Surface Laptop 7 ARM64 – KB5121003 breaks Teams and New Outlook; similar issue previously occurred with KB5094126

Hello everyone,

I am looking for input from Microsoft or other administrators who may be seeing similar behavior on ARM-based Surface devices.

We have a Microsoft Surface Laptop, 7th Edition with a Snapdragon/ARM64 processor assigned to our company's CFO. Earlier this year, after installing KB5094126, the machine developed a very specific problem: Microsoft Teams and the New Outlook would no longer launch successfully.

Other applications continued to function normally, including:

Classic Outlook

Word

Excel

Other standard Win32 applications

Teams and New Outlook, however, would either close immediately after launch or fail to start altogether.

At that time, I performed the usual troubleshooting, including DISM and SFC. Neither reported Windows corruption. I eventually rolled back KB5094126, and Teams and New Outlook immediately began working again.

A few weeks ago, for unrelated stability troubleshooting, we performed a complete factory reset of the Surface using Windows' built-in recovery process. This gave us a fresh Windows installation. The device was re-enrolled, fully patched, and operated normally afterward. Teams and New Outlook both worked correctly for several days.

Then this weekend, KB5121003 was installed.

Immediately afterward, we were back to essentially the same problem:

New Teams would not stay open.

New Outlook would not start.

Classic Outlook continued to work.

Word, Excel, and other applications continued to work normally.

This time I investigated the Windows AppX/MSIX package state in considerably more detail.

New Outlook reported:

Microsoft.OutlookForWindows – Status: DependencyIssue

The AppModel Runtime logs also generated errors such as:

0x80073CFC: Cannot create the process for package Microsoft.OutlookForWindows... [GetPackageToken]

Windows additionally reported that it could not create the application process because of an error while checking the machine-level package status.

The registry package state for New Outlook showed:

PackageStatus = 64 (0x40)

Teams showed similar AppModel behavior. Windows was successfully creating the Teams AppX process/container, but the process would terminate almost immediately. The AppModel log also showed its previous package status as 0x40 before Windows reset it to 0x0.

During the earlier KB5094126 incident, I also found that the Windows package:

MicrosoftWindows.Client.CBS

was reporting:

Status: DependencyIssue

So there appears to be a recurring issue involving the modern Windows application/package infrastructure rather than Outlook or Teams simply having corrupt user profiles.

For testing, I uninstalled KB5121003.

Teams immediately began working again.

That is the part that concerns me most. At this point we have seen essentially the same behavior twice:

A Windows cumulative update is installed.

Teams and New Outlook stop working while traditional Win32 applications continue to function.

Significant AppX/MSIX package-state or dependency errors appear.

The Windows update is removed.

The affected applications begin working again.

The device was also factory reset between these two incidents, so this is not simply a Windows installation that has accumulated years of corruption.

I do not believe there is anything unusual about our configuration that should require this level of troubleshooting just to launch Microsoft Teams and Microsoft Outlook on a Microsoft Surface device.

I should not have to investigate AppModel Runtime logs, query MSIX package dependencies, inspect package registry state, troubleshoot 0x80073CFC errors, or manually investigate PackageStatus 0x40 simply to make two standard Microsoft applications launch on a freshly reset Microsoft computer.

Has anyone else experienced this on Surface Laptop 7 / Snapdragon / ARM64 systems, particularly after KB5121003?

I would especially appreciate clarification from Microsoft on the following:

Is there a known issue with KB5121003 affecting Teams, New Outlook, AppX/MSIX package state, or ARM64 systems?

Is the 0x80073CFC / GetPackageToken behavior associated with a known Windows servicing issue?

Why would New Outlook repeatedly transition into DependencyIssue after a cumulative Windows update?

Is there a permanent remediation other than uninstalling the cumulative update?

Is Microsoft investigating this, given that we saw very similar behavior previously with KB5094126?

For now I have removed KB5121003 from this Surface because the CFO needs a reliable machine, but I am concerned that the same issue will return with a future cumulative update.

Any insight from Microsoft or others experiencing the same behavior would be appreciated.