License Waste

Most Microsoft 365 tenants pay for licenses nobody uses: seats bought and never assigned, licenses still attached to disabled accounts, and licenses held by people who have not signed in for months. The License Waste report finds all three and puts a monthly and annual price tag on them, so you know exactly how much money is on the table.

The report reads live data from your connected Microsoft tenant. It is not a scan: nothing is scheduled and no scanner runs. Open the page and the numbers are computed on the spot, then cached for about six hours.

Requires a paid plan

The License Waste report is included with paid plans. Without a paid plan the page shows an upgrade prompt with sample data instead of results. See the plans page for what each plan includes.

What counts as waste

The report groups waste into three categories:

Unassigned licenses

Seats you purchased but never assigned to anyone. For every SKU the report compares the purchased quantity with the assigned quantity; the difference is pure shelf-ware. If a SKU is oversubscribed (more assigned than purchased, which can happen briefly during a license reduction), it is reported as zero waste rather than a negative number.

Licenses on disabled users

Accounts that are blocked from signing in but still hold licenses. Offboarding often disables the account and forgets the license; these seats can be reclaimed immediately.

Licenses on inactive users

Enabled, licensed accounts with no sign-in (interactive or non-interactive) for more than 90 days. Accounts that have never signed in count as inactive only when they are older than 90 days, so brand-new hires are not flagged while onboarding.

Each license is counted in exactly one category. A user who is both disabled and inactive counts as disabled only, because removing the license from a disabled account is the stronger, safer recommendation.

Where the money figures come from

Prices are Microsoft's published commercial list prices (annual commitment, billed monthly) for the common SKUs: Microsoft 365 and Office 365 suites, Business plans, Exchange Online, Microsoft Entra ID P1/P2, Intune, the Defender plans, Copilot, Teams Phone, Power BI, Project and Visio, and the E5 Security and Compliance add-ons.

Two things to keep in mind:

• They are estimates. Your contract, CSP, or EA pricing is usually different. Treat the totals as the order of magnitude, not an invoice.
• Unknown SKUs are excluded from money totals. A SKU without a known list price still appears in the table with its unit counts, but it does not contribute to the money figures. The report tells you how many wasted units were left unpriced.

The report currency follows your account region: EUR for EU accounts, USD for US accounts, with the other currency shown alongside the headline number.

Reading the report

• The hero number is the estimated monthly waste across all connected tenants, with the annual equivalent below it.
• Biggest offender points at the single SKU burning the most money, which is usually where to start.
• The SKU table lists every license SKU with purchased, assigned, unassigned, wasted units, and monthly waste.
• The user lists name each disabled or inactive license holder with their sign-in history, so you can verify before you reclaim.
• Export CSV downloads everything on the page as a single file for your license review meeting.

When sign-in data is not available

Detecting inactive users requires the sign-in activity data that Microsoft exposes only on tenants with a Microsoft Entra ID P1 (or higher) license. Without it, the report simply skips the inactivity signal and says so on the page; unassigned licenses and disabled-user licenses are always reported.

Multiple tenants

If you have connected more than one Microsoft tenant, the report shows a section per tenant and the hero number sums all of them. A tenant whose data cannot be read (for example, when admin consent was revoked) is reported as unavailable without affecting the other tenants.