New Designer tools in Copilot Chat for image generation
Designer tools are rolling out in Microsoft 365 Copilot Chat, giving users guided controls to shape, refine, and fine-tune AI-generated images without having to start from scratch each time.
Copilot
Federated Copilot Connectors will reach General Availability in Microsoft 365 Copilot
Microsoft is bringing federated Copilot connectors to general availability in Microsoft 365 Copilot in April 2026. Using the Model Context Protocol (MCP), these connectors provide real-time access to third-party data sources without storing or indexing customer data in Microsoft services. All federated connectors are enabled by default.
Upload email files in Microsoft 365 Copilot Chat
Microsoft 365 Copilot Chat will let users upload .eml and .msg files directly into Copilot Chat, so they no longer have to copy and paste email content into their prompts.
Draft and send Outlook emails directly in Copilot Chat
Microsoft 365 Copilot Chat is getting a practical upgrade that makes email composition faster and more seamless. Users will soon be able to draft and send Outlook emails without leaving Copilot Chat.
Unified Plus (+) menu in Copilot Chat
Microsoft has unified the Plus (+) and Tools menus in Copilot Chat into a single entry point, making it easier to add grounding, tools, and sources when prompting.
SharePoint List Agent in Microsoft 365 Copilot
The SharePoint list agent is generally available. The agent creates lists from plain language or existing content in Teams, Outlook, and Word, but its scope is limited to list creation.
Copilot Agent Builder now lets users generate agent icons with AI
Copilot Agent Builder now supports AI-generated icons for Lite Agents. Describe the look, generate a unique icon, and skip the manual artwork.
Microsoft retires Skills Agent and People Agent in Microsoft 365 Copilot
Microsoft is retiring the Skills Agent and People Agent in Microsoft 365 Copilot as of March 2026, and recommends two other Frontier agents instead. I wouldn’t count on those agents for a long-term availability.
High-usage report for Microsoft 365 Pay-as-you-go services
Microsoft now offers a high-usage PAYG report to help identify users who are approaching the cost of a Microsoft 365 Copilot Business license, making license assignment worth considering.
Microsoft 365 Copilot Business with Monthly Commitment
Microsoft introduced a monthly commitment term for Microsoft 365 Copilot Business, allowing organizations to subscribe (or test) without a yearly commitment. The new term comes at a 20% surcharge and is available across all Microsoft 365 Business license packages.