Effective May 1, 2026, Microsoft 365 E7 becomes generally available. This new suite, which has been rumored about for years, brings comprehensive AI capabilities together with Microsoft 365.
Summary
- Microsoft 365 E7 bundles Microsoft 365 E5, Microsoft 365 Copilot, Microsoft Entra Suite, and Agent 365.
- Priced ~15% cheaper than buying the included capabilities separately.*
- Brings together productivity, advanced security and advanced AI capabilities.
*Prices in this article are for educational purposes only, are non-binding, may vary, and are subject to change.
Microsoft 365 E7
Microsoft is introducing Microsoft 365 E7, the long-awaited new Microsoft 365 bundle that combines productivity, Artificial Intelligence (AI), identity, security, compliance, and agent governance in one offer.
This positions Microsoft 365 E7 as the operating model enterprises need to run AI safely across their workforce and business processes.
Microsoft 365 E7 treats agents as first-class entities with identity, ownership, lifecycle management, security, and auditability. All is deeply integrated across productivity apps, identity, data protection, and security.
Licensing
- Microsoft 365 E7 includes: Microsoft 365 E5, Microsoft 365 Copilot, Microsoft Entra Suite and Agent 365 in a single bundle.
- Editions: Available with or without Teams
- General availability: May 1, 2026
- Subscription: Monthly Term, Annual Term or Triennial Term.
- Commercial channels: Enterprise Agreement (EA), Cloud Solution Provider (CSP), and web direct
- Regions: worldwide
- We expect promotions to be announced upon release.
- While included in Microsoft 365 E7, Agent 365 will also be available as a standalone offer at $15 per user per month.*
The Microsoft 365 E7 bundle explained
Microsoft 365 E7 combines Microsoft 365 E5, Microsoft 365 Copilot, Microsoft Entra Suite and Agent 365. Microsoft 365 E7 is priced ~15% cheaper than buying the included capabilities separately.
Microsoft 365 E7 combines the following components:
- Microsoft 365 E5: Provides the core productivity, security, identity, and compliance foundation required to run work securely at enterprise scale.
- Microsoft 365 Copilot: Embeds AI directly into everyday work experiences to help people reason, create, and act with context from their organization’s data.
- Microsoft Entra Suite: Extends identity and access controls to users, apps, and agents, enabling secure access, conditional controls, and least-privilege governance.
- Agent 365: Delivers centralized governance, visibility, and control for AI agents—so organizations can deploy and scale agents safely across the enterprise.
Comparing capabilities of Microsoft 365 E7’s components
Let’s compare the capabilities of Microsoft 365 E7’s components (with Microsoft Teams):
Footnotes:
1: Prices are as of July 1, 2026, $51.45 without Teams
2. $9 for E5 customers
3. $90.45 without Teams
Here is the same illustration, but this time for the “without Teams” license:
Footnotes:
*. Prices are as of July 1, 2026
1. $9 for E5 customers
Comparing Microsoft 365 E7 with Office 365 E3, Microsoft 365 E3, Microsoft 365 E5
We see that that Microsoft 365 E7 is the new flagship suite, which adds advanced AI capabilities on top of Microsoft 365 E5. It also offers more advanced security features than Microsoft 365 E3.
Footnote: 1. Both FY26 (2025-07-01 – 2026-06-30) and FY27 (2026-07-01 – 2027-06-30) prices are annual term only.
What about new features in Microsoft 365 E7?
Microsoft 365 E7 is Microsoft’s new main suite, and as such, their main priority. The following screenshot shows new features, as announced on March 9, 2026, with more to come in the future:
Key capabilities
- Microsoft 365 Copilot in Word, Excel, PowerPoint, Outlook, and Teams for AI assistance in core work surfaces.
- Work IQ as the intelligence layer that uses work signals across email, meetings, documents, chat, and collaboration. It formalizes the earlier semantic index and now serves as the intelligence layer in Microsoft 365 E7. Work IQ continuously maps how work happens across an organization so Copilot and agents can act with relevance, continuity, and accuracy rather than responding to isolated prompts. Its three core capabilities:
- Data: Uses signals across mail, meetings, documents, and collaboration to give Copilot full context of ongoing work.
- Context: Maintains continuity across tasks and apps so outputs stay aligned with real priorities.
- Inference: Combines models and skills to reason over work and help drive progress end to end.
- Agent 365 to observe, govern, and secure AI agents with registry, oversight, and policy controls.
- Microsoft Entra Suite for identity and access controls that extend to users, apps, and agents.
- Advanced Defender, Intune, and Purview capabilities for security, endpoint management, data protection, and compliance.
- Support for prebuilt, partner, and custom agent scenarios within Microsoft’s broader agent ecosystem and governance model.
Why Microsoft 365 E7 is relevant now
AI usage and AI agents have become the new norm. As organizations have been mixing licenses together to account for AI capabilities, Microsoft now introduces a new package that combines the most essential AI-related licenses with Microsoft 365.
The timing matters because many organizations have moved beyond first pilots and now need a repeatable operating model for AI. That shifts the conversation from isolated features to standardization, risk management, and procurement clarity.
Microsoft 365 E7 addresses common pain points that appear when AI adoption scales: fragmented licensing, uneven governance, shadow agent risk, and unclear ownership.
The license has been rumored about for years now, and as Microsoft has been increasingly packaging licenses together and offering them together with discounts, this is the next logical step.
Microsoft 365 E7: Pros & Cons
Pros
- Lower cost compared to buying E5, Copilot, Entra Suite, and Agent 365 separately.
- Centralized policies across users, apps, and AI agents.
- Faster AI adoption via Copilot in core Microsoft 365 apps.
- Better visibility into agent activity, ownership, and risk.
- Simplified budgeting with one per‑user bundle – discounts will become available for this suite.
- Unified licensing path for productivity, AI, identity, and governance.
Cons
- Does not replace all third‑party backup or compliance tools.
- SKU choice matters: with vs. without Teams impacts eligibility and procurement.
- Requires preparation: new governance processes, RBAC changes, and agent oversight.
- Potential regional feature gaps for AI and agent capabilities.
- May require restructuring existing add‑ons to avoid duplicate licensing.
In any case, it is wise to consult a licensing expert to evaluate whether Microsoft 365 E7 fits your environment, avoid double licensing, and optimize your portfolio.
FAQ
If we already have a Microsoft 365 Copilot license and a Productivity License, can these be combined into a single Microsoft 365 E7 license?
Yes. Customers can complete a many-to-one mid-term upgrade that combines Microsoft 365 Copilot with a base Productivity License (such as Microsoft 365 E3 or Microsoft 365 E5) into a Microsoft 365 E7 license.
Do equivalent upgrade paths exist for SKUs without Teams?
Yes. Equivalent upgrade paths are also available for SKUs that do not include Teams.
Ready to review your Microsoft 365 licensing path?
If your organization weighs Microsoft 365 E7 against existing E5, Copilot, Entra, and Agent 365 combinations, SCHNEIDER IT MANAGEMENT can help you compare suite value, eligibility, and rollout implications with a licensing-first view.
We will find the best solution for your business case, offering the right licenses, in the right licensing program, and at the best conditions. This way you increase productivity, lower organizational burden, and save costs.
Contact our Microsoft licensing experts for consultancy today.
Sources
For the announcement of Microsoft 365 E7: Unified AI, Security, and Agent Governance, please visit: https://blogs.microsoft.com/blog/2026/03/09/introducing-the-first-frontier-suite-built-on-intelligence-trust/.
For useful software licensing information on Microsoft products, please visit: https://www.schneider.im/software/microsoft/.