AI has arrived in the enterprise, and the shift is happening all at once. Every function, every role, every workflow is being reshaped. At the same time, a new class of organizations is emerging, one that will look fundamentally different from the companies that defined the last era of business. The winners won’t be those with the most demos, but those that turn AI into a governed, continuously improving system for running real work.

This isn’t just about chatbots, either. Those experiences are useful, but they don’t transform how large organizations operate. The real opportunity is teams of agents executing long running work across functions like software delivery, support, finance, HR, and operations — with the identity, context, policy, and human oversight required to trust them in production.

To make this possible, enterprises need more than access to a powerful AI model or scalable compute. What determines success is the system around the AI: how agents are built and deployed by engineering teams, how they’re contextualized in the enterprise, how they’re governed and observed in production, and how they improve safely over time. Without that system, AI remains fragmented, fragile, and difficult to trust at scale.

We’re taking a fundamentally different approach. We are building a comprehensive agent platform: one that supports many models, is open, and gives you choice and flexibility at every layer of the stack. And we are purposefully designing it with developers at the center. Today, the next pieces of that platform are clicking into place.

Building a system for the agentic enterprise

To succeed in this new era, an agent platform must meet a higher bar. It must run real production workloads, map real organizational complexity, and manage real business responsibility.

We’re building around three key principles:

First, it must be a single, integrated system, with support for a wide range of models.
Enterprises can’t afford to assemble their agent strategy one piece at a time. Disconnected tools stitched together after the fact can slow teams down and introduce unnecessary risk. Building, contextualizing, running, governing, and improving agents should happen within one coherent system. That’s why we’re bringing together Azure, GitHub, Microsoft IQ, Fabric, Foundry, Windows, Microsoft Security, and Microsoft 365 to operate as a single system you can use to deploy agents at enterprise scale. Enterprises also need the flexibility to choose the right model for the task, balancing quality, speed, and cost — including Microsoft models, partner models, and open models.

Second, it must be secured and governed by design.
Governance is easy to claim and much harder to deliver. Making it real means starting with a single stack that spans development through production, built on the identity, access, compliance, and security foundations enterprises already trust. By extending Entra, Purview, Defender, Agent 365, and the broader Microsoft Security stack, governance becomes native to the system rather than bolted on later, supporting the ambitions of an AI first enterprise without compromising control.

Third, it must improve continuously.
Enterprise AI systems can’t be static. Agent behavior, outcomes, and human feedback must flow back into the system, so it can improve safely over time under human oversight. As the system runs, models, workflows, and agents become more capable and more specific to an enterprise’s unique business processes. The result is a system that compounds in value the longer it’s in use.

These properties are becoming must-haves, and enterprises that align their AI ambitions with these three principles will pull ahead in quarters, not years.

So how does a system like this actually take shape inside a real enterprise? It starts where work begins, with how agents are built. Let’s walk through what that looks like on the platform we’ve built.

 

1. Build in GitHub

GitHub is where your developers already work. It’s where your dependencies live, where your application and code context is kept, where you collaborate with the open source community you depend on, and where you drive innovation. Building agents anywhere else means leaving all that behind.

Agents should be built the same way production software is built. You write code with GitHub Copilot to move faster. You bring together the assets that matter most: codebases, work items, agent skills, and tools. And because agents aren’t just code, you bring your evals and observability assets alongside them, all versioned the way any production system should be.

Agents must follow a lifecycle: source, test, deploy, observe, and improve. GitHub sets up that lifecycle and provides the necessary controls from day one. The result is a workflow designed for building agents with the right guardrails from the start. And you can do all this in one place, in a new app built for this system.

2. Contextualize with Microsoft IQ

Code is only part of an agent. To be useful, an agent also has to understand your business: your customers, your products, your contracts, your processes. Without enterprise context and intelligence you can trust, even the most capable model is guessing.

Enterprises require a wide variety of models and the ability to match the right model to the right job, but model choice alone is not enough. Microsoft IQ grounds agents in enterprise context by connecting to your business data wherever it lives, across Microsoft 365, your core business systems (such as customer and revenue data), and other systems your enterprise already relies on, like knowledge bases and your website. With Web IQ, the latest addition to the IQ platform, agents can also incorporate relevant information from the web when appropriate.

Contextualizing agents in enterprise data isn’t just about access. Pointing AI at raw information is inefficient and brittle. Microsoft IQ organizes, secures, and surfaces the right information in forms agents can actually use, so they can reach accurate insight without drowning in noise or hallucinating answers.

Once agents are grounded in the right context, enterprises can go further. With Frontier Tuning, you don’t just call AI models. You improve how they behave using your data and real-world workflows.

That includes Microsoft’s seven new MAI models, spanning image, voice, transcription, coding, and reasoning. Together, this model family is designed to work across the kinds of tasks that matter in the real world, and critically, these models are not static endpoints. They’re built to learn from how work actually gets done in your business.

Our reinforcement learning environments allow our models to be reinforced through actual outcomes in your environment. Think of them as training gyms for AI. Here the agent learns your very specific processes, standards, and way of working. It becomes specialized and adapted to you, delivering a measurable and better ROI.

Moreover, your custom or post-trained models all stay in your environment. Your intellectual property, your proprietary data, and the way work actually gets done become part of how your agents reason and act. The resulting intelligence runs in your environment, under your control, and the learning stays yours.

Without context and Frontier Tuning, agents are capable generalists. With it, they become a customized partner that understands the business they’re operating in.

3. Run in Foundry

Once agents are built and contextualized, they need a place to run. Not as an experiment. In production.

Agents and teams of agents place very different demands on a runtime than traditional applications do. They need to reason, act, call tools, coordinate with other agents, and adapt over time, all while operating under enterprise controls. Foundry is the runtime designed for that reality.

• The largest collection of models: Different agents need to be good at different things at different price points. Whatever the task, whatever the cost profile, Foundry provides access to the right model, and an optimized model router helps you balance quality, speed, and cost for each agent.
• Optimized performance for open models: With Fireworks AI on Foundry, enterprises get faster, more efficient inference directly into the platform.
• Support for any agent, including those not built on our stack: Bring in agents built on the Microsoft Agent Framework, LangGraph, GitHub Copilot SDK, Claude Agent SDK, or a custom harness.
• Tools and actions: Agents act on enterprise systems through MCP, connectors, APIs, and workflows, with safe execution by default.
• Evals and traces: Observability and traces make agent behavior measurable. If you can’t measure it, you can’t improve it.
• Continuous optimization: Foundry enables tuning of models, harnesses, IQs, tools, and actions over time, improving performance as agents operate in your world.

A trust, security, and policy rail wraps the entire runtime. Policy applies consistently across context access, tool calls, optimization updates, traces, and response delivery. The agent doesn’t just work. It works the way your enterprise requires.

This is where your agent stops being a project and starts becoming a production system.

4. Govern with Agent 365

Now multiply that agent by hundreds. Then thousands. That’s what happens as different teams build agents across an enterprise. Some are well designed. Some aren’t. Some have access they shouldn’t. Others are doing valuable work that no one else in the organization benefits from.

Enterprise governance isn’t optional. Enterprises need a way to see what’s running, understand what it can access, monitor task adherence, and enforce policies across their entire agent estate.

Agent 365, along with Entra, Purview, Defender, and the broader Microsoft Security stack, come together to do just this. And if you’re interested in AI for security in addition to securing your AI, there’s “MDASH.”

Every agent in your organization shows up in a single catalog, whether it was built in Foundry or elsewhere. IT sees who deployed an agent, what data and tools it can access, how it’s behaving, and what it costs. They can enforce policy or take action when required.

One place. Full visibility. Real control over what your agents do and don’t do.

5. Improve continuously

Agents can’t be static. Every agent action generates signal: trajectories, outcomes, feedback. The system captures it, refines it, and feeds it back. Observe. Evaluate. Improve. Roll out safely. Repeat.

This learning loop runs continuously, in production.

Most gains start with eval-driven improvements to the agent itself: prompts, context, skills, and tools. As clear patterns emerge, learning can extend into model routing across multiple models, fine-tuning, or reinforcement learning. But it all stays anchored in evaluation, improving agent quality and ROI to the level the business requires.

The loop is governed, not closed. Enterprises need to audit it, correct it, and control how to roll out changes. The system becomes more capable over time, guided by human oversight and increasingly autonomous, but never beyond your reach.

This is the hill-climbing model in action: system-level improvement, happening continuously while the system runs.

6. Surface where people work, and scale on Azure

Of course, none of this matters if it doesn’t reach the people doing the work.

Agents surface directly in the flow of work, in Teams, across Microsoft 365, and inside your own applications and experiences. Identity, security, and compliance are built in from the start, so the agents that your teams rely on day to day inherit the same trust model as the rest of your environment.

We support multiple platforms, but your agents can be developed and run in an optimized and secure way on Windows. You can run models both in the cloud and locally on your machine, and best-in-class sandboxing lets you run always-on agents safely.

When you need compute optimized for AI, global and sovereign infrastructure, or a route to market, the system scales on Azure, the same enterprise foundation customers have trusted for decades.

The system compounds

Every leading enterprise will converge on this model: a central AI platform that orchestrates work across the business, bringing together data, models, agents, and human judgment into a continuously improving and secure system.

As that system runs, its value compounds. Velocity increases and the bottleneck shifts from effort to human creativity and coordination. People are able to do more work independently, guided by shared context and fewer handoffs, while the business moves faster without adding friction.

We’re in a time of profound disruption. The enterprises that lead in this moment will be those that adapt as conditions change, simplify how work is coordinated across the business, and consistently turn intelligence into real outcomes. Microsoft’s agent platform is designed to do exactly that: it unlocks the ability to build, contextualize, run, govern, and improve agents as a single, integrated system.

At that point, the platform becomes more than a build layer. It becomes the operating system for enterprise AI at scale, where intelligence and trust are built in by design.

The post AI alone won’t change your business. The system running it will. appeared first on The Official Microsoft Blog.

Platforms shift when developers build. We explore, choose tools, dream, create.

This platform shift comes with more information than ever, ready at your fingertips. This shift, it’s about building fast AND THEN: it’s about building, operating, optimizing and observing. Securing your infrastructure, applications and agents in a seamless way that doesn’t slow you down from the moment you open your laptop to the moment you ship to production.

But there’s a duality in being a developer – you’re a tinkerer, choosing your own tools and models, and you’re an enterprise builder, shipping systems that demand governance, security and trust from day one.

Developers don’t need another way to just build and run an agent or app. They need trust. They need native context and knowledge. Most of all, they need choice to access the right model for the right problem.

This duality is where Microsoft thrives. We ask: what does it mean to be a modern developer today? And at Microsoft Build, we shared how we empower developers to build in this era of ubiquitous intelligence with the controls and security you expect at scale – on a platform that’s model diverse, open and heterogeneous at every layer of the stack. Bringing together what you know with what the world knows natively.

There’s a lot of news today, but there are three themes to anchor on.

First, intelligence that’s truly yours. With the Microsoft Agent Platform powered by your context and intelligence from Microsoft IQ, you can build your agent in GitHub, deploy it to Microsoft Foundry and optimize it automatically with models best suited for the job. Ground it in your intelligence and the world’s knowledge, then access it via Microsoft Teams, M365 or anywhere your team works. Designed to reduce the need to make tradeoffs between context and governance, security and speed, or models and tools.

Second, the full stack built your way. You should be able to build the way you want to build, with the tools, models and workflows you choose, and make it real. This expands beyond the agent platform to across the stack. Silicon to OS to developer tools to cloud – and that starts with Windows. Not Windows for “Windows developers.” Windows for developers, period. We’re bringing a new developer configuration that gives you more flexibility, a frictionless intelligent shell and terminal experience, local sandboxing for agents, new Windows Subsystem for Linux capabilities and powerful options to do it on your local machine.

Third is what comes next, where agentic systems move from code to human progress, amplifying what scientists and researchers can achieve. New frontiers in science and computing that start with the same developer platform underneath.

Together, developers get a multi-model ecosystem, from your laptop to the cloud, so you can build the frontier without giving up the control and craft that truly makes the work yours.

And as always, it starts with the developer. Let’s dive in.

Agents that know you, your business, and the world

As models become more capable and more available, the differentiator for any organization is no longer access to intelligence, but ownership. How does your expertise, data and way of working become a system that continuously learns and drives better outcomes? The goal is an ecosystem that gives companies their own agency, not one that funnels value back to a consultant or the model maker.

Your agents should reflect how you think and operate, from your business logic and institutional knowledge, down to your workflows.

That starts with context. Microsoft IQ, generally available today across GitHub Copilot, Microsoft Foundry and Copilot Studio, is a new context layer that grounds agents in both world knowledge and enterprise knowledge. Work IQ is the workplace intelligence layer for agents, capturing how work actually happens across Microsoft 365, organizational systems and external sources: people, emails, documents, meetings and how they connect. The Work IQ APIs, generally available on June 16, provide programmatic access to this intelligence layer and give agents the context they need to work effectively in your organization. Fabric IQ provides a shared semantic foundation over structured business data. Foundry IQ ties it together and enables retrieval planning across both enterprise knowledge and the live web.

New to the family is Web IQ, announced today: the fastest real-world grounding you can give your agents. An AI-first web search stack that’s model-agnostic and MCP-native, returning relevant passages at nearly 2.5x the speed of the next best alternative.

We’re also looking at how this context applies to new form factors, specifically always-on autonomous agents. Microsoft Scout is a new personal agent for work that we are bringing to Frontier customers today. Built on OpenClaw and WorkIQ, Microsoft Scout understands how you work, uses the tools you already live in, like Teams and Outlook, and proactively handles things like meeting prep, scheduling conflicts and routine tasks without asking. We’re excited to share more soon as we expand what Microsoft Scout can do and roll it out more broadly.

On the model layer, the Microsoft AI Superintelligence Team released a family of seven new in-house models, starting with MAI-Thinking-1 – Microsoft AI’s first reasoning model. Trained from scratch with zero distillation on enterprise grade, clean and commercially licensed data you can build on with confidence.

