Welcome to the July 2026 edition of What's New in Microsoft 365 Copilot! Every month, we highlight new features and enhancements to keep Microsoft 365 customers up to date with Copilot features that help your users be more productive and efficient in the apps they use every day.
Let’s take a closer look at what’s new this month:
User capabilities:
- Adding agents in Copilot Chat
- Model update, search enhancements, and push notifications in the Copilot app
- Model update and new ways to work in Cowork
- Additional reference support for Copilot Notebooks
- Workflows for Copilot in Word
- New skills and Power BI context for Copilot in Excel
- Branded assets, custom skills, and more for Copilot in PowerPoint
- Meetings recaps app for Copilot in Teams
- Access heatmap, AI summary, and document creation for SharePoint and OneDrive
- More Copilot connectors
IT admin capabilities:
User capabilities
Adding agents in Copilot Chat
Users can now add the Word, Excel, and PowerPoint agents directly into their Copilot Chat prompt. After opening Copilot, users simply @mention the agent, and it’s added to the chat. This enables users to create documents, spreadsheets, and presentations without leaving the Copilot app. This feature rolled out in July.
Model update, search enhancements, and push notifications in the Copilot app
OpenAI's GPT-5.6 family of models is now available in Microsoft 365 Copilot. Optimized for knowledge work in Microsoft 365, GPT-5.6 delivers stronger reasoning for complex, multi-step tasks, helping Copilot turn initial ideas into polished drafts in Word, reason over deeper analysis in Excel, generate richer presentations in PowerPoint, produce clearer responses in Chat, and carry end-to-end deliverables through in Cowork. Grounded in users’ work context, GPT-5.6 helps Copilot take on the complexity of knowledge work. This model rolled out in July.
Anthropic’s Claude Sonnet 5 is now available in Microsoft 365 Copilot. Designed for agentic, multi-step work, this new model helps with tasks like drafting documents, analyzing spreadsheets, and creating presentations. Available today in Copilot in PowerPoint, Word, and Cowork, it expands the growing set of models available in Copilot, giving people more flexibility to choose the right model for the task at hand. Combined with Work IQ, Copilot grounds its work in files, meetings, chats, and business data to deliver results that are relevant to the user’s work context. This feature rolled out in July.
New updates to Copilot answers within the Copilot Search module help organizations take advantage of Copilot in a more targeted way. Copilot answers now provide more concise responses. They also highlight more prominently that users can continue the conversation in Copilot Chat on the sidebar. The benefit is a smoother user experience with less manual effort, while giving IT teams a clearer path to support rollout and adoption. This feature rolled out in July.
New push notifications from Microsoft 365 Copilot mobile app help users quickly catch up on their work items on their iOS and Android devices, reducing the need to manually check across apps such as Outlook, Teams, and other Microsoft 365 experiences. Users receive relevant Copilot prompts like 'Your Day at a Glance' and 'Items waiting for you' as push notifications to their mobile devices. When users open a notification, they are taken to the Copilot mobile app, where the prompt’s corresponding response already appears on screen. This feature is only available for users with Microsoft 365 Copilot licenses. This feature rolled out in July.
Model update and new ways to work in Cowork
Anthropic’s Claude Fable 5 is now available in Copilot Cowork as a model update for users who need help with longer, more complex work. Anthropic describes Claude Fable 5 as built for ambitious, long-running projects, with stronger sustained reasoning, deeper context handling, and the ability to plan, execute, and check work across multi-stage tasks. In Cowork, this gives users another model option for agentic work that requires more persistence and depth, helping them delegate complex workflows with less step-by-step supervision while staying grounded in the context of their work. This model will be off by default and rolled out in July.
Copilot Cowork local browser automation with Microsoft Edge enables users who are signed into Edge to use Cowork to work across the web-based systems they work in all day, such as SaaS tools, internal portals, and more. With Cowork acting across websites on the user's behalf, users spend less time manually switching tabs to get work done.. This feature rolled out in July.
