Plan and prepare for Dynamics 365 Business Central in 2026 release wave 1

Overview

Business Central is a comprehensive business management application for small and mid-sized organizations that helps automate, integrate, and optimize core business processes. Designed to scale as companies grow, Business Central provides a broad set of capabilities for managing finance, supply chain, manufacturing, projects, service operations, and more. Organizations can extend the application with industry-specific solutions from a rich ecosystem of ISVs and tailor it to regional and regulatory needs through configuration and customization. Business Central is quick to implement, easy to configure, and continuously improved with simplicity, usability, and reliability at the core of its design.

We're moving Business Central toward AI‑driven ERP by embedding AI and automation into everyday business processes. We're helping organizations move from manual tasks to autonomous, insight‑driven operations. Business Central increasingly acts as an active partner in daily work, helping you analyze data, take action, and make decisions with greater confidence and efficiency.

A key focus is the expansion of AI-powered agents. Building on earlier investments, we're adding more capabilities to enable agents to handle more complex, end‑to‑end business processes. These agents operate directly within the Business Central environment, using contextual understanding and generative AI to automate repetitive work and help you complete tasks faster and with less effort. By reducing manual intervention, AI agents help organizations improve productivity and focus on higher‑value activities.

In the financial area, Business Central continues to strengthen its intelligent capabilities. AI agents support core processes such as payables and expenses by assisting with document interpretation, categorization, and approval workflows. These enhancements help streamline financial operations, improve accuracy, and reduce the time spent on routine processing, while maintaining control and compliance.

We're also investing in operational capabilities, with particular attention to manufacturing and supply chain scenarios. Enhancements in areas such as subcontracting and quality management help organizations manage more complex production and delivery models. Our integration with Shopify is further refined to improve data flow and operational visibility across systems.

In addition, this release delivers ongoing improvements to governance, administration, and reporting. Enhancements to compliance, localization, and regulatory readiness support organizations that operate across regions, while improved reporting and analytics capabilities help decision‑makers gain clearer insights into business performance from day one.

Overall, 2026 release wave 1 advances the Business Central vision of an intelligent, scalable, and easy‑to‑use ERP solution. By combining strong core business functionality with AI‑driven automation and continued investments across finance, manufacturing, supply chain, and integrations, this release helps organizations run their business more efficiently and adapt more quickly to change.

Updates to Dynamics 365 Business Central 2026 release wave 1

Investment areas

Adapt faster with Power Platform
Business Central's seamless integration with Power Platform helps you improve efficiency by automating repetitive tasks. Use Power Automate templates to automate workflows that optimize your processes for your unique requirements.

We continue to invest in tight integration with Power Platform to make it more powerful and give you more ways to use your business data. For example, you can use Microsoft Copilot Studio to build AI agents connected to Business Central. And you can do so through quick and easy natural language instructions.

Copilot and agents
Business Central is the comprehensive, AI-powered application for small and medium-sized organizations that want to scale their business with AI automation, eliminate tedious tasks, and simplify work with powerful generative AI. Microsoft invests in its customers' AI transformation and empowers its diverse partner community to bring industry expertise to accelerate this mission.

In the AI era, customers can trust that their data is safe. World-class security, privacy, and compliance controls protect your data. The application follows Microsoft's Responsible AI principles, which put people at the center of the experience.

• Microsoft Copilot is the AI-powered assistant that improves efficiency, boosts creativity, and eliminates tedious tasks. With your Business Central license, everyone gets a copilot at no extra cost. Copilot in Business Central has an ever-growing set of skills to guide, find, compare, analyze, suggest, and summarize. Assistive features such as Chat and task-specific features such as bank account reconciliation assistance are ready to use with no complex setup or training. The features are seamlessly integrated to reduce or eliminate the need to switch between applications.
• Autonomous agents intelligently automate key business processes. For example, the Payables Agent automates accounts payable end‑to‑end, reading invoices, matching vendors and accounts, and preparing invoices for approval with human oversight.
• For makers and pro developers, Business Central gives you the flexibility to add custom AI solutions, including designing agents and extending Copilot in Business Central, as well as connecting to the broader Microsoft cloud of AI-powered apps and services.