It’s a mid-sized, 35 billion active parameter model with a 256K context window built for high efficiency and performance, but importantly, at a low-token cost. On a blind test, independent raters prefer it to Sonnet 4.6 [1], and it matches Opus 4.6 on coding abilities on SWE Bench Pro [2]. MAI-Thinking-1 was designed to be good at complex multi-step instructions, long-context reasoning and code generation, and it’s open now on Foundry in private preview.

But that isn’t the only new model. MAI-Image-2.5 and its flash variant are Microsoft’s first models to serve both text-to-image (#3 on the Arena AI leaderboard) and enabling image-to-image workloads (#2 on the Arena AI leaderboard, surpassing Nano Banana 2). These are especially useful in creative workflows, when you want some assistance taking a concept into reality or enhancing existing image work. These models are live in PowerPoint, rolling out on OneDrive, and today, they’re landing on Foundry with market-leading quality per dollar.

There are other new members of the MAI family too: MAI Transcribe 1.5 combines state-of-the-art accuracy across 43 languages, with streaming coming soon. MAI-Voice-2 and its flash variant are now available in more than 15 additional languages with new voice options. And MAI-Code-1, our inference efficient coding model tuned for GitHub, is now available in Copilot and VS Code.

Developer choice doesn’t stop at our catalog. MAI models will also be available on Fireworks AI, Baseten and Open Router. And Fireworks AI is now generally available on Foundry, giving developers a single platform experience with enterprise governance and Azure data residency, regardless of the model they choose.

For organizations ready to make intelligence truly their own, Frontier Tuning applies reinforcement learning within your compliance boundary so agents can learn how the business actually works. Using your own data, domain knowledge and workflows, the result is a loop that sharpens as agents work. Available in private preview today.

And security and governance wraps the entire system. Agent 365 for local agents extends Entra, Defender and Purview into a single control plane to observe, govern and secure agents across your estate, regardless of where they’re hosted or what framework they’re built on. This is how you build at speed while maintaining control.

Alongside it is an open, end-to-end trust stack for AI agents on any framework anchored by two open-source projects: Adaptive Spec-driven Scoring for Evaluation and Regression Testing (ASSERT) for policy-driven safety evaluation, and the Agent Control Specification to standardize where and how to apply controls in the agent loop.

Also strengthening our defense is Codename MDASH. Our new multi-model agentic security system deploys 100+ agents to find exploitable bugs by reasoning about data flow, business logic and exploit chains with context-aware fixes delivered directly in the Defender Portal.

The full stack, your way

When we think about work in the agentic age, it requires a ubiquitous intelligence platform that spans cloud and edge. But as a developer, how do you build these rich, agentic systems while staying firmly in control? That means staying in flow instead of waiting on tools and running experiments in minutes rather than hours.

It starts at the silicon, and that’s where Surface RTX Spark Dev Box comes in – it’s designed for sustained workloads: long-running training jobs, agentic AI pipelines and local model fine-tuning.

Powered by NVIDIA RTX Spark, it delivers up to one petaflop of AI compute and 128 GB of unified memory, capable of running up to 120B parameter LLMs with up to 1 million tokens context using agents locally without cloud GPU instances [3]. Windows Services for Linux (WSL) 2 with native GPU passthrough and full CUDA support comes pre-configured for developers, with Visual Studio Code, GitHub Copilot and many more of your favorite tools pre-installed. Surface RTX Spark Dev Box will be available later this year in the US via Microsoft.com.

In the OS layer, Microsoft is making Windows an agent-native runtime. Microsoft Execution Containers (MXC), now in preview, gives developers and IT administrators a simpler way to create enterprise-grade sandboxed environments for agents, with containment enforced by the operating system itself. Describe your requirements once, and Windows enforces them everywhere your agents run.

This technology is now being used by OpenClaw on Windows, enabling execution of multi-step workflows inside these OS-enforced boundaries. NVIDIA’s OpenShell secure runtime for autonomous agents uses MXC and adds policy management, inference routing and PII obfuscation. Together, these capabilities give developers a safe environment for agent development and deployment and provide IT teams with the governance tools they need across local devices and cloud environments.

And when agents move to the cloud, hosted agents in Foundry Agent Service, in preview, provide the same model at scale: instant-on sandboxes per session, isolated execution, persistent memory and elastic scale. Think of it as the primitive for agents the way containers were for cloud-native apps.

Agentic development flows, whether in the IDE or in the command line, helps us write code faster than ever before, but that’s only one part of building software.

The GitHub Copilot app, now in preview, brings agentic development to a native desktop experience – and a much wider audience. Start from an idea, an existing issue or PR, orchestrate multiple agent sessions in parallel, and keep changes moving through review, CI and merge. Each session uses git worktrees, so work stays separated. Copilot handles execution, while developers say in control.

Developers can generate applications in seconds, but getting those apps into production still requires stitching together databases, APIs, authentication and infrastructure.

At the platform layer, Rayfin, now in preview, solves that. It brings a managed, backend-as-a-service to Microsoft Fabric, defined through GitHub-based workflows, so developers can move from prototype to production without managing infrastructure. Integration with Replit creates a fast path from prototype to enterprise-grade deployment with governance from day one. And as agentic applications scale, Azure HorizonDB delivers performance and reliability to meet your most demanding database requirements. It’s a fully managed PostgreSQL service on Azure that delivers more than 3x the throughput of comparable self-managed setups in internal testing.

The future belongs to builders

In the same way long-running agents have helped redefine software development and the role of the developer, new agents will help change research and development and what scientists can achieve.

Microsoft Discovery is generally available today. Built on Azure, it gives researchers an enterprise-grade agentic AI platform for the full science workflow. BHP is using it to find copper-leaching solutions in months instead of years. Syensqo is accelerating semiconductor R&D. GSK is iterating on drug discovery. Additionally, a free Discovery local app was announced for the broader scientific community. It is available in preview and only requires a GitHub Copilot account.

Finally, our next generation quantum computing chip Majorana 2 represents a giant step toward scale: an average qubit lifetime of 20 seconds with instances up to a minute, 1,000x higher reliability than our previous generation, and a path to one million qubits on a chip that fits in the palm of your hand. With the help of agentic AI, we will achieve a scalable quantum machine by 2029.

***

Platforms don’t shift on their own; developers build them forward. Today is about giving you more to build with.

These are just some of the announcements at Build. We’re excited to connect with those of you joining virtually and in person for keynotes, code deep dives, hack sessions and more. Many sessions will also be available on demand.

For the full set of news, visit the Microsoft Build Live blog.

Now, let’s build.

***

Footnotes:
1: measured via Surge our independent human rating partner
2: Based on the SWE Bench Pro Benchmark
3: Source: NVIDIA. Based on 1 Theoretical FP4 TOPS using the sparsity feature.

Related:
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As the pace of change accelerates, organizations are moving quickly from AI experimentation to enterprise-scale transformation. Leaders are prioritizing measurable outcomes, faster time to value and repeatability across the business.

But many are encountering the same reality: the challenge is no longer deciding whether to invest in AI — it’s scaling adoption and delivering consistent, enterprise-wide impact.

Over the past year, one thing has become clear. Organizations aren’t asking if AI matters. They’re asking how to make it real — how to embed it into the way work gets done and ensure it drives meaningful results.

That’s where many are getting stuck.

Because the barrier is no longer experimentation. It’s execution.

Intelligence and trust as the foundation

At Microsoft, we believe successful AI Transformation depends on two foundational elements: intelligence and trust.

Organizations need to harness their own work intelligence — the data, workflows and expertise that make their business unique — and apply it through AI in ways that are flexible, secure and governed. That requires a platform that supports model diversity and continuous innovation, without compromising enterprise-grade security, compliance and reliability.

Just as importantly, AI must be embedded into the flow of work — how people collaborate, make decisions and operate day to day. For that to scale, systems must be transparent, secure and accountable.

This is where real enterprise value is created — and where many organizations need a clearer path forward.

Achieving impact at scale requires more than deploying new tools. It requires a trusted foundation — integrating data, security, privacy and governance — and a new model for delivering AI into the business.

That’s why Microsoft and EY are deepening our alliance — to help organizations move faster from AI ambition to measurable business outcomes.

From pilots to production

There is no shortage of AI pilots in today’s market. But pilots don’t transform businesses. What organizations need now is the ability to scale AI across the enterprise, integrate it into core workflows and deliver sustained, repeatable impact.

EY brings that experience.

As one of the first global organizations to deploy Microsoft 365 Copilot at scale, EY began with an initial rollout to 150,000 of its people, quickly demonstrating what’s possible when AI is embedded into everyday work.

The results were significant and measurable:

• A 15% productivity gain, reinvested into client delivery and continuous learning
• 94% monthly adoption and 85% weekly usage
• 63% of enabled employees using Copilot three or more days per week
• 81% of employees reporting time savings, with 84% redirecting that time to higher-value work and 73% improving quality of output

The impact goes beyond individual productivity into agentic AI in core business operations:

• Finance operations modernized with intelligent agents, driving 95% faster lead times and more than 37% reduction in operational costs
• A multi-agent AI framework was deployed across 130,000 Assurance professionals and 160,000 audit engagements
• Tax workflows were transformed through document automation, reducing manual effort by up to 90%

With these results, EY is now expanding Copilot through Microsoft 365 E7 to more than 400,000 of its people worldwide, moving from early success to true enterprise scale.

This is what enterprise-scale transformation looks like — not isolated wins, but sustained impact across the organization.

It’s also why EY serves as Customer Zero — applying Microsoft AI technologies internally to prove what works before bringing those solutions to clients.

Investing in what actually drives outcomes

Building on this foundation, Microsoft and EY are jointly investing more than $1 billion in a new initiative designed to help organizations move from isolated AI use cases to enterprise-scale transformation.

This effort brings together Microsoft’s AI platforms, including Azure, Microsoft 365 Copilot, Foundry, Fabric and security — and EY’s deep industry capabilities and transformation leadership.

But what differentiates this initiative isn’t just what we bring. It’s how we deliver it.

At its core is a shared focus on helping organizations become Frontier Firms — where AI is embedded across the enterprise, not layered on top.

In a Frontier Firm, data, workflows and decision-making are connected end to end. AI becomes part of how work happens, and human expertise is amplified by intelligent systems.

Reaching this level requires more than investment. It requires execution.

A new model for execution at scale

This is where our approach is fundamentally different.

Microsoft and EY are cooperating as an integrated transformation engine — co-developing, co-engineering and co-delivering solutions aligned to real business priorities.

A key part of this model is Microsoft’s Forward Deployed Engineers (FDEs), who work side by side with EY transformation teams directly within customer environments.

Together, these teams:

• Co-create solutions grounded in business needs
• Accelerate deployment across complex systems
• Stay engaged from initial use case through full-scale adoption

This integrated model closes the gap between strategy and execution. It reduces friction across the technology stack and creates a direct path from pilot to production — at enterprise scale.
It also ensures that intelligence and trust advance together, embedding AI across data, applications and infrastructure in ways that can be governed, secured and continuously optimized.

Importantly, it establishes a repeatable blueprint — one that organizations can use to scale AI adoption across functions, industries and geographies.

Why this matters now

Organizations are under pressure to move faster — to go beyond experimentation and deliver AI across the enterprise.

What they need is not just technology, but a clear path to execution — grounded in both intelligence and trust.

AI is not simply about doing work faster. It’s about enabling people and organizations to do more — focusing on insight, creativity and higher-value decision-making.

Our work with EY demonstrates what’s possible when AI is deployed with purpose at scale. Together, we are bringing those learnings to customers around the world — helping them accelerate transformation, unlock efficiencies and create new opportunities for growth.

Microsoft and EY are committed to helping organizations turn AI ambition into enterprise impact.

Learn more in the official announcement.

The post From AI pilots to enterprise impact: Why execution is the new differentiator appeared first on The Official Microsoft Blog.

Updated May 11, 2026: The post was updated to reflect that third-party plugins will be available starting May 12, 2026.

Spend time with any software engineering team right now and you’ll see something worth paying attention to. Over the last few years, the way software gets built has moved through four distinct patterns of human-agent collaboration — and the same patterns are beginning to show up across other functions of the firm.

• Author: You’re producing the work, calling on AI to help as needed — a line of code, a sentence, a chart.
• Editor: You set the intent and AI creates the first draft for you to edit and approve.
• Director: You create a spec and hand off entire tasks for AI to execute in the background.
• Orchestrator: You design a system where multiple agents run in parallel across a workflow, flagging exceptions and escalations to you.

Every business leader knows the world is changing, but far fewer have a clear picture of what to do about it. These four patterns are the place to start. The real work ahead for leaders is redesigning their firm’s operating model around the collaboration patterns.

As agent use increases, human involvement doesn’t disappear — it changes shape. What declines is the amount of tactical, step-by-step execution work humans do themselves. And what rises is the need for humans to set direction, define standards and evaluate outcomes.

Ultimately, the goal is not to move every task and business process to the fourth pattern. Instead, it’s up to leaders to help their organizations develop clarity around matching workstreams to the right collaboration pattern. That’s the shape of the Frontier Firm: defined by how deliberately leaders design work across functions, matching the level of human involvement to the outcome.

What the data shows

Our 2026 Work Trend Index research reinforces this shift across roles and industries. We analyzed trillions of anonymized Microsoft 365 productivity signals and surveyed 20,000 workers using AI across 10 countries. We also spoke with leading experts in AI, work and organizational psychology to help us unpack the insights from the data and understand where all this is going. The conclusion is consistent: the constraint is no longer what people can do, it is how work is structured around them.

• AI lifts individual potential. A privacy-preserving analysis of more than 100,000 chats in Microsoft 365 Copilot shows that 49% of all conversations support cognitive work — helping workers analyze information, solve problems, evaluate and think creatively. This shift is already visible in output, with 58% of AI users saying they’re producing work they couldn’t have a year ago, rising to 80% among Frontier Professionals, the most advanced AI users in our research. Additionally, when AI users were asked which human skills are most important as AI takes on more work, they said two topped the list: quality control of AI output (50%) and critical thinking — that is, analyzing information objectively and making a reasoned judgment (46%).
• The Transformation Paradox. We are seeing a pressure point emerge within the organization where the pull to perform collides with the push to transform. 65% of AI users surveyed fear falling behind if they don’t use AI to adapt quickly, yet 45% say it feels safer to focus on current goals than to redesign work with AI. And only 13% of workers say they’re rewarded for reinvention of work with AI even if results aren’t met. The same forces accelerating AI adoption are holding it back.
• Every organization is a learning system. Our results show that organizational factors like culture, manager support and talent practices account for more than 2X the AI impact of individual factors like mindset and behavior (67% vs. 32%). Specifically, the findings underscore the importance of an AI-ready environment: a culture that treats AI as a strategic advantage and encourages experimentation, managers who model and incentivize AI use and talent practices that build skills and create space to apply them. The real question isn’t whether people have the right skills, it’s whether the organization is built to unlock them.

