February 2026 Excel Updates Turn Spreadsheets into AI Powered Data Tools

Microsoft’s February 2026 wave of Excel updates cements the spreadsheet as Microsoft’s primary battleground for embedding AI into everyday knowledge work, with a steady stream of Copilot improvements, new import and data functions, and developer-facing enhancements that push Excel from a calculation engine toward a lightweight, AI-enabled data platform. The changes delivered this month accelerate workflows for analysts and knowledge workers, but they also raise urgent questions about governance, performance, and backward compatibility that IT teams must address before broad deployment.

Background: why February 2026 matters for Excel users​

Microsoft has spent the last two years collapsing AI workflows into the Office grid—embedding Python execution, Copilot prompts, and richer data connectors directly inside workbooks. February’s updates are best understood as the continuation and operationalization of that strategy: moving beyond experiments and previews toward broader availability, model choice, and new runtime behaviors that change how spreadsheets are built, shared, and governed.
This is not merely cosmetic. Features introduced or advanced during January–February 2026—Agent Mode in Excel, expanded Copilot grounding, and new import/refresh behaviors—mean that a growing proportion of spreadsheet logic will be driven by AI agents and live data pulls rather than static formulas and manual refreshes. Microsoft’s official rollout notes and admin communications make the timing and scope of these changes explicit.

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Overview of the February 2026 feature set​

Below I summarize the most consequential additions and changes Microsoft shipped or advanced for Excel in February 2026, cross‑checked against Microsoft’s platform notes and independent reporting where possible.

• Agent Mode and Office Agents: Agent Mode for Excel (the Copilot agent that can perform multi‑step tasks inside workbooks) continued its rollout across platforms, with deeper web grounding and model selection controls becoming available to Copilot Chat users and licensed Copilot customers. This drives higher‑complexity automation directly inside the workbook environment.
• Copilot integration refinements (icon, quick prompts, local file grounding): Microsoft expanded UI affordances—like the in‑grid Copilot button and context prompts—to make it faster to summon Copilot without leaving the spreadsheet. Copilot’s ability to reference locally stored modern workbooks and organizational files (Word, PowerPoint, PDF) for grounded answers was emphasized in February rollouts.
• Native AI formulas and =COPILOT-like functionality: Microsoft and partners are experimenting with formula-level AI primitives that let users embed AI calls directly in cells that update as data changes. Community and forum reporting has discussed constructs such as =COPILOT (or similar cells that return AI-generated arrays/results) as an approach to combine AI logic with recalculation semantics inside Excel. These native AI formula concepts were highlighted in community threads and early demos.
• Power Query and Import improvements on the web: Excel for the web continued to close the gap with desktop Excel by making the full Power Query experience available (import wizard and Power Query Editor) and by shipping refreshable import functions (IMPORTTEXT, IMPORTCSV) that produce dynamic arrays and can refresh as source data changes. That completes a multi‑month effort to make web Excel a first‑class data ingestion surface.
• DAX and analytics additions: New backend functions and analytics helpers (for example, TABLEOF for DAX) were documented during February, illustrating Microsoft’s ongoing investment in analytics primitives that link Excel to Power BI and other service-side engines. These function-level changes matter for users who move models between Excel, Power Pivot, and Power BI.
• Enterprise integrations and governance controls: Microsoft published administrative detail on grounding models to organizational data, using approved enterprise asset libraries in content generation workflows, and providing IT tools to manage grounded Copilot agents—features designed to make AI-enabled creation compliant with brand and data rules. These admin-facing changes were communicated as part of the Copilot expansion.

Each of the items above is tied to Microsoft’s push to make AI a ubiquitous productivity interface inside Office while giving admins controls to manage where data and models are used. Independent outlets and Microsoft’s community posts cover the same themes, and I used both to verify timelines and behavior.

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Deep dive: Agent Mode, Copilot grounding, and the rise of agents in Excel​

What changed​

Agent Mode—Microsoft’s multi‑step Copilot workflow that can plan, iterate, and execute tasks inside Excel—entered a broader phase of availability in early 2026 and continued to mature in February. The feature now supports:

• Web grounding (searching the web for evidence while composing outputs).
• Work grounding (training the agent to reference corpora like SharePoint or OneDrive assets).
• Model switching, allowing organizations to choose between different model providers where supported (OpenAI, Anthropic, and Microsoft’s own models).

These changes let agents generate structured workbooks, create pivoted analyses, or build multi‑sheet reports from a single prompt—but crucially, they also change the threat model for data leakage and trust.

Why it matters for power users and admins​

For analysts, Agent Mode can automate repetitive multi‑step processes—cleaning, joining, pivoting, generating charts, and summarizing findings—dramatically reducing time to insight. For IT and data governance teams, Agent Mode becoming an “in‑workbook” actor means:

• Audit trails must capture agent activity (what sources were read, what model was used, what outputs were produced).
• Data residency and access policies must apply to AI grounding sources, lest sensitive data inadvertently be used to generate or refine outputs that get shared externally.