With event-triggered tasks in Cowork let users forget about constantly refreshing their inbox or worrying about missed pings. Instead, users can ask Cowork to watch mail and Teams for the moments that matter, catch them the instant they land, and have a response ready before users ask. To do this, users can create event-driven tasks triggered by a sender, an @mention, a keyword or topic, or an event name. Users can simply describe the trigger in plain language, and it will execute across Teams chats, channels, Outlook email, and meetings. This feature rolled out in July to Frontier.
By customizing Cowork with skills and plugins, users can easily tailor Cowork and extend it into the systems they rely on. Now, in the Customize tab, users can add a skill through a guided ‘Create new’ flow or by dragging and dropping an existing .md, .zip, or .skill file to ‘Upload skill.’ Plugins work the same way, with Claude or Open-Plugin zips auto-converted into publishable packages, bundled skills and MCP connectors included. The benefits are less manual setup plus easy sharing, since users can share any skill or plugin with specific people across the org while remaining the owner, so every edit flows out automatically. This feature rolled out in July.
Additional reference support for Copilot Notebooks
Copilot Notebooks now offer support for Markdown (.md), TXT (.txt), and RTF (.rtf) files as notebook references to help organizations reason over additional project context. With this update, users can add Markdown, TXT, and RTF files for content like software documentation, video transcripts, and rich-text notes directly to their notebooks and use Copilot to turn those inputs into helpful project artifacts. Reference support for TXT and RTF files rolled out in July, and support for Markdown files will roll out in August.
Workflows for Copilot in Word
Using review workflows for Copilot in Word, users can edit documents with Track Changes on, so proposed revisions are transparent and easy to review. With changes visible by default, users can easily see and approve every edit. Users can also ask Copilot to add, read, reply to, and manage comments, helping keep feedback organized and connected to the right content. This feature rolled out in June.
With drafting workflows, Copilot can now insert and update tables of contents so documents stay organized as they evolve. It can also help manage headers, footers, page numbers, dates, and footnotes, so documents are easier to format and users can maintain polished, professional documents without manual effort. This feature rolled out in July.
New skills and Power BI context for Copilot in Excel
The brand kit skill enables Copilot in Excel to format workbooks with an organization's Brand Kit from the Microsoft 365 brand center, automatically applying approved colors, fonts, and logo to tables and charts so every report follows the company branding guidelines. Users can use the Brand-kit skill and ask Copilot to brand their Excel sheet for a polished, on-brand, presentation-ready report, without manual formatting. This feature rolled out in July.
With the theme design skill, users can now apply a coordinated design theme to their data, choosing a harmonized color palette, styling charts, and structuring the layout so their key insights stand out. Users can use the @theme-design skill and ask Copilot to design or polish their sheet, and it delivers formatting with clear visual hierarchy, turning raw data into a clean, readable report and saving users the manual design work. This feature rolls out in August.
Copilot in Excel can now ground analysis in governed Power BI data, bringing trusted business metrics directly into the Excel grid. Users can attach a Power BI report from the work content selector, then ask Copilot to analyze performance, identify trends, and build summaries or supporting calculations in Excel. Copilot works with the underlying report data while respecting existing row-level security, eliminating the need to export data, manually copy and reconcile figures, or switch between Power BI and Excel. This feature rolls out in August.
Copilot in Excel is now available in more cloud-saved workbooks, including files where AutoSave is turned off on Windows and Mac. Previously, Copilot required AutoSave to be on, which meant some users could not use Copilot in otherwise supported workbooks. When AutoSave is off and the workbook has unsaved changes, Excel reminds users to turn on AutoSave before Copilot starts making changes, helping protect unsaved work. Users can still choose to continue with Copilot without turning on AutoSave. This feature is rolling out in August.
Branded assets, custom skills, and more for Copilot in PowerPoint
Users can now use their company’s branded assets like logos, icons, themes, and fonts from their Microsoft 365 Brand kit directly in Copilot in PowerPoint. Brand managers can securely update and rollout their preferred brand kit to ensure consistent design across company assets. Users can choose their company’s template and apply their brand colors, images, and icons right within PowerPoint to create on brand presentations. These features rolled out in July.
Custom user skills are now available in Copilot in PowerPoint. This enables users to create, upload and update their own custom skills in OneDrive. Skills turn repeated instructions into reusable guidance that Copilot can apply in the flow of presentation work. To learn more, visit Use custom skills with Copilot in PowerPoint. This feature rolls out in August.