The firms that build a new operating model today won’t just move faster in the short term. They’ll build something more durable, setting themselves up to create value in ways that we can’t yet conceive of: an organization that learns faster than its competitors, compounds its own intelligence and gets harder to catch with every cycle.

For deeper analysis, see the 2026 Work Trend Index Report.

Enabling the Frontier Firm with Copilot Cowork — now mobile, extensible and enterprise-ready

None of an organization’s system scales without infrastructure that brings people and agents into the same flow of work with connected data and the ability to manage and govern it all. Microsoft 365 Copilot is built for exactly that.

Today, we’re expanding Copilot Cowork with new capabilities for Frontier customers to help organizations move from isolated AI tasks to coordinated, multistep work. Cowork enables people to define outcomes and delegate work across apps, business systems and data, with execution that stays directed and controlled throughout.

This update introduces Copilot Cowork Mobile for iOS and Android, along with a growing plugin ecosystem for Cowork, bringing more of an organization’s tools and data into these experiences. This includes native plugins across Microsoft services like Dynamics 365 and Fabric, and partner integrations available in the coming weeks like LSEG (London Stock Exchange Group), Miro, monday.com, S&P Global Energy and more. Organizations can also build custom plugins to turn their own workflows and expertise into reusable, scalable processes. Additionally, a first wave of federated Copilot connectors in Researcher and Microsoft 365 Copilot Chat is generally available today from partners like HubSpot, LSEG (London Stock Exchange Group), Moody’s, Notion and more.

Together, these updates extend Copilot Cowork from a task-based assistant into an extensible platform that helps orchestrate work across Microsoft and third-party systems. With management and governance through Microsoft Agent 365, organizations can deploy and scale agents across core business functions like sales, service and operations.

For more on these product innovations: Microsoft 365 blog.

AI is no longer an experiment. It is an execution challenge. Employees are already working across all four patterns. The open question for every leadership team is whether they can catch up. Access to AI won’t be the advantage for much longer. How the work is designed around it will be.

Jared Spataro, CMO, AI at Work at Microsoft, shapes how every organization applies AI and agents to reduce costs, create new value and define the future of work. He leads research, strategy and product across Copilot, Copilot Studio, Microsoft 365, Dynamics 365 and Power Platform.

The post How Frontier Firms are rebuilding the operating model for the age of AI appeared first on The Official Microsoft Blog.

As our customers progress toward becoming Frontier Firms, they are using AI not only to optimize how work gets done, but to reinvent their business on the promise of growth. Organizations can now unlock creativity, accelerate innovation and democratize intelligence by bringing Copilots and agents directly into the tools people love and use every day. As adoption continues to scale, business value is no longer measured solely by time saved or productivity gained, but in how effectively organizations translate their unique IQ into decisions that drive measurable impact across core business processes.

The two most important elements in any AI solution are Intelligence + Trust. At Microsoft, we are focused on providing a platform for both through Microsoft IQ and Agent 365, respectively, so customers can harness the power of AI, have it amplify their unique differentiation and do so in a model diverse, open and heterogeneous manner. Microsoft IQ brings context to your data and provides faster, more accurate, more trusted experiences across modalities of chat, artifact creation and augmentation, and agent development; all while safeguarding your assets and protecting your intellectual property. Agent 365 provides observability, governance and security across all the agents you build — whether on Microsoft’s platform or third-party environments — so you can trust the outcomes you achieve with AI and ensure ROI for the same.

With intelligence embedded into daily work, organizations are activating human ambition — engaging customers more effectively, reshaping business processes and accelerating innovation without adding operational complexity — turning gains into competitive advantage. Trust makes this durable, allowing organizations to scale securely with AI. The shift to becoming Frontier can be seen in our recent partnerships, with BMW Group selecting Microsoft for its large-scale deployment of Microsoft 365 Copilot across its global workforce and Accenture rolling out Copilot to more than 740,000 employees.

Frontier Transformation — built on a foundation of Intelligence + Trust — is how organizations are enabling AI for growth; moving from aspiration to outcome with confidence, driving measurable business gains and maintaining the rigor required to operate AI responsibly. Across industries, our customers and partners are putting AI to work to reveal new sources of innovation and business value. I am pleased to highlight additional stories from this past quarter.

With millions of customer queries overwhelming its support channels, Air India was facing rising costs, slower response times and growing frustration for customers and employees. Within six months, internal development teams built an agentic AI solution using Azure OpenAI and in Foundry models. AI.g handles 40,000 customer queries daily and since launching has saved the company millions of dollars. The agent has resolved more than 13 million conversations with a 97% success rate, allowing employees to focus on contributing at a higher level — solving complex cases that require nuanced human judgement and problem-solving skills. Air India is the first airline worldwide to deploy generative AI for customer service at scale.

As the second largest school district in Florida, Broward County Public Schools serve approximately 235,000 students across 235 schools and 25,000 employees. Although the district had extensive data, it lacked the real-time insights required to support its students — while simultaneously facing a $90-million budget shortfall. Rather than slowing innovation, the district used financial pressure as a catalyst to modernize systems and rethink how work was done. By deploying Microsoft 365 Copilot, educators and staff reclaimed six to seven hours weekly — time redirected to students for direct interaction, coaching and feedback. The district also equipped students with Microsoft 365 Copilot Chat and Copilot Studio to provide faster access to learning resources and foster more equitable learning — providing support for students with disabilities, English language learners and those needing additional academic assistance. The district’s adoption of Copilot — the largest K-12 deployment globally — is also expected to generate $40 to $50 million in savings over five years.

Cemex is one of the world’s largest building materials companies, operating more than 50 cement plants and over 1,000 ready mix plants across four continents. To accelerate execution at scale, Cemex built LUCA Bot — an AI agent built in Microsoft Foundry with Azure OpenAI — giving approximately 100 senior business leaders visibility into company-wide performance across more than 120 KPIs. The self-service tool processes 400 to 500 queries per month with high accuracy, delivering real-time, conversational insights across global sales, plant operations and financial performance. By compressing decision cycles from days to seconds, the company shifted from reactive to real-time decision-making — allowing leaders to recognize demand signals faster, improve operational efficiency and drive business outcomes across its multi-billion-dollar enterprise.

Cybersecurity startup ContraForce is democratizing enterprise-grade protection for managed service providers by operationalizing Microsoft’s security — Microsoft Sentinel, Defender XDR, Entra ID and Azure OpenAI in Foundry models — into a turnkey, AI-driven platform. Built for environments where traditional tools were too complex and costly for most providers to operate efficiently, the solution automates more than 90% of incident response, reducing cost per incident and enabling 24/7 protection. Providers can onboard more customers, deliver higher-quality security services and scale operations without adding headcount — transforming security delivery into a growth engine. Analysts can manage significantly more volume with incidents resolving in minutes and teams freed to focus on more strategic advisory work.

As global professional services firm KPMG expanded its Digital Gateway platform to support secure, global engagement with clients and professionals, its data environment grew increasingly fragmented and complex — spanning multiple tools and systems that slowed collaboration and increased operational effort. The company established Microsoft Fabric as its strategic data platform; unifying its data engineering, storage, analytics, reporting and global security policies into a single, trusted environment and pacing adoption as it matured in enterprise governance. Client data onboarding times were 87% faster — from sixteen hours to two — and operational IT efforts were reduced by 25%. With a governed, real-time data foundation, KPMG is accelerating insights; enabling faster, more confident decisions and freeing teams to provide consistent, high-quality client value delivery across global engagements.

To democratize AI across its digital workplace, Mercedes-Benz is deploying Microsoft 365 Copilot company-wide — one of the largest, most comprehensive industry deployments in European industry. Moving beyond selective use of AI, the company is integrating it systematically into day-to-day work, supporting decision-making and core operational processes while reducing complexity. By placing secure, enterprise-grade AI in the hands of employees across functions, Mercedes-Benz is enabling faster execution, lowering operating costs and driving more consistent performance across its global business. Copilot is also helping teams strengthen decision quality at scale, enabling them to respond more precisely and compete more effectively in dynamic markets.

As one of the world’s busiest rail operators, MTR manages high‑volume, complex transit operations with strict service and reliability expectations. To simplify complex administrative workloads and accelerate decision‑making, MTR deployed Microsoft 365 Copilot alongside Power Platform, embedding role‑based copilots and low‑code workflows across drafting, summarization and analysis. The result reduced manual effort, shortened turnaround times and improved operational consistency across its network. To improve passenger services, the company also launched AI Tracy — a personalized assistant built on Microsoft Azure that provides real-time guidance on ticketing, station facilities and local amenities. With AI embedded into everyday workflows and passenger services, MTR is extending consistent, real-time service across its network and expanding what teams can achieve and execute with AI.

PepsiCo operates one of the world’s largest consumer goods enterprises, with 320,000 employees across more than 200 countries. The company faced a fragmented technology landscape, with disparate collaboration and tools that slowed coordination. This limited PepsiCo’s ability to grow its business, so the company standardized on Microsoft Teams and deployed Microsoft 365 Copilot to create a unified, secure foundation to innovate with AI. With Teams and Copilot seamlessly embedded into the tools employees use every day, PepsiCo is improving how work gets done. With 90% to 95% daily Copilot usage, AI is embedded in everyday work — creating a more connected environment that fosters collaboration and reduces friction, saving employees hours each day and freeing up time for them to focus on higher-impact work.

Global real estate developer Tata Realty manages a diverse portfolio spanning residential, commercial, mixed-use and infrastructure in Southeast Asia. As the business grew, fragmented data across finance, operations, engineering, safety and HR made it difficult to generate insights — slowing decision-making, increasing costs and introducing operational risk. By adopting Microsoft Fabric as a unified, governed data platform, the company consolidated engineering, warehousing and reporting into a single environment. This move helped reduce data processing time by 20% and lower annual analytics costs by 20% to 30%. With real-time, cross-functional insights now embedded in core workflows, teams are making faster, more informed decisions and operating with greater speed, consistency and control across the business.

Tru Cooperative Bank (formerly First West Credit Union) serves more than 250,000 members with complex financial products and high service expectations. By deploying Microsoft 365 Copilot and Copilot Studio, the organization reduced administrative effort and accelerated service delivery, reaching 93% employee adoption and 90% weekly usage. With AI embedded in daily workflows, employees can instantly access and bring together member context, policies and procedures — enabling faster decision cycles and more proactive, personalized guidance. By automating routine work, teams are creating space to focus on higher-value client conversations that deepen relationships, advance financial outcomes and drive member growth — with human ambition at the center of every interaction. At the same time, moving from reactive work to real-time, insight-driven engagement is strengthening member trust and scaling consistent, high-quality delivery across the organization.

Frontier Transformation is changing how organizations operate, compete and grow. By embedding intelligence into the flow of work and grounding it in enterprise‑grade trust, businesses are operating with greater precision and expanding what their teams can achieve at global scale. With an open, model-diverse and secure platform, Microsoft enables organizations to unlock human ambition and leverage AI for growth — transforming their unique IQ into decisions and actions that drive measurable business outcomes. We are grateful for the continued trust of our customers and partners. Together, we are shaping how every organization can lead with AI.

Judson Althoff is the chief executive officer of the commercial business at Microsoft. He is responsible for the product strategy, sales, services, support, marketing, operations and revenue growth of the company’s commercial business, which operates in more than 120 regional and national subsidiaries globally.

The post Unlocking human ambition to drive business growth with AI appeared first on The Official Microsoft Blog.

Today, I am pleased to announce that Azure Local now scales to support deployments of up to thousands of servers within a single sovereign environment, allowing organizations to run much larger workloads locally across large-footprint datacenters, industrial environments and edge locations while maintaining control within their sovereign boundary.

Organizations operating national infrastructure, regulated workloads or mission-critical services are navigating a fundamental shift in how cloud infrastructure must be deployed and managed. As digital sovereignty postures evolve and regulatory requirements tighten across regions, infrastructure strategies are increasingly shaped by the need to maintain jurisdictional control over data, operations and dependencies. At the same time, AI and data-intensive applications are moving closer to where data is generated, requiring infrastructure that can scale to support larger deployment footprints while maintaining operational control, compliance and data residency requirements within sovereign environments.

Azure Local is the foundation for Microsoft’s Sovereign Private Cloud, allowing organizations to run cloud-consistent infrastructure on hardware they own and operate within their sovereign boundary. It supports deployments across connected, intermittently connected or fully disconnected environments. With Azure Local disconnected operations, customers retain the ability to apply policy enforcement, role-based access control, auditing and compliance configuration locally, allowing them control over how infrastructure is configured, secured and updated regardless of public cloud connectivity.

Scaling Sovereign Private Cloud

Sovereign Private Cloud deployments must scale to support not only larger workloads, but also the operational requirements of national infrastructure and regulated industries. Azure Local allows organizations to grow deployments from hundreds up to thousands of servers within a single sovereign boundary, allowing infrastructure to expand alongside demand without requiring architectural redesign.

As deployment footprints grow, resiliency becomes essential to maintaining continuous operations for mission critical services. Expanded fault domains and infrastructure pools help prevent hardware failures from resulting in service outages, ensuring critical workloads remain operational across environments with varying levels of cloud connectivity.

At these larger scale points, organizations can run data-intensive AI inference and analytics workloads entirely within their own environment. With support for high-performance graphics processing unit (GPU) infrastructure, sensitive models and operational data remain within customer-controlled infrastructure, while access management, auditing and compliance controls are maintained within the sovereign deployment.

Built for challenging workloads 

Increased deployment scale unlocks new workload placement opportunities, from large sovereign private cloud deployments to distributed AI workloads, allowing organizations to run more data intensive and latency sensitive applications entirely within their sovereign boundary.

