The major SaaS providers have announced another round of significant price increases for 2025, continuing a trend that’s putting pressure on enterprise software budgets across the board. After years of relatively stable pricing, these companies are leveraging their market positions to drive revenue growth through higher per-seat costs.
Salesforce: The 6% AI-Driven Increase
Salesforce implemented a 6% price increase for its Enterprise and Unlimited Editions, effective August 1, 2025. The company positioned this as reflecting the value of new AI capabilities through their Agentforce platform. Management described it as demonstrating “strong pricing power and customer stickiness” while adding AI functionality.
This represents the second significant price adjustment in the last several years, following a 9% increase across their entire product portfolio in 2023. The timing suggests Salesforce is accelerating its pricing cadence as revenue growth has further declined to single digits.
Microsoft: The Multi-Front Assault
Microsoft took the most aggressive approach, implementing price increases across multiple product lines simultaneously. Starting April 1, 2025, they rolled out:
Billing Structure Changes:
- 5% surcharge for customers choosing monthly billing on annual subscriptions (affecting Microsoft 365, Office 365, and Dynamics 365)
Teams Phone Increases:
- Teams Phone Standard jumping 25% from $8 to $10 per user per month
- Teams Phone Standard for Frontline Workers rising from $4 to $5 per user per month
Power BI Dramatic Increases:
- Power BI Pro rising 40% from $10 to $14 per user per month ($120 to $168 annually)
- Power BI Premium Per User climbing 20% from $20 to $24 per user per month Microsoft 365 Price Increases in 2025: What You Need to Know – US Cloud +2
But Microsoft wasn’t done. They announced the first price increase for Dynamics 365 Business Central in over five years, effective October 1, 2025, with increases of 10-15%:
- Essentials: From $70 to $80 per user per month (14% increase)
- Premium: From $100 to $110 per user per month (10% increase)
- Device License: From $40 to $45 per device per month (12.5% increase) Business Central Price Increase Effective October 2025
The strategy is clear: penalize monthly billing flexibility while driving customers toward higher-tier bundles and longer commitments.
Google: The Largest Increase of the Group
Google Workspace made the most dramatic pricing move. Prices increased 17-22% across all plans, with the popular Business Standard plan rising 16% from $14.40 to $16.80 per user per month.
Google’s strategy involved integrating Gemini AI features directly into all business tiers and discontinuing the standalone Gemini add-on. This bundling approach means customers now pay for AI capabilities whether they use them or not. The increases took effect for new customers in January 2025 and existing customers in March.
Atlassian: Substantial Data Center Increases
Atlassian implemented some of the steepest increases, particularly targeting Data Center customers:
Jira Software Data Center:
- 1-1,000 users: 15% increase
- 1,001-5,000 users: 20% increase
- 5,001+ users: 25% increase
- Legacy advantage pricing: 30% increase
Confluence and Jira Service Management: Similar percentage increases across all user tiers.
These changes align with Atlassian’s cloud-first strategy, making on-premise deployments significantly more expensive relative to cloud alternatives.
Industry-Wide Pricing Pressure
This isn’t an isolated phenomenon. SaaS inflation is running at 4x the rate of general inflation, with businesses now spending an average of $8,700 per employee on SaaS, representing a 27% year-over-year increase, per Vertice.
Additionally, 60% of vendors mask their price increases, making it difficult for procurement teams to accurately budget and compare alternatives.
Among the top 500 SaaS companies, there were 339 pricing and packaging changes in the past year, with many companies implementing multiple adjustments.
Other Leaders, Too
The pricing pressure extends beyond the major platform providers. Even specialized tools and emerging leaders are following similar patterns in 2025:
Monday.com: Customers report receiving notices of price increases coming into effect in January 2025, with some noting Pro plan increases to $19.00 with no discounting available. The company has also implemented minimum seat requirements, with Enterprise plans now requiring a minimum of 25 seats moving forward.
Asana: Asana has been implementing selective price increases throughout 2025, with customers reporting 2.6% price uplifts at renewal with no changes to subscriptions. The company is actively migrating customers from legacy business SKUs that are being discontinued in January 2025, often resulting in higher costs.
Notion: Starting May 2025, Notion restructured its pricing plans with changes taking effect for existing customers by August 2025. The company increased prices for Plus and Business plans while bundling AI features into higher tiers. Some enterprise customers report renewal uplifts of up to 10%, with pricing increases from $8 to $10 per member per month being proposed.
Zoom: Zoom has implemented automatic price increases ranging from 5-25% throughout 2025, even for customers on auto-renewal. The Workplace Pro plan increased by $10 annually to $159.90 per user, while some enterprise customers faced renewal increases of up to 30%. Many customers report discovering these increases only through automatic payment notifications.
Zendesk: Customer reports indicate ongoing price pressure in 2025, with annual increases of 7-10% being proposed at renewal. Some customers report being able to negotiate these increases away, but others note that Zendesk has warned “contracts would be increasing dramatically” and encouraged early renewals to avoid higher rates.
HubSpot: Industry observers expect continued incremental price increases throughout 2025, particularly as HubSpot integrates recent acquisitions like Clearbit (now Breeze Intelligence) and Cacheflow into their platform.
Datadog: While not announcing major across-the-board increases, Datadog has been implementing selective price increases during renewal negotiations throughout 2025, with some customers reporting proposals to increase log prices and other SKU-specific adjustments.
The pattern is consistent: whether through outright price increases, model changes that effectively raise costs, or usage-based billing that leads to surprise bills, virtually every major SaaS provider is finding ways to extract more revenue per customer in 2025.
Some Pushback: When Uncle Sam Says No
Not everyone is rolling over for these price increases. The federal government has started pushing back hard, and even mighty Salesforce has had to blink.
