Some users may be unable to share files with external recipients through SharePoint Online and Microsoft OneDrive

Title: Some users may be unable to share files with external recipients through SharePoint Online and Microsoft OneDrive

User impact: Users may be unable to share files with external recipients through SharePoint Online and OneDrive.

More info: Affected users may be unable to send external sharing invitations from SharePoint Online sites and OneDrive locations, despite external sharing being enabled at both the tenant and site levels. Upon failure, affected users encounter the following error: "That didn't work: We couldn't find a valid SharePoint Online license..."

While we're working to resolve this issue, impacted organizations may be able to bypass the impact in one of the following two ways:

1) Create a support case and contact Microsoft to request that "Unlicensed User Access" be enabled for their tenant.

2) Admins within the affected organizations can assign any license that provides the SharePoint Online service to the external users they're attempting to share with to bypass the impact for those users.

Current status: We've rolled back a recent service change that we believe may be contributing to this impact and have confirmed that this step has mitigated impact for a subset of users. We're continuing to monitor this rollback in order to validate full remediation for this event.

Scope of impact: Some users attempting to share files with external recipients through SharePoint Online and OneDrive may be impacted. This information may be updated as our investigation continues.

Root cause: Organizations that requested we turn off Unlicensed User Access for their organization are encountering this problem after OTP deprecation and unlicensed user check in the external sharing code is now being enforced.

Next update by: Wednesday, August 5, 2026, at 10:30 PM UTC

Title: Some users may be unable to share files with external recipients through SharePoint Online and Microsoft OneDrive

User impact: Users may be unable to share files with external recipients through SharePoint Online and OneDrive.

More info: Affected users may be unable to send external sharing invitations from SharePoint Online sites and OneDrive locations, despite external sharing being enabled at both the tenant and site levels. Upon failure, affected users encounter the following error: "That didn't work: We couldn't find a valid SharePoint Online license..."

While we're working to resolve this issue, impacted organizations may be able to bypass the impact in one of the following two ways:

1) Create a support case and contact Microsoft to request that "Unlicensed User Access" be enabled for their tenant.

2) Admins within the affected organizations can assign any license that provides the SharePoint Online service to the external users they're attempting to share with to bypass the impact for those users.

Current status: We're continuing to evaluate the data pathways responsible for providing file sharing to external users to assist us in identifying the most expedient path to complete remediation.

Scope of impact: Some users attempting to share files with external recipients through SharePoint Online and OneDrive may be impacted. This information may be updated as our investigation continues.

Root cause: Organizations that requested we turn off Unlicensed User Access for their organization are encountering this problem after OTP deprecation and unlicensed user check in the external sharing code is now being enforced.

Next update by: Monday, August 3, 2026, at 10:30 PM UTC

Title: Some users may be unable to share files with external recipients through SharePoint Online and Microsoft OneDrive

User impact: Users may be unable to share files with external recipients through SharePoint Online and OneDrive.

More info: Affected users may be unable to send external sharing invitations from SharePoint Online sites and OneDrive locations, despite external sharing being enabled at both the tenant and site levels. Upon failure, affected users encounter the following error: "That didn't work: We couldn't find a valid SharePoint Online license..."

Current status: We've identified that this impact only occurs in a specific scenario: if your organization previously contacted Microsoft at some point in the past to specifically request that Microsoft turn off Unlicensed User Access for your organization. Otherwise, no impact is occurring. Furthermore, the reason why this was previously working, and is now not working, is we've identified that an unlicensed user check exists in the external sharing code that was previously not enforced, as one-time password (OTP) generation essentially rendered it unnecessary. However, with the recent deprecation of OTP, this check is now being enforced. We've identified two mitigations impacted organizations can take to relieve the issue:

2) Admins within the affected organizations can assign any license that provides the SharePoint Online service to the external users they're attempting to share with to bypass the impact for those users.

2) Impacted organizations can create a support case and contact Microsoft to request that "Unlicensed User Access" be enabled for their tenant.

We're continuing to evaluate how unlicensed user access should interact with external sharing.

Scope of impact: Some users attempting to share files with external recipients through SharePoint Online and OneDrive may be impacted. This information may be updated as our investigation continues.

Root cause: Organizations that requested we turn off Unlicensed User Access for their organization are encountering this problem after OTP deprecation and unlicensed user check in the external sharing code is now being enforced.

Next update by: Wednesday, August 5, 2026, at 10:30 PM UTC

Title: Some users may be unable to share files with external recipients through SharePoint Online and Microsoft OneDrive

User impact: Users may be unable to share files with external recipients through SharePoint Online and OneDrive.