Verification and cross‑checks​

Microsoft’s community posts document Agent Mode rollouts and the expanded grounding options in January–February 2026, and independent change‑management trackers echo those timelines. This confirms the feature’s availability trajectory and the addition of model switching and grounding controls.

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Practical features that change day‑to‑day Excel work​

In‑grid Copilot button and quick prompts​

Microsoft added UI affordances so that users can summon Copilot from a small floating icon near their cell selection and run a suggested prompt in one click. This reduces friction between observation and action in the grid—no need to open a side pane, type a prompt, and wait. The UX change is simple but materially increases Copilot’s usage frequency by reducing cognitive overhead.

Import functions and Power Query on the web​

The web client now offers the full Power Query experience, plus new import functions that return dynamic arrays. That means:

• Analysts working exclusively in the browser can now build end‑to‑end ETL pipelines without switching to desktop Excel.
• IMPORTTEXT and IMPORTCSV make it feasible to embed refreshable, formula-driven imports into shared workbooks that live in OneDrive or SharePoint.

These changes effectively render the web client an enterprise-grade data ingestion and transformation tool—something organizations have been asking for to support distributed data teams.

Native AI formulas and =COPILOT patterns​

Community threads and early demos discussed formula‑level AI calls that behave like other Excel functions: they accept ranges and parameters, return arrays, and recalc when inputs change. These primitives—conceptually similar to writing =COPILOT(A2:A100, "summarize") inside a cell—allow teams to build sheets that embed classification, text extraction, and list generation logic directly into cells. This turns AI outputs into first‑class spreadsheet artifacts that participate in Excel’s dependency graph.

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Developer, API, and analytics implications​

DAX and function-level improvements​

February saw additions to analytics function sets (for example TABLEOF in DAX), which matters for organizations that migrate analytical models between Power BI and Excel’s Data Model. TABLEOF and similar primitives make it easier to reference table metadata programmatically when authoring measures or moving logic between tools.

Add‑ins and Excel APIs​

Excel API updates and requirement set expansions continue to land; these unlock programmatic control of notes, formatting, and custom functions from Office Add-ins. For developers, that means richer integration points for AI‑driven services that want to push results into Excel or create custom Copilot interactions. Investment in APIs signals Microsoft wants partners to create extensible automation on top of the AI features, not just proprietary black boxes.

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Benefits: productivity, accessibility, and new workflows​

• Faster insights: Multi‑step agents, in‑grid Copilot, and native AI formulas shorten the loop from question to answer, especially for unstructured tasks like summarization and classification.
• Broader platform parity: Power Query and Python capabilities on the web reduce friction for cross‑platform teams, enabling shared, refreshable ETL across Windows, Mac, and web.
• Democratized analytics: Analysts who aren’t fluent in Python or DAX can still build robust analyses using Copilot prompts and AI formulas embedded in cells.
• Developer extensibility: API improvements and new DAX primitives mean partners can build deeper integrations and automation flows that persist as workbook objects or measures.

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Risks, tradeoffs, and what IT must consider​

No rollout is risk‑free. The February 2026 Excel updates introduce several operational and security implications that IT and data governance teams must manage proactively.

1) Data leakage and grounding ambiguity​

When agents are allowed to ground on both web and organizational data, administrators must clearly define and enforce what constitutes acceptable grounding. Failure to do so risks models using sensitive internal documents for generation and potentially exposing derived outputs in external contexts. Microsoft added admin controls and grounding options, but configuration and monitoring are the customer responsibility.

2) Auditability and reproducibility​

AI‑generated results embedded in cells create a versioning and audit challenge. If a cell is populated by an AI call referencing live data and the model changes over time, reproducing or validating historical outputs may be impossible unless logging and snapshots are enforced. Organizations should adopt policies that preserve model, prompt, and source metadata alongside generated results.

3) Cost and performance​

Live AI calls and Python execution inside sheets increase compute load and can create ongoing service costs if models are invoked frequently in shared workbooks. Native AI formulas that recalc on every change may cause latency in large workbooks. Organizations should evaluate thresholds or quotas and train users to avoid placing chatty AI calls into high‑frequency recalculation paths.

4) Compatibility and portability​

Not all users will receive the same features at the same time; desktop, Mac, web, and mobile clients have differing rollouts and capabilities. Workbooks that rely on new AI formulas, import functions, or Agent Mode may break or degrade for users on older clients or non‑subscription editions. Roadmaps and migration planning are essential to ensure broad accessibility.

5) Security vulnerabilities and patch cadence​

Excel remains a high‑value attack surface. While Microsoft continues to patch security issues regularly, introducing complex runtime behaviors (external imports, agent calls, on‑file Python execution) enlarges the attack surface. Security teams should treat Excel agents and Python runtimes with the same vigilance applied to web services: monitor for anomalous outbound calls, require least privilege for connectors, and keep client‑side applications patched. Recent security advisories around Excel underscore the importance of vigilance.

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Recommended deployment and governance checklist​

If you’re an IT manager or an Excel power user planning adoption, start with the following checklist—ranked, practical steps to maximize value and reduce risk.

