This is not a supported scenario, guest users can only use the web apps indirectly, by accessing documents shared with them. Instead, the guest should ask for license in their "home" tenant.
Guest Access to Microsoft 365 Apps for Business
Mobu
20
Reputation points Microsoft Vendor
Hi team,
I assigned Microsoft 365 Apps for Business license to a guest user in my tenant. The license assignment is successful but it seems guest can not really use M365 apps (Word, Excel, etc). The guest user gets error message when to access M365 app after successfully sign in to my organization.
Also, the guest user cannot pass the license authentication in a desktop M365 app.
Is this intended behavior?