling to Abu Dhabi with a Seattle delegation of public and private leaders. The group includes a former Governor and local leaders in economic development, higher education, medical research, the non-profit community, and sports. The goal is to deepen understanding, exchange ideas, and explore solutions that can advance both regions.
Looking to the future
Microsoft is committed to the future of the UAE and a strong relationship between our two nations. We believe in the UAE’s long-term economic vision and the role the UAE and the U.S. continue to play together to support peace, stability, and growth across the Middle East.
As we do everywhere we do business, Microsoft is committed to a broad perspective and long-term approach. Our work in the UAE has underscored the importance of connecting technology investments to initiatives to attract and develop the talent needed for a vibrant and self-sustaining tech ecosystem. And work to advance trust, which may seem peripheral to some, is in fact of central importance. From stronger business practices to broader international ties, trust is a critical catalyst for technology success at a local and global level.
Technology is our business and we’re as excited as anyone by its potential. But we know that ultimately there is only one test that matters. It’s how our technology empowers others to achieve more. Like every public company, our shareholders rightly expect us to deliver value to customers in ways that enable us to continue to grow. But we also judge ourselves by whether we are generating local opportunities and growth that go well beyond ourselves. Across the UAE, we’re committed to passing this test.
AI has introduced a transformative era in scientific discovery. In the hands of researchers, innovators, and startups, it is accelerating breakthroughs from advancing medical research to powering new manufacturing capabilities and energy transitions.
For Microsoft, the real promise of AI emerges when we bring our powerful tools together with problem solvers in local communities. For the past eight years, Microsoft has been sharing knowledge and collaborating with communities to unlock opportunity through Microsoft TechSpark, an economic development, skilling, and community-building program across the US. Since its inception, TechSpark has helped create more than 4,500 jobs and contributed more than $700 million in community funding to support local initiatives.
Today, we’re announcing a new milestone in our TechSpark program: a pioneering partnership with leading innovation centers—TitletownTech, in partnership with the University of Wisconsin-Madison, and the New Jersey (NJ) AI Hub, in partnership with Princeton University. Together, we’re launching a new model for scientific collaboration that combines the agility of a startup, the expertise of a university, and the technology of a global company.
Through this partnership, Microsoft will provide the Microsoft Discovery platform to TitletownTech and NJ AI Hub and access to the latest advancements in AI and high-performance computing that promise to accelerate scientific discovery. We believe this kind of alliance is essential to ensure that breakthroughs in science and solutions to global challenges are not confined to a few but shared broadly for the benefit of all.
A new model for scientific discovery
Researchers and innovators from these organizations will have an opportunity to access Microsoft Discovery, an advanced agentic AI platform designed to accelerate scientific breakthroughs. They will also benefit from the expertise of the Microsoft Discovery and Quantum team, under the leadership of Jason Zander. Currently available only in private preview, this opportunity enables researchers to leverage state-of-the-art AI and high-performance computing to collaborate with a team of specialized AI agents combined with a graph-based knowledge engine to drive scientific outcomes with speed, scale, and accuracy.
Through Microsoft Discovery, researchers can speed up scientific discovery by analyzing vast amounts of data, simulating experiments, and uncovering new materials and solutions more efficiently. The platform facilitates effective collaboration, bringing together teams of specialized AI agents and human experts for continuous, iterative investigation. This dynamic environment helps organizations refine their knowledge, learn from their results, and innovate in ways that were previously unimaginable.
What makes this partnership unique is its focus on real breakthroughs in chemistry, life sciences, advanced manufacturing, and AI-driven innovation. Building on years of TechSpark collaboration, this initiative is not just another corporate research and development center or a one-off research grant. Instead, we are creating a shared undertaking, deeply rooted in engagement with local communities and aligned around the promise of AI. By blending the strengths of top research universities with the cutting-edge infrastructure of the NJ AI Hub and TitletownTech Labs and Microsoft’s role as an industry convener, we hope to set the stage for transformative progress.
Collaborating for real-world impact
While we are still in the early days of what’s possible, we are dedicated to discovering what can be achieved when our institutions work together to accelerate science and innovation.
This technology could be a game-changer for environmental challenges like plastic waste. For example, Microsoft Discovery can enablemodeling of complex chemical reactions, unlocking new pathways for catalyst design in recycling systems. This would enable more efficient, selective, and controlled recycling processes, fewer costly lab experiments, and faster innovation. In the future, advances like these could empower researchers to turn plastic waste into valuable resources.
