Microsoft Applied Skills: What They Are and Are They Worth It?
Hands-on lab credentials that prove you can do the work — not just answer questions about it
In 2023, Microsoft launched Applied Skills — a new type of credential that sits alongside (not replacing) traditional Microsoft Certifications. Instead of sitting a proctored multiple-choice exam, you earn an Applied Skills credential by completing a scenario-based lab assessment in a live Azure environment. With 'microsoft applied skills' generating nearly 3,000 impressions per month and growing, these credentials are clearly getting attention. Here is everything you need to know.
What Microsoft Applied Skills actually are
Applied Skills are scenario-based, lab-assessed credentials. Microsoft presents a real-world business scenario and gives you a live Azure environment to complete a set of tasks — deploy a resource, configure a policy, secure an identity. There is no multiple-choice component. You either complete the task correctly or you do not. Each credential takes 1–2 hours to complete and is assessed automatically. They appear on your Microsoft Learn profile just like certifications.
Applied Skills are free to attempt — unlike Microsoft Certifications, which cost $165 USD per exam. This makes them an accessible way to earn a verifiable Microsoft credential without the financial barrier.
How Applied Skills differ from Microsoft Certifications
Microsoft Certifications (AZ-900, AZ-104, etc.) are earned by passing a proctored exam at a Pearson VUE test centre or via online proctoring. They cover broad knowledge across a certification domain. Applied Skills are narrower, lab-based, and not proctored — you complete them on Microsoft Learn at your own pace. Certifications do not expire (Fundamentals) or require annual renewal (Associate/Expert). Applied Skills credentials do not expire. Neither replaces the other — they serve different purposes in a profile.
For hiring managers, Microsoft Certifications are more widely recognised because they have 20+ years of market history. Applied Skills are newer and better known in Microsoft's ecosystem (partners, MVPs) than in general hiring.
The full list of available Applied Skills credentials
As of mid-2026, Microsoft offers Applied Skills credentials across Azure infrastructure, AI, security, and data. Key credentials include: Configure secure access to your workloads using Azure networking; Deploy and configure Azure Monitor; Secure Azure services and workloads with Microsoft Defender for Cloud; Implement security through a pipeline using GitHub Actions; Build a natural language processing solution with Azure AI Language; Create an intelligent document processing solution with Azure AI Document Intelligence; Administer Active Directory Domain Services; Implement a data warehouse with Microsoft Fabric. Microsoft adds new credentials regularly — check learn.microsoft.com/credentials for the current list.
Applied Skills credentials map closely to specific Azure services rather than broad certification domains. If you use a specific Azure service daily, there is likely an Applied Skills credential that directly validates your experience with it.
Who should pursue Applied Skills
Applied Skills are most valuable in three situations: (1) You are a Microsoft partner employee and your organisation needs to meet partner solution area requirements — Applied Skills count toward this. (2) You want a verifiable credential that proves hands-on ability, not just conceptual knowledge — useful in portfolios and on LinkedIn. (3) You are mid-career with real Azure experience but have not yet sat a formal exam — Applied Skills can demonstrate skill while you prepare for the full certification.
Applied Skills are not a shortcut to replace AZ-104 or AZ-500 on a CV for enterprise hiring. Recruiters and hiring managers outside Microsoft's partner ecosystem are still more familiar with the traditional certification names. Do both if career progression is your goal.
How to earn an Applied Skills credential
Go to learn.microsoft.com/credentials, sign in with a Microsoft account, find the Applied Skills credential you want, and complete the associated Microsoft Learn training (optional but recommended). When ready, click 'Start the assessment' — this launches a sandboxed Azure environment with a list of tasks. You have up to 2 hours. Complete all tasks and submit. Scoring is automatic and results are typically available within minutes to hours. Passed credentials appear immediately on your Learn profile and can be shared via Credly.
There is no retake cooldown period for Applied Skills — if you fail, you can retry immediately. Use the first attempt as a diagnostic run to identify which tasks you could not complete, then study those gaps and re-attempt.
Applied Skills vs certifications: which to take first
If you are new to Azure: start with AZ-900 (Azure Fundamentals). It costs $165 but is the broadest and most recognised entry point, and sets the foundation for all other Azure learning. Once you have a certification, add Applied Skills credentials that reflect your actual day-to-day work. If you are an experienced Azure professional without any formal credentials: Applied Skills are a fast, free way to get something verifiable on your profile while you prepare for the full AZ-104 or AZ-500 exam.
Key tips
Applied Skills credentials are free — the only cost is your time.
They appear on LinkedIn via Credly just like traditional Microsoft Certifications.
Microsoft Partner organisations can use Applied Skills to count toward solution area requirements.
There is no expiry on Applied Skills credentials — once earned, they stay on your profile.
You can re-attempt immediately if you fail — no waiting period.
Frequently asked questions
What are Microsoft Applied Skills?
Microsoft Applied Skills are scenario-based, lab-assessed credentials that prove you can complete real Azure tasks in a live environment. Unlike traditional Microsoft Certifications, they involve no multiple-choice exam — you are given a scenario and complete tasks in a sandboxed Azure environment.
Are Microsoft Applied Skills free?
Yes. Applied Skills assessments are completely free on Microsoft Learn. You need a Microsoft account to access them.
Do Microsoft Applied Skills expire?
No. Applied Skills credentials do not expire once earned.
Are Applied Skills worth it?
Applied Skills are worth doing for three reasons: they are free, they prove hands-on capability rather than test-taking skill, and they count toward Microsoft Partner solution area requirements. They are less broadly recognised in general hiring than traditional Microsoft Certifications, so they complement rather than replace AZ-104, AZ-500, and similar exams.
How long does an Applied Skills assessment take?
Most Applied Skills assessments take 1–2 hours. You are given a sandboxed Azure environment with a set of tasks and up to 2 hours to complete them.
Can Applied Skills replace Microsoft Certifications?
No. Applied Skills do not replace traditional Microsoft Certifications. They are a complementary credential that proves hands-on ability in a specific area. Certifications like AZ-104 and AZ-500 remain the standard market credential for hiring.
Where do Applied Skills appear on my profile?
Applied Skills credentials appear on your Microsoft Learn profile and can be shared via Credly — the same badging platform used for Microsoft Certifications.
Related glossary terms
Infrastructure as a Service
Infrastructure as a Service (IaaS) is a cloud computing model that provides on-demand virtualized computing resources over the internet, such as virtual machines, storage, and networking, instead of owning and maintaining physical hardware.
Platform as a Service
Platform as a Service (PaaS) is a cloud computing model that provides a complete platform for developing, running, and managing applications without the complexity of building and maintaining the underlying infrastructure.
Software as a Service
Software as a Service (SaaS) is a cloud computing model where users access software applications over the internet on a subscription basis, without installing or maintaining the software locally.
Virtual Private Cloud
A Virtual Private Cloud (VPC) is a logically isolated section of a public cloud where you can run resources in a private, customizable network environment.
Function As A Service
Function as a Service (FaaS) is a cloud computing model that lets you run small pieces of code in response to events without managing servers or infrastructure.
Anything As A Service
A model where you rent any IT resource or service over the internet instead of owning it.
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