AT&T, one of the world’s largest telecommunications operators, is deploying Azure Local to run mission-critical infrastructure on hardware they own in their environment. The goal: full operational control while running at the scale the business demands.

“Azure Local provides the infrastructure foundation we need to run critical operations at scale, while ensuring control and governance across our environment. The consistency of the Azure operating model, delivered on our own infrastructure, is key as we continue to modernize while delivering reliable services to our customers.”

— Sherry McCaughan, Vice President – Mobility Core Services, AT&T

Kadaster, the Netherlands’ official land registry and mapping agency, is running Azure Local to keep sovereign control over some of the country’s most sensitive public data.

“As a government agency responsible for some of the Netherlands’ most sensitive data, we need infrastructure that gives us full control over where our data lives and how it’s governed. Azure Local has been a consistent foundation for that — and as our workloads grow in scale and complexity, the platform has grown with us.”

— Maarten van der Tol, General Manager, Kadaster

FiberCop, Italy’s most advanced and extensive digital network operator is deploying Azure Local across its edge locations to bring sovereign cloud and AI services to organizations throughout the country. Fabio Veronese, Chief Information & Technology Officer commented:

“FiberCop is better positioned than any other player on the Italian market to drive innovation and deliver cloud as well as AI services at national scale. Azure Local supports our mission to drive Italy’s digital future and brings Microsoft’s cloud capabilities to edge workloads across the country while keeping data sovereignty and compliance where they matter most.”

The infrastructure behind Sovereign Private Cloud

Azure Local is available today with validated compute and enterprise storage platforms from partners including DataON, Dell Technologies, Everpure, Hitachi Vantara, HPE, Lenovo and NetApp, allowing organizations to integrate existing Storage Area Networks (SAN) and preserve prior investments while allowing compute and storage resources to scale independently within their sovereign environment.

At the silicon level, Intel®  Xeon® 6 processors provide the compute foundation for the platform. Built for the density and performance demands of modern enterprise workloads, Xeon 6 also brings built-in AI acceleration with Intel® AMX, meaning organizations running inference or generative AI workloads within their sovereign environment do not need to introduce separate, specialized infrastructure to do so.

Together, Azure Local, validated compute and enterprise storage platforms, accelerated computing platforms and underlying silicon can provide a datacenter-scale stack that supports sovereign infrastructure deployments while helping ensure data, models and execution remain within customer-controlled environments.

Sovereign infrastructure built for your requirements

Azure Local was built to meet customers where their requirements are whether that means strict data residency, disconnected operations, regulated workloads or AI running close to where data is generated. As these requirements evolve across regulated industries and governments worldwide, Sovereign Private Cloud deployments can expand from a single node at the edge to large enterprise-scale datacenter environments, running on hardware organizations own and operate, with consistent lifecycle management through Azure.

Resources:

• Learn more about Azure Local
• Explore Microsoft’s Sovereign Cloud
• Read the Tech Community blog
• Visit the Azure Local solution catalog

Douglas Phillips leads global engineering efforts for Microsoft’s specialized, sovereign and private clouds. He is responsible for Microsoft’s global strategy, products and operations that bring Microsoft’s industry-leading solutions, including Azure, our adaptive cloud portfolio and Microsoft 365 collaboration suite, to customers with additional sovereignty, security, edge and compliance requirements.

The post Microsoft Sovereign Private Cloud scales to thousands of nodes with Azure Local appeared first on The Official Microsoft Blog.

Amended Agreement Provides Long-Term Clarity

The rapid pace of innovation requires us to continue to evolve our partnership to benefit our customers and both companies. Today, we are announcing an amended agreement to simplify our partnership and the way we work together, grounded in flexibility, certainty and a focus on delivering the benefits of AI broadly. The greater predictability in the amended agreement strengthens our joint ability to build and operate AI platforms at scale while providing both companies the flexibility to pursue new opportunities. The agreement spells out:

• Microsoft remains OpenAI’s primary cloud partner, and OpenAI products will ship first on Azure, unless Microsoft cannot and chooses not to support the necessary capabilities. OpenAI can now serve all its products to customers across any cloud provider.
• Microsoft will continue to have a license to OpenAI IP for models and products through 2032. Microsoft’s license will now be non-exclusive.
• Microsoft will no longer pay a revenue share to OpenAI.
• Revenue share payments from OpenAI to Microsoft continue through 2030, independent of OpenAI’s technology progress, at the same percentage but subject to a total cap.
• Microsoft continues to participate directly in OpenAI’s growth as a major shareholder.

While this amendment simplifies the partnership, the work we’re doing together remains ambitious. From scaling gigawatts of new datacenter capacity, to collaborating on next-generation silicon, to applying AI to advance cybersecurity, and more, we’re excited to keep partnering to advance and scale AI for people and organizations around the world.

The post The next phase of the Microsoft-OpenAI partnership appeared first on The Official Microsoft Blog.

AI has moved quickly from experimentation to production. Customers want measurable business outcomes, along with security, governance and responsible AI built in from day one. Microsoft partners are a meaningful differentiator to deliver these objectives. They turn ideas into deployable solutions by prioritizing the highest value use cases, building the right data and security foundations and establishing adoption and measurement capabilities so customers can run AI reliably in production.

Frontier Transformation is where AI becomes a repeatable, governed capability embedded into the flow of work, business processes and customer engagement. Customers are quickly moving from targeted pilots to operating AI at scale with a foundation built upon identity, data protection, compliance, monitoring and change management. As organizations expand from custom agents to agent-led processes, unified governance is essential so leaders can manage risk, track performance and scale with confidence.

Two essentials: Intelligence and Trust

Frontier Transformation depends on two essential elements: intelligence and trust. Customers want solutions grounded in their unique work intelligence, including their data, business context and operational realities. They also expect trust by design, with AI artifacts observable, managed and secured across the technology stack so they can deploy responsibly and scale with confidence.

A success framework for Frontier Transformation

Microsoft has developed a powerful framework for success as partners enable AI transformation for customers across all segments, industries and geographies:

1. Enriching employee experiences: enabling businesses to empower employees with world-class tools and capabilities to activate a thriving, productive workforce
2. Reinventing customer engagement: applying AI and agentic solutions to break through with customers, accelerate revenue growth, become more efficient at customer acquisition and deliver more personalized solutions
3. Reshaping business processes: redesigning workflows across the business, enhanced by AI and agentic capability
4. Bending the curve on innovation: AI acceleration is a powerful catalyst for business transformation and for addressing society’s biggest challenges — curing disease, addressing climate change and famine and other meaningful advancements

The “what” matters, and so does the “how.” Organizations that scale successfully put AI where people already work, enable innovation close to the business challenge and build observability at every layer so leaders can measure quality, govern risk and manage AI like a production system.

More than 90% of the Fortune 500 use Microsoft 365 Copilot, reflecting how quickly AI is becoming part of everyday work.(1) IDC predicts 1.3 billion agents in circulation by 2028(2) and 80% of the Fortune 500 are already using Microsoft agents, led by operationally complex industries like manufacturing, financial services and retail.(3) As customers move from piloting AI to agents embedded in their flow of work, governance and security need to scale with them.

Microsoft’s approach is straightforward: Copilot drives action in the flow of work, agents orchestrate workflows across systems and Microsoft Agent 365 provides a unified control plane designed to govern and secure agents at scale, with the same tools businesses use for employee administration, such as Microsoft admin center, Defender, Entra and Purview.

Partners are creating impact right now in three areas. First, agentic workflows that remove operational friction and orchestrate end-to-end work across operations, finance, supply chain and service. Second, Customer Zero maturity. Partners who adopt Copilot and agents internally build credibility and move faster because they have meaningful, real-world experiences that they translate into their go-to-market plans. Third, security as the foundation. There is no AI at scale without secure identity, protected data and strong governance.

Microsoft 365 E7 and Agent 365: The Frontier Suite

In March, Microsoft introduced Wave 3 of Microsoft 365 Copilot and announced Microsoft 365 E7: The Frontier Suite, with general availability of Microsoft 365 E7 and Microsoft Agent 365 on May 1, 2026.

Microsoft 365 E7 brings together Microsoft 365 E5 for secure productivity, Entra Suite for identity and access control, Microsoft 365 Copilot for AI in the flow of work and Agent 365 as the control plane to govern and scale agents. It is grounded in shared intelligence from Work IQ, the layer that brings together signals from the Microsoft 365 environment, including content, context and activity, so AI can operate with the right business grounding and policy awareness.

Microsoft Agent 365 provides a unified control plane for agents, enabling IT, security and business teams to observe, govern and secure agents across the organization. This applies to any agents an organization uses, whether they are built on Microsoft AI platforms, delivered by ecosystem partners or introduced through other technology stacks. It also applies the same security and compliance capabilities teams already rely on, including Microsoft Defender, Microsoft Entra and Microsoft Purview.

Some customer scenarios require custom agents. Microsoft Agent Factory is designed to accelerate the move from experimentation to execution. The Microsoft Agent Factory Pre-purchase Plan (P3) adds licensing flexibility across Copilot Studio, Microsoft Foundry, Fabric and GitHub, with tiered discounts intended to support broader adoption rather than isolated pilots. It also enables inclusion of tailored, role-based skilling at no additional cost to the customer, reducing adoption friction and increasing delivered value.

The opportunity for partners is end-to-end, and this is where the partner’s strategy really matters. Shifting from transaction-first to outcome-first, partners who iterate quickly, establish clear guardrails and build an operating rhythm for adoption move customers from interest to impact.

Over time, every organization will employ people who can direct and govern agents as part of daily work. Partners can make that capability real through packaged offers, change management and managed operations. Publishing those packaged offers in the Microsoft Marketplace adds a scalable route to market, improving discoverability and enabling a more repeatable buy-and-deploy motion as customers expand agent usage.

Partner success: What governed scale looks like in practice

“AI is at the forefront of everything we do. Through our ‘learn, use, create’ methodology and our AI Academy, we really support partners with learning paths.”
— Nicole Clark, Global Alliance Manager, Arrow Electronics

Partners are embracing Frontier Transformation by modernizing foundations, driving adoption, designing security into delivery and building agents that automate repeatable work and orchestrate business processes.

• Cognizant treated legacy automation as a platform modernization effort. Using Microsoft Power Platform, Copilot agents and governance frameworks, Cognizant migrated and modernized automation and scaled it across teams, consolidating platforms, lowering costs and reducing manual work through agent-led workflows.
• EPAM’s work with their customer Albert Heijn demonstrates what agent-first execution looks like in frontline scenarios. By delivering an employee-facing virtual assistant inside the retailer’s staff app, EPAM supported scenarios like restocking, onboarding and faster access to product and inventory information, with enterprise governance and observability in mind.
• Insight’s Flight Academy shows what it looks like to treat adoption as a program, not an announcement. Through a structured approach, Insight enables teams to build AI fluency in daily work and reinforces usage with practical learning and internal momentum that can scale beyond early enthusiasts.
• aCloud demonstrated a repeatable security pattern with their customer Jurong Engineering Limited (JEL) by bringing together Microsoft Purview, Microsoft Sentinel, Microsoft Defender XDR and Microsoft Security Copilot, paired with co-design workshops and cross-team alignment to strengthen compliance readiness.
• Arrow Electronics showed how distributor-led enablement can accelerate partner execution by using ArrowSphere to streamline Cloud Solution Provider (CSP) lifecycle management and ArrowSphere Assistant to surface AI-driven insights for renewals, upsell opportunities and Copilot adoption, complemented by a security dashboard that strengthens posture visibility and supports trust-by-design conversations.

Find more stories of partners innovating and driving meaningful outcomes for customers with Microsoft technology.

This same disciplined approach is especially relevant in the small and medium business space (SMB), where Microsoft partners offer end-to-end capability through managed services offerings and solutions packaged into repeatable motions, tailored to this customer segment.

SMB momentum: Scaling work with Copilots and agents

As Microsoft 365 Copilot Business expands AI built for work to organizations with fewer than 300 users, SMBs have a practical path to adopt AI more broadly. CSP partners are well positioned to guide that journey with a motion that combines adoption, security and ongoing management.

New Omdia research illustrates that CSP is a durable growth model for partners. In a study of 267 CSP partners across 36 countries, 79% rated CSP authorization as good, very good or excellent, and 88% would recommend it to other partners.(4) Omdia also found that 60% of CSP partner revenue is now tied to value-added services, with licensing acting as the entry point to broader, services-led engagements.(6)

“We’re bringing customers resources that only a partner can deliver to them: our relationship with Microsoft, technical training and programs that push them further and faster to learn technologies like Microsoft Copilot Studio, Foundry and Fabric.”
— Chance Weaver, Global VP of AI Adoption, Pax8

SMB demand is also expanding. For CSP partners, the near-term opportunity is to standardize advancing Copilot and agents from conversation to consumption. Lead with a simple, repeatable motion: outcome selection, security baseline, deployment, adoption and optimization cadence. Renewal moments are often the easiest time to introduce change when paired with a clear business case and time-bound offers.

A simple, scalable approach is to roll out in stages:

1. Deploy Microsoft 365 Copilot Business broadly, paired with a strong foundation of identity, data protection and compliance.
2. Target high-propensity accounts with tools such as Microsoft CloudAscent and the AI Business Solutions & Security Insights dashboard to deepen adoption and standardize responsible prompting.
3. Extend with agents to take on repeatable tasks and support key business processes, with governance and security built in.

Microsoft provides CSP partners with a powerful set of tools to combine licensing, lifecycle management and optimization into one customer relationship. Omdia notes that partners value operational advantages such as monthly billing flexibility and managing licenses through Partner Center for real-time provisioning and 24/7 license management. Partners can review the CSP incentives guide to understand the latest CSP incentives and how they map to an SMB motion.

Microsoft supports SMB-focused partners by combining product, security and go-to-market resources that make it easy to deliver a repeatable motion. That includes tools to assess readiness, prioritize the right use cases and track adoption over time, plus role-based skilling to build sales and technical and delivery confidence across Copilot, security and agents. For partners building managed services offerings, Microsoft Marketplace also provides a scalable route to market, improving discoverability and enabling customers to buy through familiar procurement paths, while Partner Center brings licensing and lifecycle management into the same operational flow.

