Microsoft Highlights AI Transformation at Ignite 2025

Microsoft kicked off Ignite 2025 with over 70 announcements related to the "lifecycle of AI." Taken together, the announcements signal the company’s push from discrete AI features toward a full-stack enterprise AI infrastructure.

Two of the biggest releases today are an AI management platform called Agent 365 and a new “intelligence layer” to inform AI comprised of Work IQ, Fabric IQ and Foundry IQ.

The number of announcements is in keeping with the rate of feature releases the company has maintained in the last year, having shipped, “more than 400 new features in the last year.” The question remains: can customers keep up?

Agent 365 Provides AI Oversight and Management

During its FY26 Q1 earnings call in October, the company claimed customers had built over 3 million agents using SharePoint and Copilot Studio. Microsoft-sponsored research by IDC predicts 1.3 billion agents by 2028. Proper governance is a must to keep the agents productive rather than destructive.

Agent 365 is Microsoft’s answer to this agent sprawl and the emerging need for AI operational governance, not just security. The platform ingests agents built natively in Microsoft Foundry and Copilot Studio, as well as open source and third-party agents from partners. Agent 365 helps you manage these agents in five areas:

A registry — A single place to view all agents in an organization.
Access control — Controls and limits the access agents have to only the necessary resources.
Visualization — A dashboard to monitor agent behavior and performance in real-time.
Interoperability — Gives agents the data and apps to simplify workflows.
Security — To detect threats in advance and protect agents from vulnerabilities.

Together, these capabilities amount to an MDM-like governance layer for AI agents, a necessary step as organizations shift from pilots to production-scale AI workflows. The platform integrates with existing Microsoft safeguards including Entra identity management, Purview data compliance and Defender security.

Microsoft Agent 365 Registry — A view of the Agent 365 registryMicrosoft

“With Microsoft Purview, you gain visibility into agent-related data risks, protect sensitive data, enforce compliance policies, and block harmful agent behaviors — while supporting an audit-ready posture with detailed logging and reporting of agent interactions, including content safety risks,” said a Microsoft spokesperson.

Agent 365 is currently available through Microsoft’s Frontier Program, its early-access program for select businesses to get hands on with products before they become generally available.

AI Context Through Work IQ, Foundry IQ and Fabric IQ

Tech companies have spent the latter half of 2025 providing AI systems with better context to inform AI agent actions and improve and create more explainable outcomes. Knowledge graphs, semantic layers and data fabric all come into play here to make AI recommendations traceable and more reliable.

Microsoft is no stranger to the knowledge graph, having first explored its potential with Project Cortex and more recently, with the retired Viva Topics. Today it introduced Work IQ, an intelligence layer to provide Copilot and agents with a better understanding of the work you do, how you do it and your relationships and work patterns so they can infer the next best action.

Work IQ pulls from sources like Word, PowerPoint, Excel and Teams. People can build agents specific to their work context using Work IQ via a Microsoft 365 Copilot API.

An open question around the IQ release is data scope. At the time of writing, Microsoft had not responded to a question of whether Work IQ incorporates data and information from outside the Microsoft walls, a critical point if the goal is to provide full context of work activities.

Joining Work IQ are Foundry IQ and Fabric IQ. These three layers address context in three dimensions: user-level context (Work IQ), app/data-level context (Foundry IQ) and enterprise-level context (Fabric IQ).

Fabric IQ — “Unifies analytics, time-series and operational data under a semantic framework. Because all data resides in OneLake, either natively or via shortcuts and mirroring, organizations can realize these benefits across on-premises, hybrid, and multicloud environments,” said a Microsoft spokesperson.
Foundry IQ — Helps companies connect agents to the right data through a single API. A Microsoft spokesperson described the benefits as: “Instead of building custom RAG pipelines, developers get knowledge bases and agentic retrieval in a single API that just works — all while respecting user permissions.”

Frontier customers using Fabric IQ include ENMAX Power, which uses Fabric IQ to perform advanced forecasting, risk evaluation and outage mitigation. Kyndrl is using Fabric IQ to define an ontology to ground agents in the business with real-time operational context.

The IQ trio release sounds comparable to Glean’s Personal and Enterprise Graphs and Google’s recently launched Gemini Enterprise, two approaches to pulling together data from cross-organizational sources to produce more relevant, trustworthy AI outcomes.

Microsoft needed this layer to improve Copilot context and responses, which anecdotally have not all been on target. The weakest link in Copilot so far has been its tendency to generate confident but contextually shallow output — something Microsoft is now trying to fix at the infrastructure level.

Whether IQ can succeed where Project Cortex and Viva Topics fell short remains to be seen. The latter two were built on great promise — to organize knowledge on a collective scale — but failed to account for the human effort needed to classify and maintain content. Microsoft may be betting on both the improvements to AI’s abilities of inference and the efforts that organizations have made to ready their data for AI will make the difference this time.

Microsoft 365 Copilot Updates

Unsurprisingly, Copilot received a fair amount of attention in the announcements, all geared at “making human-agent teamwork a reality.”

Just a few of the announcements include:

Voice in the Microsoft 365 Copilot app — Commercial customers will gain access to the mobile speech mode with Copilot in December. Voice allows users to give verbal queries and commands to Copilot, such as asking, “Catch me up on recent meetings I missed.”
Copilot in Outlook — A new interactive voice interface, one-tap prompts, scheduling meeting via chat and resolving personal scheduling conflicts are just a few of the additions available now or in early access.
Work IQ in Copilot and SharePoint — Work IQ retains and updates its knowledge of an individual so Copilot can deliver more relevant, more personalized and useful responses. This is available for Frontier Program members. Generally available is Work IQ improving the semantic understanding of the metadata in SharePoint document libraries.
Copilot Notebooks Updates — Frontier partners now have the ability to share Notebooks, create video overviews for any given notebook and will receive recommendations for relevant or more up-to-date references to ensure Notebooks remain up to date.
Copilot Chat Page Creation — People can create Copilot Pages via chat to visualize and share concepts with others.

The company also rolled out Agents and Agent Mode for Excel, PowerPoint and Word. Taken together, these updates show Microsoft is betting on multimodal input, personal context and collaborative creation as the next stage of Copilot evolution.

calendar enhancements in Outlook announced at Microsoft Ignite 2025

Is it Possible to Have Too Much AI?

Microsoft’s hold on the enterprise continues, as evidenced by the 200,000 people who registered for the conference, including 20,000 attending in person at Moscone Center in San Francisco. But recent signs of strain — from reports of the company hiring influencers to compete partner OpenAI, to a lawsuit from the Australian government over Copilot bundling — suggest mounting pressure to make sure its multi-billion dollar AI spend pays off.

The pace of change is impressive from an innovation perspective, but given the challenges enterprises report in keeping up with AI releases, it’s worth asking if such a flood will help businesses or overwhelm them.

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