Copilot and agents are available only to Business Central online customers.

Country and regional
To ensure Business Central remains compliant with evolving global regulations, every release includes foundational updates that align with the latest legal, fiscal, and data governance requirements. These updates are driven by continuous monitoring of regulatory changes across key markets and industries. Whether it's tax schema adjustments or electronic invoicing mandates, we embed the necessary capabilities to help customers meet their compliance responsibilities without disruption.

We not only address immediate legislative changes, but also build extensible frameworks that support future mandates with minimal friction. These efforts include enhancements to configuration models, localization layers, and reporting structures that allow customers to tailor compliance settings to their specific jurisdictions. By abstracting complexity and offering guided setup experiences, we reduce the operational burden on IT and finance teams while ensuring audit readiness.

Development
The pace of evolution in AI coding agents has been remarkable in the last year. What started as code completion tools has rapidly matured into autonomous agents capable of independently planning, writing, testing, debugging, and deploying code. Tools like GitHub Copilot agent mode in Visual Studio Code, or coding agents outside, can now handle entire development workflows end-to-end, provided the underlying platform exposes the right tools.

We invested heavily to meet that bar for AL development, making Business Central first-class for coding agent-driven development. We have exposed tools like compile, deploy, symbol download from server and NuGet, symbol search, and so on, for agents inside Visual Studio Code and outside via a new "ALMCP" model content protocol server. We added a troubleshooting MCP server so agents can help you troubleshoot issues with natural language during interactive debug, and empower coding agents to debug themselves. We also added support for discovering and executing AL tests in Visual Studio Code, whether as a user or a coding agent.

These investments empower coding agents to work with AL across planning, implementation, building and compiling, deploying, creating and running tests, and troubleshooting. The result is significant. AL developers who use coding agents are reporting productivity gains that would have seemed implausible just a year ago. The combination of AL's strongly-typed, domain-rich language and the new tool surface means coding agents can navigate, extend, and validate Business Central solutions with high accuracy and minimal human intervention.

Another foundational investment is the ability for partner consultants and developers to, in public preview, design and deploy their own custom Business Central agents using the same agent runtime that powers the built-in Sales Order and Payables agents.

The new in-product agent design experience, delivered as part of the AI Development Toolkit for Business Central, provides a low-risk environment for envisioning and prototyping custom agents. Agents are defined through natural language instructions, similar to writing prompts for large language models, and can be refined, tested, and iterated on against real Business Central data in a sandbox environment. This makes the capability accessible not just to developers, but also to consultants, product owners, and domain experts who understand the business processes they want to automate.

Given the inherent variability of generative AI, we fully recognize the paramount value of evaluating quality and accuracy. To that end, we also strengthened the Evaluation tool in the AI development toolkit to support configurations, multi-language test datasets, assess Copilot credit consumption, and not least test Business Central agents.

These investments lay the groundwork for a partner ecosystem built around custom Business Central agents, which will eventually be surfaced as MCP tools consumable by Agents in Microsoft Copilot Studio and Microsoft 365.

Ecommerce
In each release of Business Central, we enhance its integration with Shopify based on customer feedback. With this integration, you can efficiently manage planning, procurement, and product costs. You also gain control over inventory levels across locations and item variants.

When you integrate the apps, you simplify the process of defining prices and discounts. You also simplify managing and reporting taxes to comply with government regulations. Whether you're using Shopify or Shopify Plus, which includes business-to-business capabilities, this integration helps streamline your operations and boost your business efficiency.

Electronic documents
E-documents in Business Central streamline the end‑to‑end exchange of e-invoices and other electronic business documents by removing manual data entry and reducing the risk of errors. By automating document exchange, organizations can shift their focus from administrative tasks to higher‑value strategic work, improving both productivity and operational agility.

