Microsoft’s July 2026 Microsoft 365 price increase adds 5–8% to list prices.
For large enterprises, the prior removal of EA volume discounts raises the effective increase to 15–23%. This article analyses the combined cost impact and renewal timing options.
Microsoft announced price increases for Microsoft 365 and Office 365 subscriptions on 4 December 2025, effective 1 July 2026.
Microsoft 365 E3 rises 8.3% and E5 rises 5.3%. However, these increases come on top of the Enterprise Agreement (EA) volume discount changes introduced in November 2025. For large enterprises, the combined effect is not an 8% uplift — it is closer to 20%.
For example, a 25,000-user organisation on Microsoft 365 E5 that previously benefited from Level D volume discounts faces an effective annual increase of approximately $3 million.
The list price increase and the loss of historical discounting compound, and most organisations are unlikely to negotiate back to previous discount levels.
Key points
Microsoft 365 E3 increases from $36 to $39 per user per month (+8.3%); E5 increases from $57 to $60 (+5.3%).
Frontline worker SKUs see the steepest rises: F1 up 33%, F3 up 25%.
Combined with EA volume discount changes, large enterprises face 15–23% effective increases, depending on prior discount level.
Microsoft is positioning the uplift as added value by bundling Defender for Office 365 P1 into E3, Security Copilot allocation into E5, and expanding Intune features across both editions.
Annual upfront renewals completed before 1 July 2026 lock in current pricing for the full term.