In May 2025, Salesforce agreed to offer Slack to federal agencies at up to a 90% discount through November 2025, along with a 70% discount on Slack AI for Enterprise. This deal replaced “lower, fragmented discounts negotiated on an agency-by-agency basis” with a unified government-wide pricing structure.
The dramatic discount came as part of the Trump administration’s “OneGov” procurement strategy, which treats the federal government as a single buyer to leverage massive purchasing power. GSA Commissioner Josh Gruenbaum made it clear he’s “not afraid to do a wholesale swap out of long-time federal software vendors if there’s better long-term value elsewhere”.
Similar deals were struck with Adobe and Google, with Gruenbaum calling these “a harbinger of longer-term, discounted contracts in the next fiscal year”. The message to vendors is clear: negotiate, or we’ll find someone who will.
This pushback highlights what’s possible when buyers have real leverage and aren’t afraid to use it. The 90% Slack discount proves these companies have substantial margin to work with—they’re just choosing not to extend that flexibility to private sector customers who lack the government’s negotiating power.
The Salesforce Price Increase Playbook: A Case Study
Salesforce provides an instructive example of how these price increases translate to bottom-line impact. Based on analysis of their revenue growth over the past three years:
Revenue Growth Timeline:
- 2022: $26.5B
- 2023: $31.4B (+18.3% growth)
- 2024: $34.9B (+11.2% growth)
- 2025: $37.9B (+8.7% growth)
Estimated Price Increase Contribution: The July 2023 price increase (9% across all products) and the 2025 increase (6% for Enterprise/Unlimited) likely contributed approximately 25% of Salesforce’s total revenue growth over the three-year period from 2022-2025.
Breaking it down by year:
- 2024: Price increases contributed roughly 4.5 percentage points of the 11.2% total growth (40% of growth)
- 2025: Price increases contributed approximately 6.3 percentage points of the 8.7% total growth (72% of growth)
This analysis reveals how crucial pricing has become to Salesforce’s growth story. While management downplayed the impact in 2024, noting that the price increase “won’t be a major factor,” the data suggests otherwise.
With Salesforce’s organic growth slowing from historical rates of 25%+ to under 10% in recent quarters, price increases have become an essential tool for maintaining growth targets.
This pattern likely extends across the industry, with mature SaaS companies increasingly relying on price optimization rather than customer acquisition to drive revenue growth.
50% of Zoom’s Revenue Growth The Past 24 Months May Have Come From Price Increases
Zoom’s Pricing Strategy Shift
Timeline of Price Increases
2024 Increases:
- Workplace Pro annual plan: +$10 to $159.90 per user (6.7% increase)
- Various enterprise renewals: 5-30% increases reported by customers
2025 Escalation:
- Automatic price increases: 5-25% across different plans
- No advance notification for many customers
- Bundling strategy: AI features moved to higher-tier plans only
Implementation Approach
Zoom’s pricing strategy demonstrates several key characteristics:
- Stealth Implementation: Many customers discovered increases only through automatic payment notifications
- Value Bundling: Price increases justified by adding AI features and doubling storage limits
- Segmented Targeting: Different increase percentages for different customer segments
- Renewal Leverage: Using contract renewals as primary increase vehicles
Market Dynamics at Play
These price increases are largely enabled by the market concentration in enterprise software. Google Workspace controls 44-79% of the cloud office market, while Microsoft and Google dominate their respective categories with limited viable alternatives for enterprise customers.
As Google’s leadership noted during earnings calls, revenue growth was “primarily driven by increase in average revenue per seat”—a clear indication that pricing, rather than customer acquisition, is driving growth.
The AI Justification
Nearly every price increase cites AI feature integration as justification. Companies are bundling AI capabilities into existing products and using these additions to support higher pricing across their entire customer base, regardless of individual AI adoption or usage patterns.
Budget Impact
With SaaS now representing $1 in every $8 of typical organizational spending, these cumulative increases represent a significant budget impact for most companies. The timing is particularly challenging as many organizations are dealing with broader economic pressures and cost optimization initiatives.
Looking Ahead
With high switching costs and deep product integrations, enterprise customers have limited near-term alternatives, giving vendors confidence in their ability to implement these increases successfully.
However, the federal government’s success in securing massive discounts demonstrates that these price increases aren’t inevitable—they’re strategic choices that can be challenged with sufficient leverage and willingness to walk away.
The AI Double-Edged Sword: Expect AI to continue serving as the primary justification for price increases throughout 2025 and beyond. Every new AI feature will be positioned as revolutionary value that warrants higher pricing, regardless of actual customer adoption or ROI. Companies have learned that “AI tax” is an acceptable way to boost margins while appearing innovative.
But AI is also creating new competitive dynamics that could eventually challenge these pricing strategies. AI-native startups are building products with fundamentally lower cost structures, leveraging large language models to deliver functionality that previously required massive engineering teams. Tools like Claude for coding, AI-powered design platforms, and intelligent automation solutions are beginning to challenge traditional software categories.
Additionally, AI is lowering barriers to entry across software development, enabling smaller companies to rapidly build competitive alternatives to established players.
While the full impact may take years to materialize, the same technology being used to justify price increases … could ultimately democratize software creation and intensify competition.
For procurement and IT leaders, this environment requires more aggressive vendor management, careful contract timing, and potentially exploring alternative solutions where viable. The Salesforce example demonstrates that these aren’t one-time adjustments—they’re becoming a regular revenue growth strategy that organizations need to plan for in their long-term budgets. And the government’s negotiating success shows that even the biggest vendors will cut prices dramatically when faced with real consequences.
For now, expect more price increases justified by AI features that may or may not deliver proportional value.