Copilot in PowerPoint can now write, reply to, and resolve comments right inside a presentation. Users can ask Copilot to draft a new comment, respond to existing feedback, or resolve completed comment threads without switching context. This makes it easier to organize slide feedback, move reviews forward faster, and collaborate on presentations with less manual effort. This feature rolled out in July.
Additionally, users can soon assign tasks and notify relevant stakeholders within comments using Copilot in PowerPoint. Users can ask Copilot to turn feedback into assigned follow-ups and bring the right people into the conversation directly from the comment thread. This helps teams move from feedback to action faster, keeps presentation reviews organized, and reduces the manual effort needed to track next steps across stakeholders. This feature rolls out in August.
Copilot in PowerPoint users now have more key capabilities in iOS Mobile and iPad. First, Copilot can now plan multi-step actions like creating, editing, and analyzing. Second, Copilot can now ground implicitly based on the current slide and explicitly based on attached files. Finally, to support on-the-go mobile tasks, users can keep working or switch apps while Copilot works in the background. These features rolled out in July.
Users can now create new presentations or restyle existing ones using another presentation as a reference with Copilot in PowerPoint. Users can either attach a PowerPoint file to reference or open a PowerPoint deck and ask Copilot to create a new or existing presentation using the reference deck's visual style. Copilot applies the reference deck's layouts, theme, and visual system to create a polished, consistent deck. This new feature lets users easily reuse trusted designs, align content to brand guidelines, and match the look and feel of an existing presentation without manual reformatting. This feature rolled out in June.
Meetings recaps app for Copilot in Teams
The new Meeting recaps app brings AI-generated meeting recaps together in one convenient app that can be pinned in the Teams sidebar, so users can easily find recaps and catch up. Users can apply quick filters to instantly surface the meetings that matter, browse and revisit meetings with recaps from the past 30 days, or generate an audio recap to catch up on meeting highlights on the go. This feature rolled out in July.
Access heatmap, AI summary, and document creation for SharePoint and OneDrive
The new Agent Access Insights heatmap for SharePoint and OneDrive sites helps organizations take advantage of Copilot in a more targeted way. It provides a visual heatmap of agent activity to help admins quickly detect patterns, hotspots, and unusual access behavior. The benefit is a smoother user experience with less manual effort, while giving IT teams a clearer path to support rollout and adoption. This feature rolled out in July.
Users can access an AI-generated audio summary of their SharePoint News posts in the SharePoint app for Teams (Viva Connections). This helps users consume news updates more efficiently, helping them stay informed without interrupting their daily workflow. This feature rolled out in June.
Now users can generate documents using forms in SharePoint with Power Automate. This helps organizations take advantage of Copilot in a more targeted way. The new Power Automate action enables automated document generation using document generation (DocGen) forms in SharePoint. Generate document from form (Preview) enables customers to create documents from a template by mapping data inputs to predefined template fields. This feature rolled out in June.
More Copilot connectors
More Copilot connectors are now available, bringing industry-specific knowledge directly into the flow of work while honoring existing security, compliance, and permissions. Connectors enable users to search, reason over, and act on data from the business systems their organizations already use. Newly available connectors span a wide range of industries:
- Financial services: Daloopa, FactSet, Fitch Solutions, Morningstar, PitchBook, S&P Global
- Professional services: Dice, Forrester, HG Insights
- Industrial and manufacturing: Infor Nexus, Sight Machine
- Software and technology: Granola
- Healthcare and life sciences: Article Galaxy, and Nyquist AI
- Retail and consumer goods: Passby Pulse, Polar Analytics
- Cross industry: CB Insights, Sprouts.ai
Users can now discover and connect to data sources directly from the Add and manage sources menu and scope prompts to a specific connector for more targeted results. By connecting specialized enterprise data to Copilot, organizations can help employees access more relevant insights, richer context, and industry-specific knowledge across Copilot experiences. These connectors are now generally available for administrators to manage. These connectors rolled out in July.
