Microsoft has confirmed that a sudden spike in demand for compute resources in its East US region caused issues with virtual machines, but despite being marked as resolved, the problem continues to affect users.
The troubles began on July 29 and were supposed to be fixed by August 5. However, customers have reported allocation failures when creating or updating virtual machines. The issue was caused by insufficient capacity due to a surge in demand, which led to hardware thresholds being pushed beyond safe operational levels.
Only certain instance types were affected, but Microsoft recommended using alternate types or switching to the East US 2 region as workarounds. Some users have reported experiencing issues with Intel and AMD VMs, particularly when upgrading to k8s 1.31 from 1.30.
Microsoft initially stated that the service had been restored and customer impact was mitigated. However, many users disagree, saying “the incident has been marked resolved, in practice it lingers.” Some have also reported wave of incidents and cancelled maintenance around the same time, hinting that capacity issues may have affected Microsoft’s own services.
Despite a request for clarification from The Register, Microsoft has yet to respond.
Source: https://www.theregister.com/2025/08/08/sudden_spike_in_demand_azure_issues