Microsoft enhanced its European cloud offerings with advanced data control, sovereignty, and privacy tools, ensuring local data processing, stricter access oversight, and customer-managed encryption.

Microsoft Corporation (MSFT) has announced enhancements to its European cloud offerings to strengthen data sovereignty and compliance with regional regulations. 

These updates aim to provide European customers with greater control over their data, ensuring that it remains within the continent and is governed by European laws.

Microsoft reported that all customer data will be stored and processed within Europe, with operations managed by European personnel. 

This initiative is part of the company's broader strategy to address growing concerns among European companies and governments about data privacy and international data transfers. 

Notably, any remote access by Microsoft engineers to European data systems will require approval and real-time monitoring by Europe-based staff, ensuring enhanced oversight and security.

The company has introduced several key features to bolster data protection, including Data Guardian, External key management, Regulated environment management, and Microsoft 365 local.

Data Guardian ensures that only Microsoft employees residing within Europe can control access to its systems, adding an additional layer of oversight whenever engineers outside Europe need access.  

Through External key management, customers can connect Azure to keys stored on their own Hardware Security Module (HSM) on-premises or hosted by a trusted third party, providing full control over encryption.

The regulated environment management service enables customers to easily manage features such as Data Guardian policies and access log entries, centralizing the configuration and monitoring of workloads in sovereign operations. 

Microsoft 365 Local brings Microsoft's productivity server software into an Azure Local environment that can run entirely within a customer's own data center.

The tech giant said it is expanding its European data center capacity by 40% over the next two years to support the growing demands of AI and cloud services, while keeping data operations geographically close to customers.

On Stocktwits, retail sentiment around Microsoft remained in ‘neutral’ territory with ‘high’ message volume.

MSFT's Sentiment Meter and Message Volume as of 01:25 p.m. ET on Jun.16, 2025 | Source: Stocktwits

Microsoft stock has gained over 13% year-to-date and 6% in the last 12 months.

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