Microsoft announced on Saturday that its services, including Teams, Outlook, and other products, have fully returned to normal, concluding a global disruption that affected online communication for businesses and governments for more than 24 hours.
The company shared on X, “We have finished our work to resolve the root cause of the incident and have restored service to all remaining affected customers and regions.”
According to Microsoft, server malfunctions were responsible for the issues, which also impacted its Copilot AI assistant, and the company confirmed there was no evidence of malicious activity, thus excluding AI as a factor.
Outlook and Teams rank among the most popular workplace applications, boasting hundreds of millions of users. The outage hindered critical tasks such as sending emails, managing calendars, and conducting virtual meetings.
Microsoft expresses that it is ‘deeply sorry’ for the prolonged outage affecting global businesses and governments. The technology giant attributes the issue to a ‘technical problem’ that has largely been resolved.
The disruption impacted government departments from Australia and Japan to the United States, causing delays for trading firms, preventing some businesses from disclosing earnings, and leading airlines to alert customers about communication delays, as noted in public statements.
Organizations operating Microsoft services on their own servers instead of in the cloud experienced less of an impact.
Another outage for Microsoft
The outage, which began garnering attention on Thursday, is among the longest in Microsoft’s history and marks the second incident affecting its services this year.
Microsoft indicated that the outage primarily affected features related to Exchange Online — its cloud-based email and scheduling platform — while other applications remained functional.
This incident raises further concerns about the global dependence on a small number of Big Tech firms that provide both essential software and the cloud infrastructure that supports it.
The situation also underscored the reliance on Microsoft’s workplace software, as reports of the outage surged with the start of workdays across Asia and Europe, according to Downdetector’s parent company, Ookla.
Downdetector recorded over 7.4 million outage reports globally, peaking at nearly 20,000 reports per minute, which is more than 1,500 times the normal rate.
“This illustrates how much of the daily work relies on one provider’s email and collaboration tools,” stated Luke Kehoe, leading industry analyst at Ookla.
On Friday, Microsoft shares closed unchanged at $523.88, with the stock having risen approximately eight percent this year.
The disruptions and financial ramifications resulting from the outage could lead to multiple insurance claims; however, the overall impact on insurers is anticipated to be limited, according to Mario De Cicco, vice-president of European financial institutions at Morningstar DBRS.
De Cicco assessed the global insured losses from the outage to be between $300 million and $500 million, significantly lower than the $400 million to $1.5 billion financial impact from the 2024 CrowdStrike outage, which affected over eight million Windows-based computers and caused extensive disruptions.
Microsoft also experienced an outage with its 365 services in January this year and in October of the previous year. Last month, it reported an outage of its Azure cloud platform that affected its suite of productivity software and numerous industries worldwide.
“The greater concern is that this is not the first Microsoft 365 outage this year,” remarked Josh Gilbert, market analyst at trading platform eToro.
“If reliability starts to appear as a recurring issue, it provides every IT department with a reason to reconsider putting more of their operations in a single provider’s control.”
Nevertheless, some analysts have questioned whether such incidents can drive customers to competitors, given the substantial switching costs associated with replacing tools that are deeply integrated into everyday operations.