Program momentum and updates

The Microsoft AI Cloud Partner Program continues to be the primary way we invest in partners as they build, sell and deliver cloud and AI solutions. Our focus is simple: enable partners to build capability, accelerate demand, differentiate in the market and scale repeatable delivery.

In February 2026, Microsoft introduced a wealth of expanded benefits updates across Copilot, security, Azure credits and go-to-market resources. These updates are designed to strengthen how partners run their business and accelerate the ability to take solutions to market. We continue to evolve partner benefits packages as a practical growth lever, combining product, support and advisory benefits so partners can invest with confidence.

To enable AI Transformation, Microsoft is introducing program updates and offers in the coming months. These updates are intended to enable partners, including services partners, channel partners and software companies, to build and deliver agents across the Frontier product stack. 

• Differentiation via Frontier Partner specialization: The Frontier Badge is evolving into a Frontier Partner specialization. This specialization differentiates partners, including services partners and channel partners, who demonstrate capabilities to build or deliver agents across Microsoft’s Frontier product stack. It creates a clear way for customers and Microsoft field sales teams to identify partners with validated readiness for agentic AI scenarios.
• Updated Frontier Distributor designation: Microsoft is evolving the Frontier Distributor designation to reflect distributor capabilities that matter for scaling agentic AI across the channel. For partners, this will make it easier to identify distributors that can deliver repeatable skilling, enablement to build and manage agents and Marketplace-backed motions to transact and grow agent sales.
• Benefits for software companies building AI apps and agents via App Accelerate: App Accelerate supports software companies building AI apps and agents on the Microsoft agent stack, with benefits designed to bring agentic solutions to market with strong foundations for trust.

Investments in skilling

This year we are investing in partner skilling that connects certification readiness to project-ready execution, with role-based experiences like Project Ready Workshops that translate skills into repeatable delivery practices. These learning experiences are delivered through our Partner Skilling Hub.

We are also introducing the Frontier Engineer Badge, a new learning path delivered through Titan Academy that prepares Solution Engineers and Solution Architects within the partners’ organization to design, build and operate production-ready agentic AI solutions across the Frontier Transformation stack, including Microsoft Copilot, Copilot Studio, Azure AI Foundry, GitHub Copilot, Microsoft Fabric and Agent 365.

The journey is hands-on by design and follows a three-part model: earn required certifications to establish a shared technical baseline, demonstrate delivery capability through Project Ready (building and integrating agents with governance, security and compliance) and build advanced readiness for operating at scale through governance, velocity and industry solution patterns. The outcome is clear: delivery-ready engineers who can move customers from prototypes to trusted, governed deployments.

Capturing the Marketplace opportunity

Marketplaces matter more in 2026 as customers consolidate procurement and expect faster time to value, especially as AI moves from pilots to production. With over 5,000 AI solutions available, Microsoft Marketplace increases discoverability for partner-built AI solutions, including agents, and supports a more repeatable buy-and-deploy motion through familiar procurement. It also makes it easy for partners to package multiparty software and services offers, so customers can purchase what they need to implement, govern and scale AI in production.

Omdia projects Microsoft Marketplace as a nearly $300 billion partner services opportunity by 2030. In the same study, partners selling through Marketplace reported go-to-market benefits, including faster sales cycles and larger deals, with 75% of study participants reporting faster closes and 69% reporting larger deals through Microsoft Marketplace.(5)

To accelerate demand generation and make it easy to activate these motions, we recently introduced Partner Marketing Center Pro, an AI-powered experience for end-to-end campaign creation. It brings campaign discovery, customization and co-branding, intelligent localization and translation, automated publishing and built-in reporting into one workflow, with an AI assistant that provides coaching throughout the process.

Partner Marketing Center Pro is a benefit of the Microsoft AI Cloud Partner Program available to partners who have purchased at least one partner benefits package, who have attained a Solutions Partner designation or who are currently enrolled in ISV Success.

Ways to engage now

Here are a few practical next steps partners can take to maximize their Microsoft investment:

Start by joining the Microsoft AI Cloud Partner Program.

• Plan to attend our annual sales kickoff for partners, virtually on Wednesday, July 22, 2026, to learn more about FY27 priorities and execution motions.
• Explore partner benefits packages and select the option that aligns to their growth plan.
• Pursue a Solutions Partner designation or specialization that matches their solution plays and customer demand.
• Visit the Partner Skilling Hub to find role-based learning resources.
• Launch an FY26 campaign focused on SMB, security, Copilot adoption or marketplace growth using Partner Marketing Center Pro.

Making Frontier Transformation real

Frontier Transformation is about building AI-powered operating capability grounded in intelligence and trust, and delivered consistently across industries, geographies and market segments. Partners make that real for customers by turning strategy into production-ready solutions, with governance, security and adoption built in from day one.

Microsoft is committed to partner success. We will continue investing in the Microsoft AI Cloud Partner Program, with the incentives, the skilling and the go-to-market capabilities that enable partners to build repeatable offers, increase discoverability and deliver trusted AI outcomes for customers at scale.

Nicole Dezen leads the Microsoft partner ecosystem and the Global Channel Partner Sales organization in Small, Medium Enterprises and Channel (SME&C). As Chief Partner Officer, she has grown the Microsoft partner ecosystem to become the largest in the industry, enabling more than 500,000 partners to deliver AI transformation to millions of customers in each segment around the world.

 

Footnotes

¹ Microsoft FY25 Third Quarter Earnings Conference Call, Microsoft, April 2025.
² IDC Info Snapshot, sponsored by Microsoft, 1.3 Billion AI Agents by 2028, #US53361825, May 2025.
³ Based on Microsoft first party telemetry measuring agents built with Microsoft Copilot Studio or Microsoft Agent Builder that were in use during the last 28 days of November 2025.
⁴ Omdia, Unlocking Growth Potential: Partner Perspectives on Microsoft CSP, December 2025. Results are not an endorsement of Microsoft. Any reliance on these results is at the third party’s own risk.
⁵ Microsoft estimate based on IDC data (SMB TAM: $777B by FY26; $1T+ by 2030), as published on the Microsoft Partner Blog, “The Microsoft Marketplace opportunity for channel ecosystem,” November 20, 2025.
⁶ Omdia, Partner Ecosystem Multiplier – The Microsoft Marketplace Opportunity, commissioned research sponsored by Microsoft, December 2025. Results are not an endorsement of Microsoft. Any reliance on these results is at the third party’s own risk.

Throughout this document, $ refers to USD.

 

 

 

 

The post Accelerating Frontier Transformation with Microsoft partners appeared first on The Official Microsoft Blog.

Today is the day. Open to Work: How to Get Ahead in the Age of AI is officially available!

At a time when technology dominates the headlines, the conversation I see most often on LinkedIn is deeply human: what does AI mean for my job and my career?

And that makes sense. Careers once felt more predictable. Titles defined what you did. Progress looked like a ladder. That model has been evolving for years, but AI is accelerating the shift.

The most important truth about this moment is that the outcome isn’t written yet. The new world of work is being assembled right now, task by task, policy by policy, business by business. It will reflect the choices of the people who show up to build it.

That’s why Aneesh Raman and I wrote this book.

Open to Work is a practical guide informed by what we see across the global labor market and insight into the tools millions of people use every day. It’s for every person asking what comes next for their job, their career, their company or their community.

With help from experts and everyday LinkedIn members, it shows you how to engage with AI before you have to, how to adapt by focusing on what you can control and how to become irreplaceable by leaning into what makes you uniquely you.

And those ideas don’t just apply to individuals, they guide how we as Microsoft and LinkedIn are building for this moment. At the intersection of how work gets done and how careers get built, our shared goal is to connect people to opportunity and turn the tools they use every day into a canvas for human and AI collaboration at scale. Done right, that’s how AI expands opportunity and helps people build confidence and momentum in their careers.

We’ve always believed technology should serve people. AI should help humans. Not the other way around. That doesn’t happen by accident. It happens when we all decide to make it true.

If you want to go deeper on Open to Work, listen to my conversation with Microsoft President and Vice Chair Brad Smith on his Tools and Weapons podcast.

Open to Work is available now at linkedin.com/opentowork.

Ryan Roslansky is the CEO of LinkedIn and Executive Vice President of Microsoft Office, where he leads engineering for products like Word, Excel, PowerPoint and Copilot. Through these roles, Ryan is shaping where work goes next to unleash greater economic opportunity for the global workforce.

The post Open to Work: How to Get Ahead in the Age of AI appeared first on The Official Microsoft Blog.

Satya Nadella, Chairman and CEO, and Mustafa Suleyman, Executive Vice President and CEO of Microsoft AI, shared the below communications with Microsoft employees this morning.

SATYA NADELLA MESSAGE

I want to share two org changes we’re making to our Copilot org and superintelligence effort.

It’s clear a new era of productivity is emerging as AI experiences rapidly evolve from answering questions and suggesting code, to executing multi-step tasks with clear user control points. You see this in our announcements over the last couple of weeks, like Copilot Tasks and Copilot Cowork, agentic capabilities in Office, and Agent 365. As these experiences connect more naturally across agents, apps, and workflows, we have an opportunity to help customers spend more time on higher-value work and reduce manual coordination, while providing people with more agency and empowerment and organizations with the governance and security controls they need.

To that end, we are bringing the Copilot system across commercial and consumer together as one unified effort. This will span four connected pillars: Copilot experience, Copilot platform, Microsoft 365 apps, and AI models. This is how we move from a collection of great products to a truly integrated system, one that is simpler and more powerful for customers.

Jacob Andreou will lead the Copilot experience across consumer and commercial, driving design, product, growth, and engineering, as EVP, Copilot, reporting to me. As CVP of Product and Growth at Microsoft AI, Jacob has accelerated our user-focused AI-first product making and growth framework. Prior to that, he was SVP at Snap, where he helped scale the company from its early days.

Progress at the AI model layer is more critical than ever to our success as a company over the next decade and is foundational to everything we build above it. We are doubling down on our superintelligence mission with the talent and compute to build models that have real product impact, in terms of evals, COGS reduction, as well as advancing the frontier when it comes to meeting enterprise needs and achieving the next set of research breakthroughs. Mustafa Suleyman and I have been working towards this plan for some time, and he will continue to lead this high ambition work, reporting to me. Mustafa is uniquely qualified to drive this forward, with his deep focus and commitment to advancing the frontiers of model science, while also ensuring that human control, agency, and economic opportunity remain at the center of these advancements.

Ryan Roslansky, Perry Clarke, and Charles Lamanna will lead M365 apps and the Copilot platform. Together, Jacob, Ryan, Charles, Perry, and Mustafa make up the Copilot LT and over the next few weeks they’ll work to align the teams.

Our org boundaries will simply reflect system architecture and product shape such that we can deliver more coherent and competitive experiences that continue to evolve with model capabilities. And I am looking forward to how together we apply all of this to empower people, organizations, and the world.

MUSTAFA SULEYMAN MESSAGE

Subject: A new structure for Microsoft AI

Technology and the future of our industry will be defined by two things: frontier models, and the products through which they are experienced. For some time, I’ve been thinking about how we best tackle these huge challenges, and today I’m excited to be evolving our structure at Microsoft AI, ensuring we’re positioned to succeed in both.

I came to Microsoft with an overriding mission: to create Superintelligence that delivers a transformative, positive impact for millions of people. This requires us to build frontier models, at scale, pushing the boundaries of what’s possible. Everything else follows from this. It’s the foundation for our future as a company. With our ambitious, long-term frontier scale compute roadmap locked, we now have everything we need to build truly SOTA models.

As you will have just heard from Satya, the next phase of this plan is to restructure our organization to enable me to focus all my energy on our Superintelligence efforts and be able to deliver world class models for Microsoft over the next 5 years. These models will enable us to build enterprise tuned lineages that help improve all our products across the company. They’ll also enable us to deliver the COGS efficiencies necessary to be able to serve AI workloads at the immense scale required in the coming years. Achieving all this will be a huge challenge, and I’m committing everything we have – and I have personally – to make it happen.

To that end, I’ve been working hard with other leaders in the background for a while now to define a strategy to unify Copilot by bringing together the Consumer and Commercial efforts as one. We all know this makes sense. Every user – whether at home or at work – will be able to enjoy the full benefit of what we are all building. Today, we’re combining these organizations into a single, unified Copilot org. Jacob has demonstrated himself to be an outstanding leader for the product experience and clearly has the product instincts, the operational range, and the conviction to make Copilot a great success.

Jacob will retain a dotted line to me, and I’ll stay directly involved in much of the day-to-day operation of MAI, attending Meetups, MMMs, LT, and supporting Jacob to drive all areas of product strategy. To ensure that the models we build and the products we ship are mutually reinforcing, we are establishing a Copilot Leadership Team that includes me, Jacob, Charles Lamanna, Perry Clarke, and Ryan Roslansky. This will enable us to focus our brand strategy, our product roadmap, our models and our core infrastructure as one to deliver the best experiences possible for all our users.

Thank you for everything you’ve done over the last few years. I know how hard everyone has been pushing and the sacrifices many of you have made to help the company adapt to this new era.

We really do have an incredible opportunity to redefine Microsoft for this agentic revolution.

Mustafa’s mail has been edited slightly for external use.

The post Announcing Copilot leadership update appeared first on The Official Microsoft Blog.

Microsoft combines accelerated computing with cloud scale engineering to bring advanced AI capabilities to our customers. For years, we’ve worked with NVIDIA to integrate hardware, software and infrastructure to power many of today’s most important AI breakthroughs.

What’s new at NVIDIA GTC

• Expanded Microsoft Foundry capabilities to build, deploy and operate production-ready AI agents on NVIDIA accelerators and open NVIDIA Nemotron models
• New Azure AI infrastructure optimized for inference-heavy, reasoning-based workloads, including the first hyperscale cloud to power on next-generation NVIDIA Vera Rubin NVL72 systems
• Deeper integration across Microsoft Foundry, Microsoft Fabric and NVIDIA Omniverse libraries and open frameworks to support Physical AI systems from simulation to real‑world operations

From Frontier models to production-ready agents

At the foundation of this system is Microsoft Foundry: serving as the operating system for building, deploying and operating AI at enterprise scale. Foundry builds on Azure to bring together models, tools, data and observability into a single system designed for production agents. Today we’re expanding those capabilities across Foundry Agent Service and NVIDIA Nemotron models.

