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Packaging and Pricing Updates for Microsoft 365 Commercial Suites Public FAQs

Answers to common questions about Microsoft 365 commercial pricing and packaging updates.

March 24, 2026

Microsoft is announcing global price and packaging updates for commercial Microsoft 365 suites. Packaging updates will begin to roll out CY26 Q3. Customers will receive a 30‑day notice in Message Center before the update becomes available in their tenant. Pricing updates will be effective July 1, 2026. This change reflects the significant innovation delivered over the last several years and the expanded value customers will gain with new additions to the suites, including major advancements in security and IT management.

The price increase applies to Office 365 E3, Microsoft 365 E3/E5, Business, Frontline, and standalones (EMS, Windows, etc.). Microsoft remains committed to transparency, continuous innovation, and supporting organizations as they adapt to new ways of working.

This update is designed to ensure Microsoft 365 continues to deliver robust, secure, and innovative solutions that empower organizations to thrive in a rapidly changing environment.

This update follows a significant but unrelated announcement: (1) the separation of Teams and no-Teams SKU. Learn more about the separation of Teams and no-Teams SKUs here.

FAQ

Overview

  • Microsoft is committed to delivering continuous innovation and value through Microsoft 365. Over the past several years, we’ve invested deeply in security, compliance, productivity, AI, and IT management— helping organizations stay productive, secure, and competitive in a rapidly evolving landscape. This change reflects the significant innovation delivered over the past several years and the added value customers will gain with new additions to the suites, including major advancements in AI (ex. Copilot Chat, Copilot Chat Analytics), security (ex. Microsoft Defender for Office P1), and IT management (ex. Intune Suite).

  • The new commercial pricing for Microsoft 365 suites and standalones will be effective starting July 1, 2026. This change applies to both new and renewing customers globally, with local market adjustments as appropriate. Existing customers will see the new prices at their next renewal after July 1, 2026.

  • The price increase will apply to the following products:

    • Office 365 E3 and E5
    • Enterprise Mobility and Security (EMS) E3 and E5
    • Windows E3 and E5
    • Microsoft 365 E3 and E5
    • Microsoft 365 Apps
    • Microsoft 365 Business Basic, Business Standard, Apps for Business
    • Microsoft 365 F1 and F3
    • Microsoft 365 G3, Microsoft 365 G5
    • Microsoft 365 GCC F1, Microsoft 365 GCC F3
    • Office 365 G1, Office 365 G3
    • Entra P1 and P2
    • Per device SKUs: Windows Enterprise, Microsoft 365 Apps

  • Alongside the price update, Microsoft is introducing additional security, storage, and AI capabilities. These enhancements are designed to strengthen security and simplify IT management.

    New capabilities will begin to roll out CY26 Q3. Customers will receive a 30‑day notice in Message Center before the update becomes available in their tenant. Roll out of the following features will be complete by August 1, 2026: Microsoft Defender for Office 365 Plan 1, Intune Remote Help, Intune Advanced Analytics, Intune Plan 2, Intune Privilege Management, Microsoft Cloud PKI, and Intune Application Management. Check full packaging changes here.

  • All qualifying SKUs will receive the new features as they roll out in 2026, regardless of the price paid or agreement term.

  • Check the table here. Note that all pricing subject to change and may vary by country and currency.

  • The price increase reflects the overall value delivered across the suite, including new security, productivity, and management features— not just individual capabilities.

  • The price increase applies globally, with local market adjustments in certain regions to reflect currency and market conditions.

Pricing and Customer Impact

    • Consumer: There are no changes to consumer pricing at this time.
    • Government: Refer to the Government section of this FAQ for details on Microsoft 365 Government pricing and packaging changes.
    • Nonprofit: Nonprofit pricing will be adjusted in line with commercial pricing, as it is tied to commercial rates through a fixed percentage discount. For the impacted products, the nonprofit discount rate is 60-75%. See nonprofit pricing updates here. Note that all pricing subject to change and may vary by country and currency.

  • Yes, the new pricing will apply to both annual and monthly billing plans for all impacted commercial suites, effective at the next renewal after July 1, 2026.

  • Customers on existing multi-year agreements will continue at their current pricing until renewal. The new pricing will apply at the next renewal after July 1, 2026.

  • For customers with renewals before July 1, 2026, they will be able to renew or upgrade to their chosen suite and lock in the current pricing (pre-price increase pricing) until their next renewal after July 1, 2026. For customers with renewals after July 1, 2026, existing customers will transition to the new pricing for their chosen suites at their next renewal date.

    Note: Customers who choose to do a mid-term upgrade to M365 E3 or E5 3-yr SKUs will pull forward their subscription start date (Learn article).

Licensing and Options

  • Yes, customers will continue to have the flexibility to choose Microsoft 365 suites with or without Teams, in alignment with regional regulations and customer needs. Refer to our recent announcement about Teams and no-Teams options here.

  • No, the announced price update applies only to the SKUs listed below. It does not apply to standalone Microsoft Teams or Copilot SKUs. Any future changes to standalone Teams or Copilot SKUs will be communicated separately.