More info: Affected users may be unable to send external sharing invitations from SharePoint Online sites and OneDrive locations, despite external sharing being enabled at both the tenant and site levels. Upon failure, affected users encounter the following error: "That didn't work: We couldn't find a valid SharePoint Online license..."

Current status: We're continuing to obtain data such as Trace logs and specific User Principal Names (UPNs) from various affected users to assist in furthering our understanding of the full scope of this issue. The development of effective remediation steps is taking longer than anticipated as we allow time for this this thorough root cause analysis.

Scope of impact: Some users attempting to share files with external recipients through SharePoint Online and OneDrive may be impacted. This information may be updated as our investigation continues.

Next update by: Thursday, July 30, 2026, at 10:30 PM UTC

Title: Some users may be unable to share files with external recipients through SharePoint Online and Microsoft OneDrive

User impact: Users may be unable to share files with external recipients through SharePoint Online and OneDrive.

More info: Affected users may be unable to send external sharing invitations from SharePoint Online sites and OneDrive locations, despite external sharing being enabled at both the tenant and site levels.

Current status: We're in the process of obtaining Trace logs, specific User Principal Names (UPNs), and confirmation of the identified feature status from various affected users to further our investigation into the issue and options for mitigation.

Scope of impact: Some users attempting to share files with external recipients through SharePoint Online and OneDrive may be impacted. This information may be updated as our investigation continues.

Next update by: Wednesday, July 29, 2026, at 10:30 PM UTC

Title: Some users may be unable to share files with external recipients through SharePoint Online and Microsoft OneDrive

User impact: Users may be unable to share files with external recipients through SharePoint Online and OneDrive.

More info: Affected users may be unable to send external sharing invitations from SharePoint Online sites and OneDrive locations, despite external sharing being enabled at both the tenant and site levels.

Current status: We're reviewing cases from affected users and previous service guidance to identify the most effective options for resolution.

Scope of impact: Some users attempting to share files with external recipients through SharePoint Online and OneDrive may be impacted. This information may be updated as our investigation continues.

Next update by: Tuesday, July 28, 2026, at 10:30 PM UTC

Title: Some users may be unable to share files with external recipients through SharePoint Online and Microsoft OneDrive

User impact: Users may be unable to share files with external recipients through SharePoint Online and OneDrive.

More info: Affected users may be unable to send external sharing invitations from SharePoint Online sites and OneDrive locations, despite external sharing being enabled at both the tenant and site levels.

Current status: We're continuing our investigation into associated configuration changes in parallel with analyzing recent network trace logs from a portion of affected users in order to determine the next steps for remediation.

Scope of impact: Some users attempting to share files with external recipients through SharePoint Online and OneDrive may be impacted.

Next update by: Tuesday, July 28, 2026, at 12:30 AM UTC

Title: Some users may be unable to share files with external recipients through SharePoint Online and Microsoft OneDrive

User impact: Users may be unable to share files with external recipients through SharePoint Online and OneDrive.

More info: Affected users may be unable to send external sharing invitations from SharePoint Online sites and OneDrive locations, despite external sharing being enabled at both the tenant and site levels.

Current status: We're expanding our investigation to include recent changes or updates which may be contributing to the impact.

Scope of impact: Some users attempting to share files with external recipients through SharePoint Online and OneDrive may be impacted.

Next update by: Monday, July 27, 2026, at 9:30 PM UTC

Title: Some users may be unable to share files with external recipients through SharePoint Online and Microsoft OneDrive

User impact: Users may be unable to share files with external recipients through SharePoint Online and OneDrive.

More info: Affected users may be unable to send external sharing invitations from SharePoint Online sites and OneDrive locations, despite external sharing being enabled at both the tenant and site levels.

Current status: We're reviewing HTTP Archive (HAR) files alongside API call patterns to help identify the root cause and next steps required to mitigate impact.

Scope of impact: Some users attempting to share files with external recipients through SharePoint Online and OneDrive may be impacted.

Next update by: Monday, July 27, 2026, at 7:30 PM UTC

Title: Some users are unable to share files with external recipients through SharePoint Online and Microsoft OneDrive

User impact: Users are unable to share files with external recipients through SharePoint Online and OneDrive.

More info: Affected users are unable to send external sharing invitations from SharePoint Online sites and OneDrive locations, despite external sharing being enabled at both the tenant and site levels.

Current status: We're reviewing HTTP Archive (HAR) files alongside API call patterns to help identify the root cause and next steps required to mitigate impact.

Scope of impact: Your organization is affected by this event, and some users attempting to share files with external recipients through SharePoint Online and OneDrive are impacted. This information may be updated as our investigation continues.

Next update by: Monday, July 27, 2026, at 7:30 PM UTC