The next-generation Foundry Agent Service and Observability in Foundry Control Plane are now generally available, enabling organizations to build and operate AI agents at production scale. Foundry Agent Service allows teams to quickly develop agents that reason, plan and act across tools, data and workflows. Once created, Foundry Control Plane provides the developer end-to-end visibility into agent behavior, unlocking both developer productivity as well as enterprise trust. Companies such as Corvus Energy are already using Foundry to replace manual inspection workflows with agent-driven operational intelligence across their global fleet.

We are further simplifying the path from prototype to production with the availability of Voice Live API integration with Foundry Agent Service, in public preview, which enables developers to build voice-first, multimodal, real-time agentic experiences. This pairs with the general availability of a refreshed Microsoft Foundry portal and expanded integrations for Palo Alto Networks’ Prisma AIRS and Zenity, delivering deeper builder experiences and runtime security across the entire agent lifecycle.

NVIDIA Nemotron models are also now available through Microsoft Foundry, joining the widest selection of models on any cloud, including the latest reasoning, frontier and open models. This bolsters our recent partnership announcement bringing Fireworks AI to Microsoft Foundry, enabling customers to fine-tune open-weight models like NVIDIA Nemotron into low-latency assets that can be distributed to the edge.

Scaling AI infrastructure for the world’s most demanding workloads

Inference AI workloads are reshaping cost, performance and system design requirements. To operationalize agentic AI at scale, customers need purpose-built infrastructure for inference‑heavy, reasoning‑based workloads that can be deployed and operated consistently across global and regulated environments.

Microsoft’s AI infrastructure approach is engineered to seamlessly bring next-generation NVIDIA systems into Azure datacenters that are designed for power, cooling networking and rapid generational upgrades. This allows our customers to move with speed and agility and stay at the leading edge from generation to generation.

In less than a year, we’ve deployed hundreds of thousands of liquid-cooled Grace Blackwell GPUs across our global datacenter footprint, and now we are excited to be the first hyperscale cloud to power on NVIDIA’s newest Vera Rubin NVL72 in our labs. Over the next few months, Vera Rubin NVL72 will be rolled out into our modern, liquid-cooled Azure datacenters.

Microsoft’s infrastructure innovation with NVIDIA also extends to sovereign and regulated environments to give customers control of both where AI runs and how it evolves over time. Recently, we announced Foundry Local support for modern infrastructure and large AI models, and today we now have initial support for NVIDIA Vera Rubin platform on Azure Local, extending accelerated AI capabilities to customer-controlled environments. This approach allows organizations to plan for next-generation AI workloads, including reasoning-based and agentic systems, while maintaining Azure-consistent operations, governance and security through our unified software layer with Azure Arc and Foundry Local.

Bringing AI into the physical world

As AI moves beyond digital experiences, Microsoft and NVIDIA are collaborating to support the next wave of Physical AI. At GTC, this work centers on NVIDIA Physical AI Data Factory Blueprint, with Microsoft Foundry as the platform for hosting and operating Physical AI systems on Azure at cloud scale.

By integrating this blueprint with Azure services as part of a Physical AI Toolchain, Microsoft enables developers to build, train and operate physical AI and robotics workflows that connect physical assets, simulation and cloud training environments into repeatable, enterprise-grade pipelines. To support, we are introducing a public Azure Physical AI Toolchain GitHub repository integrated with the Nvidia Physical AI Data Factory and with core Azure services.

To further the impact of AI in real‑world, physical environments, today Microsoft and NVIDIA are deepening the integration between Microsoft Fabric and NVIDIA Omniverse libraries, connecting live operational data with physically accurate digital twins and simulation. This allows organizations to see what’s happening across their physical systems, understand it in real time and use AI to decide what to do next. In practice, customers in manufacturing and operations and beyond are using this approach to move beyond dashboards and alerts to coordinated, AI‑driven action across machines, facilities and workflows.

From innovation to impact

Microsoft is delivering reliable, production‑scale AI by bringing together its global AI infrastructure, platforms and real‑world systems with the latest innovation from NVIDIA. For customers, this means the ability to operate intelligence continuously, running inference-heavy, reasoning-based and physical AI workloads with the performance, security and governance required for real businesses and regulated industries.

Whether powering always-on agents, scaling next-generation AI infrastructure or deploying intelligent systems in factories, energy facilities and sovereign environments, Microsoft and Nvidia are helping customers move faster from insight to action.

Yina Arenas leads product strategy and execution for Microsoft Foundry, overseeing the end–to–end AI product portfolio, infrastructure, developer experiences and foundation model integration across OpenAI, Anthropic, Mistral, DeepSeek and others. She delivers an enterprise ready, production grade AI platform trusted by global customers for secure, reliable and scalable AI.

The post Microsoft at NVIDIA GTC: New solutions for Microsoft Foundry, Azure AI infrastructure and Physical AI appeared first on The Official Microsoft Blog.

Rajesh Jha, Executive Vice President, Experiences + Devices, and Satya Nadella, Chairman and CEO, shared the below communications with Microsoft employees this morning.

RAJESH JHA MESSAGE 

Subject: Organizing for the future and my transition

Dear Team,

After 35+ years at Microsoft, I am moving into retirement. I will transition out on July 1st and then stay in an advisory role.

Satya and I have been working on succession for some time. I am incredibly confident and excited about the future with Perry Clarke, Charles Lamanna, Pavan Davuluri, and Ryan Roslansky as EVP direct reports to Satya.

I am also excited to announce the promotions of Jeff Teper to EVP, and Sumit Chauhan and Kirk Koenigsbauer to President.

Please join me in congratulating these leaders on this well-deserved recognition.

We’re announcing these top-level changes today, and between now and June, my leadership team and I will work together to finalize the full cascade of details needed in this kind of transition. This includes aligning operating rhythms, decision ownership, and details on the future org structure, all so we’ll be fully aligned and ready to run at the start of FY27. Our intent in taking this approach is to minimize changes and not lose the great momentum we have.

Our priorities around SFI, QEI, and Copilot remain unchanged – let’s keep the intensity here.

I want to add that working with you all over the years, in the service of customers, has been an incredible privilege for me. I am deeply grateful.

Best regards,

Rajesh

SATYA NADELLA MESSAGE

Rajesh has been a constant throughout my entire life at Microsoft. From our earliest days working together, I have admired his unwavering commitment to his team, to our customers, to the products we build, and to the company. I have always been struck by his operational rigor, his ability to make the hard strategic calls, lead through the grind, and emerge stronger on the other side. That, to me, is what true leadership looks like.

When I think about the pantheon of leaders who have truly shaped this company, Rajesh stands firmly among them. He embodies the commitment that helped build and transform Microsoft into the company it is today, and it is on the strength of that foundation that we will continue to move forward. 

And as we look to the future, the opportunity ahead is expansive. We have the depth of talent, the product ethos, and a clear sense of purpose as a company to ensure our technology advancements accrue to our mission of empowerment.

Rajesh – I am deeply grateful for all you have done for Microsoft and our customers and for all you have taught me personally. On behalf of all of us – Thank You.

Satya

 

The post Microsoft announces Experiences + Devices leadership changes appeared first on The Official Microsoft Blog.

Today Microsoft is announcing:

• Wave 3 of Microsoft 365 Copilot
• Expanded model diversity with Claude and next-gen OpenAI models available today
• General availability of Agent 365 on May 1 for $15 per user
• General availability of the new Microsoft 365 E7: The Frontier Suite on May 1 for $99 per user¹

Frontier Transformation is a holistic reimagining of business, aligning AI with human ambition to achieve an organization’s highest aspirations. It is the next evolution of AI Transformation — not only do we need to deliver efficiency and productivity, but we need to democratize intelligence and do more for humanity. Companies do not want or need more AI experimentation. They need AI that delivers real business outcomes and growth.

In my daily conversations with customers and partners, they typically question what the most important components of an AI solution are. Is it the model? Is it silicon? At Microsoft, we believe the two most essential elements of Frontier Transformation are Intelligence + Trust. Organizations need to harness their own unique work intelligence as they build agents and solutions and all AI artifacts across their technology stack must be observed, managed and secured to ensure they are delivering value responsibly. 

Intelligence that shows up in real work 

I often say that zero-shot artifact creation is nothing more than a parlor trick. Models can reason over data, produce draft documents, presentations and spreadsheets, but they do not understand work. Real differentiation comes from intelligence — deep work context, embedded in the tools people already use. AI should amplify your intelligence but do so in a manner that protects your differentiation and unique value.

Work IQ amplifies an individual’s IQ by tapping into your organization’s IQ. It is the intelligence layer that enables Microsoft 365 Copilot and agents to know how you work, with whom you work and the content upon which you collaborate. That is why Copilot is faster, more accurate and more trusted than solutions built on models and connectors alone.

This month, we are unleashing Work IQ with our next generation of agentic experiences in Wave 3 of Microsoft 365 Copilot in Word, Excel, PowerPoint and Outlook. Employees will have an enhanced chat experience in Copilot with the ability to create and augment artifacts, and the power to build their own agents within the canvas they work in every day.

Microsoft 365 Copilot is model diverse by design. Rather than betting on a single model, we built a system that makes every model useful at work. Customers get the choice, performance and flexibility in an open, heterogenous environment.  Copilot leverages leading models from OpenAI and Anthropic, operating openly across clouds and data services without locking customers in. Claude is now available in mainline chat in Copilot via the Frontier program, alongside the latest generation of OpenAI models.

Microsoft 365 Copilot Wave 3 is not just a singular release of new capabilities but rather a commitment to continuous innovation. We will bring frontier capabilities with enterprise promises for our customers in an open and model diverse manner. Another great example of this is Copilot Cowork, which is in research preview. Built in close collaboration with Anthropic, we are bringing the technology that powers Claude Cowork into Microsoft 365 Copilot to enable long-running, multi-step work that unfolds over time.  Learn about our Wave 3 news.

These announcements come as our customers across industries are already seeing the value of Microsoft 365 Copilot. Microsoft recently delivered its strongest quarter yet with Copilot, with paid seats growing more than 160% year over year and daily active usage up ten times, as customers increasingly make Copilot a core part of everyday work. Expansion is also accelerating as the number of customers deploying Copilot at significant scale — more than 35,000 seats — tripled year over year. Just last week, Mercedes Benz announced a global rollout of Microsoft 365 Copilot, following recent investments from NASA, Fiserv, ING, the University of Kentucky, the University of Manchester, the U.S. Department of the Interior and Westpac. This is in addition to the 90 percent of the Fortune 500 who now use Copilot.

Trust: from agent experimentation and sprawl to enterprise control 

The speed of agent development and proliferation tells us customers see value, but without guardrails the pace of adoption turns into blind spots, diminished ROI and real security risk. As AI agents become more capable and autonomous, trust is nonnegotiable. IDC predicts 1.3B agents in circulation by 2028, and 80% of the Fortune 500 are already using Microsoft agents, led by operationally complex industries like manufacturing, financial services and retail.

That is why I am excited to announce the May 1 general availability of Microsoft Agent 365, the control-plane for AI agents. Priced at $15 per user, Agent 365 gives IT and security leaders a single place to observe, govern, manage and secure agents across the organization — using the same infrastructure, applications and protections they rely on to manage people today.

We are seeing tremendous momentum with our preview customers. In just two months, tens of millions of agents have appeared in the Agent 365 Registry. We have tens of thousands of customers that are already adopting Agent 365 to securely govern and scale AI agents across enterprise workflows.

At Microsoft, we are also using Agent 365 as Customer Zero and the early signals are clear. We now have visibility into more than 500,000 agents across the company with the most widely used focused on research, coding, sales intelligence, customer triage and HR self-service. That adoption is translating into real work. Over the past 28 days alone, agents have been generating more than 65,000 responses every day for employees. This is evidence that we are not simply experimenting, we are embedding agents in the flow of everyday work and empowering human ambition.

Introducing the Frontier Suite

To meet this demand, I am thrilled to announce we are bringing Intelligence + Trust together with Microsoft 365 E7: The Frontier Suite. Microsoft 365 E7 unifies Microsoft 365 E5, Microsoft 365 Copilot and Agent 365 into a single solution powered by Work IQ and integrated with the apps and security stack customers already rely on. It includes Microsoft Entra Suite and advanced Defender, Intune and Purview security capabilities, delivering comprehensive protection across agents and employees.

Customers have told us E5 alone is no longer enough; they do not want multiple tools stitched together, they want one trusted solution. At $99 per user, E7 is priced below purchasing these capabilities à la carte, giving customers a simpler, more cost-effective way to deploy enterprise AI at scale.

With the general availability of Agent 365 and the latest agentic experiences in Microsoft 365 Copilot offered as one Frontier suite, AI moves from experimentation to durable, enterprise-wide value, built on a foundation of Intelligence + Trust. This is how we make Frontier Transformation real. Microsoft is not just imagining the future of AI, we are empowering organizations across industries and around the world to build it.

¹Microsoft 365 E7 is available with and without Teams.

The post Introducing the First Frontier Suite built on Intelligence + Trust appeared first on The Official Microsoft Blog.

Since 2019, Microsoft and OpenAI have worked together to advance artificial intelligence responsibly and make its benefits broadly accessible. What began as a research partnership has grown into one of the most consequential collaborations in technology — grounded in mutual trust, deep technical integration, and a long‑term commitment to innovation. 

As conversations around AI investments and partnerships grow and as OAI announces new funding and new partners as they did today, we want to ensure these announcements are understood within the existing construct of our partnership. Nothing about today’s announcements in any way changes the terms of the Microsoft and OpenAI relationship that have been previously shared in our joint blog in October 2025. 

The partnership remains strong and central. Microsoft and OpenAI continue to work closely across research, engineering, and product development, building on years of deep collaboration and shared success. 

Our IP relationship continues unchanged. Microsoft maintains its exclusive license and access to intellectual property across OpenAI models and products. Collaborations like the partnership between OpenAI and Amazon were always contemplated under our agreements and Microsoft is excited to see what they build together. 

Our commercial and revenue share relationship remains unchanged. The ongoing revenue share arrangement remains unchanged and has always included sharing revenue from partnerships between OpenAI and other cloud providers. 

