[BUG] Cowork fails with HCS 0x80370102 despite fully functional Hyper-V (Windows 11 Pro 25H2, domain-joined)

Preflight Checklist

• [x] I have searched existing issues and this hasn't been reported yet
• [x] This is a single bug report (please file separate reports for different bugs)
• [x] I am using the latest version of Claude Code

What's Wrong?

Cowork displays "Virtualization is not enabled" and fails to start the VM with HCS error 0x80370102 ("Cannot create system 'cowork-vm' since Hyper-V is not installed on the host").

Hyper-V is fully installed and working on this machine:

• New-VM -Name "test-vm" -MemoryStartupBytes 512MB -Generation 2 -NoVHD succeeds — VM is created and listed
• Get-VMHost returns valid host info (24 LPs, 64GB)
• hcsdiag hostproperties processortopology returns all 24 logical processors
• Get-CimInstance -Namespace root\virtualization\v2 -ClassName Msvm_ComputerSystem returns host with Status=OK
• All Hyper-V features enabled (Microsoft-Hyper-V-All, Services, Hypervisor, Tools, Management)
• bcdedit hypervisorlaunchtype = Auto
• CoworkVMService, vmcompute, vmms all running
• No Group Policy restrictions on virtualization found

Deleting %APPDATA%\Claude\vm_bundles and restarting CoworkVMService allowed Cowork to start once, but the error returned on the next launch.

Environment: Domain-joined Windows 11 Pro 25H2 (Build 26200.8037), 12th Gen Intel i9-12900K, 64GB RAM, Claude Desktop v1.1.6452.0 (Microsoft Store / MSIX).

What Should Happen?

Cowork should detect that Hyper-V is operational and start the VM workspace.

Error Messages/Logs

[info] [VM:start] Configuring Windows VM service...
[info] [VM:start] Windows VM service configured
[error] [VM:start] VM boot failed: HCS operation failed: failed to create compute system: HcsWaitForOperationResult failed with HRESULT 0x80370102: {"Error":-2143878910,"ErrorMessage":"The virtual machine could not be started because a required feature is not installed.","ErrorEvents":[{"Message":"Cannot create system 'cowork-vm' since Hyper-V is not installed on the host.","Provider":"17103e3f-3c6e-4677-bb17-3b267eb5be57","EventId":11008,"Data":[{"Type":"String","Value":"cowork-vm"},{"Type":"String","Value":"%%2151088386"},{"Type":"String","Value":"0x80370102"}]}]}
[error] [VM:start] HCS error detected, available=true, missing=[], sentinel=HYPERVISOR_SERVICE_ERROR
[info] Dispatching startup error: HYPERVISOR_SERVICE_ERROR
[error] [VM:start] Startup failed: Error: HYPERVISOR_SERVICE_ERROR

Steps to Reproduce

1. Install Claude Desktop v1.1.6452.0 from Microsoft Store on a domain-joined Windows 11 Pro 25H2 machine
2. Ensure full Hyper-V is enabled (all features, hypervisorlaunchtype = Auto)
3. Open Claude Desktop and navigate to Cowork tab
4. Observe "Virtualization is not enabled" error

Claude Model

None

Is this a regression?

I don't know

Last Working Version

N/A

Claude Code Version

Claude Desktop v1.1.6452.0

Platform

Other

Operating System

Windows

Terminal/Shell

PowerShell

Additional Information

Troubleshooting Steps Attempted

All of the following were tried and did not resolve the issue:

1. Enabled full Hyper-V (Enable-WindowsOptionalFeature -Online -FeatureName Microsoft-Hyper-V -All) — was previously not enabled, only Virtual Machine Platform was
2. Set bcdedit /set hypervisorlaunchtype auto — was not set at all prior
3. Rebooted multiple times after each change
4. Verified all services running: CoworkVMService, vmcompute, vmms
5. Verified no Group Policy restrictions: gpresult /r | findstr -i "hyper virtual" returned nothing
6. Verified HCS is responsive: hcsdiag hostproperties processortopology returns all 24 logical processors
7. Verified Hyper-V management API works: New-VM succeeds, Get-VMHost returns valid info, WMI root\virtualization\v2 returns host with Status=OK
8. Deleted %APPDATA%\Claude\vm_bundles and restarted CoworkVMService — Cowork started once, then failed again on next launch with the same error
9. Repeated step 8 — fresh VM bundle downloaded (rootfs.vhdx, vmlinuz, initrd all re-downloaded and checksum validated), same 0x80370102 error immediately after

Related Issues

#27316, #27317, #27384, #27420, #29359, #29887, #30997, #32004

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This bug report was written by Claude (Opus 4.6, claude-opus-4-6) based on a live diagnostic session with the affected user.