Nikoo Samadi
Microsoft has kicked off the year with a powerful update to its Dynamics 365 ERP suite. The Dynamics 365 ERP 2025 features introduced in the 2025 Release Wave 1, rolling out from April through September, bring a wide range of improvements across supply chain management, finance, automation, and AI.
Whether you’re a business leader, IT manager, or ERP consultant, this release brings smart tools designed to streamline processes, improve forecasting, and support global operations.
In this blog, we’ll break down the most important Microsoft Dynamics 365 ERP update 2025 highlights in plain terms, starting with updates in supply chain and finance, then moving on to AI-driven enhancements and compliance. At the end, we’ll give you a quick preview of what to expect in Wave 2, coming later this year.
Smarter Supply Chain Management with AI and Automation
The 2025 Wave 1 update brings powerful tools to help businesses make faster, more informed decisions across their supply chains.
AI-Powered Demand Planning
Copilot helps with demand planning by using generative AI. It creates forecasts and explains the reasons behind changes. Like why sales might rise or fall. This helps planners understand the data and adjust supply plans more easily.
Manufacturing Process Improvements
New tools help manufacturers run quality checks, test products, and keep operations efficient. Copilot offers suggestions and summaries during updates, which helps teams work faster and avoid mistakes.
Smarter Planning Optimization
The planning engine now handles lean production, step consumption, and catch-weight items. These updates make it easier to support industries like food, chemicals, and manufacturing.
Vendor Rebate and Contract Automation
The system now tracks rebates better, flags mismatches, and allows re-submissions. These changes cut down on the manual work needed to manage contracts and payments.
A New Vendor Portal (No License Required)
Vendors can use a self-service portal built with Power Pages. They don’t need a Dynamics 365 license to access it. The portal lets them manage delivery appointments, track invoices, and review performance, which simplifies their work.
Financial Management: Faster Close, Smarter Insights
In 2025, Dynamics 365 ERP 2025 features in finance focus on simplifying global operations, speeding up the month-end close, and making financial data easier to trust and act on. These changes solidify the difference between ERP and CRM when it comes to managing back-office operations at scale.
AI-Powered Financial Analysis
Finance Copilot helps controllers and finance managers summarize reports, spot trends, and find unusual activity. It explains why revenue dropped or why a cost increased, making analysis faster and clearer.
Close Process Automation
Microsoft improved the Financial Close workspace to help organizations automate task assignments, approvals, and dependencies. You can customize close checklists and track progress in real time across subsidiaries.
Tax Management and Compliance
The tax engine now supports e-invoicing and tax localization for more countries, helping global companies meet local regulations without needing custom code. This includes updated formats and built-in compliance reports.
Subscription Billing Enhancements
Subscription-based revenue recognition now handles complex cases like upgrades, cancellations, and multi-element arrangements more effectively. This reduces manual fixes and keeps audit trails clear.
Intercompany Accounting Improvements
For companies with multiple legal entities, Microsoft simplified processing intercompany transactions. It applies consistent rules and lowers reconciliation errors, especially in shared service centers.
Copilot & AI: Built-In Intelligence Across the ERP
AI is now part of the core experience in Dynamics 365 ERP 2025 features. In the 2025 update, Microsoft expands Copilot into finance, supply chain, and project management. It helps users work faster and reduce manual steps.
Natural Language Prompts
Users can now type plain language commands like “Summarize this report” or “Show me sales trends for last quarter.” Copilot responds with tailored outputs, saving time on filtering and clicking through menus.
Context-Aware Guidance
Copilot gives suggestions based on your role, task, and past activity. Whether you’re approving a purchase order or checking a budget variance, it adapts to how you work. It improves over time and helps teams move faster without extra training.
Cross-App Intelligence
Copilot isn’t limited to one module. It pulls insights across ERP apps (like Finance + SCM) and even from Microsoft 365 tools like Excel or Teams. For example, it can surface a supplier issue linked to delayed revenue recognition in your P&L.
Drafting, Editing, and Explaining
The 2025 Wave 1 release of Microsoft Dynamics 365 ERP brings updates across core areas—finance, supply chain, AI, and compliance. Whether you’re closing books, managing inventory, or operating in new markets, the changes are practical and easy to use.
Key takeaways:
Copilot is built in and supports faster, more accurate work.
Finance and supply chain tools offer better automation, forecasts, and visibility.
Compliance is simpler, with more support for country-specific tax and reporting rules.
No-code tools make it easier to adjust the system to fit your needs.
These updates make Dynamics 365 ERP more straightforward and more flexible for day-to-day work.
Global Compliance and Localization: Ready for Regional Rules
Managing compliance across countries takes time. The Microsoft Dynamics 365 ERP update 2025 makes it easier. Microsoft has added more built-in support for local tax, invoicing, and reporting rules. These updates cover more regions and reduce the need for manual setup.
Expanded Localizations
Wave 1 adds support for Bangladesh, Egypt, and Morocco. Each country gets its own tax reporting setup, e-invoicing format, and language option. With this update, Dynamics 365 now supports over 50 countries and regions.
No-Code Configuration for Local Rules
Using the Globalization Studio, businesses can now set up local tax rules, document layouts, and compliance processes without writing code. This speeds up deployments and makes changes easier to manage in-house.
Real-Time Regulatory Updates
Microsoft releases monthly localization updates for supported countries. These cover VAT rules, e-invoice formats, and legal declarations. The updates help businesses stay audit-ready without needing custom fixes or external help.
Compliance Dashboards
New dashboards show the status of regulatory tasks across subsidiaries. Finance teams can track filing deadlines, spot errors, and manage exceptions. This is useful for companies that operate in multiple countries.
Simplify Your Decision with GEM365
Get in touch with GEM365 to guide you through the process and get consultation for free.
Final Thoughts: What Dynamics 365 ERP in 2025 Brings to the Table
The Dynamics 365 ERP 2025 features in the Wave 1 release bring meaningful updates across every core area such as finance, supply chain, AI, and global compliance. Whether you’re automating your close process, optimizing inventory, or scaling operations across borders, the improvements are practical and easy to apply.
Key takeaways:
- AI is built-in, not bolted on. Copilot helps teams work faster and smarter.
- Finance and SCM have stronger automation, forecasting, and visibility tools.
- Compliance is easier, especially for global businesses needing localized tax support.
- No-code tools make it easier to adapt the system to unique business needs.
- The difference between ERP and CRM is more evident than ever in how deeply integrated these tools have become with operations.
Together, these Microsoft Dynamics 365 ERP update 2025 improvements make it a more proactive, user-friendly platform for modern business operations.
What’s Next: 2025 Release Wave 2
Microsoft updates Dynamics 365 ERP twice a year. The 2025 Release Wave 2 begins on October 1, 2025, and will roll out into early 2026.
Details are not final, but Wave 2 will likely expand Copilot, strengthen industry-specific tools, and add more regulatory support.
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