Microsoft’s Rebuilt Copilot Is a Bet on How Companies Will Work Next 

In 1981, a multinational company that wanted to know what the next financial quarter looked like had to piece the answer together from interoffice memos and faxes, each moving from desk to desk until someone could reconcile the numbers. That labor-intensive process disappeared with the introduction of the Excel spreadsheet, which traveled as an email attachment and collected financial figures along the way. 

“That was not just about our new digital tools,” Satya Nadella said at an event with Frontier program customers. “It was a completely new way to conceptualize how that business process trajectory worked.” Microsoft’s chief executive sees a similar shift taking shape around Copilot. As AI changes how work moves through a company, he argued, it falls to business and technology leaders to rethink how that work gets done—to be “the architects of that new frontier of work.”

Microsoft wants Copilot to be the tool those architects reach for, and to get there, it has rebuilt Copilot into what may be its most ambitious form yet. On Friday, the company introduced a new version organized around three destinations: Home, Code, and Autopilot. It also includes Office in Copilot, which brings full versions of Word, Excel, and PowerPoint inside Copilot.

One Copilot for All

For the past several years, Microsoft has had two versions of Copilot—an eponymous one for consumers and Microsoft 365 Copilot for business users. However, the company announced in June 2026 at its annual Build conference that it would soon consolidate both apps, creating a so-called “super” app that brings together “chat, Cowork, and code all in Copilot.”

Microsoft is following a similar pattern to OpenAI and Anthropic. The former combined Codex with ChatGPT this summer, while the latter merged Claude chat and Cowork into a single interface earlier this month. This move appears aimed at helping users choose tools instead of context-switching—something chatbots like ChatGPT and Claude are supposed to eliminate.

Jacob Andreou, Microsoft AI’s executive vice president for Copilot, explained the reasoning for Copilot’s unification: “The bar for enterprise software is higher than it has ever been before. The expectations that we have of the tools that we adopt at work are set by the things that we use after hours and on the weekends at home.” In other words, it’s the consumerization of IT all over again—employees are seeing the benefits of AI at home and want to continue that experience in the workplace, but don’t want to have to deal with the software equivalent of clearing customs every time they transition to work and again on the way home.

“There are almost 90 million folks who pay for [Microsoft 365] out of their own pocket,” Andreou said. “These are people who value the use of things like PowerPoint and Excel so much in their personal lives that they actually go ahead and pay for it themselves. These folks don’t want some kind of dumbed-down consumer product; they want the full power that we offer to enterprise users, but in the context of their personal life.”

Andreou said that Microsoft has done a lot of work improving Copilot, largely by being “laser-focused on the fundamentals.” He reported improved metrics over the last few months: speed performance increasing 25 percent, and per-user engagement and user satisfaction rates doubling. He added that daily usage has grown eightfold over the last year. Response quality has also gone up, though Andreou didn’t provide specific numbers.

“What’s really exciting about these numbers is not just that they’re great and that they’re big, but actually it’s that every single one of these things represents real people inside of your companies and at home getting real things done,” he said. “These are problems solved. There are things that have shipped, and this is time back.”

Copilot Goes to Work

Since last year, Microsoft has been urging businesses to become what it calls Frontier Firms: organizations built around AI, where people work alongside agents rather than just using AI tools. The new Copilot is Microsoft’s clearest attempt yet to give those companies a place to start, and perhaps the first real sense of what working that way feels like.

Unsurprisingly, Andreou said he spends much of his day inside Copilot, calling it “the hub of so much of my work life.” But it’s how he pairs it with Teams that points to a new definition of the work operating system. Copilot is where he does his own work: chatting, drafting, editing, and building. Teams is where he hands work off, and increasingly not only to his colleagues but to his Autopilot. In Microsoft’s vision, delegating to an agent looks no different from delegating to a coworker.

But Microsoft isn’t the first to try to capitalize on crafting a Work OS, though it has far more experience developing operating systems than most other companies. Salesforce has also pitched Slack as being the so-called agentic OS for the enterprise. Slack’s advantage appears to be that it’s built for conversations (ideal for prompting), is open, and requires only one app—in Microsoft’s strategy, there are two: Copilot and Teams, though most Microsoft customers likely already have Teams pre-installed. That said, Microsoft’s differentiator is that it owns the files, controls distribution, and offers a trusted identity and governance platform.

The new Copilot underscores Microsoft’s further push to the enterprise—after all, that’s the audience that will pay, and AI isn’t cheap to run. Before unification, Copilot ran on two tracks: one app for consumers and another for the enterprise. At one point, the company had plans to transform Copilot into a personal AI companion. There was even a feature that would have let people customize Copilot’s look. However, those never materialized or were short-lived—in fact, during the Great Copilot Merger of 2026, Microsoft shut down several consumer features, including Copilot Podcasts, Group Chat, and Deep Research.

Embracing the enterprise can be a good move, as those customers may use Copilot more actively than consumers. By showing organizations its vision of what effective AI looks like, Microsoft may be able to convert more users into paying customers and boost its bottom line.

