(Reuters) – Microsoft (MSFT.O) will increase prices for its Microsoft 365 productivity suites globally starting July 2026 for commercial and government clients, the company said on Thursday.
The move comes as Microsoft’s suite, which includes Word, Excel and PowerPoint, faces growing competition from Google’s products.
The price hike will affect businesses and public sector agencies, with small business and frontline worker plans seeing the sharpest increases.
Microsoft 365 Business Basic will rise 16.7% to $7 per user per month, while Business Standard will climb 12% to $14. Enterprise plans will see smaller jumps, with Microsoft 365 E3 up 8.3% at $39 and E5 up 5.3% at $60.
Subscriptions for frontline workers will surge by as much as 33%, with Microsoft 365 F1 moving from $2.25 to $3 and F3 from $8 to $10. Government suites will follow a similar trajectory, with changes phased in according to local regulations.
The company said the changes reflect more than 1,100 new features added across Microsoft 365, including AI-driven productivity tools and integrated security enhancements.
The update comes as Microsoft pushes deeper into AI-powered productivity, offering Copilot as a $30-per-month add-on and introducing new bundles for small and medium businesses.
Microsoft last raised commercial Office prices in 2022 and earlier this year it increased consumer subscription rates for the first time in over a decade.
