We appreciate your patience on this matter.
We got an update from our Internal Support Team and confirmed that this article: Record your screen in PowerPoint that we also previously provided able to explain how to use screen recording in PowerPoint. It does specifically mention that you need three things in order to get audio work on it. Therefore, you should have a sound card, microphone, and speakers. If you don’t have a sound card on your computer, then the feature will rely on the microphone and any audio that PowerPoint picks up the sound.
An alternative would have both audio and video prerecorded separately and inserted into PowerPoint as separate media. But we understand how important it is to select audio source recording when using this PowerPoint feature. Hence, this experience should be heard by our developers via PowerPoint UserVoice. This way, we can let them know of this behavior and consider enhancing this PowerPoint feature in future updates.
Note: Our UserVoice platform may be asked to sign in to your Microsoft account and/or create a new one if needed.
For your information, Microsoft continuously strives to provide a better experience to our customers regarding our products and services. The item regularly receives Microsoft responses on the submissions, so you can see what we are doing about your request/concern. Please frequently revisit to see the status of your submission.
Should you have other concerns for this matter, you can get back to us by replying to this post or create a new thread using this link if you have a different query.