Beyond efficiency, e-documents enhance data accuracy, consistency, and security to ensure sensitive information is handled reliably throughout the process. The result is stronger compliance, lower operational costs, and faster document processing across the business.

While the core capability supports e-invoice exchange, the e‑documents framework is designed for much broader scenarios. It now supports more document types, such as shipments, transfer shipments, and other operational documents to open the door for partners and organizations to extend electronic exchange to a wider range of business processes.

E-documents in Business Central provide a scalable, future‑ready foundation for digital document exchange, enabling businesses to operate more efficiently, securely, and in full alignment with regulatory requirements.

Financial Management
To determine the Financial Management capabilities for each release, we prioritize customer requests and respond to market trends. For example, we focus on helping customers use Copilot to optimize their business processes. This focus includes leveraging AI to streamline data entry, automate routine tasks, and provide intelligent insights that enhance decision-making.

Currently, we focus on enabling agents to help with tasks related to financial management. For example, agents help with bookkeeping tasks based on previous patterns or business practices. We're committed to ensuring that our financial management tools are robust and adaptable to the diverse needs of our global user base. This commitment involves enhancing the management of taxes to comply with various international regulations and continuously updating Business Central to address the evolving financial landscape.

Governance and administration
Business Central gives administrators more tools for managing environments, apps, and data migrations. With these tools, administrators can solve customer needs and handle a variety of administrative scenarios.

New features in Business Central improve security, flexibility, and partner management for customers with multiple environments. Administrators can assign partner access to specific environments, which simplifies control and compliance. Customer-managed encryption keys enhance data protection and help businesses meet privacy standards. Extended update windows give administrators more flexibility to schedule upgrades. A unified interface for managing per-tenant extensions (PTEs) and AppSource apps streamlines deployment across environments and saves time. IPv6 supports connectivity, ensures seamless service, and enhances data security.

Productive with Microsoft 365
People work smarter and teams perform better when business apps are combined with productivity apps. Business Central seamlessly integrates with best-in-class Microsoft 365 apps and services such as Outlook, Excel, Word, OneDrive, and Teams to bring data into the flow of work.

The current capabilities include:

• Respond to inquiries faster by attaching quotes and invoices from Outlook.
• Connect to Exchange to automatically track email interactions or send outgoing mail from Business Central.
• Analyze a snapshot of any list in Excel, or export it to a dynamic worksheet that can be refreshed, edited, and published back to Business Central.
• Start a conversation about a record in Teams or rally the team around key datapoints.
• View, share, and co-author business documents using OneDrive for Business, even from your browser.
• Author beautiful reports and email templates in Word.

We'll continue to help users be more productive when they use business and productivity apps.

Reporting and data analysis
In today's world, data is an invaluable resource. It forms the foundation of decision-making and progress across all sectors. Recent advances in AI technology and data analytics tools bring radically new ways for businesses to turn complex information into actionable intelligence. These advances reveal hidden patterns and trends, and they find correlations that earlier methods missed. The critical insights that data analysis provides empower organizations to optimize their strategies, enhance customer experiences, and identify potential risks. With these insights, organizations gain unprecedented understanding of their operations and environments. They can innovate in ways that once seemed impossible.

As data continues to fuel innovation and drive transformative advancements, harnessing its potential is essential for staying competitive. For small and medium-sized businesses, data helps shape a more efficient and sustainable future.

Our reporting strategy focuses on building universal BI and analytics within the Business Central experience. We aim to seamlessly integrate in-context, rich, and immersive BI and analytics content from first and third parties into Business Central. With flexible self-service capabilities, you can easily access and use your data for maximum value.

Service and platform
With the new service and platform improvements, users see fewer interruptions. Business Central generally feels faster, and web services and certain scenarios are noticeably quicker. We continue to invest in the fundamentals of our service, with a focus on performance, stability, resource governance, security, and compliance. This focus lets Business Central grow in scale along with our customers' needs.

The new full-text search on lists, drill-downs, and look-ups gives you faster, more accurate access to key data. It focuses only on relevant columns for quicker, targeted results. This improvement boosts productivity and enhances user satisfaction by reducing search time and delivering precise, actionable information. You still have the flexibility to enable the previous search method when needed.

The improved job queue flow keeps the job order (FIFO) and adds a priority system in job queue categories. This system makes sure that high-priority tasks go first. Reduced locking during concurrent warehouse postings lowers bottlenecks. This reduction lets operations run more smoothly in high-traffic environments. Automated performance testing in AL-Go for GitHub helps developers find and fix performance issues earlier. This testing step makes reliability and overall system performance better.

Supply chain management
Supply chain management in Business Central offers a range of features, from procurement and production to distribution and logistics. These features help businesses streamline their operations and improve efficiency.

Business Central provides tools for managing the entire supply chain, including inventory management, order processing, and demand forecasting. Businesses can create and manage purchase orders, track inventory levels, and ensure timely delivery of products to customers. Business Central supports various supply chain methodologies, so businesses can choose the approach that best suits their operations.

A key benefit of using Business Central for supply chain management is its integration with other Microsoft products, such as Power BI and Microsoft Teams. These integrations give businesses deeper insights into their supply chain data, help their people collaborate more effectively, and support good decisions based on real-time information.

The investments for the supply chain management area focus on quality management and subcontracting.

Sustainability Management
To align with customer feedback and evolving regulatory demands, we continuously expand key parts of the Sustainability Management capabilities in Business Central.

There are more tools to collect sustainability data:

• Capture environmental data with sustainability journals and purchase documents, either manually or through formulas.
• Monitor emissions, water usage, and waste intensity across companies, countries, regions, or facilities. You can also purchase carbon credits directly within Business Central.
• Import emission factors from external sources through open APIs to ensure accurate and reliable calculations.
• Use Copilot to help estimate your carbon footprint, even when the system doesn't yet have emission factors.

It's easier to track your progress:

• Use the modern Sustainability Role Center to access all sustainability data and key performance indicators (KPIs) in one place.
• Set baselines and targets, and track your progress with scorecards and goal management tools.

You can gain insights faster and simplify reporting:

• Access built-in reports, Excel-based reporting, embedded Power BI dashboards, and analysis views tailored to your sustainability data.
• Use financial reports to compare sustainability entries with statistical or general ledger data.
• Report on various greenhouse gases in CO₂ equivalents, as well as water and waste metrics.
• Customize reports to focus on the sustainability indicators that matter most to your business.
• Meet regulatory requirements by reporting in line with the Corporate Sustainability Reporting Directive (CSRD) and other standards through integration with External ESG Reporting.
• Calculate and report data required for Carbon Border Adjustment Mechanism (CBAM) and extended producer responsibility (EPR) compliance.

Enhance your brand reputation:

• Use the integrated sustainability features in Business Central to enable full value chain tracking of Scope 3 emissions across all operations.
• Add carbon footprint data on product invoices or your projects to promote transparency and accountability.

These capabilities provide a comprehensive approach to sustainability management. They help you measure, analyze, and report your environmental impact with confidence and efficiency.

To learn more about the entire set of capabilities being delivered during this release wave, check out the release plan for Dynamics 365 Business Central below:

For application administrators

User-impacting features to the user experience enabled automatically
User-impacting features should be reviewed by application administrators. This facilitates release change management and enables successful onboarding of new capabilities released to market. For the complete list, look for all features tagged "Users, automatically" in the release plan.

Features that must be enabled by application administrators
This release wave contains features that must be enabled or configured by administrators, makers, or business analysts to be available for their users. For the complete list, look for all features tagged "Users by admins, makers, or analysts" in the release plan.

Get the most out of Business Central