In Microsoft’s own labs, the integration of high-performance computing and AI into Microsoft Discovery is already unlocking new scenarios. For instance, our researchers used Discovery’s advanced AI systems and HPC capabilities to discover a novel sustainable coolant prototype for datacenter immersion cooling—moving from digital discovery to synthesis in just four months.
Looking ahead
We are putting the Microsoft Discovery platform into the hands of innovators, like those at TitletownTech and the NJ AI Hub, to fuel innovation and demonstrate real-world impact.
In the coming weeks, we will work to enable access to Microsoft Discovery for these labs under the private preview, and as we roll out the Discovery platform availability to the public, we will continue to work with these partners and other researchers and universities to ensure we expand opportunity for scientific discovery through AI.
It’s only with a strong ecosystem that we’ll be able to realize the full potential of Microsoft Discovery, and it’s why we’re working with these partners and others to bring first-party advancements together with leading industry tools and domain expertise.
With this new chapter for our TechSpark partners, we reaffirm our commitment to championing innovation and discovery alongside the brilliant local innovators across Wisconsin and New Jersey. Together, we look forward to shaping the future of science for everyone.
In 80% of the cyber incidents Microsoft’s security teams investigated last year, attackers sought to steal data—a trend driven more by financial gain than intelligence gathering. According to the latest Microsoft Digital Defense Report, written with our Chief Information Security Officer Igor Tsyganskiy, over half of cyberattacks with known motives were driven by extortion or ransomware. That’s at least 52% of incidents fueled by financial gain, while attacks focused solely on espionage made up just 4%. Nation-state threats remain a serious and persistent threat, but most of the immediate attacks organizations face today come from opportunistic criminals looking to make a profit.
Every day, Microsoft processes more than 100 trillion signals, blocks approximately 4.5 million new malware attempts, analyzes 38 million identity risk detections, and screens 5 billion emails for malware and phishing. Advances in automation and readily available off-the-shelf tools have enabled cybercriminals—even those with limited technical expertise—to expand their operations significantly. The use of AI has further added to this trend with cybercriminals accelerating malware development and creating more realistic synthetic content, enhancing the efficiency of activities such as phishing and ransomware attacks. As a result, opportunistic malicious actors now target everyone—big or small—making cybercrime a universal, ever-present threat that spills into our daily lives.
In this environment, organizational leaders must treat cybersecurity as a core strategic priority—not just an IT issue—and build resilience into their technology and operations from the ground up. In our sixth annual Microsoft Digital Defense Report, which covers trends from July 2024 through June 2025, we highlight that legacy security measures are no longer enough; we need modern defenses leveraging AI and strong collaboration across industries and governments to keep pace with the threat. For individuals, simple steps like using strong security tools—especially phishing-resistant multifactor authentication (MFA)—makes a big difference, as MFA can block over 99% of identity-based attacks. Below are some of the key findings.
Critical services are prime targets with a real-world impact
Malicious actors remain focused on attacking critical public services—targets that, when compromised, can have a direct and immediate impact on people’s lives. Hospitals and local governments, for example, are all targets because they store sensitive data or have tight cybersecurity budgets with limited incident response capabilities, often resulting in outdated software. In the past year, cyberattacks on these sectors had real-world consequences, including delayed emergency medical care, disrupted emergency services, canceled school classes, and halted transportation systems.
Ransomware actors in particular focus on these critical sectors because of the targets’ limited options. For example, a hospital must quickly resolve its encrypted systems, or patients could die, potentially leaving no other recourse but to pay. Additionally, governments, hospitals, and research institutions store sensitive data that criminals can steal and monetize through illicit marketplaces on the dark web, fueling downstream criminal activity. Government and industry can collaborate to strengthen cybersecurity in these sectors—particularly for the most vulnerable. These efforts are critical to protecting communities and ensuring continuity of care, education, and emergency response.
Nation-state actors are expanding operations
While cybercriminals are the biggest cyber threat by volume, nation-state actors still target key industries and regions, expanding their focus on espionage and, in some cases, on financial gain. Geopolitical objectives continue to drive a surge in state-sponsored cyber activity, with a notable expansion in targeting communications, research, and academia.
Key insights:
China is continuing its broad push across industries to conduct espionage and steal sensitive data. State-affiliated actors are increasingly attacking non-governmental organizations (NGOs) to expand their insights and are using covert networks and vulnerable internet-facing devices to gain entry and avoid detection. They have also become faster at operationalizing newly disclosed vulnerabilities.
