Wave 3 of Microsoft Copilot has arrived

Details of Wave 3 of Microsoft Copilot were disclosed in several blog posts from Microsoft in early March. 

"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," said Judson Althoff - CEO, Microsoft Commercial Business, in a separate blog post.

The company also introduced Work IQ, a new capability that ensures each job is not performed in isolation, but with the big picture in mind. "...It has the full context of your work, not just fragments of data, so it can reason over all relevant materials," said Spataro in a description of Cowork.  

Agent 365

Microsoft Agent 365 gives IT and security leaders a single place to observe, govern, manage and secure agents across the organisation. 

"Agent 365 extends the management, security, and governance processes organisations already use for employees to agents, so they can stay in control as agents become part of daily work," Spataro said.

"The idea is simple: there is no need to reinvent the wheel. The fastest path to getting agents under control is to manage them in a similar manner to managing users, using familiar Microsoft solutions including the Microsoft Admin Center for agent management and Microsoft Security solutions like Defender, Entra, and Purview for agent security and governance."

Althoff said there has been "tremendous momentum" with tens of thousands of preview customers, with tens of millions of agents added to the Agent 365 Registry in the last two months. 

"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," Althoff disclosed. 

"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." 

Details

Generally available May 1, Microsoft Agent 365 will be priced at US$15 per user. 

Copilot

Wave 3 of Copilot will work alongside users in Word, Excel, PowerPoint, and Outlook, creating, editing, and refining high-quality content from start to finish inside a document, spreadsheet, presentation, or email respectively, said Spataro. 

Work IQ helps Copilot to stay within the context of the work, so edits always reflect what is current and relevant across your files, meetings, chats, and relationships, he added.

"Copilot does the heavy lifting by updating existing work: refining a Word document into a polished draft, improving Excel spreadsheets with real formulas, producing slides in PowerPoint that match how your organisation builds decks—including understanding layouts, object styles, and brand kits— and drafting and refining emails directly in Outlook. And because this work happens inside the apps where people already work, every change is transparent, reviewable, and reversible as you iterate," Spataro said.

Organisations can apply governance, audit, compliance, and retention policies at scale. 

Althoff said that Microsoft recently delivered its strongest quarter yet with Copilot, and noted that 90% of the Fortune 500 use the solution. Paid seats have grown more than 160% year over year and daily active usage is up 10x. There are currently more than 35,000 Copilot seats, with Mercedes Benz recently announcing a global rollout of Microsoft 365 Copilot.

Details

The new Copilot experiences are generally available in Excel and Word, with PowerPoint and Outlook to roll out over the coming months. 

Copilot's Anthropic support

While Copilot will continue to be powered by OpenAI’s latest models, Microsoft customers can use Anthropic models too, starting in Researcher or when building agents in Microsoft Copilot Studio.  

Microsoft will enable Anthropic models on by default for most customers in commercial cloud (excluding EU/EFTA and UK). This update enables the use of multiple AI models in Microsoft offerings, including in Microsoft 365 Copilot, Researcher, Copilot Studio, Power Platform, Agent Mode in Excel, and Word, Excel, and PowerPoint agents. 

"Copilot hosts the best innovation from across the industry and chooses the right model for the job regardless of who built it. This is a pattern of work that will only become more powerful as new models and ways of working emerge," remarked blog post author Jared Spataro, CMO, AI for Work at Microsoft. 

Full availability is expected by end-March.  

Copilot Chat

The chat window becomes an entry to creation and execution. "From chat, you can create documents, spreadsheets, and presentations directly from a conversation, or ask Copilot to take common workplace actions—like scheduling a meeting or drafting and sending an email to your team—without copying and pasting between tools or switching contexts," Spataro shared.  

"Built‑in agents for Word, Excel, PowerPoint, and Outlook let you move easily from conversation into app‑native work. And with agents in Copilot supporting open standards like Apps SDK and MCP Apps, your apps can now surface directly within chat—enabling live, interactive experiences where work actually happens."

Details 

Excel, Word, and PowerPoint Agents are rolling out to generally availability in chat in Copilot. Schedule from chat and custom instructions are available today and send email from chat is rolling out with broad availability this spring (Q2-Q326).

Copilot Cowork

Copilot Cowork 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," Althoff disclosed.

"With Cowork, Copilot can break down complex requests into steps, reason across tools and files, and carry work forward with visible progress and opportunities to steer. Tasks are no longer confined to a single turn or a single app. They can run for minutes or hours, coordinating actions and producing real outputs along the way," said Spataro.  

Details

Cowork is being tested with selected customers as a research preview and will be available through the Frontier programme in March. 

Join the Frontier programme at https://adoption.microsoft.com/en-us/copilot/frontier-program/ 

GPT-5.3 Instant

Now available in Microsoft 365 Copilot and Microsoft Copilot Studio, GPT-5.3 Instant improves how Copilot responds in everyday work scenarios with more reliably accurate answers, stronger and more adaptable writing, and more direct, useful responses, Microsoft said.  

"For questions that draw on information from the web, with GPT-5.3 Instant, Copilot now delivers clearer, more relevant responses by better synthesising what it finds online with its own knowledge and reasoning—so answers are less shaped by retrieved content alone and more closely reflect the needs of the task," elaborated Nitin Agrawal, Corporate VP, Microsoft, in a blog post. 

E7

Source: Microsoft. Comparison table showing the spread of capabilities for different solutions against E7.

Microsoft 365 E7: The Frontier Suite was one of the Wave 3 announcements. The solution adds AI to email, documents, meetings, spreadsheets, and business application surfaces, while giving IT and security leaders the observability and governance needed to operate AI at enterprise scale, said Spataro.

"Copilot and agents work together with shared intelligence, understanding context, history, priorities, and constraints. Trust is built in by default—with user data, enterprise data, and agent actions protected through identity, policy, and observability—so AI can scale across the workforce without compromising security or compliance," he said in the blog post. 

Althoff provided more context: "Customers have told us E5 alone is no longer enough; they do not want multiple tools stitched together, they want one trusted solution. At US$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."

Details

Microsoft 365 E7 will be available for purchase on May 1 at a retail price of US$99 per user per month, and includes Microsoft 365 Copilot, Agent 365, Microsoft Entra Suite, and Microsoft 365 E5 with advanced Defender, Entra, Intune, and Purview security capabilities. The solution is available with and without Teams.  

Explore

View the Microsoft 365 roadmap at https://www.microsoft.com/en-sg/microsoft-365/roadmap?id=558852