Microsoft’s automated service monitoring systems initially detected a surge in failed connection attempts for Cloud PC users. After investigation, the company’s engineers determined that a specific Windows 365 update was the root cause of the access problems. This update, identified as the KB5074109 Windows security update, is causing “credential prompt failures” when users attempt to establish Remote Desktop connections via the Windows App to Azure Virtual Desktop and Windows 365. The incident is currently flagged as “service degradation,” indicating a critical issue with noticeable user impact.
The affected platforms include Windows 11 versions 25H2 and 24H2, along with Windows Server 2025, 2022, and 2019, impacting both Windows 365 Enterprise and Windows 365 Business subscriptions. Windows 365 operates as a cloud-based service running on Azure Virtual Desktop, allowing businesses to stream Windows Cloud PCs to end-users. The occurrence highlights a broader industry challenge where security enhancements, while crucial, can sometimes introduce unforeseen complications. According to research, cloud security incidents saw a 154% increase in 2024, with 61% of organizations reporting disruptions linked to unpatched systems or misconfigured services. The average cost of a data breach escalated to $4.88 million in 2024, underscoring the financial implications of such outages.
Microsoft stated that A recent Windows 365 update intended to further improve security functionality is causing failed connection attempts to Cloud PC sessions
. The company’s engineers are currently analyzing the update to determine the most effective mitigation strategy. This incident aligns with observations from cybersecurity experts, who note that the rapid pace of cloud innovation, while beneficial, can expand the attack surface and introduce complexities in maintaining a secure posture, often before systems can be fully configured or patched.
Microsoft has not yet disclosed the specific geographical regions affected by this issue, nor the total number of users experiencing access difficulties. A definitive timeline for a permanent resolution has also not been provided, though active investigation and mitigation are underway.
While Microsoft engineers work on a permanent fix, the company has provided two temporary workarounds for affected users. Users can access their Cloud PCs either through the Windows App Web Client at windows.cloud.microsoft or by utilizing the Remote Desktop client for Windows to connect to Azure Virtual Desktop. The company is reviewing its telemetry and coordinating between Azure Virtual Desktop and Windows Update teams to address the issue.
- If impacted, use the Windows App Web Client at windows.cloud.microsoft as a temporary alternative to access Cloud PCs.
- Alternatively, utilize the Remote Desktop client for Windows to connect to Azure Virtual Desktop.
- Monitor the Microsoft 365 Service Health Dashboard for official updates and resolution timelines regarding incident WP1217671.
- Contact your organization’s IT administrator for specific guidance, especially concerning network configurations, firewall settings, or if the issue persists with the suggested workarounds.
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