Azure remains the exclusive cloud provider of stateless OpenAI APIs. Microsoft is the exclusive cloud provider for stateless APIs that provide access to OpenAI’s models and IP. These APIs can be purchased from Microsoft or directly from OpenAI. Customers and developers benefit from Azure’s global infrastructure, security, and enterprise-grade capabilities at scale. Any stateless API calls to OpenAI models that result from a collaboration between OpenAI and any third party – including Amazon – would be hosted on Azure. 

OpenAI’s first party products, including Frontier, will continue to be hosted on Azure.  

AGI definition and processes are unchanged. The contractual definition of AGI and the process for determining if it has been achieved remains the same.

The partnership supports OpenAI’s growth. As OpenAI scales, it continues to have flexibility to commit to additional compute elsewhere, including through large-scale infrastructure initiatives such as the Stargate project.  

The partnership was designed to give Microsoft and OpenAI room to pursue new opportunities independently, while continuing to collaborate, which each company is doing, together and independently. 

We remain committed to our partnership and to the shared mission that brought us together. We continue to work side‑by‑side to deliver powerful AI tools, advance responsible development, and ensure that AI benefits people and organizations everywhere.

The post Microsoft and OpenAI joint statement on continuing partnership appeared first on The Official Microsoft Blog.

As digital sovereignty becomes a strategic requirement, organizations are rethinking how they deploy critical infrastructure and AI capabilities under tighter regulatory expectations and higher risk conditions. Microsoft’s approach to sovereignty is grounded in enabling enterprises, public sectors and regulated industries to participate in the digital economy securely, independently and on their own terms. The Microsoft Sovereign Cloud brings together productivity, security and cloud workloads to span both public and private environments. Customers can choose the right control posture for each workload, through a continuum of sovereign options protecting against fragmenting their architecture or increasing operational risk. Trust is built on confidence: confidence that data stays protected, controls are enforceable and operations can continue under real-world conditions.  

To support these confidential environments, Microsoft offers full stack capabilities that support customers across connected, intermittently connected and fully disconnected modes. Today’s expansion of capabilities includes three major updates:

• Azure Local disconnected operations (now available) – Organizations can now run mission-critical infrastructure with Azure governance and policy control, with no cloud connectivity, optimizing continuity for sovereign, classified or isolated environments. 

• Microsoft 365 Local disconnected (now available) – Core productivity workloads, Exchange Server, SharePoint Server and Skype for Business Server can run fully inside the customer’s sovereign operational boundary on Azure Local, keeping teams productive even when disconnected from the cloud. 

• Foundry Local adds modern infrastructure capabilities and support for large AI models – Organizations can now bring large AI models into fully disconnected, sovereign environments with Foundry Local. Using modern infrastructure from partners like NVIDIA, customers with sovereign needs will now be able to run multimodal models locally on their own hardware, inside strict sovereign boundaries enabling powerful, local AI inferencing in fully disconnected environments. 

This delivers a truly localized full stack experience built on Azure Local infrastructure and Microsoft 365 Local workloads, designed to stay resilient across any connectivity condition, with large models being part of Foundry Local extending the stack to run advanced multimodal models locally, securely, even when fully disconnected. Customers can now help maintain uninterrupted operations, keep mission critical workloads protected and apply consistent governance and policy enforcement, while keeping data, identities and operations within their sovereign boundaries.

Azure Local runs critical infrastructure locally, even when disconnected 

For workloads with specialized requirements, Azure Local provides the on-premises foundation with consistent Azure governance and policy controls. With Azure Local disconnected operations, management, policy and workload execution stay within the customer-operated environments, so services continue running securely even when environments must be isolated or connectivity is not available. Using familiar Azure experiences and consistent policies, organizations can deploy and govern workloads locally without depending on continuous connection to public cloud services. Azure Local is designed to scale with mission-critical needs from smaller deployments to larger footprints that support data-intensive and AI-driven workloads. Customers can start fast, expand over time and maintain a unified operational model, all within their sovereign boundary.

Operating in disconnected environments surfaces constraints that go beyond traditional cloud assumptions: External dependencies may be unacceptable, connectivity may be intentionally restricted and operational continuity is a business imperative. 

“The availability of Azure Local disconnected operations represents a breakthrough for organizations that need control over their data without sacrificing the power of the Microsoft Cloud. For Luxembourg, where digital sovereignty is not just a principle but a strategic necessity, this model offers the resilience, autonomy and trust our market expects. By combining Microsoft’s technological leadership with Proximus NXT’s sovereign cloud expertise, we are enabling our customers to innovate confidently — even in fully disconnected mode,” said Gerard Hoffmann, CEO Proximus Luxembourg. 

Microsoft 365 Local keeps productivity and collaboration available in fully disconnected environments 

As sovereign environments move into disconnected environments, keeping people productive becomes just as critical as keeping infrastructure online. Building on more than a decade of delivering and supporting these services, Microsoft 365 Local disconnected brings that continuity to the productivity layer, delivering Microsoft’s core server workloads — Exchange Server, SharePoint Server and Skype for Business Server supported through at least 2035 — directly into the customer’s sovereign private cloud.  

With Microsoft 365 Local, teams can communicate, share information and collaborate securely within the same controlled boundary as their infrastructure and AI workloads. Everything runs locally, under customer-owned policies, with full control of data resiliency, access and compliance. By operating with Azure-consistent management and governance, customers get the productivity experience they rely on, designed to stay resilient and secure even when offline. 

Bringing large models and modern infrastructure to Foundry Local 

With the availability of larger models and modern infrastructure as part of the Foundry Local portfolio, Microsoft is enabling customers with highly secure environments the ability to run multimodal, large models directly inside their sovereign private cloud environments. This brings the richness of Microsoft’s enterprise AI capabilities to on-premises systems, complete with local inferencing and APIs that operate completely within customer-controlled data boundaries.  

Expanding beyond small models, the integration of Foundry Local with Azure Local is specifically designed to support large-scale models utilizing the latest GPUs from partners such as NVIDIA. Microsoft will provide comprehensive support for deployments, updates and operational health. Even as inferencing demands increase over time, customers retain complete control over their data and hardware.  

Choice and control without added complexity 

Customers facing strict sovereignty and regulatory requirements are clear that a fully disconnected sovereign private cloud is a key business need. Microsoft Sovereign Private Cloud is designed to meet these needs head-on, enabling secure, compliant operations even in environments with no external connectivity. At the same time, we recognize that disconnected environments are not one-size-fits-all; some customers operate across connected, hybrid and disconnected modes based on mission, risk and regulation. Our approach helps customers to meet strict sovereign requirements in fully disconnected scenarios without compromising simplicity, while retaining flexibility where connectivity is possible. Together, Azure Local disconnected operations, Microsoft 365 Local and Foundry Local help organizations choose where workloads run and how environments are managed, while standardizing governance and operational practices across connected and disconnected deployments. 

Get started 

• Azure Local disconnected operations and Microsoft 365 Local disconnected are now available worldwide, and large models on Foundry Local are available to qualified customers. 

• Explore the Microsoft Sovereign Cloud  

• Learn more about Azure Local disconnected operations 

Douglas Phillips leads global engineering efforts for Microsoft’s specialized, sovereign, and private clouds. He is responsible for Microsoft’s global strategy, products and operations that bring Microsoft’s industry-leading solutions, including Azure, our adaptive cloud portfolio and Microsoft 365 collaboration suite, to customers with additional sovereignty, security, edge and compliance requirements. 

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Satya Nadella, Chairman and CEO, and members of his executive team shared the following communications with employees today.

SATYA NADELLA MESSAGE

Gaming has been part of Microsoft from the start. Flight Simulator shipped before Windows, and you can practically ray‑trace a line from DirectX in the ’90s to the accelerated‑compute era we’re in today.

As we celebrate Xbox’s 25^th year, the opportunity and innovation agenda in front of us is expansive. Today we reach over 500 million monthly active users, are a top publisher across all platforms, and continue to innovate across gaming hardware, content, and community, in service of creators and players everywhere.

I am long on gaming and its role at the center of our consumer ambition, and as we look ahead, I’m excited to share that Asha Sharma will become Executive Vice President and CEO, Microsoft Gaming, reporting to me. Over the last two years at Microsoft, and previously as Chief Operating Officer at Instacart and a Vice President at Meta, Asha has helped build and scale services that reach billions of people and support thriving consumer and developer ecosystems. She brings deep experience building and growing platforms, aligning business models to long-term value, and operating at global scale, which will be critical in leading our gaming business into its next era of growth.

Matt Booty will become Executive Vice President and Chief Content Officer, reporting to Asha. Matt’s career reflects a lifelong commitment to games and to the people who make them. Under his leadership, Microsoft Gaming has grown to span nearly 40 studios across Xbox, Bethesda, Activision Blizzard, and King, which are home to beloved franchises including Halo, The Elder Scrolls, Call of Duty, World of Warcraft, Diablo, Candy Crush, and Fallout.

Together, Asha and Matt have the right combination of consumer product leadership and gaming depth to push our platform innovation and content pipeline forward. Last year, Phil Spencer made the decision to retire from the company, and since then we’ve been talking about succession planning. I want to thank Phil for his extraordinary leadership and partnership. Over 38 years at Microsoft, including 12 years leading Gaming, Phil helped transform what we do and how we do it. He expanded our reach across PC, mobile, and cloud; nearly tripled the size of the business; helped shape our strategy through the acquisitions of Activision Blizzard, ZeniMax, and Minecraft; and strengthened our culture across our studios and platforms.  I’ve long admired Phil’s unwavering commitment to players, creators, and his team, and I am personally grateful for his leadership and counsel. He will continue working closely with Asha to ensure a smooth transition.

We have extraordinary creative talent across our studios and a global platform that is second to none. I’m excited for how we will capture the opportunity ahead and define what comes next, while staying grounded in what players and creators value.

Please join me in congratulating Asha and Matt on their new roles, and in thanking Phil for everything he has done for Microsoft and for our industry.

PHIL SPENCER MESSAGE

When I walked through Microsoft’s doors as an intern in June of 1988, I could never have imagined the products I’d help build, the players and customers we’d serve, or the extraordinary teams I’d be lucky enough to join. It’s been an epic ride and truly the privilege of a lifetime.

Last fall, I shared with Satya that I was thinking about stepping back and starting the next chapter of my life. From that moment, we aligned on approaching this transition with intention, ensuring stability, and strengthening the foundation we’ve built. Xbox has always been more than a business. It’s a vibrant community of players, creators, and teams who care deeply about what we build and how we build it. And it deserves a thoughtful, deliberate plan for the road ahead.

Today marks an exciting new chapter for Microsoft Gaming as Asha Sharma steps into the role of CEO, and I want to be the first to welcome her to this incredible team. Working with her over the past several months has given me tremendous confidence. She brings genuine curiosity, clarity and a deep commitment to understanding players, creators, and the decisions that shape our future. We know this is an important moment for our fans, partners, and team, and we’re committed to getting it right. I’ll remain in an advisory role through the summer to support a smooth handoff.

I’m also grateful for the strength of our studios organization. Matt Booty and our studios teams continue to build an incredible portfolio, and I have full confidence in the leadership and creative momentum across our global studios.  I want to congratulate Matt on his promotion to EVP and Chief Content Officer.

As part of this transition, Sarah Bond has decided to leave Microsoft to begin a new chapter. Sarah has been instrumental during a defining period for Xbox, shaping our platform strategy, expanding Game Pass and cloud gaming, supporting new hardware launches, and guiding some of the most significant moments in our history. I’m grateful for her partnership and the impact she’s had, and I wish her the very best in what comes next.

Most of all, to everyone in Microsoft Gaming, I want to say “thank you.” I’ve learned so much from this team and community, grown alongside you, and been continually inspired by the creativity, courage, and care you bring to players, creators, and to one another every day.

I’m incredibly proud of what we’ve built together over the last 25 years, and I have complete confidence in all of you and in the opportunities ahead. I’ll be cheering you on in this next chapter as Xbox’s proudest fan and player.

Phil

XBL: P3

ASHA SHARMA MESSAGE

Dear team,

Today I begin my role as CEO of Microsoft Gaming.

I feel two things at once: humility and urgency.

Humility because this team has built something extraordinary over decades. Urgency because gaming is in a period of rapid change, and we need to move with clarity and conviction.

I am stepping into work shaped by generations of artists, engineers, designers, writers, musicians, operators and more who create worlds that have brought joy and deep personal meaning to hundreds of millions of players. The level of craft here is exceptional, and it is amplified by Xbox, which was founded in the belief that the power of games connects people and pushes the industry forward.

Thank you to Phil for his leadership, and to every studio, platform, and operations team that built this foundation. We are stewards of some of the most loved stories and characters in entertainment and bring players and creators together around the fun and community of gaming in entirely new ways.

My first job is simple: understand what makes this work and protect it.

That starts with three commitments.

First, great games.

Everything begins here. We must have great games beloved by players before we do anything.  Unforgettable characters, stories that make us feel, innovative game play, and creative excellence. We will empower our studios, invest in iconic franchises, and back bold new ideas. We will take risks. We will enter new categories and markets where we can add real value, grounded in what players care about most.

I promoted Matt Booty in honor of this commitment. He understands the craft and the challenges of building great games, has led teams that deliver award-winning work, and has earned the trust of game developers across the industry.

Second, the return of Xbox.

We will recommit to our core Xbox fans and players, those who have invested with us for the past 25 years, and to the developers who build the expansive universes and experiences that are embraced by players across the world.

We will celebrate our roots with a renewed commitment to Xbox starting with console which has shaped who we are. It connects us to the players and fans who invest in Xbox, and to the developers who build ambitious experiences for it.

Gaming now lives across devices, not within the limits of any single piece of hardware. As we expand across PC, mobile, and cloud, Xbox should feel seamless, instant, and worthy of the communities we serve. We will break down barriers so developers can build once and reach players everywhere without compromise.

Third, future of play.

We are witnessing the reinvention of play.

To meet the moment, we will invent new business models and new ways to play by leaning into what we already have: iconic teams, characters, and worlds that people love. But we will not treat those worlds as static IP to milk and monetize. We will build a shared platform and tools that empower developers and players to create and share their own stories.