What’s New in Copilot

The “evolved” Copilot consists of three main sections: Home, Code, and Autopilot. Together, these features connect popular user tools with, as Jared Spataro, Microsoft’s Chief Marketing Officer for AI at Work, put it, “the next generation of capabilities they need to build, customize, and scale impact with AI.” Yet, although Microsoft introduced the new Copilot today, not everything will be available immediately. 

Copilot’s New Entry Point

Home is the starting point for all users—the area described as where “chat and Cowork come together.” “Home is where you get your bearings, keeping you grounded and moving forward,” Spataro wrote in a blog post. Here, users can use Copilot’s chatbot to answer questions, look up information, generate content, and stay in the loop at every turn. 

This section also lets users delegate work to Copilot, powered by Copilot Cowork. First introduced in March, Cowork is an agentic automation tool that can complete work on a user’s behalf across Microsoft’s productivity app ecosystem. Now that Cowork is part of the new Copilot, users simply define the task they want completed, and the AI handles everything end to end to deliver a completed result. That includes generating an RFP response, composing a launch kit, creating a customer briefing, or handling any other complex work.

But generating a draft is only one part of the job. The document still needs editing, commenting, and sharing with colleagues, which usually means leaving Copilot for another app. Rather than making people make that jump, Microsoft is bringing the apps into Copilot itself. It’s why the company has introduced Office in Copilot, which lets users harness the full capabilities of Word, Excel, and PowerPoint inside the chatbot. Microsoft has already brought Copilot to these apps, but now it’s time for the reverse. 

“Whether you’re using the document inside of Copilot or your teammates are in the native application, it doesn’t matter—collaboration is seamless,” Andreou said, stressing that this isn’t “just some simplified viewer.” 

Microsoft said that the new Home experience and Office in Copilot are both expected to roll out to Frontier Program customers in “the coming weeks.”

Code in Copilot

Chat and Cowork are built around a single request: Ask or delegate, and Copilot hands back a result. But some work isn’t a one-time request. It could be the ROI model a salesperson walks through in every customer meeting, or a dashboard that tracks buyer signals and stays current on its own. For that kind of work, Microsoft wants people to build their own tools. The new Copilot includes a section that lets users vibecode their own software.

Vibecoding isn’t unfamiliar territory for Microsoft—anyone can create software using GitHub Copilot. However, Andreou said software engineers are the ones writing code day to day in an organization, not non-technical employees. He believed it’s for three reasons: the command-line interface is “super intimidating,” most coding solutions are local and setting up a local environment is hard, and hosting and sharing what was built can be challenging.

For those reasons, Microsoft has introduced Code in Copilot. Powered by the same technology as GitHub Copilot, users describe what they want to build—such as a dashboard, an app, a tracker, an automation, or any type of workflow—in plain English, and Copilot selects the best approach and creates the software directly inside Copilot. Andreou said development takes place in a sandbox by default. This means all work happens in an isolated space. The finished product is also hosted inside the organization’s tenant, the same way Cowork is. And, according to Andreou, hosting and sharing is “as simple as saving and sharing a Word document.”

Code in Copilot is currently available to a limited number of Frontier Program customers, but Microsoft said “broad availability” is expected over the next couple of weeks.

Autopilot

At Microsoft Build in June, Nadella introduced Scout. At the time, it was the first “Autopilot” agent of its kind, meaning the OpenClaw-powered bot could work autonomously over long stretches and meet enterprise compliance requirements. “Scout works where you work, joining group chats and teams, handling threads in Outlook,” Microsoft’s CEO said back then on stage.

Fast forward to today, and Scout is now Autopilot. It’s also part of the new Copilot experience. Users have many options for long-running autonomous agents. Besides OpenClaw or its Claw variants, there’s the Hermes Agent, Gemini Spark, Instinct, and even Meta’s Muse. The problem, according to Andreou, is that “these agents have been almost impossible to bring into the enterprise.”

“The hallmark of an amazing, long-running agent is autonomy and flexibility,” he added. “It is their superpower. That is the same thing that makes them absolutely terrifying to an IT admin or somebody who’s trying to maintain a business posture.”

With Autopilot in Copilot, users can create their own digital teammate, assigning it a name (Clippy? Bob?), a role, and a goal. Andreou shared that Autopilot isn’t confined to one window—it can navigate to other places where work needs to be done, such as Teams, Outlook, documents, etc. Users can invoke Autopilot agents with an @mention. Users can assign their Autopilot to monitor channels, follow up on threads, run recurring work, or pick a project back up that was dropped days earlier, all without being prompted. 

It’s also cloud-hosted, so users don’t have to monitor Autopilot 24/7/365, meaning it can work off-hours or when a human isn’t paying attention. And to provide peace of mind to IT teams, Microsoft said Autopilot resides in an organization’s tenant, with real permissions, audit, and governance, as outlined in Agent 365. “Autopilot is equipped with enterprise-grade security and control, so it can be trusted in your organization from day one,” Spataro said. 

Autopilot is scheduled to be available by the end of September, though it will be in private preview.

