On 1 July 2026, Microsoft raises its prices on most commercial Microsoft 365 suites. Existing subscriptions hold their committed price until they renew, so the change does not bite straight away. It bites at the next renewal after 1 July.
What happens to your margin at that renewal is decided by one thing: the price rule sitting on each subscription. Some rules pass the increase straight through and protect you automatically. One does not, and it will quietly cost you. Here is how to tell which is which, and what to check before renewals start landing.
Microsoft's cost to you is going up across the board. A few examples, in USD list pricing:
Selected suite price increases shown per user, per month.
| Suite | Now | From 1 July | Change |
|---|---|---|---|
| Business Basic | $6.00 | $7.00 | +16.7% |
| Business Standard | $12.50 | $14.00 | +12.0% |
| Office 365 E3 | $23.00 | $26.00 | +13.0% |
| Microsoft 365 E3 | $36.00 | $39.00 | +8.3% |
| Microsoft 365 E5 | $57.00 | $60.00 | +5.3% |
| Frontline F3 | $8.00 | $10.00 | +25.0% |
| Frontline F1 | $2.25 | $3.00 | +33.3% |
Note: Prices shown are illustrative list prices for the suites included in this example.
A note on currency: EUR and SEK cloud prices were separately rebased down on 1 February 2026, with EUR down 7.4% and SEK down 13.5%, so the net change in local currency will not match the USD headline. Always quote and verify in Partner Center for your region.
Existing subscriptions are not uplifted mid-term. The increase only applies from the first renewal after 1 July.
In Cloudmore, the price a customer renews at comes from the price rule on that product, set at broker or organisation level. Microsoft raising its cost does not automatically raise what you charge. Those are two separate numbers, and only your price rule connects them.
That means a subscription sitting on a fixed sales price will renew at exactly the price you set, against Microsoft's new, higher cost. Your margin absorbs the entire difference. On thin SKUs, that can go to zero.
Subscriptions on a rule that holds a margin or a discount off list will reprice automatically at renewal and keep you whole. The only job between now and then is finding out which of your subscriptions are on which rule.
Worked on one Microsoft 365 E3 seat, where Microsoft's cost moves from $36 to $39:
Fixed Sales Price: a locked, absolute price. Renews at your locked price. Sell price stays put, cost rises $36 to $39, so margin drops by $3 a seat. It will not move until you change it. This is the one to audit.
Fixed Margin %: a set margin on cost. Sell price recalculates to hold your percentage on the new $39 cost. The customer pays a little more, your margin percentage is preserved. Protected.
Discount on MSRP %: a set discount off list. Sell price recalculates to your percentage off the new MSRP. It rises in step with Microsoft, and your discount and margin both hold. Protected.
MSRP (default): follows list price exactly. Sell price follows Microsoft's list up automatically. No margin erosion, but no buffer either. The customer sees the full increase with nothing absorbed on your side.
1. Run the Subscription Renewals Report for July to December 2026. It shows New Total Sales and New Total Margin for every subscription, so you can see exactly what each one renews at under its current rule, before it happens.
2. Flag anything on a Fixed Sales Price. These are the subscriptions that will renew into a squeezed, or even negative, margin. Sort by the new-margin figure and deal with the worst cases first.
3. Switch exposed products to Fixed Margin or Discount on MSRP. This protects your margin automatically through this price change, and the next one Microsoft makes after it.
4. Right-size while you're in there. Strip out idle seats, ex-employee accounts, and over-tiered licences. A clean licence count often offsets the increase for the customer entirely, with nothing for you to absorb.
If you're managing this across more than a handful of accounts, doing it product-by-product per customer does not scale. Cloudmore supports a bulk price-rules template, and a Price Rules API, for exactly this. Get in touch with your Cloudmore contact, or support@cloudmore.com, and we'll run it with you.
Microsoft figures sourced from Partner Center; always verify regional and local-currency pricing in Partner Center directly before quoting. Platform behaviour current as of Cloudmore's latest release.