According to documents published on the Hebrew website of the Israeli Ministry of Finance, Middle East Eye reports that Microsoft signed a contract worth over $100 million with the Israeli government in 2024.
Details of this multi-million dollar agreement appear in the annual report on the execution of the Israeli budget for 2024, which was released by the ministry's chief accountant in March 2025. However, information about the deal with Microsoft was hidden among an extensive list of procurement obligations and only became known after careful analysis of the ME Eye report.
The report contains a list of the largest procurement obligations of the Ministry of Defense. One entry records an agreement concluded in 2024 with Microsoft to purchase software licenses worth approximately 464 million shekels (about $125.4 million). According to the document, the full cost of the contract remained unpaid as of December 31, 2024, meaning no payments were made during that year, and the completion of obligations is expected in 2027.
The report does not specify what software this agreement covers, which departments of the Israeli Ministry of Defense or armed forces will use it, or whether the year 2027 refers to the license term, payment schedule, or both aspects.
Microsoft declined to comment on the contract, telling ME Eye that 'we have nothing more to add.'
Renewal of a previous contract
Last year, an internal document studied by the Associated Press showed that Microsoft signed a three-year contract worth $133 million with the Israeli military in 2021. AP also found that Microsoft classified the Israeli military as an 'S500' client, a category reserved for the company's most priority clients. AP identified at least 635 individual subscriptions belonging to the Israeli military under code names, including 'Mamram' and '8200', the latter belonging to the elite Israeli cyber warfare unit.
Former Microsoft employees who monitor the tech giant's Israeli contracts told ME Eye that the recently revealed agreement might be an extension of the contract Israel signed with Microsoft in 2021. Both agreements share similarities: the previous one was valid for three years, while the Israeli government documents record an agreement with Microsoft starting in 2024 and running until 2027. The stated values are also similar: $133 million for the early contract and approximately $125.4 million for the new one.
However, these two figures come from different sources. The Israeli budget report does not indicate that the 2024 agreement with Microsoft is an extension of the previous one.