As monetization and AI evolve and influence this future, we will not chase short-term efficiency or flood our ecosystem with soulless AI slop. Games are and always will be art, crafted by humans, and created with the most innovative technology provided by us.

The next 25 years belong to the teams who dare to build something surprising, something no one else is willing to try, and have the patience to see it through. We have done this before, and I am here to help us do it again. I want to return to the renegade spirit that built Xbox in the first place. It will require us to relentlessly question everything, revisit processes, protect what works, and be brave enough to change what does not.

Thank you for welcoming me into this journey.

Asha

MATT BOOTY MESSAGE

I read Phil’s note with much gratitude. He has been a steady champion for game creators and our studio teams, and I’ve learned so much from his leadership over the years. All our games have benefited from his foundational support. I’m also grateful to Satya for his ongoing commitment to gaming and holding a vision of how it can connect back to the larger company.

Looking forward, I’m excited to partner with Asha as our next CEO. Our first conversations centered on her commitment to making great games and the role that plays in our overall success. She asks questions, pushes for clarity, and wants our choices grounded in player and developer needs. That mindset matters as the industry around us is changing quickly: how players engage, how games are made, and how business models and platforms evolve.

We have good reasons to believe in what’s ahead. This organization and its franchises have navigated change for decades, and our strength comes from teams who know how to adapt and keep delivering. That confidence is grounded in a strong pipeline of established franchises, new bets we believe in, and clear player demand for what we are building.

My focus is on supporting the teams and leaders we have in place and creating the conditions for them to do their best work. To be clear, there are no organizational changes underway for our studios.

Thanks for everything you do for players and for each other.

Matt

 

 

The post Asha Sharma named EVP and CEO, Microsoft Gaming appeared first on The Official Microsoft Blog.

In 2020, Microsoft announced a moonshot commitment to become carbon negative by 2030 — accelerating work across our company to advance the partnerships and technologies needed to advance sustainability for our businesses, our customers and the world. A key milestone on this journey was our aim to match 100% of our annual global electricity consumption with renewable energy(1) by 2025. Today, we are pleased to share that Microsoft has achieved this milestone(2). This progress helps drive investment into the power systems where we operate, expand clean energy supply and advance broader energy innovation.

Over a decade of investment: 40 gigawatts of new renewable energy contracted

What began in 2013 with a single 110 megawatt (MW) power purchase agreement (PPA) in Texas — a small first step to demonstrate how corporate procurement could scale clean energy(3) — has evolved into one of the largest clean energy portfolios in the world. This first deal not only supported Microsoft’s early cloud services but also set in motion a decade of commercial partnerships and learning-by-doing that served to demonstrate how corporate demand for advanced energy solutions can help to achieve a more affordable and sustainable power system, while supporting reliability for customers.

Since our carbon negative announcement in 2020, we have contracted 40 gigawatts (GW) of new renewable energy supply across 26 countries, working with more than 95 utilities and developers across 400+ contracts and counting. To put that amount in perspective — that’s enough energy to power about 10 million US homes. Of that contracted volume, 19 GW are now online, delivering new clean energy supply to the power grid, while the remainder are slated to come online over the next five years.

Our new renewable energy procurement continues to deliver significant environmental benefits, including the reduction of Microsoft’s reported Scope 2 carbon dioxide emissions by an estimated 25 million tons(4) and the mobilization of billions of dollars’ worth of private investment in regions where we operate.

Catalyzing market investment through bankable, repeatable models

Microsoft is among the early pioneers in developing technical and commercial practices that help advance bankable, repeatable and scalable procurement tools suitable for each market. Our clean energy purchasing navigates a global patchwork of power market designs, requiring creativity in how we balance cost, time to market and project sizing in our portfolio across planning, contracting and management.

Our work has benefited from a broad coalition of partners helping to build this market together. According to Bloomberg New Energy Finance, more than 200 global corporations collectively purchased nearly 200 GW of clean energy around the world since 2008. Working alongside other clean energy buyers — as well as hundreds of utilities, manufacturers, financiers, developers and engineers — we have helped reduce transaction costs, expand developer access to financing and streamline procurement approaches that other buyers can adopt.

This global flywheel of partnership, investment, technology and policy innovation is expected to continue to facilitate billions of dollars’ worth of investment into infrastructure and jobs. And as we’ve seen repeatedly, when Microsoft sends a clear market signal for world-class, first-of-a-kind technologies and infrastructure, the power sector rises to the challenge. Our procurement over the past decade has demonstrated that partnerships, communities and innovation are essential ingredients that help to accelerate first-of-a-kind technologies and infrastructure at scale.

Scaling partnerships to scale infrastructure

Critical to Microsoft’s success in expanding digital infrastructure and supporting our local communities is our ability to build trusted partnerships with the over 95 global energy suppliers that support our clean energy portfolio. We have sourced clean energy through multiple requests for proposal or information, bilateral engagements and clean tariffs to evaluate over 5,000 unique carbon-free energy projects around the world.

Today, Microsoft has six energy company partners with which we have over 1 GW of contracted renewable energy capacity, and more than 20 energy supplier partners where each partner has at least five separate renewable energy projects with Microsoft — evidence of the durable, repeatable relationships necessary to scale clean energy. Combining scale with speed, Microsoft’s landmark 10.5 GW framework agreement with Brookfield sends a long-term, 2030 demand signal to the market that enables developers to raise funding more efficiently, bolster supply chains, hire engineers and construct world-class energy infrastructure.

Putting communities first

Our renewable energy procurement has mobilized billions of dollars in private investment, supported thousands of jobs across the communities where we operate and delivered meaningful co-benefits. Through partnerships with developers and nonprofit organizations, we’ve worked to embed community-driven benefits into our energy portfolio. These benefits include robust infrastructure, economic inclusion and support for community-focused organizations.

Our support for communities shows up in projects like our 500 MW PPA with Sol Systems, or our 250 MW PPA with Volt Energy Utility that provided local training and jobs, as well as grants to community nonprofit organizations and habitat restoration. We’ve also signed over 1.5 GW of distributed solar, bringing clean energy directly into hundreds of communities around the world. Landmark agreements like our 500 MW offtake with Pivot Energy, or our 270 MW offtake with PowerTrust are expected to foster employment, energy cost savings and grid resilience in communities across the United States, Mexico and Brazil. More details on the above examples and our approach to community benefits in clean energy agreements can be found in a dedicated Microsoft whitepaper.

Innovation unlocks new markets and pathways

Microsoft’s clean energy procurement continues to play an important role in catalyzing technical, commercial and regulatory innovation. Our commercial efforts have helped lower barriers to entry into new markets and expand access into multi-technology contracts that accelerate decarbonization.

In Japan, Microsoft signed one of the first corporate PPAs in the country’s restructured power market. Our 25 MW, 20-year agreement with Shizen represents the first single-asset virtual PPA executed in the country, which helped pave the way to over 2GWs of corporate procurement since 2024, according to Bloomberg New Energy Finance. Alongside opening new markets, we have structured several multi-technology offtakes in nascent markets for corporate procurement. In India, Microsoft purchased a combined 437 MW solar/wind hybrid offtake from Renew, where our projects will support energy access and rural electrification. In Microsoft’s home state of Washington, our datacenters in Douglas County are supplied by 100% carbon-free energy, as we leverage a creative blend of new wind power and hydropower storage to deliver around-the-clock clean energy.

Looking forward to 2030 and beyond

In 2025, the International Energy Agency (IEA) described a new “Age of Electricity,” marked by accelerating electricity demand from electric vehicles, air conditioners, data centers and heat pumps. As the world electrifies more of the economy, the demand for affordable, reliable and clean electricity will continue to rise.

Our experience building Microsoft’s clean energy portfolio both reflects and furthers global trends. According to IEA data, since 2000, renewable energy generation has expanded nearly four-fold. In many power markets across the world, clean energy is one of the fast-growing sources of generation, and often the one with the fastest time-to-market. Corporate buyers like Microsoft continue to serve as an important catalyst in driving commercial demand for innovation and infrastructure across the power industry.

As we continue our journey toward becoming carbon negative by 2030, Microsoft will continue to push for an expansive focus on adding all forms of carbon-free electricity solutions, complementing and adding to our portfolio of renewable energy resources. We recognize that the world’s rising electricity needs require a balanced, all-of-the-above decarbonization strategy to meet global economic growth and environmental goals, and our sustainability goals will continue to support this approach moving forward. Such a strategy requires a broader set of carbon-free energy and grid-enabling technologies, including nuclear energy, next-generation grid infrastructure and carbon capture technology. Just as renewable energy was a relatively small part of global energy grids in 2013 when we signed our first PPA, today many advanced energy technologies remain early in their development but offer significant promise to accelerate progress towards an affordable, reliable and sustainable energy future.

Microsoft has already taken early steps to support the advancement of a broader set of carbon-free energy technologies as we partner with Helion and Constellation Energy on a 50 MW fusion project in Washington state and work with Constellation to restart the 835 MW Crane Clean Energy Center in Pennsylvania. Microsoft’s Climate Innovation Fund has allocated $806 million of capital to 67 investees, with 38% directed toward Energy Systems — advancing carbon-free power and fuels, energy storage and energy management solutions.

We welcome continued collaboration with our power sector partners to bring these innovations to market and incorporate new technology tools in the process to accelerate their development.

We will continue to build and leverage new AI-driven tools to design, permit and deploy new power technologies that help expand and more efficiently operate the electricity grid, bringing more clean energy online faster. This work is exemplified by our recently announced collaborations with Idaho National Laboratory and the Midcontinental System Operator, among other examples.

And as we advance innovative energy technologies, we recognize that standards must evolve alongside innovation. That is why we will continue participating in industry forums that strengthen carbon accounting frameworks — so that our clean energy procurement is measured with greater accuracy and delivers real world emissions reductions, with a continued focus on maintaining the high level of integrity that the world has come to expect from Microsoft.

Our carbon negative commitment remains a call to action — for Microsoft, our customers and the broader technology sector — to invest in an affordable, reliable and sustainable power system. As we look toward 2030, that call to action has never been clearer.

Gratitude — and momentum for the work ahead

Today’s milestone represents a shared achievement among the utility professionals, clean energy developers, community leaders, technology innovators and forward-thinking policymakers who continue the deployment of renewable energy. Meeting today’s milestone shows what partnership can deliver in bringing big ideas to life. The future of carbon-free energy is one that we will create – together.

As Microsoft’s Chief Sustainability Officer, Melanie Nakagawa leads the company’s targets to be carbon negative, water positive, and zero waste by 2030. She brings deep experience at the intersection of policy, business, and technology to advance climate and sustainability solutions globally.

As President of Cloud Operations + Innovation at Microsoft, Noelle Walsh leads the organization that powers the global Microsoft Cloud. She oversees the company’s physical cloud infrastructure and operations, with a charter focused on safety, security, availability, sustainability, and competitive infrastructure growth — bringing decades of global operational leadership.

Footnotes

1. Renewable energy is defined within Microsoft’s fact sheet https://aka.ms/SustainabilityFactsheet2025, which represents FY24 data.
2. To date, Microsoft’s renewable energy target includes two primary categories: renewable energy from contracted projects and grid mix. The first is renewable energy delivered under PPAs or similar long-term contracting mechanisms, generally for new projects where our financial involvement in the project’s development is critical for its success. This category represents more than 90% of the renewable energy applied to achieve our 2025 target. The second category is “grid mix” — renewable energy supported via our standard utility relationships and rates, inclusive of policy programs such as renewable portfolio standards and state and utility decarbonization goals. Our 2025 100% renewable target does not include purchases from short-term, so-called “spot market” renewable energy credits (RECs) sourced from operational clean energy projects. With the above in mind, Microsoft leverages a straightforward formula to determine our 100% renewable energy metric on a global, annual basis. We update and further detail the methodology and assumptions behind this formula in our annual sustainability reports:
3. Clean energy — also referred to in this blog as carbon free energy — is defined within Microsoft’s fact sheet https://aka.ms/SustainabilityFactsheet2025, which represents FY24 data.
4. Reduction of reported Scope 2 emissions are calculated between FY20-25, the cumulative difference between location based and market-based emissions, excluding the use of short-term, so-called “spot market” RECs.

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Satya Nadella, Chairman and CEO, posted the below message to employees on Viva Engage this morning.

I am excited to share a couple updates in two of our core priorities: security and quality. Hayete Gallot is rejoining Microsoft as Executive Vice President, Security, reporting to me. I’ve also asked Charlie Bell to take on a new role focused on engineering quality, reporting to me.

Charlie and I have been planning this transition for some time, given his desire to move from being an org leader to being an IC engineer. And I love how energized he is to practice this craft here day in and day out!

Hayete joins us from Google where she was President, Customer Experience for Google Cloud. Before that, she spent more than 15 years at Microsoft with senior leadership roles across engineering and sales, playing multiple critical roles in building two of our biggest franchises – Windows and Office, leading our commercial solution areas’ go-to-market efforts. And she was instrumental in the design and implementation of our Security Solution Area. She brings an ethos that combines product building with value realization for customers, which is critical right now.

As we shared during our quarterly earnings last week, we have great momentum in security, including progress with Security Copilot agents, strong Purview adoption, and continued customer growth, and we will build on this.

We have a deep bench of talent and leaders across our security business, and this team will now report to Hayete. Additionally, Ales Holecek will take on a new role as Chief Architect for Security, reporting to Hayete. Ales has spent years leading architecture and development across some of our most important platforms and will help bring that same sensibility to security and its connections back to our existing scale businesses and the Agent Platform.

As we shared yesterday, we have a new operating rhythm with commercial cohorts, and Hayete and her team will now be accountable for our security product rhythms as part of this process.

Charlie built our Security, Compliance, Identity, and Management organization and helped rally the company behind the Secure Future Initiative. And we’re fortunate to have his continued focus and leadership on another one of our top priorities. With our Quality Excellence Initiative, we have increased accountability and accelerated progress against our engineering objectives to ensure we always deliver durable, high quality-experiences at global scale. And Charlie will partner closely with Scott Guthrie and Mala Anand on this work.

I’m excited to welcome Hayete back to Microsoft to advance this mission critical work, and grateful to Charlie for all he has done for our security business and what he will continue to do for the company.

Satya

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