Organizations in US government DoD clouds can now bring knowledge from external business systems directly into Copilot using Microsoft-built connectors, including Atlassian Jira and Confluence. Previously available in GCC and GCC High, these connect business data from CRMs, databases, document repositories, and other enterprise applications, so organizations can give Copilot access to more of the information employees rely on every day. This helps Copilot deliver more relevant, accurate, and grounded responses, reducing time spent searching across systems and enabling employees to work more effectively. Content is securely indexed into Microsoft Graph and remains within the organization’s Microsoft 365 tenant boundary. Existing permissions, compliance policies, and security controls continue to govern access, helping organizations meet their security, privacy, and data residency requirements. This feature rolled out in June.
IT admin capabilities
New controls and reports in Microsoft admin center
Domain exclusion for web grounding enables organizations to exclude up to 1,000 specified domains from Copilot web grounding results. This helps organizations limit the use of content from specified websites in Copilot web search, reducing the likelihood of responses being influenced by unwanted or non-compliant sources while providing administrators with greater oversight of web-grounded content. This feature rolled out in July.
Data Loss Prevention to restrict external emails from being referenced gives organizations greater control over how email data is used in Copilot responses. We are expanding Microsoft Purview DLP for Microsoft 365 Copilot and Copilot Chat to prevent external emails from being referenced. Admins can now exclude messages from external senders from being summarized, referenced, or used as grounding data in responses. This feature rolled out to Public Preview in June.
The Agent 365 Dashboard in Insights helps business leaders track agent usage and adoption for their teams. Analysts can also use the dashboard for org-wide reporting with organization filtering. The dashboard unifies data from Agent 365, giving leaders greater visibility into their team’s use of agents, across different sources and agent types. View adoption by group, track retention, identify top agents, and compare usage trends to better inform agent deployment strategies and optimization. Drill down into individual agent usage for deeper insights and trends. Historical reporting for Copilot Studio agents will also be available via a toggle in the same dashboard. This feature rolled out in July.
The new Copilot Connectors usage report is now available in Public Preview in the Microsoft 365 admin center, helping IT admins understand how Copilot users are benefiting from connected enterprise knowledge. The report shows how often responses across Copilot Chat, Copilot Search, and agents are grounded in content from connectors deployed in the organization, giving admins a clearer view of connector adoption, engagement, usage patterns, and connector-level impact. Admins can use these insights to evaluate which connected data sources are driving value and optimize their connector deployment strategy over time. This feature rolled out in June.
Copilot Chat usage report for customers in GCC, GCC High, and DOD are now available in the Microsoft 365 admin center, helping customers understand and drive Copilot Chat adoption. Admins can view organization-level usage to track trends and view user level details to inform Microsoft 365 Copilot licensing decisions. This report includes total active users, Copilot Chat usage with a breakout per Microsoft 365 app, and user-level activity insights (anonymized by default). This feature rolled out in July.
Cost Management updates in Microsoft 365 admin center improve spending controls for usage-based billing services through more reliable alerts, clearer policy enforcement, better overage handling, and improved visibility into Copilot Credits. These updates give admins greater confidence in monitoring and managing AI consumption costs across services such as Cowork and Work IQ APIs.
Highlights include:
- Improved spending alerts helps admins stay informed and act quickly when consumption approaches policy thresholds. As part of this update, admins should recreate alerts on existing spending policies where notifications are required.
- Clearer spending policy logic ensures users governed by multiple spending policies remain on the policy with the highest per-user limit. Users stay on that policy and aren’t moved to another policy if they hit their limit.
- Overage handling allows users that hit their spending policy limit during a task to finish that task without incurring billable overages. These overages are not charged and will not show up as credits consumed in cost management reports.
Learn more about managing AI experiences enabled by usage-based billing. These features rolled out in July.
Did you know? The Microsoft 365 Roadmap is where you can get the latest updates on productivity apps and intelligent cloud services. Microsoft 365 Copilot release notes is where you can see the Microsoft 365 Copilot features that are generally available (Current Channel for Microsoft 365 apps) and specific to each platform. Check back regularly to see what features are in development, coming soon and generally available. Please note that the dates mentioned in this article are tentative and subject to change.
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