• Review and document permitted grounding sources for Copilot/Agent Mode (web, SharePoint, OneDrive, external connectors). Ensure policies are clear and enforced.
• Configure audit logging for Copilot/Agent activity where available; preserve prompt text, model used, and referenced assets for compliance needs.
• Pilot new features with a controlled group: test Agent Mode, in‑grid Copilot buttons, and native AI formulas in low‑risk datasets to measure performance and cost.
• Set tenant limits or quotas for model invocations where possible; users should be trained to design efficient prompts and avoid unnecessary recalc loops.
• Update endpoint and application security rules to detect anomalous outbound/model calls, and add Excel runtime exceptions to vulnerability scanning processes.
• Provide template workbooks that wrap AI formulas and imports with metadata sections explaining expected behavior, refresh cadence, and the date/model snapshot used.
• Communicate compatibility expectations: create a quick reference specifying which features require updated desktop builds, which are web‑only, and how to handle version fallbacks.

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Real‑world scenarios: how teams will use (and misuse) these features​

Useful: automated monthly reporting with Agent Mode​

A finance team can instruct an Excel agent to "pull the latest sales CSV files from our data lake, clean the rows, calculate month‑over‑month variance per region, and generate a one‑page summary with chart and narrative." Agent Mode can orchestrate those steps, create a new workbook, and leave behind the exact steps as an action log—transforming what used to be a half‑day manual chore into a single prompt and review.

Risky: embedding chatty AI calls in high‑frequency dashboards​

Creating a dashboard where each cell calls a model for sentiment analysis on live customer feedback will look clever in a demo, but in production will create latency, unpredictability, and uncontrolled API costs. Use batch processing or scheduled refreshes with cached results instead.

Developer use: programmatic book building and governance hooks​

Developers can use Excel APIs to create controlled workflows where Copilot agents generate content, but an add‑in or automation layer captures the provenance (prompt, model, timestamp) and stores it in a governance database before the workbook is shared—balancing automation with auditability.

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Cross‑reference and verification notes​

I verified the major rollout points and product behaviors using Microsoft’s community blog posts and Message Center summaries (Agent Mode, Power Query on the web, local workbook grounding), as well as independent reporting that tracked Copilot feature changes and their availability windows. For analytics and function‑level changes I referenced Microsoft DAX documentation and developer postings that list newly documented functions. For forum‑level, hands‑on takes about native AI formula patterns and =COPILOT‑style experiments, I cross‑checked community threads that have been discussing those primitives and early prototypes.
A note on unverifiable claims: some pieces circulating in community forums suggest proprietary formula names or exact syntax (for example literal =COPILOT function names) that aren’t present in official Microsoft docs. Those early constructs are useful to understand intent and experimental design, but when Microsoft documents native AI formulas formally we should treat the official syntax as authoritative. Where an assertion came from community threads rather than Microsoft docs I flagged it and avoided treating it as final.

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Longer‑term implications: spreadsheets as live apps​

February’s rollouts are incremental, but they push Excel toward a future where:

• Workbooks are not static artifacts but live apps that fetch, transform, and generate content on demand.
• AI agents act as first‑class workers inside the spreadsheet, capable of orchestrating multi‑step analysis and generation tasks.
• Governance and reproducibility become central product requirements because AI outputs and live imports are now standard parts of the workbook lifecycle.

That future is powerful—and fragile. The combination of live data imports, model-driven outputs, and cross‑platform clients means spreadsheets can unlock rapid insights, but teams must adopt modern software practices—testing, staging, logging, and version control—if they want to manage complexity sustainably.

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Final assessment and what to watch next​

February 2026’s Excel changes deepen Microsoft’s commitment to making AI part of everyday spreadsheet work. The most significant outcomes for users will be:

• Faster, more autonomous workflows (Agent Mode + Copilot affordances).
• Web parity for data ingestion (Power Query and import functions on Excel for the web).
• Emerging formula‑level AI patterns that turn model outputs into recalculating cell values—powerful but in need of governance.

What you should watch next:

• Microsoft’s formal documentation for any native AI formula syntax (to replace community prototypes with official behavior and compatibility notes).
• Admin and compliance tool updates that add stronger tenant controls, audit trails, and model‑use reporting.
• Cost and performance telemetry in pilot deployments—these will determine whether organizations gate or accelerate Copilot usage inside shared workbooks.

For IT teams and power users, the advice is straightforward: pilot aggressively, instrument everything, and treat AI‑enabled Excel artifacts with the same lifecycle discipline you already apply to critical code and data assets. The productivity upside is large—but so is the responsibility.

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Conclusion
February 2026’s Excel updates are a meaningful step in Microsoft’s long arc to make Office the default workspace for AI‑assisted knowledge work. The combination of Agent Mode maturity, in‑grid Copilot access, web parity for Power Query, and experimental formula‑level AI primitives moves spreadsheets from a passive record toward an active, AI‑orchestrated workspace. Organizations that prepare their governance, logging, and cost controls now will be best placed to capture the productivity gains without exposing themselves to unnecessary compliance, security, or cost risks.

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Source: Neowin Here are all the new features Microsoft added to Excel in February 2026