    • Office 365 E3 and E5
    • Enterprise Mobility and Security (EMS) E3 and E5
    • Windows E3 and E5
    • Microsoft 365 E3 and E5
    • Microsoft 365 Apps
    • Microsoft 365 Business Basic, Business Standard, Apps for Business
    • Microsoft 365 F1 and F3
    • Microsoft 365 G3, Microsoft 365 G5
    • Microsoft 365 GCC F1, Microsoft 365 GCC F3
    • Office 365 G1, Office 365 G3
    • Entra P1 and P2
    • Per-device SKUs: Windows Enterprise, Microsoft 365 Apps

Information on Microsoft 365 Government

  • These changes apply to GCC, GCC-High, Department of Defense (DoD), and National Cloud Operational Environment (NCOE). They do not apply to US AGC.

  • NCOE pricing will include a 10% uplift over commercial pricing. This means that when commercial Microsoft 365 Government prices are updated, NCOE prices will reflect the same changes plus the additional 10% adjustment.

  • All price increases for Microsoft 365 Government suites will begin on July 1, 2026. See details here.

  • While commercial customers will see expanded access to capabilities like advanced security tools, productivity enhancements, and IT management features immediately, Government customers will continue to receive updates aligned with their compliance frameworks and roadmap. This helps ensure that features meet strict standards for data residency, FedRAMP, and other government-specific mandates. Microsoft remains committed to delivering innovation across all clouds, and many of the same enhancements will be introduced to Government offerings over time, following the necessary validation steps.

  • All percentage discounts included in the OneGov offer remain intact, regardless of any list price changes. If a purchase occurs before July 1, 2026, the discount applies to the original list price. If customers purchase on or after July 1, 2026, the discount applies to the new list price. Customers will receive access to the new features associated with the packaging changes rolling out throughout 2026, whether they purchase products with or without the OneGov offer.

Information on Windows Enterprise

  • While <5% of our installed base uses per-device license, these are important for certain customers with on-premises or remote offline scenarios. This license comes with Software Assurance for the device to help keep it secure and up to date.

  • Windows Enterprise securely extends the Windows platform into the cloud-connected world, with APIs and services to help monitor endpoints, proactively remediate any issues, and keep it up to date, reducing management burden and enhancing network protection. It powers productive experiences for employees right from the start, supporting hybrid working models and all types of workers with identity-based authentication and advanced accessibility features.

  • Windows Enterprise continues to develop and release features designed to delight users while making it easier to manage at scale. In addition to IT-focused improvements, like Quick Machine Recovery (QMR), and post-quantum security APIs, Windows Enterprise includes:

    • A new wave of AI and agentic features to improve interaction with the computer, like support for Microsoft 365 Copilot voice, Ask Microsoft 365 Copilot on the taskbar, Agents on the taskbar, and fluid dictation.
    • AI-powered productivity enhancements, like Writing Assistance, Click To Do on Copilot+ PCs.
    • Development opportunities with native Model Context Protocol and Windows 365 for Agents.

    Please read the Ignite 2025 blogs for more information: Windows News​ and Windows Blog.

Information on Microsoft Intune

  • New Intune features for eligible EMS E3, Microsoft 365 E3, and Microsoft 365 E5 tenants will begin to roll out CY26 Q3 and will be complete by August 1, 2026. Customers will receive a 30‑day notice in Message Center before the update becomes available in their tenant. No customer action is required to receive these entitlements.

  • Yes. Standalone Intune Suite and add-ons will continue to be available for purchase and are appropriate for customers who do not require EMS E3, Microsoft 365 E3, or Microsoft 365 E5 plans.

  • No. Eligible customers will receive the new Intune features automatically. No opt-in or manual action is required.

  • Read the Intune blog to understand more about the changes to Intune offerings.

Information on Security Copilot

  • Microsoft Security Copilot is a generative and agentic AI-powered assistant for daily operations in security and IT that helps organizations detect, investigate, and respond to threats faster and more effectively. At Ignite 2025, we announced that agentic capabilities will be built directly into the workflows of security teams using Microsoft Defender, Entra, Intune, and Purview. These agents bring autonomous and proactive protection across security workflows, enabling faster response and reducing manual effort. 

    By including Security Copilot with Microsoft 365 E5, we’re expanding the availability of these AI agents, so security teams can get started quickly and leverage integrated, intelligent defense across their existing tools.

  • Rollout began on November 18, 2025 for existing Security Copilot customers with Microsoft 365 E5 and will continue over the coming months for all Microsoft 365 E5 customers. Customers will receive 30-day advance notice before activation and should review the documentation to ensure proper deployment.

  • Yes. Microsoft 365 E5 customers will receive 400 Security Compute Units (SCUs) per month for every 1,000 paid user licenses, with a maximum of 10,000 SCUs per month. Allocation scales by seat count (e.g., 400 user licenses = 160 SCUs/month; 4,000 licenses = 1,600 SCUs/month). For more details, refer to the MS Learn documentation.

  • Security Copilot is built into Microsoft Defender, Entra, Purview, and Intune — giving users easy access to agentic and generative AI capabilities across the Microsoft Security stack. Security Copilot agents support a wide range of use cases:

    • SOC teams can simplify phishing triage and incident response with agents that classify alerts, summarize threats, and guide remediation.
    • Identity teams can strengthen access controls and reduce risk with agents that optimize Conditional Access policies and automate access reviews.
    • Data security teams can strengthen data protection and compliance with agents built to help triage alerts and discover sensitive data.
    • IT teams can better maintain secure, compliant endpoints more easily, with agents that help with tasks like assessing changes before they impact productivity.
    • For all other use cases, you can build custom Security Copilot agents, tailored to your organization’s unique workflows.

  • Read the announcement here and refer to MS Learn documentation. Learn more about Security Copilot use cases in the Adoption Hub.