Iran is going after a wider range of targets than ever before, from the Middle East to North America, as part of broadening espionage operations. Recently, three Iranian state-affiliated actors attacked shipping and logistics firms in Europe and the Persian Gulf to gain ongoing access to sensitive commercial data, raising the possibility that Iran may be pre-positioning to have the ability to interfere with commercial shipping operations.
Russia, while still focused on the war in Ukraine, has expanded its targets. For example, Microsoft has observed Russian state-affiliated actors targeting small businesses in countries supporting Ukraine. In fact, outside of Ukraine, the top ten countries most affected by Russian cyber activity all belong to the North Atlantic Treaty Organization (NATO)—a 25% increase compared to last year. Russian actors may view these smaller companies as possibly less resource-intensive pivot points they can use to access larger organizations. These actors are also increasingly leveraging the cybercriminal ecosystem for their attacks.
North Korea remains focused on revenue generation and espionage. In a trend that has gained significant attention, thousands of state-affiliated North Korean remote IT workers have applied for jobs with companies around the world, sending their salaries back to the government as remittances. When discovered, some of these workers have turned to extortion as another approach to bringing in money for the regime.
The cyber threats posed by nation-states are becoming more expansive and unpredictable. In addition, the shift by at least some nation-state actors to further leveraging the cybercriminal ecosystem will make attribution even more complicated. This underscores the need for organizations to stay abreast of the threats to their industries and work with both industry peers and governments to confront the threats posed by nation-state actors.
2025 saw an escalation in the use of AI by both attackers and defenders
Over the past year, both attackers and defenders harnessed the power of generative AI. Threat actors are using AI to boost their attacks by automating phishing, scaling social engineering, creating synthetic media, finding vulnerabilities faster, and creating malware that can adapt itself. Nation-state actors, too, have continued to incorporate AI into their cyber influence operations. This activity has picked up in the past six months as actors use the technology to make their efforts more advanced, scalable, and targeted.
For defenders, AI is also proving to be a valuable tool. Microsoft, for example, uses AI to spot threats, close detection gaps, catch phishing attempts, and protect vulnerable users. As both the risks and opportunities of AI rapidly evolve, organizations must prioritize securing their AI tools and training their teams. Everyone—from industry to government—must be proactive to keep pace with increasingly sophisticated attackers and to ensure that defenders keep ahead of adversaries.
Adversaries aren’t breaking in; they’re signing in
Amid the growing sophistication of cyber threats, one statistic stands out: more than 97% of identity attacks are password attacks. In the first half of 2025 alone, identity-based attacks surged by 32%. That means the vast majority of malicious sign-in attempts an organization might receive are via large-scale password guessing attempts. Attackers get usernames and passwords (“credentials”) for these bulk attacks largely from credential leaks.
However, credential leaks aren’t the only place where attackers can obtain credentials. This year, we saw a surge in the use of infostealer malware by cybercriminals. Infostealers can secretly gather credentials and information about your online accounts, like browser session tokens, at scale. Cybercriminals can then buy this stolen information on cybercrime forums, making it easy for anyone to access accounts for purposes such as the delivery of ransomware.
Luckily, the solution to identity compromise is simple. The implementation of phishing-resistant multifactor authentication (MFA) can stop over 99% of this type of attack even if the attacker has the correct username and password combination. To target the malicious supply chain, Microsoft’s Digital Crimes Unit (DCU) is fighting back against the cybercriminal use of infostealers. In May, the DCU disrupted the most popular infostealer—Lumma Stealer—alongside the US Department of Justice and Europol.
Moving forward: Cybersecurity is a shared defensive priority
As threat actors grow more sophisticated, persistent, and opportunistic, organizations must stay vigilant, continually updating their defenses and sharing intelligence. Microsoft remains committed to doing its part to strengthen our products and services via our Secure Future Initiative. We also continue to collaborate with others to track threats, alert targeted customers, and share insights with the broader public when appropriate.
However, security is not only a technical challenge but a governance imperative. Defensive measures alone are not enough to deter nation-state adversaries. Governments must build frameworks that signal credible and proportionate consequences for malicious activity that violates international rules. Encouragingly, governments are increasingly attributing cyberattacks to foreign actors and imposing consequences such as indictments and sanctions. This growing transparency and accountability are important steps toward building collective deterrence. As digital transformation accelerates—amplified by the rise of AI—cyber threats pose risks to economic stability, governance, and personal safety. Addressing these challenges requires not only technical innovation but coordinated societal action.
Login