Pricing

The new Copilot’s most powerful features aren’t free. Spataro shared that there are two ways of paying. The first is a Copilot User Subscription License (USL), for everyday AI use across an entire workforce. “The Copilot USL gives you the best possible quality at a fixed, predictable cost,” he said. “It’s priced per user per month and includes features like Auto mode—a new feature that weighs accuracy, speed, and cost of each request before routing it to the model best suited for the job—and chat, and Word, Excel, PowerPoint, Outlook, and Teams, model selection, and new capabilities and models as they become available.” 

For agentic work, however, Microsoft uses usage-based billing (UBB). It’s meant to provide agents with the best possible quality using the most advanced models. This billing model gives organizations full control over the models used and matches cost to value. Spataro said Cowork, Code, and Autopilots all fall under UBB, along with new frontier models like OpenAI’s Astra and Anthropic’s Fable. Microsoft plans to implement UBB for Microsoft 365 subscriptions for individuals later this year in order to enable Cowork, Code, and other experiences.

Microsoft has also revealed new FinOps for AI capabilities in Agent 365, making it easier for IT teams to govern and manage Copilot consumption. It now includes centralized spending controls, policy-based model access, and insights that pair usage with business value.

Grounded in Microsoft IQ

Everything in Microsoft’s upgraded Copilot is grounded in Microsoft IQ, the layer that pulls together an organization’s emails, documents, meetings, and business data so the AI understands how that company actually works. Andreou and Spataro repeatedly mentioned it throughout their posts and speeches, aiming to reassure customers that this sophisticated Copilot won’t hallucinate and knows everything about their business.

The emphasis on Microsoft IQ isn’t surprising, as it’s part of a trend among software vendors to show organizations why context matters in how AI agents respond. Glean, Salesforce, Google, and others have spent the past year making the same argument: AI is only as useful as what it knows about the business it works for, and the vendor holding that context has a lot of leverage. 

Microsoft does have a lot of organizational context, perhaps more than any other enterprise platform. It can pull in information not only from Microsoft 365, but also from Teams, Azure, Dynamics, Power BI, Bing, and Fabric. This provides organizations with a rich set of enterprise context to start with.

That said, Microsoft has several announcements relating to Microsoft IQ. First, the company is bringing Fabric IQ into Copilot to ground both chat and Cowork in trusted context. It’s generally available today. In addition, Code will also support Fabric IQ, though that integration will be limited to the Frontier program “soon.”

Next, Microsoft said Work IQ now grounds Copilot in data and workflows from Dynamics 365 and Power Platform. This lets the AI reason across more systems that help run a business, not just the ones providing productivity data. This integration is expected to roll out over the next month in a public preview.

Lastly, a new plugin registry is scheduled to launch by the end of September. It will provide organizations with a secure marketplace to connect Copilot to third-party actions and data. The registry brings together plugins from Microsoft, partners, and custom-built solutions. It’s perhaps not too dissimilar from what Anthropic offers with skills, though Microsoft’s is specifically for the enterprise. IT teams can approve and manage plugins from a central dashboard, and developers only have to publish once for their plugins to be available across all “supported experiences.”

Copilot’s Future Plans

Hello, Today

Microsoft has unveiled a feature coming soon called Today, which turns Copilot’s entry gate from being reactive to proactive. Andreou described it as the company’s “first-ever proactive, single pane of glass experience,” and it shows the tasks a user missed and needs to address immediately. 

The feature brings together Outlook email, calendar appointments, Microsoft Teams threads, meetings, and tasks. If there’s a scheduling conflict, for example, Today uses Copilot to propose changes to a user’s calendar. And if something gets forgotten, Microsoft said Today will not only display a reminder, but also provide the context to help users understand why it was important. Today “doesn’t just surface the work, it gets work done,” Andreou said.

Microsoft said Today is expected to enter private preview in October in Copilot, with plans to extend it to Outlook and Teams later.

@Copilot in Teams

Another feature that Microsoft announced doesn’t have to do with the new Copilot—at least not directly. It’s a capability coming to Microsoft Teams called @Copilot in Teams. Users can invoke this by typing “@Copilot” in a chat along with their request. The AI will then provide everyone in the Teams channel, group chat, or meeting with the same context and permissions. So, if a user wanted to understand why a product decision was made, @Copilot would display information pulled from across conversations. If it impacts other areas such as manufacturing, packaging, or launch timing, the AI will offer to prepare cross-functional reviews with dependencies, owners, open questions, and decisions to show everyone how their work connects and highlight what still needs to be resolved.

@Copilot in Teams is similar to what Slack unveiled last week at Dreamforce. The Salesforce-owned company announced that its Slackbot can now be tagged in a channel, thereby helping entire teams learn and answer together. In essence, Slackbot is no longer just a personal AI assistant, but an AI teammate that benefits every group member. This is likely what @Copilot in Teams is also doing—serving as a knowledge-work teammate for entire groups.

Microsoft said @Copilot in Teams should be in private preview by the end of September.

As he closed his presentation, Andreou had a question. He asked attendees to think about who in their company has “the most expertise…the best judgment, but always the least time,” and then: “What does it look like when you take a tool like [Copilot], and you put it in the hands of the very best people inside of your company?” It’s the same question Nadella asked with his forecast story from 1981. The tools arrive first. Whether the work changes depends on the people using them.