Microsoft 365 customers across Europe are looking at a second pricing shift in five months, and the two changes interact in ways that make a simple “how much more will we pay” question harder to answer than it should be.
The July 1 increase
Effective July 1, 2026, most commercial and government Microsoft 365 and Office 365 plans went up in list price. In USD terms, Microsoft 365 Business Basic rose from 6 to 7 dollars per user per month, a 17 percent increase. Business Standard rose roughly 12 percent. Office 365 E3 moved from 23 to 26 dollars per user per month, up 13 percent, and Microsoft 365 E3 rose from 36 to 39 dollars, up around 8 percent. Business Premium is one of the few plans left unchanged. These are the headline figures Microsoft published in its licensing update, and they apply across the commercial, frontline, and standalone component catalogue, not just flagship suites.
A second, separate change for European currencies
Layered on top of the headline increase is a distinct adjustment: as of July 1, select SKUs billed in EEA currencies through MCA-E, CSP, and buy-online channels reflect a pricing-precision correction that Microsoft attributes to EU settlement compliance requirements. This is not the same change as the percentage increases above. It is a rounding and precision fix applied specifically to how euro-denominated invoices are calculated, and it lands on the same date, which makes it easy for finance teams to conflate the two and misjudge the actual delta on next month’s invoice.
Why the net effect on European invoices is not the sticker-shock number
European buyers also have to net this against a separate move from earlier in the year: Microsoft cut EUR cloud prices by roughly 7.4 percent from February 1, 2026, ahead of this July increase. The organisations that renewed licences between February and June locked in the lower euro base before the July increase applied on top of it. Organisations renewing after July 1 are working from a euro base that already reflects the February cut, then absorbing the new percentage increase on that adjusted figure, which is a smaller net rise than the raw USD percentages suggest, but still a real increase that most finance teams have not modelled precisely because the two changes were announced separately and months apart.
What this means for procurement planning
The practical risk here is not the price increase itself, it is budgeting on the wrong number. Teams that only look at the July percentage figures will overestimate their new spend if they already benefited from the February euro cut. Teams that assume the February cut is still in effect will underestimate their renewal cost. Getting this right requires checking your actual tenant’s billing currency, channel (CSP versus direct, EA versus MCA), and renewal date against both changes, not applying a single published percentage.
For any organisation managing more than a handful of licences, this is also a natural point to revisit whether your current mix of E3, E5, Business Standard, and add-ons still matches actual usage, since a renewal event is the cheapest moment to right-size a licence estate before the new pricing locks in for another term.
If your organisation needs help modelling the real cost impact of this change on your specific tenant, auditing whether your current Microsoft 365 licence mix matches your actual usage, or planning procurement timing around EU pricing changes, contact Excello Digital. We help European businesses turn cloud licensing complexity into a straightforward budget line.