Microsoft 365 Prices 2026: What Businesses Need to Know
Microsoft announced on December 4, 2025, that it will adjust the prices of commercial Microsoft 365 suite licenses worldwide starting July 1, 2026. This decision does not come out of the blue: it coincides with the introduction of expanded AI, security, and management capabilities added to Microsoft 365, such as advanced Copilot features, enhanced Defender protection, and extensive device management options.
For IT managers and CFOs, this means that reviewing license usage and budget priorities becomes crucial to accommodate the additional costs without exceeding the IT budget. By anticipating these changes now, organizations can not only manage their budgets more effectively but also strategically benefit from cheaper alternatives.
What Microsoft Says About the Price Change
In the official announcement, Microsoft explains that the price adjustment is part of a broader update to the Microsoft 365 suite. In addition to new features such as Copilot Chat in Word, Excel, and Outlook and improved security, advanced management capabilities are also being added.
Microsoft emphasizes that customers will have ample time to adjust their contracts and licenses, meaning there are opportunities to implement renewals, upgrades, and license changes strategically. This provides companies with an optimal chance to apply license optimization and achieve cost savings before the increases take effect.
Microsoft 365 Price Increases as of July 1, 2026
Price increases vary significantly depending on the subscription type and customer segment. For commercial customers, the increase ranges from 5% to 33%, depending on the subscription.
These price increases as of July 1, 2026, apply worldwide, with local adjustments for currency and market differences, and have a direct impact on budgeting, license planning, and contract management in companies of all sizes. When Microsoft announces price changes, it is primarily in US dollars (USD). Amounts such as $6 → $7 or $36 → $39 are global list prices in USD. Microsoft adjusts these list prices worldwide and then sets local euro prices based on exchange rates, market context, and local tax structures. The ratio between the euro (€) and the US dollar ($) fluctuates constantly but is currently around 1 euro for approximately 1.17 to 1.18 dollars.
As Microsoft 365 subscription costs increase structurally, it is wise for many organizations to consider alternatives. Pre-owned Microsoft licenses from Softtrader offer an attractive and fully legal alternative. Instead of ongoing subscription commitments, organizations can choose perpetual licenses with a one-time investment, such as Office 2024, Windows Server 2025, or SQL Server.
These licenses are legally validated in Europe, fully compliant with Microsoft terms, and often significantly cheaper than new licenses or subscriptions. By setting up (part of) the IT environment with pre-owned licenses, organizations can structurally reduce their licensing costs, gain more control over their IT budget, and become less dependent on future price increases within the Microsoft 365 ecosystem.
Why Microsoft Is Increasing Prices
New AI and Productivity Functionality
Microsoft has added more than 1,100 new features to Microsoft 365, including AI-powered tools such as Copilot Chat, intelligent analytics in Excel, and enhanced collaboration features in Teams. This enables companies to accelerate workflows, generate insights faster, and increase employee productivity.
These upgrades add real business value and are at the core of the price increases: organizations are paying not only for software but also for improved efficiency and competitive advantage.
Improved Security
Security is an increasingly high priority for organizations, especially with the rise of remote work and hybrid IT environments. Microsoft has therefore integrated advanced security features, such as improved phishing detection, endpoint monitoring, and real-time threat analytics.
This additional security reduces the risk of data breaches and compliance issues and, according to Microsoft, justifies the higher subscription prices.
Better Management Capabilities
Organizations now receive extensive management tools such as device compliance monitoring, Intune Remote Help, and advanced reporting. This makes IT management more efficient and helps teams resolve issues faster, which is particularly valuable for larger companies and multi-site organizations.
Impact on European Companies
For organizations within Europe, the announced price increases will be implemented in euros. This is influenced not only by the fixed increases from Microsoft but also by factors such as exchange rates, local market adjustments, and existing contract agreements. Although Microsoft aims for price harmonization within the European market, the final costs may vary by country and organization. This makes it especially important for European companies to gain timely insight into what the new rates concretely mean for their specific situation.
Strategic Impact
The price adjustments force organizations to critically review their IT budget and license portfolio. For smaller companies, the impact is often immediately visible in higher monthly costs per user, which can put pressure on operational budgets. Larger organizations and enterprise environments, on the other hand, often manage hundreds or even thousands of licenses. For them, a seemingly small price increase per user can result in a substantial rise in total annual IT expenditure. This is why strategic license planning is essential to keep costs manageable and allocate the IT budget efficiently.
How Organizations Can Save Costs
Use Pre-owned Licenses
Pre-owned licenses are fully legal, compliant, and offer immediate savings. They are ideal for companies looking to upgrade without paying the full price of new licenses.License Analysis
Inventory which licenses are actually used and which are redundant. This prevents paying for features that your organization does not need.Timely Planning Before July 1, 2026
By planning license renewals and contract revisions now, you can take advantage of current prices before the increase takes effect. This is especially relevant for large companies with multiple license types.
Conclusion
The announced price increases as of July 1, 2026, are a direct result of the addition of AI, security, and management capabilities to Microsoft 365.
However, organizations can optimize their IT budget and limit unexpected expenses through proactive license planning, pre-owned licenses, and license type optimization. Now is the time to analyze your license portfolio and make strategic decisions.
Check out the pre-owned Microsoft licenses at Softtrader and contact us to efficiently plan your IT budget before the price increase. This allows you to save costs while still benefiting from all Microsoft functionalities.
FAQ
When will the new Microsoft 365 prices take effect?
The price increases for many business Microsoft 365 and Office subscriptions take effect on July 1, 2026. In addition, the SPLA program will increase by 10% as of January 1, 2026, and there will be price adjustments for certain European Commercial Cloud services in February 2026.
Which Microsoft 365 subscriptions will become more expensive?
Among others, the following subscriptions will face price increases:
Microsoft 365 Business Basic
Microsoft 365 Business Standard
Microsoft 365 E3 and E5
Microsoft 365 F1 and F3
Office 365 E3
Why is Microsoft raising the prices?
According to Microsoft, the price increases are due to the added value within Microsoft 365, including:
Integration of AI functionality such as Copilot
Expanded security and compliance features
Improved management and productivity capabilities
Microsoft states that these innovations require structural investments and are therefore reflected in the new prices.
What does the price increase mean for European companies?
For European organizations, the price increases are applied in euros. Exchange rates and local market adjustments play a role. Although Microsoft aims for European price harmonization, final costs may differ by country and contract.
Will existing contracts also be affected by higher prices?
It depends on the type of contract. Organizations with ongoing annual or multi-year agreements typically retain their current price until the end of the contract period. For renewals or new contracts, the new rates apply.
What is the impact for organizations with many users?
For organizations with hundreds or thousands of users, a relatively small price increase per license can lead to a significant annual cost increase. Therefore, it is important to evaluate license usage and ensure all subscriptions are still necessary and appropriate.
Are pre-owned Microsoft licenses a legal alternative?
Yes. Pre-owned Microsoft licenses are fully legal and compliant under European law, provided they are correctly transferred. They offer organizations a way to reduce licensing costs without compromising functionality or compliance.