Looks to be supported.
https://www.kali.org/docs/cloud/azure/
--please don't forget to upvote
and Accept as answer
if the reply is helpful--
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I wanted to ask if anyone else had an issue with Kali running in hyper-v in the cloud. I wanted to create a lab to practice anywhere instead of using virtual box on my machine. But following the steps for creating an ethical hacking lab in azure I run into the issue lightdm failed (something along those lines) in kali. I tried multiple methods of reinstalling lightdm, installing new packages, reinstalling kali, and it seems I hit a wall. I created VM's on multiple machines before and used kali in multiple instances. This is my first time dealing with this error.
Now I have tried using virtual box on the server instead and it has taken 2 days for kali to download not sure if I need to just use a desktop instance of windows 10 and create a virtual box or configure my lab directly in the cloud. I just don't want the unnecessary cost and time to build something to complete the task of what hyper-v should do.
Looks to be supported.
https://www.kali.org/docs/cloud/azure/
--please don't forget to upvote
and Accept as answer
if the reply is helpful--
I had the same problem. The fix that works requires these steps: