<div id="readability-page-1"><div><div>Microsoft MSFT announced last week that it will eliminate enterprise discounts on Microsoft 365 subscriptions and other cloud apps, which could raise customer costs by 6% to 12%, according to partners.Microsoft 365 offers a subscription-based suite of productivity tools that includes Word, Excel, PowerPoint, cloud storage, advanced security, and other services. It helps individuals and businesses stay productive across multiple devices.Microsoft told CNBC that the update aligns enterprise pricing with Azure’s model and promotes channel transparency. The change takes effect on November 1.Also Read: Microsoft’s New AI Lab Powers Wisconsin ManufacturingThe move marks Microsoft’s attempts to further boost its margins by leveraging its pricing power.Microsoft shares have climbed 20% year-to-date, outpacing the NASDAQ Composite Index’s 10% gain, as momentum in its cloud and artificial intelligence businesses continues to accelerate.The company’s exclusive licensing deals and access to OpenAI’s models have boosted its Azure cloud business and are driving its market value toward $4 trillion.Analysts at UBS told CNBC that the pricing shift already reflects in Microsoft’s latest guidance, which called for double-digit revenue growth when reported with fourth-quarter earnings on July 30.Microsoft is targeting higher revenue per user by pushing Copilot add-ons and premium plans, as Microsoft 365 seat growth has remained below 10% since 2023.Productivity and Business Processes, which includes Microsoft 365, generated most of Microsoft’s $128.5 billion in fiscal 2025 operating profit, with 73% of the segment’s revenue tied to commercial Microsoft 365 products and cloud services.After cutting more than 15,000 jobs in 2025, Microsoft is pressing ahead with its $80 billion AI investment, akin to its Big Tech peers like Alphabet GOOGL GOOG, Meta Platforms META, and Amazon.com AMZN.Meta, Microsoft, and Alphabet plan to pour over $250 billion into AI infrastructure between 2025 and 2026.Wedbush analyst Dan Ives called the investment surge a watershed moment that will drive years of rapid AI expansion.Apple AAPL also announced an extra $100 billion U.S. investment, adding to its earlier pledge of more than $500 billion over four years to advance AI, silicon engineering, and workforce development.Price Action: MSFT stock is trading higher by 0.06% to $506.00 premarket at last check Thursday.<ul> <li>Xbox Braces For Fourth Major Layoff Round In 18 Months As Microsoft Pivots To AI</li> </ul>Photo by bluestork via Shutterstock</div></div></div>

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Microsoft will end enterprise discounts on Microsoft 365 and cloud apps starting November 1, potentially increasing customer costs by 6% to 12%. This change aligns enterprise pricing with Azure’s model and aims to enhance margins. Microsoft’s shares have risen 20% this year, driven by growth in cloud and AI sectors. The company is focusing on higher revenue per user through premium plans and Copilot add-ons. Microsoft’s Productivity and Business Processes segment generated significant profits, with a strong emphasis on AI investments alongside other tech giants.

- Microsoft announced the elimination of enterprise discounts on Microsoft 365 subscriptions, potentially increasing customer costs by 6% to 12%, effective November 1.  
- This pricing update aligns with Azure’s model and aims to enhance channel transparency while boosting Microsoft's margins amid strong growth in its cloud and AI sectors.  
- Microsoft’s Productivity and Business Processes segment, primarily driven by Microsoft 365, contributed significantly to its $128.5 billion operating profit in fiscal 2025, with ongoing investments in AI expected to further accelerate growth.  

Microsoft Ends Enterprise Discounts On Microsoft 365, Cloud Apps In November