Windows 11 VM on Parallels has broken virtual TPM.

Changing the RAM allocation is not relevant to this issue. We know what the problem is, the Jul update is trying to enforce AIKv2 on Parallels VMs, and the vTPM isn't compatible. You can use vivetool to restore the previous behaviour (AIKv1), install the Jul update, and get on with your life. It's not clear why Microsoft haven't backed out the change with Controlled Feature Rollout, as they have on the physical laptops in my organisation, or when Parallels will fix the vTPM, but I'm not holding my breath. The lack of comms from both Microsoft and Parallels truly is breathtaking!

 

Same here, will check to disable the update.

 

There is a temporary fix here so you don't have to remove the whole KB. https://patchmypc.com/blog/why-intune-devices-became-noncompliant-after-the-july-windows-update/

 

My VM just said that an emergency fix was being applied and to reboot...and guess what.... IT WORKS NOW!!! I'm guessing they disabled the 62861611 via a GP update or implemented the mimicked the vivetool functionality via some other mechanism. it was *not* a parallels update so that's my guess...

 

Or the preview fix was installed? Microsoft Update Catalog

 

I manually applied the MSU and did not have a functioning TPM post.

 

This one? kb5101684-preview?

 

Now on a second machine where the preview update was already in my updates suggestions, not a MSU. Same behavior.

 

Use the vibe tool command in the post I shared (and that another user shared above) that worked for me, it just disables that one feature of the update that broke it until Parallels updates the software

 

I got an update this morning at work ... KB5007651 (Version 10.0.29628.1000)
After this I was able to set the PIN ... it took a couple of times ... but in the end I did succeed.

 

but in the end I did succeed. .... nope it is not really working .... still seeing TPM errors in the Event Viewer Logs.

 

I can confirm that on my Parallels VM, installing KB5101684 Preview, which is meant to fix the underlying Windows issue, wasn't enough. However, I had previously disabled Vive:62861611 and my 're-broken vTPM' was only after setting 62861611 to manually enabled with Vivetool, after installation of the KB Preview.

It implies that the 62861611 feature still isn't compatible with the current Parallels implementation of vTPM, but I have no concrete way of knowing if MS intends for 62861611 feature to be enabled right now (although I think they probably do intend to switch it back on in due course: it's why KB5101684 Preview was issued).
For the time being, I've left KB5101684 Preview applied, and left feature 62861611 disabled via Vivetool. In this configuration, right now, things are working.

It's definitely going to need some work by Parallels to get things working properly long-term.